VOID CONTRACTS
a. CONCEPT
The following are void from the
beginning: (Art. 1409)
1. cause, object, or purpose is contrary
to law, morals, good customs, public order, or
public policy
2. Absolutely simulated or fictitious
3. cause or object did not exist at the
time of the transaction
4. object is outside the commerce of
men
5. which contemplate an impossible
service
6. intention of the parties relative to the
principal object of the contract cannot be
ascertained.
7. expressly prohibited or declared void
by law
1. No ratification (Art. 1409)
2. No waiver of defense of illegality (Art. 1409)
3. No prescription (Art. 1410)
b. ILLEGAL CONTRACT
1. Is legal costs or object constitutes a criminal
offense
• most parties being in pari delicto, they shall
have no action against each other. and both shall
be prosecuted (Art. 1411)
2. If unlawful act or forbidden cost does not
constitute a criminal offense
• If both parties have fault neither, may recover
what he has given.
• if only one is at fault, he cannot recover what
he has given, but the other who is not at fault
may demand the return.
3. Repudiation
When money is paid or property is
delivered for an illegal purpose, one of the
parties can repudiate the contract before it is
completed or damaged. (Art 1414).
4. One party incapable of consent
The courts may order that money or
property delivered by the incapacitated person
be recovered. (Art. 1415)
5. Prohibited only, not illegal per se
He may come up if public policy is
thereby enhanced, recover what he has paid or
delivered (Art. 1416).
• Price of article or commodity (Art.
1416) Any person paying any amount in excess
of the maximum price allowed may recover such
excess
6. Divisible contract
Terms that are illegal can be separated
from those that are legal. (Art 1420).
7. When defense unavailable to third person
(Art. 1421)
8. Resulting contract
The outcome of a prior illegal contract is
thus void.