Voidable Contracts

I. What contracts are voidable. (Art. 1390)

1. When one of the parties is incapable of giving consent (absolute incapacity)
2. When one or more of the vices of consent is present.
a. Violence
b. Intimidation
c. Mistake
d. Fraud
e. Undue Influence
- Consent is defective.
- Annulment
- Art. 1390
- Can be ratified.
II. Incapacity
1. When one of the parties is incapable of giving consent (absolute incapacity)

Exception: when the contracts involve necessaries.

III. When one or more of the vices of consent is present.

a. Violence- When in order to wrest consent, serious or irresistible force is employed.
b. Intimidation- when one of the contracting parties is compelled by a reasonable and well-
rounded fear of an imminent and grave evil upon his person or property, or upon the person or
property of his spouse, descendants, or ascendants, to give his consent. Exception: if the claim is
just or legal, does not vitiate consent.
c. Mistake refers to the substance of the object, identity/qualification of a person, or conditions
that have principally moved one or both parties to enter the contract.

Pacto de retro- sale with a right to repurchase to buy what you sell.

Vendor a retro- originally nagbenta at meron right para bilhin yun

Ignorance of the law excuses no one from compliance therewith Art. 3 does not vitiate the contract.

Mutual mistake of law- art1334

d. Fraud- through insidious words or machinations of one of the contracting parties, the other is
induced to enter into a contract which, without them, he would not have agreed to.
e. Undue influence- When a person takes improper advantage of his power over the will of
another, depriving the latter of a reasonable freedom of choice.
IV. Annulment of voidable contracts

Voidable contracts are valid until annulled.

When annulment cannot proceed

1. When the object of the contract is lost through the fault of the person who may annul the
contract
2. When the contract is ratified
Who can annul voidable contracts?

1. Incapacitated persons upon ceasing of incapacity.

2. Persons whose consent was vitiated.

When can it be allowed?

1. Within 4 years after guardianship of minors or incapacitated persons ceases

2. Within 4 years after intimidation, violence or undue influence ceases
3. Within 4 years from the time of discovery of mistake and fraud
V. Annulment vs Rescission

VI. Ratification of contract

Who may ratify?

The party who can annul a voidable contract.