What is rescission of a contract?

Rescission of a contract is a legal remedy in Pennsylvania contract law where one or both of the parties to the contract can cancel the contract and be put back in the same position as if the contract had never existed. Rescission can be done in two ways: either voluntarily or through the court system. Voluntary rescission is when parties to the contract agree to cancel the agreement, and both parties are then released from any further obligations under the contract. If one party does not agree to rescission, then the other party can take the case to court for a judge to decide on the matter. When a court grants rescission, it means that the contract is cancelled and the parties to the contract are no longer obligated to perform under it. The court may also award the non-breaching party the money and/or value that they have paid or promised to pay under the contract. Once a contract is cancelled through rescission, the parties must act quickly to undo the contract as if it never existed. For example, if a contract involved the exchange of money, the parties must return the money given and/or promised by each of them. If the contract involved a piece of property, the parties need to transfer the property back to its original owner.

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