ExpertHard1 markMultiple Choice
CPA · Question 52 · Area II: Business Law
Which of the following is a 'void' contract?
Which of the following is a 'void' contract?
Answer options:
A.
A contract to commit a crime.
B.
A contract entered into by a minor.
C.
A contract induced by fraud in the inducement.
D.
A contract where one party was drunk (but not adjudicated incompetent).
How to approach this question
Distinguish Void (never existed legally) from Voidable (can be cancelled). Illegality and Physical Duress = Void.
Full Answer
A.A contract to commit a crime.✓ Correct
A contract with an illegal purpose (e.g., to commit a crime) is VOID (void ab initio). Contracts with minors, or induced by fraud in the inducement, are VOIDABLE (valid until cancelled by the protected party).
Common mistakes
Confusing Void and Voidable.
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