Summary

A transaction is void where a transaction has been completed, i.e. the required declarations have been made, yet there is some deficiency in the transaction which renders it void from its inception.

A transaction may be void due to a number of deficiencies, of which the consequences are sufficiently serious that, under the law, the legal consequences that the transaction was intended to bring about are not allowed to arise. The circumstances that render a transaction void or the grounds for nullity can be divided into three main categories: grounds related to persons (active legal capacity, capacity to exercise will, right of representation), grounds related to form and grounds related to substance. In this article, the author focuses on grounds for the nullity of transactions that are related to the substance of a transaction.

The deficiencies in the substance of a transaction which provide grounds for nullity are set out in sections 86-89 of the General Part of the Civil Code Act. These include contradiction with good morals or public order, contradiction with a prohibition arising from law, ostensible transactions and violation of a restraint on disposition. This article focuses on these grounds in detail, with the exception of violation of a restraint on disposition.