CLASSES OF DEFECTIVE CONTRACTS

VOID OR INEXISTENT
ESSENTIAL FEATURES RESCISSIBLE VOIDABLE UNENFORCEABLE CONRTACTS
The contract is entered
There is damage or There is vitiation of into excess or without
One or some of the essential
injury either to one consent or legal authority, or does not
requisites of a valid contract
1. AS TO DEFECT of the contracting incapacity of one of comply with the statutes of
is either lacking either in fact
parties or to third the contracting fraud, or both contracting
or in law
person parties parties are legally
incapacitated
Valid and Valid and
enforceable until enforceable until
Cannot be enforced by a As a general rule, do not
2. AS TO EFFECT they are RESCINDED they are ANNULLED
proper action in court produce legal effect
by a competent by a competent
court court
Action for recovery, if The action for declaration of
there was a total or partial nullity or inexistence or the
Action for
3. AS TO PRESCRIPTIBILITY performance of the defense of nullity or
annulment or the
OF ACTION OR DEFENSE Action for rescission unenforceable contract inexistence does not
defense of
under No. 1 or No. 3 of Art. prescribed
annulability
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4. AS TO SUSCEPTABILITY OF Not susceptible of Susceptible of Not Susceptible of

Susceptible of ratification
RATIFICATION ratification ratification ratification

Not only by a
contracting party but
Not only by a contracting
even by a third
5. AS TO WHO MAY ASSAIL only by a party but even by a third
person who is only by a contracting party
CONTRACTS contracting party person whose interest is
prejudiced or
directly affected
damaged by the
contract
6. AS TO HOW THE
Directly only and not Directly or
CONTRACTS MAY BE Directly or collaterally Directly or collaterally
collaterally collaterally
ASSAILED

Rescissible contract- a contract which is valid because it contains the essential requisites prescribed by law, but which is defective because of inquiry
of damage to either of the contracting parties or to third persons, as a consequence of which it may rescinded by means of a proper action for
rescission.

Voidable Contracts- those contracts in which all the essential elements for validity are present, although the element of consent is vitiated by either
lack of legal capacity of one of the contacting parties, or by mistake, violence, intimidation, undue influence or fraud.

Unenforceable contracts those contracts which cannot be enforced by a proper action in court, unless they are ratified, because, either they are
entered into or without excess of authority or they do not comply with the statutes of fraud or both of the contracting parties do not possess the
required legal capacity.

Void or inexistent contract one which lacks absolutely either in fact or in law one or some of the elements which are essential for its validity. Thus
if there is absolutely no consent, object or cause, or if the formalities which are essential for validity are not complied with, or even if there is a cause
and an object, if such cause or object is contrary to law, morals or good customs, public order, or public policy, or if the contract is expressly prohibited
or declared by law to be void, the contract is void or inexistent.

Contracts which are void - refer to those where all of the requisites of a contract are present, but the cause, object or purpose is
contrary to law, morals, good customs, public order or public policy, or contract itself is prohibited or declared void by law.

Contacts which are inexistent- refer to those where one or some of all of those requisites which are essential for the validity of
a contract are absolutely lacking, such as those which are absolutely simulated or fictitious, or those where the cause or object
did not exist at the time of the transaction.