Contract

LAW 1 – Obligations and Contracts Basis of Defect Status of Legal Effects Prescriptive Ratifiability
Classification
Contract Classification
Contract Period
Rescissible Contract There is no defect in a A rescissible contract is a Based on Art. 1380, The action to claim NO
rescissible contract at all valid contract; however, a rescissible contract rescission must be
>Contracts entered into in but by reason of some due to non-compliance of is valid and commenced within Such contracts are
behalf of wards. external factors, its one of the parties, there enforceable until four years from the susceptible to
>Contracts agreed upon in enforcement would has been damage. While a rescinded by a date of the contract convalidation but
representation of absentees. contract is valid, it may be not of ratification
cause injustice. (Art. competent court. was entered into.
>Contracts undertaken in fraud rescinded in cases proper.
of creditors. 1381) provided for by law. (Art. 1389)
>Contracts which refer to things (Art. 1380)
under litigation.
>Other instances
(Art. 1381)

Voidable Contract A voidable contract is
defective such that:
>Contracts where one of the a. Legal incapacity of
parties is incapacitated of giving one of the parties to give
consent. consent.
>Contracts whose consent was
b. Violation of consent
vitiated by
mistake ,violence ,intimidation, where vitiation is done
by mistake, violence,
undue influence or fraud.
(Art. 1390) intimidation, undue
influence and fraud.
Voidable contracts are Based on Art. 1390 The action for YES
valid and binding between voidable contracts annulment shall be
the parties unless annulled brought within four Susceptible to
are valid and years beginning from
by a proper action in the enforceable until ratification (Article
the time the defect of
court by the injured party. they’re annulled by a 1392)
the consent ceases,
competent court from the time of
discovery of mistake
and fraud, and when
action refers to
contracts entered into
by incapacitated
persons.

Unenforceable Contract Unenforceable contract Although valid, Such contracts are There could be YES
is defective caused by unenforceable contracts not rendered corresponding action
>Those entered into the name lack of form, authority or cannot be enforced or effective until proper for recovery if there Susceptible to
of another by one who has been given effect in a court of was total or partial ratification.
given no authority or has acted capacity of both parties law or sued upon by ratification by a performance of the
beyond his power. not cured by reason of certain defects competent court. unenforceable
>Those who do not comply provided by law and (Art. 1405) contract under no. 1
with the Statute of Frauds.
prescription.
inoperative until ratified. or 3 Art. 1403 of the
>Those where both parties are Civil Code may
incapable of giving consent.(Art.
prescribe.
1403)

Void Contract Void contracts are Void contracts produce Void contracts have Since void contracts NO
defective such that they no effect at all. They are no legal effect, as a have no effect at all,
Contracts lack one or some or all considered inexistent general rule. (except it is therefore, These contracts
>whose consent, cause, and of the elements of valid from its inception or void marriages) unnecessary to cannot be ratified.
object is contrary to law. Neither can the
>which are absolutely contract or do not from the very bring an action to
simulated or fictitious. comply with the beginning. declare it void. right to set up
>without cause or object. formalities essential for a (Art. 1409) However, it is better defense of
>whose object is outside the contract to be valid. to secure a illegality be
commerce of men. declaration of waived. (Art 1409)
> which contemplate an
impossible service.
nullity. (Art. 1410)
>where the intention of the
parties relative to the subject matter
can’t be ascertained.
>expressly prohibited or
declared void by law.