What is a contract that may be terminated at the option of one of the parties?

What is a contract that may be terminated at the option of one of the parties?

• A. Voidable
• B. Valid
• C. Unenforceable
• D. Executed

Answer: (A)

A voidable contract is initially valid and enforceable, but one party has the right to cancel it. This option to terminate exists when there are defects such as misrepresentation, fraud, duress, lack of capacity, or undue influence. The contract remains binding until the party with the right to void it exercises that option; if they disaffirm, the agreement is cancelled and treated as if it never existed. This differs from a strictly valid contract, which has no unilateral exit, from an unenforceable contract, which cannot be enforced due to a legal defense, and from an executed contract, which has been fully performed.

A voidable contract is initially valid and enforceable, but one party has the right to cancel it. This option to terminate exists when there are defects such as misrepresentation, fraud, duress, lack of capacity, or undue influence. The contract remains binding until the party with the right to void it exercises that option; if they disaffirm, the agreement is cancelled and treated as if it never existed. This differs from a strictly valid contract, which has no unilateral exit, from an unenforceable contract, which cannot be enforced due to a legal defense, and from an executed contract, which has been fully performed.