Question

An agreement which is enforceable by law at the option of one or more of the parties thereto, but not at the option of the other or others, is __________.

• A. An optional contract
• B. A voidable contract
• C. A futures contract
• D. A contingent contract

Hint:

A voidable contract is valid and effective until it is rescinded.
Once rescinded, the party rescinding must restore any benefit received under Section 64 of the Act.

Answer 1

The Correct Option is B

Step 1: Understanding the Question:
The question asks for the definition of an agreement that can be enforced or rejected at the option of one party, but cannot be avoided by the other party.

Step 2: Key Legal Principles and Approach:
The interpretation clause, Section 2 of the Indian Contract Act, 1872, defines this concept under subsection (i).

Step 3: Detailed Explanation:

• Statutory Definition: Section 2(i) of the Act states: "An agreement which is enforceable by law at the option of one or more of the parties thereto, but not at the option of the other or others, is a voidable contract."

• Factors causing Voidability: A contract typically becomes voidable when the consent of one of the parties is not free.

• Under Section 19 and 19A, if consent to an agreement is caused by coercion, undue influence, fraud, or misrepresentation, the agreement is a contract voidable at the option of the party whose consent was so caused.

• Legal Status: Such a contract remains valid and fully binding on both parties until it is formally rescinded or avoided by the aggrieved party.

• If the aggrieved party chooses to validate it, the other party must perform their obligation.

• Therefore, Option (B) is the exact statutory term.

Step 4: Final Answer:
An agreement enforceable at the option of only one party is a voidable contract as per Section 2(i), making Option (B) the correct answer.