Void Agreement vs. Void Contract: Know the Difference
By Shumaila Saeed || Published on January 20, 2024
A Void Agreement is invalid from the beginning and has no legal effect, while a Void Contract starts as valid but becomes void due to certain reasons.
Key Differences
A Void Agreement is an agreement that lacks legal enforceability from the moment it is created. It does not meet the essential elements of a contract, such as mutual consent, lawful object, and consideration. An example is an agreement to commit a crime. In contrast, a Void Contract begins as a valid agreement but becomes void due to certain circumstances that arise after the contract is formed, such as a change in law or the impossibility of performance.
Shumaila Saeed
Jan 20, 2024
Void Agreements are never recognized by law as valid contracts and therefore, they do not have any legal consequences. For instance, an agreement with a minor is void from the outset. Void Contracts, however, may have legal consequences before they become void. For example, a contract that becomes void due to a party's incapacity to perform had legal standing before the incapacity occurred.
Shumaila Saeed
Jan 20, 2024
In a Void Agreement, no party can sue the other for non-performance because the agreement was never valid in the first place. An agreement to divide property obtained by theft would be void. Conversely, in a Void Contract, the parties may have rights or obligations up until the time the contract becomes void. A contract that becomes void due to a new law would be enforceable up to the change in law.
Shumaila Saeed
Jan 20, 2024
The key difference lies in the time of formation: Void Agreements are invalid from inception and never transform into a valid contract, whereas Void Contracts may be valid and enforceable at inception but later become void due to external or unforeseen factors. An agreement for an illegal purpose is void ab initio, while a contract to deliver goods that later become unavailable due to unforeseen events becomes void subsequently.
Shumaila Saeed
Jan 20, 2024
Comparison Chart
Legal Status
Never legally enforceable
Initially valid, becomes unenforceable
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Jan 20, 2024
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Time of Invalidity
Invalid from the beginning
Becomes invalid due to subsequent events
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Jan 20, 2024
Example
Agreement to perform an illegal act
Contract becomes void due to legality changes
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Jan 20, 2024
Enforcement
Cannot be enforced at any point
May be enforced before it becomes void
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Jan 20, 2024
Rights and Obligations
No rights or obligations arise
Rights and obligations may exist before voidance
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Jan 20, 2024
Void Agreement and Void Contract Definitions
Void Agreement
An agreement with no legal binding or enforceability.
An agreement with a minor for property sale is void.
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Void Contract
A contract that becomes non-binding due to unforeseen events.
A performance contract voided due to an unforeseeable natural disaster.
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Void Agreement
A mutual understanding that fails to constitute a valid contract.
A handshake deal to engage in insider trading is a void agreement.
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Jan 06, 2024
Void Contract
A legally binding contract that ceases to be enforceable.
A service contract voided by the sudden unavailability of the service provider.
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Jan 06, 2024
Void Agreement
An agreement not recognized by law due to lack of essential elements.
An agreement to rob a bank is a void agreement.
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Jan 06, 2024
Void Contract
A contract that loses its legal enforceability due to subsequent changes.
A contract voided due to the impossibility of performance.
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Jan 06, 2024
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Void Agreement
A deal that is inherently illegal or against public policy.
A contract for selling prohibited substances is a void agreement.
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Jan 06, 2024
Void Contract
An agreement that initially meets legal requirements but later becomes invalid.
A contract becomes void when a new law prohibits its terms.
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Jan 06, 2024
Void Agreement
An arrangement that is null from its inception.
A verbal agreement to commit fraud is inherently void.
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Jan 06, 2024
Void Contract
An agreement valid at creation but invalidated by external factors.
A sales contract becomes void after the destruction of the goods sold.
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Jan 06, 2024
Repeatedly Asked Queries
Can a void agreement be rectified?
No, it's void from the start and cannot be made valid.
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Jan 20, 2024
What makes an agreement void?
Lack of essential contractual elements like consent, legality, and consideration.
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Jan 20, 2024
Can a void contract be enforced before it becomes void?
Yes, it can be enforced until it becomes void.
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Jan 20, 2024
Can a void contract be revived?
No, once a contract becomes void, it cannot be revived.
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Jan 20, 2024
Are void agreements illegal?
They often involve illegal purposes or lack legal formalities.
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Jan 20, 2024
Is a contract with a minor void?
Yes, contracts with minors are generally considered void.
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Jan 20, 2024
Is a void agreement the same as an illegal agreement?
All illegal agreements are void, but not all void agreements are illegal.
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Jan 20, 2024
When does a contract become void?
When subsequent events make its performance impossible or illegal.
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Jan 20, 2024
Can a void agreement be presented in court?
No, as it has no legal standing from the outset.
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Jan 20, 2024
Can a void agreement involve legal transactions?
No, as it lacks the legal structure to be valid.
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Jan 20, 2024
Are all void contracts initially valid?
Yes, they start as valid but become void later.
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Jan 20, 2024
Can mutual mistakes make a contract void?
Yes, mutual mistakes about a fundamental fact can render a contract void.
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Jan 20, 2024
Does impossibility of performance always void a contract?
Yes, impossibility of performance generally renders a contract void.
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Jan 20, 2024
Can compensation be claimed in a void contract?
Compensation may be claimed for the period before the contract became void.
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Jan 20, 2024
Do void agreements have any legal implications?
No, they are not recognized by law and have no legal implications.
Shumaila Saeed
Jan 20, 2024
Do void agreements require mutual consent?
They may have consent, but it's ineffective due to other missing elements.
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Jan 20, 2024
Can fraud make a contract void?
Yes, fraud can lead to a contract being declared void.
Shumaila Saeed
Jan 20, 2024
What happens to the advance money in a void contract?
It may be returned unless the contract had legal standing before becoming void.
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Jan 20, 2024
Are void contracts considered a breach of contract?
No, a void contract is not a breach as it is no longer enforceable.
Shumaila Saeed
Jan 20, 2024
Can void agreements be informal or oral?
They can be, but their format doesn't change their void status.
Shumaila Saeed
Jan 20, 2024
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About Author
Written by
Shumaila SaeedShumaila Saeed, an expert content creator with 6 years of experience, specializes in distilling complex topics into easily digestible comparisons, shining a light on the nuances that both inform and educate readers with clarity and accuracy.
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