A fraudulent contract is not void, but voidable. The defrauded party may avoid the contract if he chooses, but the contract itself, is not without effect, simply by reason of the fraud.
A mere failure to disclose facts or conditions, if not accompanied by active measures to distract the defrauded party's attention from the thing to be concealed, ordinarily does not amount to fraud.
If one party by means of threatened or actual violence compels another to enter into a contract, or to part with something of value, the contract is said to have been obtained by duress. Such contracts may be avoided by the injured party, who may recover what he has lost.
A, a police officer, wrongfully arrests and imprisons B and releases him only after B has signed a promissory note for one hundred dollars ($100.00). A cannot recover on the note.
A, who is superior in physical strength to B, by threats of personal violence, compels B to admit that he is indebted to A for one hundred dollars ($100.00), which B pays A. B may recover the money from A. The contract is voidable on account of duress.
26. Mistake. One of the essential elements of a contract is that there must be a meeting of the minds of the contracting parties. If there is a mutual mistake on the part of the contracting parties, their minds do not meet and no contract results. A offers to sell B his farm for five thousand dollars ($5,000.00). A has two farms. A has one in mind, and B the other. Their minds do not meet and there is no contract.
A mistake as to the legal effect of a contract does not avoid it. This is known as a mistake of law.
A mistake on the part of one of the parties only, ordinarily does not avoid the contract.
27. Impossible Contracts. Parties may enter into any kind of a contract they choose, so long as the provisions and conditions are legal. As a general rule, a party is liable in damages to the other party, for failure to observe and carry out the terms of his contract. There is, however, a class of contracts, known in law as impossible contracts. Many contracts are made upon the assumption that the persons making the contract, or the particular thing under consideration will continue to exist until the contract is performed.
A agrees to paint a picture for B, for one thousand dollars ($1,000). A fails in health or dies. A or his estate, is not responsible in damages to B, since the contract contemplated A's remaining in health and life.