What does it mean if a contract is deemed "voidable"?

A contract that is deemed "voidable" means that it remains valid and enforceable until one party exercises their right to cancel it. This term generally applies in situations involving factors such as fraud, misrepresentation, undue influence, or the incapacity of one of the parties. Essentially, the party with the legal right to void the contract can choose to affirm it or cancel it, allowing for some flexibility in the enforcement of the agreement.

In cases where a contract is voidable, it does not inherently lack legal effect; it is valid until the affected party decides to void it. This distinction is crucial in understanding contract law, as it highlights the potential for one party to decide whether to uphold the agreement or terminate it based on specific circumstances.

The other options mischaracterize what a voidable contract entails. For instance, stating it cannot be enforced by any party suggests that the contract has no legal effect at all, which is incorrect. Similarly, describing it as automatically terminated does not reflect the nature of a voidable contract; a decision must be made by one party to cancel the contract. Lastly, saying it is subject to modification by the court implies a judicial intervention that is not generally applicable in voidable scenarios, as the choice to cancel or affirm