A contract legally void is an agreement that does not have any legal effect. This means that the contract is invalid and unenforceable, and neither party can be held responsible for fulfilling their obligations under the contract.
A contract may become legally void for several reasons, including fraud, misrepresentation, duress, undue influence, mistake, illegality, or incapacity. Let us look at these reasons in more detail.
Fraud: A contract becomes void if one party deliberately makes a false statement or conceals a material fact to induce the other party to enter into the contract. For example, if John sells a car to Mary, knowing that the car has a serious engine problem, and he does not disclose it to Mary, the contract becomes voidable at Mary`s option.
Misrepresentation: This occurs when one party makes an innocent or negligent false statement that induces the other party to enter into the contract. Like fraud, misrepresentation makes the contract voidable at the option of the innocent party.
Duress: This occurs when one party uses physical or emotional force to coerce the other party to enter into the contract. A contract entered into under duress is voidable at the option of the coerced party.
Undue Influence: This occurs when one party uses their position of power or authority to influence another party to enter into a contract. A contract entered into under undue influence is voidable at the option of the influenced party.
Mistake: This occurs when both parties to a contract make an erroneous assumption about a material fact. A contract entered into under a mutual mistake is voidable at the option of either party.
Illegality: A contract is void if its subject matter or purpose is illegal. For example, a contract to sell drugs is illegal and, therefore, void.
Incapacity: A contract is void if one or both parties lack the capacity to enter into the contract. For example, a contract entered into by a minor is voidable because minors lack the capacity to contract.
In conclusion, a contract legally void is a contract that lacks legal effect. Such a contract cannot be enforced, and the parties cannot be held responsible for fulfilling their obligations under the contract. Therefore, individuals should ensure that they understand the terms and conditions of the contracts they enter into. Additionally, it is essential to seek legal advice when in doubt to avoid entering into a legally void contract.