Words and phrases

 

'void' and 'voidable' ab initio

There are a number of specified circumstances (such as duress or unconscionable conduct) which have the effect of invalidating a legal transaction. It is important to know what it means to say that a transaction is made either 'void ab initio' or 'voidable ab initio' by a specified circumstance.

A transaction is said to be 'void' ab initio when, because of the circumstances, the attempt to enter into that transaction is ineffective. The result in such cases is that no valid transaction ever comes into existence. Ab initio means 'from the outset'.

A transaction is said to be 'voidable' ab initio when, despite the circumstances, the attempt to enter into that transaction is effective and a valid transaction is created. However, because of the circumstances, a court may order the transaction to be set aside as void ab initio. The power of a court to set aside the transaction is what makes it 'voidable'. If a court orders that a voidable transaction be set aside as void ab initio, the result is the same as in the case of a transaction that was never valid at all.