How to get out of a Legally Binding Contract
If you need to know how to get out of legally binding contracts, you need to know that there are legal ways to void contracts that you've signed. 3 min read
Updated July 2, 2020:
If you need to know how to get out of legally binding contracts, you need to know that there are legal ways to void contracts that you've signed. It just depends on how the contract was written. Because contracts are written or oral agreements, they are typically enforceable by law. There are some circumstances where you can break a contract. These include actions (or lack of actions) in fulfilling the commitment and any statutes intended to protect consumers.
Acceptable Reasons to Void A Contract
Contracts are legally binding by law. Although agreements can be oral or written, most arrangements are laid out in writing and signed by both parties. There are circumstances, though where a contract is invalid. For example, if a contract does not meet legal requirements, it is not enforceable.
- Impossibility of performance. When you are in a situation where it is impossible to fulfill contract terms, either party can nullify the contract.
For example, you hire a party planner to organize your 50th birthday celebration, but she dies before she has finished the job. The contract is terminated because she cannot fulfill her duties.
- Contract fraud, mistakes, or misrepresentation. You could break a contract if the other party did something unethical or wrong, if you and the other party made the same mistake, or if the other party was dishonest.
Example mutual mistake: You formed a contract to purchase a photo from a friend that was signed by Michael Jackson. You both find out the signature is not authentic. You are no longer legally required to follow through with the contract.
- Breach of contract. This happens when you are involved in a contract and the other party does not honor the agreement by refusing to do his or her part, doing something that is not part of the contract, or otherwise inhibiting you from fulfilling your part of the contract. Only material breaches are litigable. Material breaches violate the central part of the contract while an immaterial breach does not affect the contract fulfillment.
For example, you hire a photographer to take a family portrait. Instead, the photographer decides to sketch a picture because his camera is in the shop. The photographer materially breached the contract because the heart of the contract is a family portrait. On the other hand, the photographer stated he would use a Canon camera in the contract. Instead, he shows up with a Nikon because his Canon is in the shop. This is an immaterial breach because it would not change the central part of the agreement, which is a family portrait.
- Prior agreement to end a contract. A contract that states the agreement can terminate early if both parties fulfill the heart of the agreement.
For example, you enter a contractual agreement with a small business consultant whom you hired to finish your business plan in six months. The agreement also states that if the business consultant completes the project in less than six months and you approve it, then either party can terminate the contract with written notice.
- Unconscionable agreement. When a contract is grossly one-sided, you can break it. The law frowns upon deals where the power and benefits sit on one side of the agreement.
For example, you rent an apartment and midway through the contract, the other party raises the contract by $300 a month and says you must pay or move out.
- Anticipatory breach or anticipatory repudiation. When the other party backs out or show signs of backing out, you may have enough reason to void the contract.
For example, you are a life coach contracted to give client 12 coaching sessions over 12 weeks. After the fourth session, your client stops showing up, and you can no longer reach her.
- Completion of the contract. If you fulfill the agreements in the contract, then you can end the agreement.
For example, you are hired to audit your client's documentation. You finish the terms of the agreement, but the client wants to extend the contract. You are not under no obligation to extend the contract.
There are also federal and local state consumer protection laws that look out in the consumer's best interest. Contracts are agreements that are intended to be equally beneficial to all involved parties. There are times when you need to break the agreement. Knowing contract laws will help you know whether you can lawfully nullify an agreement.
If you need help with contract agreements, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.