Understand A Void Agreement, Voidable Agreement and An Illegal Agreement

Append below some basic understanding of the following terms:


A void agreement/contract is one


·        Which is destitute of all legal effects. In the eyes of law such an agreement is no agreement at all from its very inception.

·         A void agreement does not create any legal rights and obligations. It confers no rights on either party.

·         It is void ab intito (ie void from the very beginning) and without any legal effect.

·         Examples are agreement with a minor, agreements without consideration, agreements which are in restraint of trade or marriage or of legal proceedings, wagering agreement.


A voidable agreement/contract is one


  • Which a party can put to an end. He or she can exercise his/her option.
  • The voidable contract is however binding if he does not exercise his option to avoid it within a reasonable time.



An illegal agreement/contract is one


  • which like void agreement has no legal effect as between the immediate parties further, transaction collateral to it also become tainted with illegality and are therefore not enforceable.
  • Every illegal agreement is void but every void agreement may not amount to illegal agreement. Parties to an unlawful agreement cannot get any help from a court of law. “ For no polluted hands shall touch the pure fountain of justice.” On the other hand, a collateral transaction can be supported by a void agreement


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