BUSINESS LAW

VOID AGREEMENT, VOID AND A VOIDABLE

CONTRACT
Presented by
Affan Bajwa
Ayesha Sharif
Sundas Amjad
CONTRACT

 An agreement that can be enforced in court.

 It is made between two or more parties

 Promisor
 The person making the proposal is called „promisor

 Promisee
 The person accepting the proposal is called „promisee‟.
ELEMENTS OF A CONTRACT

1. Agreement
2. Consideration
3. Contractual Capacity
4. Legality
AGREEMENT

Every promise and every set of promises,

forming the consideration for each other,
is an agreement.
WHAT AGREEMENTS ARE CONTRACTS?

 All
agreements are contracts if they are
made by the free consent of parties
competent to contract, with the law of
consideration and with a lawful object.
CONTRACTUAL CAPACITY

Contractual Capacity maintains that the law

must recognize parties as possessing
characteristics that qualify them as competent.
WHO ARE COMPETENT TO CONTRACTUAL
CAPACITY

1. Age of Majority

2. Persons of Sound Mind

3. Persons NOT Disqualified

 AGE OF MAJORITY

 This is now regulated by the Majority Act, 1875. Section

3 of the Act declares that every person domiciled in
Pakistan shall be deemed to have attained his majority
when he shall have completed his age of eighteen years,
and not before.
 SOUND MIND
 The person is said to be sound mind
for the purpose of making a contract
if, at the time when he makes it, he is
capable of understanding it, and of
forming a rational judgment as to its
effect upon his interest.
 DISQUALIFIED PERSONS
 This
section deals with personal
capacity in three distinct branches:

Political
Professional

Legal Statute
VOID CONTRACT

 A contract
which ceases to enforceable by
law becomes void when it ceases to be
enforceable
VOID AGREEMENT

An agreement not enforceable by law

is void agreement.
CONSIDERATION
Consideration is defined as something of value
received or promised to convince a person to
make a deal.
FACTORS IN CONSIDERATION
 Forbidden by Law
 Injury to Person and Property
 Immoral and Applied to Public Policy
 Unlawful
 Fraudulent
FORBIDDEN BY LAW
An act or undertaking is equally forbidden
by law whether it violates a prohibitory
enactment of the Legislature or a principle
of unwritten law.
INJURY TO PERSON AND PROPERTY

 A comprehensive term for any wrong or

harm done by one individual to another
individual's body, rights, reputation, or
property. Any interference with an
individual's legally protected interest.
IMMORAL AND APPLIED TO PUBLIC
POLICY
UNLAWFUL
 An action which is in violation of a
statute, federal or state constitution, or
established legal precedents (against the
law)
FRAUDULENT

 The description of a willful act commenced with

the specific intent to deceive or cheat, in order to
cause some financial detriment to another and to
engender personal financial gain.
VOIDABLE CONTRACT
 An agreement which is enforceable by law at the
option of the one or more of the parties thereto,
but not at the option of the other or others, is a
voidable contract.
REVOKE CONTRACT

 A voidable agreement can be revoke if one

of the party has free consent.

CONSENT:
 Two or more persons are said to consent
when they agree upon the same thing in
the same sense.
FREE CONSENT

Consent is said to be free when it is not caused by

 COERCION
 FRAUD

 MISREPRESENTATION

 UNDUE INFLUENCE
 Relation of parties to dominate the will
 Fiduciary, age and health
 Unconscionable transaction
COERCION
 Coercion is the committing or threatening
to commit, any act forbidden by the
Pakistan Penal Code or the unlawful
detaining, or threatening to detain any
property or life, with the intention of
causing any person to enter into an
agreement.
FRAUD
 Fraud means and includes any of the following acts
committed by a party to contract , or to induce him
to enter into the contract…
 The suggestion, as to a fact, of that which is not
true, by one who does not believe it to be true.
 The active concealment of a fact by one having
knowledge or belief of the fact.
 A promise made without any intention of
performing it.
 Any other act fitted to deceive
 Any such act or omission as the law specially
declares to be fraudulent.
MISREPRESENTATION
The misrepresentation must be made with
the intention of influencing the other person
to act upon it
The misrepresentation or concealment must
induce action and cause injury to the other
party
UNDUE INFLUENCE DUE TO
RELATION OF PARTIES TO DOMINATE
THE WILL
 A contract is said to be induced by “undue influence”
where the relations subsisting between the parties such
that one of the parties is in a position to dominate the
will of the others, and uses that position to obtain an
unfair advantage over the other.
 FIDUCIARY, AGE AND HEALTH
 In particular and without prejudice to the generality of
the foregoing principle, a person is deemed to be in a
position to dominate the will of another ---

 Where he holds, a real or apparent authority over the other, or

where he stands in Fiduciary relation to the other

 Where he makes a contract with a person whose mental

capacity is temporarily or permanently affected by reason of
Age, Illness, or Mental or Bodily distress
UNCONSCIONABLE TRANSACTION
 Where a person who is in a position to dominate the will
of another, enters into contract with him, and the
transaction appears, on the face of it or on the evidence
adduced, to be unconscionable, the burden of proving
that such contract was not induced by undue influence
shall lie upon the person in a position to dominate the
will of the other
THANK YOU