How to Void a Contract Legally: Everything you Need to Know
If trying to discover how to void a contract legally, that means you currently have signed a contract that you no longer want to continue abiding by. 3 min read
If trying to discover how to void a contract legally, that means you currently have signed a contract that you no longer want to continue abiding by. Contracts are serious agreements that can lead to costly consequences if not followed. Still, you can lawfully void a contract under exceptional circumstances. A contract must have certain elements to make it valid. If those elements are not present, then the contract is void, even if both parties signed it.
Basic Elements of Valid Contract
A contract is enforceable by law if it has these required elements:
- Offer and acceptance. You must have an offer from one party and acceptance from the other party. This is usually done in writing, such as a work contract.
- Legal object and capacity of parties. The offer must be legal and the parties:
- Must both enter into the contract willingly.
- Must be legal age to enter a contract.
- Must have the mental capacity to carry out the agreement.
- Consideration. The contract must be mutually beneficial. For instance, you can have a contract with a photographer. You provide the compensation, and the photographer offers a professional headshot. Someone giving you 25% interest in a company for your marketing abilities is also mutually beneficial.
- Written and verbal. Not all oral agreements are enforceable. Contracts with significant consideration usually require written agreements. Real property purchases, car financing, and wills are a few examples of arrangements with large amounts of consideration.
A contract is much more than an agreement between two people. You must ensure your contract has all the elements necessary for a legally binding agreement.
How to End a Contract
- An unconscionable agreement is one that is one-sided. You have legal grounds to terminate a contract that mainly benefits one party in the deal.
- When the other party shows signs of giving up on the contract (anticipatory breach), then you are no longer legally bound by the agreement.
- A material breach is one that violates the contract's core. If one party does not or cannot deliver on the main reasons for the contract, it voids the contract.
- If a contract is fraudulent, it is not enforceable, and therefore you have grounds to terminate the contract.
- Some contracts have a termination clause. A termination clause usually states ways parties can terminate the contract early.
- There are situations where you or the other party cannot perform the duties outlined in the contract (impossibility of performance) due to a condition beyond either party's control. If this is the circumstance, then the contract can no longer move forward.
- If you can prove that you were forced to sign a contract under duress, then the contract is not enforceable. Keep in mind that you would need to show that the other party heavily influenced your contractual agreement.
- The FTC has a "cooling-off" rule wherein customers of door-to-door sales of $25 or more have 72 hours to change their mind. Before the sale, sellers must review the return policy with customers and provide them with the cancellation forms.
If you need to terminate your contract prematurely, you do not have to end up in court to do so. Present your reasons to the other party and work together to come to an amicable solution.
Check to make sure you follow consumer protection laws. It is also smart to have an attorney look over any agreement.
Difference Between “Void” and “Voidable” Contracts
There is a difference between a void contract and a voidable contract. Void contracts are not enforceable from the beginning because it does not have all the elements required for a valid contract. A contract is void for any of the following reasons:
- The contract included unlawful consideration or object.
- One of the parties was not in their right mind at the time the agreement was signed.
- One of the parties was underage.
- The terms are impossible to meet.
- The agreement restricts a party's right.
On the other hand, only one party is legally bound to the contract while the other party can choose whether he or she wants to go through with the agreement in a voidable contract.
Make sure you understand the elements what makes a contract valid, void, or voidable before entering into an agreement. Disputing a contract after the fact can be pretty costly.
If you need help with reviewing a contract, 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, Stripe, and Twilio.