A valid contract is a contract satisfying the following requisites-agreement, consideration, legal purpose, capacity, and form. Valid contracts may be enforceable or unenforceable.
An unenforceable contract is an otherwise valid contract rendered unenforceable by some statute or law (e.g., an oral contract that, due to the passage of time, must be evidenced by a writing to be enforceable).
A voidable contract is an otherwise valid contract that one of the parties may legally avoid, cancel, or annul (e.g., a contract entered into under duress or under false pretenses).
A void contract is a contract having no legal force or binding effect (e.g., a contract entered into for an illegal purpose).
has been defined as "an electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record."
The E-SIGN Act provides that no contract, record, or signature may be "denied legal effect" solely because it is in electronic form.
E-Signature Technologies: E-signature technologies include encrypted digital signatures, names intended as signatures at the end of e-mail messages, and clicks on a Web page if the clicks include some means of identification.
Exclusions: Some documents are exempt from the E-SIGN Act including court papers, divorce decrees, evictions, foreclosures, health insurance terminations, prenuptial agreements, and wills.
Contracts made by mentally incompetent persons can be void, voidable, or valid.
If a court has previously determined a person to be mentally incompetent, any contract made by that person is void. The court will appoint a guardian to represent the individual and only the guardian can enter into binding legal obligations on behalf of the mentally incompetent person.
A party who has not been determined to be mentally incompetent by a court of law may avoid a contract if, at the time of contracting, he (1) did not know he was entering into a contract or (2) lacked the mental capacity to understand its nature, purpose, and consequences.
Only the incompetent party has the option of disaffirming his contractual obligations; any competent party to the contract remains bound unless released by the incompetent party's disaffirmance.
A contract entered into by a person who is mentally ill-but not previously declared incompetent-may be valid if the person had capacity at the time the contract was formed, i.e., during a lucid interval (time period when that person's intelligence, judgment, and will are temporarily restored).