Difference between void and voidable contract

The terms void and voidable are confusing for many that seek to employ the use of either in a contract,
and this can lead to legal difficulties when the person creating the contract is unaware of what the terms
mean and how they can affect the deal. While these two terms share similarities, they are different and
require a full understanding of these differences.

The Term Void

When a contract is void, it cannot lead to enforcement by either party. This is a contract that is no
longer useable. The law will then treat the contract as if the two parties never formed any type of
agreement between them or any legally binding obligations. A contract is void when one party attempts
to accomplish something that is either impossible or illegal in the state or country. If both parties engage
in these similar activities, the void contract will not support them through any type of relationship or
business dealing. However, illegal activity can lead to criminal charges.

The Term Voidable

A Voidable contracts can proceed through the court enforcing the clauses because it is a valid
agreement between the two parties. In these situations, one party will remain bound to the terms of the
contract while the other may only need to supply something such as payment or another item of value.
The unbound party can cancel the contract and cause the document to become void. This term voidable
provides the party that remains unbound with the power to cancel the agreement and leave the other
person or entity without payment or services. The clauses are generally specific with certain stipulations.

The Primary Difference

While the terms void and voidable are different in the legal context, they also mean something different
when in use. A void contract cannot perform under the law validly. However, a voidable contract can
still perform legally and still have bound and unbound parties. The unbound party in the contract can
void the agreement before the other party performs the necessary services as part of the contractual
obligations. In a void contract, the services given are not legally bound or necessary because the
agreement is no longer valid and the parties cannot uphold the contract in the courts.