What void and voidable means
Void means it was never a contract. Voidable means it was, until somebody undid it.
A void agreement has no legal effect from the start. Nobody can enforce it, and it cannot be rescued by the parties agreeing to treat it as valid.
A voidable contract is real and binding unless and until the party with the right to avoid it takes steps to set it aside. Until they do, it operates normally.
How it is used
The distinction decides what happens to everybody else caught up in the transaction.
If a contract is void, no rights pass, so a third party who acquired something under it generally acquires nothing. If it is merely voidable, a third party who acquired rights in good faith before it was avoided may keep them.
That is why the classification is the first thing a lawyer establishes in a dispute over a transaction that has already moved on to other people.
Key features
- A void agreement has no legal effect from the outset
- A voidable contract is valid until avoided by the party entitled to do so
- Illegality and lack of capacity commonly make agreements void
- Misrepresentation, duress and undue influence commonly make contracts voidable
- The right to avoid can be lost by affirmation, delay, or third party rights arising
How this works in Nigeria
Land supplies the clearest Nigerian examples. A transfer of land held under a statutory right of occupancy, made without Governor's consent under Section 22 of the Land Use Act, is exposed to being void.
In customary family land, a sale by principal members without the head of the family is generally treated as void, whereas a sale by the head without the concurrence of the principal members is generally voidable at the instance of the family. Two similar looking failures, two very different outcomes for the buyer.
Contracts induced by misrepresentation or undue influence are generally voidable, which means the wronged party must act rather than assume the contract has already collapsed.
Void vs voidable vs unenforceable
Void means no contract ever existed in law.
Voidable means a valid contract exists but one party can set it aside.
Unenforceable is different again. The contract is valid, but a court will not enforce it, often because of a procedural failure such as a document that should have been stamped and was not. The parties can sometimes cure it, for example by paying the duty.
Mixing these up leads people to assume they are protected when they are not. A voidable contract left alone stays binding, and an unenforceable one can often be fixed.
Limits and risks
The right to avoid a voidable contract is not permanent. It can be lost by affirming the contract after learning the truth, by unreasonable delay, or once third parties acquire rights in good faith.
That gives the wronged party a practical deadline. Sitting on a discovery while deciding what to do is how people lose the remedy they had.
Worth knowing
If you discover grounds to avoid a contract, act promptly and in writing. Continuing to perform after you knew can be treated as affirming it.