What is a voidable contract?

A voidable contract is a legally binding agreement in Delaware that one or both parties have the option of voiding or rescinding. Voidable contracts are valid until one or both parties exercise their right to void the agreement. A contract will be voidable if any of the following conditions apply to it: duress, mistake, misrepresentation, or a lack of capacity to contract. Duress refers to a situation where one party was forced under an imminent threat of harm (physically, emotionally, or financially) to enter into a contract. The fact that a party was in a vulnerable state of mind and was forced to accept the terms of a contract can make it voidable. Mistake can refer to a situation where one or both parties are mistaken as to the terms of the agreement or their capacity to enter into it. For example, if a party incorrectly purports to be a corporation, but it is actually an individual, this mistake can render the contract voidable. Misrepresentation is where a party makes a false statement of material fact that induces the other party to enter the agreement. This false statement must be intentional and must be material to the contract (i.e. it must affect the terms of the contract). A contract may also be voidable if one of the parties is not of sound mind and does not possess the capacity to contract. This includes minors, those with certain mental illnesses, or those under the influence of substances. In summary, a voidable contract is a legally binding agreement that can be rescinded by one or both parties, depending on the circumstances of the contract. These include duress, mistake, misrepresentation, or lack of capacity to contract.

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What is a voidable contract?

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