Distinguish between the following: Void and illegal agreements

CS Executive · Economic, Business and Commercial Laws · PYQS · December 2019
Distinguish between the following: Void and illegal agreements

Answer & Explanation:

A void agreement is one which is destitute of all legal effects. It cannot be enforced and confers no rights on either party. It is really not a contract at all, it is non-existent. The expression provides a useful label for describing the situation that arises when a contract is claimed but in fact does not exist. For example, a minor's contract is void. An illegal agreement is one which, like the void agreement has no legal effects as between the immediate parties. Further, transactions collateral to it also become tainted with illegality and are, therefore, not enforceable. Parties to an unlawful agreement cannot get any help from a Court of law. On the other hand, a collateral transaction can be supported by a void agreement. Therefore, it may be said that all illegal agreements are void but all void agreements are not necessarily illegal.

Topics: Indian Contract Act, 1872

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