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Void and voidable Contracts.

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Introduction

Void Contracts: A contract is void if it is worthless, that is, not really a contract at all. Some contracts made by minors, for example, are automatically void. Contracts may be declared void on the basis that they oblige the contracting parties to commit illegal acts. Damages cannot be claimed by a party injured by attempting to comply with a void contract. For example, if I contract to pay someone to shoot a TV game show host, and the would-be murderer decides to take the money and run without satisfying his part of the deal, then the courts will not assist me to recover the money. The illegality need not be as serious as murder for this to be the case. Some contracts may not be strictly void, but can be declared void. The distinction is important because when goods or property are exchanged under a voidable contract, title is passed. With a void contract no title passes, because effectively the contract never existed. Voidable Contracts: Unlike a void contract, whose legal status is as if it never existed, a voidable contract is one that remains in force until it is declared void by one of the contracting parties. ...read more.

Middle

She has ordered the display model which she has seen in the shop window offered at a reduced price. A sales assistant confirms the sale with Safina and takes a credit card deposit from her. Unbeknownst to either of them, the sofa has actually been destroyed the previous day, due to not complying with current health and safety regulations. This is known as a common mistake. A common mistake is one when both parties make the same error relating to a fundamental fact. A contract will be void at common law if the subject matter of the agreement is, in fact, res extincta, non-existent. Section 6 of the Sale of Goods Act 1979 provides that: Where there is a contract for the sale of specific goods, and the goods without the knowledge of the sellers have perished at the time when the the contract was made, the contract is void. Therefore, the contract is totally void, and is, as if it never existed. 4. In this case Dan buys a garage from a large oil company. While negotiating the oil company gives Dan an estimate of the profit he should make annually. ...read more.

Conclusion

In the case of Forster v Suggett [1918] it was held that an employer cannot prevent an employee from using his own skill after he has left even if that skill was learnt from the employer. However, if it is an express term of the contract, as it is with Omar, the test of reasonableness is used to determine whether the restraint clause applies in total, or in part, or not at all. The courts try and strike a balance between protecting the goodwill of the employer and allowing the employee to earn a living. The test of reasonableness is applied to duration of the restraint, the radius of it and the scope of it. In the case of Omar, it would be unreasonable to expect him not to work for another firm of architects within Europe or the USA for the next ten years. A reasonable restraint would have been that he could not work for a firm of architects within the West Midlands area for two years following his termination of the contract. This would at least give him the option of working within England to earn a reasonable living. Therefore the clause is not valid and hence renders the contract in question void. Contract Law Assignment 4 Access to Law Mohammed Abdullah ...read more.

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