Also known as: avoidance action · avoidance
Written by attorneys · grounded in primary & secondary sources — see below
2 senses
A contractual party's right to rescind an agreement and recover benefits conferred when grounds such as mistake, misrepresentation, or duress render the contract voidable. The right persists even if the party failed to discover the facts, provided the failure does not amount to bad faith or violation of reasonable commercial standards.
A contractual party's right to rescind an agreement and recover benefits conferred when grounds such as mistake, misrepresentation, or duress render the contract voidable. The right persists even if the party failed to discover the facts, provided the failure does not amount to bad faith or violation of reasonable commercial standards.
Select any source to read its text and confirm it supports the definition.
An affirmative defense or plea that avoids or defeats the opposing party's claim without denying its allegations.
Select any source to read its text and confirm it supports the definition.
An affirmative defense or plea that avoids or defeats the opposing party's claim without denying its allegations.
Each sense below has its own examples, sources, and questions.
Doug, a farmer, signed a multi-season seed contract with Brook Ag after the representative concealed trial data showing the seeds were not pest-resistant. Doug later discovered the omission and sought to avoid the agreement. Because the representative's concealment amounted to a failure to act in good faith, Doug retained the power of avoidance and could recover the price paid in restitution.
No. A mistaken party's fault in failing to know or discover the facts does not bar avoidance unless the fault amounts to a failure to act in good faith and in accordance with reasonable standards of fair dealing.
Supporting sources
A party who avoids a contract is entitled to recover in restitution any benefit conferred on the other party through part performance or reliance. The avoiding party must generally return any benefit received, subject to adjustments for improvements or other equitable considerations.
Supporting sources
Reformation or avoidance is not precluded merely because the contract falls within the statute of frauds. The equitable power to avoid or reform remains available when the writing fails to express the parties' true agreement due to mistake.
Supporting sources
In a suit with dozens of defendants, one defendant filed an answer containing an avoidance defense alleging the plaintiff's claim was time-barred. Under the applicable rule, that avoidance was automatically deemed denied by all other parties without further pleading, allowing the case to proceed on the merits without additional responsive filings from co-defendants.