Difference Between void

agreement and void contract

Abdul Majid Khalil
The difference between void agreement and void
contract are as under:
1. Enforceability:
A void agreement is unenforceable from the beginning
whereas a void contract is enforceable when it is made.
It becomes unenforceable later on.
2. Enforced
A void agreement can never be enforced. Whereas a void
contract can be enforced before it becomes
unenforceable.
3. Restoration of Benefit:
In a void agreement the parties are not entitled
for restoration of benefits which they have
exchange during the contract. Whereas in a void
contract the parties are entitled for restoration
of benefits which they have exchange during the
contract.
Difference between Illegal and void contract

The following are the points of difference between

the two:
1. Prohibited
An illegal agreement is prohibited by law whereas
a void agreement is not prohibited by law.
2. Punishable
An illegal agreement is punishable whereas a void
agreement is not punishable.
3. Nature
An illegal agreement is also void agreement
whereas a void agreement is not illegal
agreement.
4. Object
The object of illegal agreement is totally illegal
and against the law whereas the object of void
agreement is not illegal.
5. Collateral agreement
A collateral agreement to an illegal agreement is
not enforceable whereas a collateral agreement to
a void agreement is enforceable.
6. Restoration of benefit
In illegal agreement the money paid cannot be
claimed back whereas in void agreement the
money received must be returned to the other
party.
Explanation of Collateral Agreement:
When an agreement is illegal, other agreement which is
collateral to it is also illegal and so not enforceable by
law.
Example:
A borrows Rs. 2 lac from B to buy a car from X for bomb
blast. B knows the purpose of the loan. An agreement
between A and B is collateral to the agreement with X
so it is also illegal and void agreement.
 Difference Between Void Agreement and
Voidable Contract
Following are the points of difference between the
two:
1. Enforceability
A void agreement is not enforceable by law whereas a
voidable contract is enforceable by law till it is rejected.
2. Defects
A void agreement is void ab initio and its defects
cannot be removed whereas a voidable contract is not
void ab initio and its defects can be removed.
3. Rights of Third Party
In a void agreement a third party who buys goods in good
faith and for consideration does not acquire any rights.
Whereas in a voidable contract a third party who buys goods
in good faith and for consideration acquires rights before the
contract is rejected.
4. Compensation
In a void agreement the person is not entitled to
compensation for loss arising due to non performance of the
agreement. Whereas in a voidable contract, a person is
entitled to compensation for loss arising due to non-
 performance of the contract.
5. Collateral agreement
A collateral agreement to void agreement is not
enforceable by law. Whereas a collateral agreement to a
voidable contract is enforceable by law.
6. Lapse of time
It can never become a valid contract on the expiry of
reasonable time. whereas a voidable contract may
become a valid contract if the aggrieved party does not
reject it within a reasonable time.
7. Free consent
It is void due to lack of any essentials of a valid
contract except free consent. Whereas it is
voidable contract because the consent of a party
is not free.