Voidable contract CASES

In English law, a voidable contract is a valid agreement that can be affirmed or rejected (rescinded) by one of the parties due to specific issues affecting consent.

Definition and Principles

Voidable contracts initially create legally binding obligations but contain defects, such as misrepresentation, duress, undue influence, or minority, allowing the disadvantaged party to rescind if they choose.

Grounds for Voidability

  • Misrepresentation: False statements inducing agreement.
  • Duress: Improper pressure or threats.
  • Undue Influence: Exploitation of trust or power imbalance.
  • Minority: Contracts entered by minors.

Consequences

When rescinded, parties are restored to their original positions, as if the contract never existed. Affirmation makes the contract fully enforceable.

Practical Importance

Recognising voidable contracts protects parties from exploitation, allowing them to correct agreements compromised by unfairness or deception.

Law books in a law library

Barton v Armstrong [1973] UKPC 2, [1976] AC 104

Armstrong, chairman of Landmark Corporation, threatened to have Barton, the managing director, killed unless he executed a deed purchasing Armstrong's shares. The Privy Council held that a contract may be avoided for physical duress even if the threats were not the main reason for entering the agreement. Facts Alexander Barton...