Void and Voidable Agreements

An agreement which does not satisfy the essential

elements of a contract may be either void or voidable.

1.Void Agreement-“An agreement not enforceable by

law is said to be void.”-Sec.2(g). A void agreement has
no legal effect.
Example-
An agreement made by a minor;
Agreements without consideration;
Certain agreements without public policy.
 Agreements which become void
The following agreements have been ‘expressly
declared’, to be void by the Indian Contract Act:
(i) Agreements in restraint of marriage (Sec.26).
(ii) Agreements in restraint of trade (Sec.27).
(iii)Agreements in restraint of legal proceedings (Sec.28).
(iv)Agreements the meaning of which is uncertain
(Sec.29).
(v)Agreements by way of wager (Sec.30).
(vi)Agreements contingent on impossible events (Sec.36).
(vii)Agreements to do impossible acts (Sec.56).
(i) Agreements in restraint of marriage: Section 26 of
the Contract Act provides that every agreement in
restraint of the marriage of any person, other than a
minor, is void.

Example- A agrees with B for good consideration that

she will not marry C. It is a void agreement.

(ii)Agreements in restraint of trade: Section 27 of the

Act states that every agreement by which anyone is
restrained from exercising a lawful profession, trade
or business of any kind, is to that extent void.
Example- An agreement whereby one of the parties
agrees to close his business in consideration of
the promise by the other party to pay a certain
sum of money, is void, being an agreement is
restraint of trade, and the amount is not
recoverable, if the other party fails to pay the
promised sum of money.

(iii)Agreements in restraint of legal proceedings:

According to Section 28 of the Act Private
individuals cannot by agreement alter or vary
their personal law or Statute law.
(iv)Agreements the meaning of which is uncertain:
Section 29 implies that agreements, the meaning of
which is not certain, or capable of being made
certain, are void.
Example- A agrees to sell to B “a hundred tons of oil.”
There is nothing whatever to show what kind of oil
was intended. The agreement is void for uncertainty.
(v)Agreements by way of wager: Literally the word
‘wager’ means a ‘a bet’: something stated to be lost
or won on the result of a doubtful issue, and
therefore, wagering agreements are nothing but
ordinary betting agreements. Section 30 of the
Contract Act clearly states that agreements by way of
wages are void.
Example- A and B mutually agree that if it rains today A
will pay B 200 tk. and if it does not rain B will pay A
200 tk. This is a wagering agreement.

(vi)Agreements contingent on impossible events:

“Contingent agreements to do or not to do anything, if
an impossible event happens, are void, whether the
impossibility of the event is known or not to the parties
to the agreement at the time when it is made.” (Sec.36)

Example- A agrees to pay B 1,000 tk.(as a loan) if two

straight lines should enclose a space. The agreement is
void.
(vii)Agreements to do impossible acts: “An agreement
to do an act impossible in itself is void.” (Sec. 56)
Example- A agrees with B to discover treasure by
magic. The agreement is void.
2.Voidable agreement: A voidable agreement is one
which can be avoided, i.e., set aside by some of the
parties to it. “An agreement which is enforceable by
law at the option of one or more of the parties thereto,
but not at the option of the other or others, is a
voidable contract.” Usually a contract becomes
voidable when the consent of one of the parties to the
contract is obtained by coercion, undue influence,
misrepresentation or fraud.
Example- A threatens to shoot B if he does not
sell his new Bajaj scooter to A for 50000 tk. B
agrees. The contract has been brought about by
coercion and is voidable at the option of B.