Voidable Contract

A voidable contract, unlike a void contract, is a valid contract which may be either affirmed or
rejected at the option of one of the parties. At most, one party to the contract is bound. The
unbound party may repudiate the contract, at which time the contract becomes void. Typical
grounds for a contract being voidable include coercion, undue influence, misrepresentation or
fraud. A contract made by a minor is often voidable, but a minor can only avoid a contract during
his or her minority status and for a reasonable time after he reaches the age of majority. After a
reasonable period of time, the contract is deemed to be ratified and cannot be avoided. Other
examples would be real estate contracts, lawyer contracts, etc. When a contract is entered into
without the free consent of the party, it is considered a voidable contract. The definition of the
act states that a voidable contract is enforceable by law at the option of one or more parties but
not at option of the other parties. A voidable contract may be considered valid if it is not
cancelled by the aggrieved party within a reasonable time.

Situation:

 When a party has entered into a contract or obligation on the basis of a fraudulent
misrepresentation it shall be voidable. The contract or obligation must have been
accepted by the innocent party relying on the deception. Deception may arise where one
party is intentionally silent about a salient point. It should be noted however, where one
party is expressly contracting for a specific risk and has opportunity to price for it, it is
unlikely to be considered that the other party has been deceptive in being silent in matters
pertaining to that risk.

 When a party is coerced into entering into a contact or obligation by the reasonable belief
of grievous and imminent danger to life, limb, honor or property to it or others it shall be
voidable. Similarly, a contract or obligation will be voidable where the party has entered
into it having been exploited by the moral influence of the other.

 A contract will be voidable when a party has entered into it having made a mistake as to
some circumstance which, had the mistake not have been made would have prevented it
from entering into the contract or obligation. The party having made the mistake must act
in good faith and cannot call for the revocation of the contract or obligation unless it will
suffer substantial harm.

 A contract or obligation will be void if the subject matter breaches public order or
morality. There are some obvious examples of where this might be the case, for example
if the subject matter was gambling, but the circumstances which may arise in a
construction and engineering context are likely to be a matter of degree and judgement.
Rescissible Contract

Those validly entered into by the contracting parties, but because of them resulting to economic
damage or lesion to one of the parties or a third person, OR for having been entered into in fraud
of creditors, OR without knowledge and approval of judicial authority having custodia legis over
the property involved, OR for being specially declared by law as rescissible may, for equitable
reasons, be rescinded or set aside by the court (Articles 1380 and 1381).

Situation:

 When a party was unable to comply with their agreement or obligation the contract will
be cancelled or rescind. The injured party may choose between the fulfillment and the
rescission of the obligation, with the payment of damages in either case.

those validly entered into by the contracting parties, but because of them resulting to economic damage or lesion to one of the parties or a third person,
OR for having been entered into in fraud of creditors, OR without knowledge and approval of judicial authority having custodia legis over the property
involved, OR for being specially declared by law as rescissible may, for equitable reasons, be rescinded or set aside by the court (Articles 1380 and 1381).

https://www.dlapiper.com/en/kuwait/insights/publications/2015/10/letters-of-the-law-v-is-for-
void-and-voidable/