Important Questions with Solutions

Panjab University – Important Questions | Curated by Jeevansh Manocha, Student at Government College Ludhiana (East)

Q2. Difference between Void agreement, Voidable contract and Void contract. (15 marks)

Introduction. In the law of contracts, the terms void agreement, void contract and voidable contract have precise meanings and different legal consequences. It is essential for practitioners and students to distinguish them because rights, liabilities and remedies of parties vary depending on which category the transaction falls under.

Definitions (short)

Key differences (concise table)

AspectVoid Agreement / Void ContractVoidable Contract
MeaningNo legal effect from the beginning; unenforceable.Enforceable until avoided by the aggrieved party.
CreationInvalid at formation (e.g., unlawful object, impossible act).Validly formed but vitiated by defective consent.
EnforceabilityCannot be enforced by courts by any party.Enforceable by innocent party unless avoided by the aggrieved.
Right to rescindNo rescission necessary — nothing to rescind.Aggrieved party may rescind or affirm the contract.
Effect on partiesNo contractual rights or obligations arise; may give rise to restitution in quasi-contractual situations.Parties remain bound until contract is affirmed/avoided; rights and obligations subsist till avoidance.
ExamplesAgreement to commit a crime; wagering agreements; agreement in restraint of trade (subject to exceptions).Contract entered under coercion, undue influence, fraud, misrepresentation or where mistake vitiates consent.
RemediesNo contractual remedy; sometimes restitution (quantum meruit) under quasi-contract.Damages, rescission, or affirmation; injured party may seek relief in court.

Illustrations & Case law (concise)

Void / Void Agreement: An agreement to commit an illegal act is void (e.g., a contract to smuggle goods). Section 23 and public policy play a role. Courts will not enforce such agreements.

Voidable Contract: In R v. Attorney-General (or local common law cases) and Indian precedents, contracts induced by coercion or undue influence are voidable at the option of the aggrieved party. For instance, if a party is forced to sign under threat, they may avoid the contract and claim restitution.

Legal consequences — focused points for exam

Examiner-ready summary (bullet points to write in answer)

Conclusion: A void agreement or void contract is a nullity and creates no legal obligations, while a voidable contract is valid until rescinded by the aggrieved party; the distinction determines enforceability, remedies and the rights of third parties.

This answer forms part of a carefully curated set of important questions that have frequently appeared in past university examinations and therefore hold a high probability of reappearing in future assessments. While prepared with academic accuracy and aligned to the prescribed syllabus, these solutions should be treated as high-quality preparation material rather than a guaranteed prediction of any upcoming exam paper.