What is Voidable contract, Kinds and its Consequences?

Scope of Study

1. What is voidable contract?
2. Kinds of Voidable contract
3. Consequences of Voidable contract

What,

Contract that can be affirmed or rejected at the option of aggrieved party can be said as voidable contract.

Here in a contract aggrieved/innocent  party doesn’t have given the free consent. Aggrieved party is induce to give the consent to the contract, against his/her will, that results, the absence of free consent in contract and became voidable.

Example,

Mr. Ram gives threat to shoot Shyam if he does not let his house to Ram on hire. Shyam agrees to give his house to Shyam on hire.

Kinds of voidable contract

Since absence of free consent in a contract makes it voidable, we can say the situation where there is absence of free consent is the kind of voidable contract.

Thus voidable contract are,

1. Contract by coercion
2. Contract by Undue influence
3. Contract by Fraud
4. Contract by Misrepresentation

Consequences of voidable contract

1. Innocent party may appeal to void the contract.
2. Innocent party can affirmed or continue the contract, if the contract is in the favor him/her.
3. He/she can claim compensation
4. He/she may ask to brought them in pre contract stage.
5. Limitation
6. Innocent party has to go the court, within 1 year to declare the voidable contract void
7. If not then contract will become valid Ipso Facto.