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Void Contracts Group 1

Presentation of void contracts

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Angeline Sebastian
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42 views15 pages

Void Contracts Group 1

Presentation of void contracts

Uploaded by

Angeline Sebastian
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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VOID CONTRACTS

The Law on Obligations and Contracts


Void Contracts
Those which, because of certain defense, generally
produces no effect at all. They are considered as
inexistent from its inception or from the very
beginning.
Art. 1409. The following contracts are inexistent and void from
the beginning:

(1) Those whose cause, object or purpose is contrary to law,


morals, good customs, public order or public policy;
(2) Those which are absolutely simulated or fictitious;
(3) Those whose cause or object did not exist at the time of the
transaction;
(4) Those whose object is outside the commerce of men;
(5) Those which contemplate an impossible service;
(6) Those where the intention of the parties relative to the
principal object of the contract cannot be ascertained;
(7) Those expressly prohibited or declared void by law.
Characteristics of Void Contracts

• Generally, it produces no force and effects whatsoever.


• It cannot be ratified
• The right to set up the defense of illegality cannot be waived.
• The action or defense for the declaration of it’s inexistence
does not prescribe.
• The defense of illegality is not available to third person whose
interest are not directly affected.
• It cannot give the rise to a valid contract.
Art. 1410. The action or defense for the
declaration of the inexistence of a contract
does not prescribe.
Article 1411 Rules were contract illegal and the acts constitutes
criminal offense

A.When both parties are in Pari Delicto.

a. the parties shall have no action against each other.


b. both shall be prosecuted.
c. the things or the price of the contract, as the effects or
instruments of the crime, shall be confiscated in favor of government.
B. When one party is guilty( In Delicto but Pari Delicto)

a. the guilty party will be prosecuted.


b. the instrument of the crime or the object in the contract will
be confiscated.
c. the innocent one may claim what he has given, or if he has
not yet given anything, he shall not be bound to comply whit his
promise.
Article 1412 Rules where contract is illegal but the act does
not constitute criminal offense.

A. Where both parties are in Pari Delicto

a. neither party may recover what he has given by virtue of


the contract.
b. neither party may demand the performance of the other’s
undertaking.
B. Where only one party is guilty

a. the guilty party may loses what he has given by reason


of the contract.
b. the guilty party cannot ask for the fulfillment of the
other’s undertaking.
c. the innocent party may demand the return of what he
has given.
d. the innocent party cannot be compelled to comply his
promise.
Art. 1413. Interest paid in excess of the interest allowed by the usury
laws may be recovered by the debtor, with interest thereon from the
date of the payment.

Art. 1414. When money is paid or property delivered for an illegal


purpose, the contract may be repudiated by one of the parties before the
purpose has been accomplished, or before any damage has been caused
to a third person. In such case, the courts may, if the public interest will
thus be subserved, allow the party repudiating the contract to recover
the money or property.
Art. 1415. Where one of the parties to an illegal contract is
incapable of giving consent, the courts may, if the interest of justice
so demands allow recovery of money or property delivered by the
incapacitated person.

Art. 1416. When the agreement is not illegal per se but is merely
prohibited, and the prohibition by the law is designated for the
protection of the plaintiff, he may, if public policy is thereby
enhanced, recover what he has paid or delivered.
Art. 1417. When the price of any article or commodity is
determined by statute, or by authority of law, any person paying
any amount in excess of the maximum price allowed may recover
such excess.

Art. 1418. When the law fixes, or authorizes the fixing of the maximum
number of hours of labor, and a contract is entered into whereby a
laborer undertakes to work longer than the maximum thus fixed, he may
demand additional compensation for service rendered beyond the time
limit.
Art. 1419. When the law sets, or authorizes the setting of a
minimum wage for laborers, and a contract is agreed upon by
which a laborer accepts a lower wage, he shall be entitled to
recover the deficiency.

Art. 1420. In case of a divisible contract, if the illegal terms


can be separated from the legal ones, the latter may be
enforced.
Art. 1421. The defense of illegality of contract is not
available to third persons whose interests are not directly
affected.

Art. 1422. A contract which is the direct result of a previous


illegal contract, is also void and inexistent.
THANK YOU!
Group 1:
Angeline Sebastian
Glenda Gemina
Elaiza Mae Pascua
Angel Gonzales
Mary Ann Coloma
Rica Rapisora
Grace Ann Salazar

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