What is the difference between a void and a voidable contract?

The distinction between a void and a voidable contract is fundamental in contract law. A void contract is one that lacks legal effect from the outset; it is as if this contract never existed. This means that neither party can enforce the contract, and it holds no legal obligations or rights for anyone involved.

In contrast, a voidable contract is initially valid and binding on the parties but includes certain conditions or factors that allow one or both parties to rescind or void the contract at a later time. For example, contracts made under duress, undue influence, or with a minor can be considered voidable. Thus, while they are valid until challenged by the appropriate party, they hold the potential to become void if one party decides to exercise their right to void the contract.

This understanding of void and voidable contracts is crucial for real estate professionals and salespersons, as it impacts the enforceability of agreements and the rights of parties involved in transactions.