Which type of contract is considered void and cannot be enforced?

Study for the CLEP Business Law Test. Engage with flashcards and multiple choice questions, each question has hints and explanations. Prepare effectively for your exam!

A contract that is considered void is one that lacks legal effect from the moment it is created. This means that it cannot be enforced by either party, as it is treated as if it never existed in the eyes of the law. Void contracts arise for various reasons, such as the subject matter being illegal, the parties lacking the capacity to enter into a contract (e.g., minors, mentally incompetent individuals), or the terms being impossible to perform.

In contrast, a valid contract is legally binding and enforceable. A voidable contract is one that may be enforced at the discretion of one party, typically because of certain defects (like misrepresentation or undue influence), but is valid until that party chooses to void it. An implied in fact contract is a type of contract formed by the conduct of the parties rather than explicit words.

Therefore, the option that correctly identifies a contract that cannot be enforced at all is the void contract.

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy