Leadership Letter
April 2022
ASK COUNSELOR TARA
ASCE’s General Counsel Tara Hoke responds to legal questions posed by Sections and Branches here each month. Send Tara an email with your question.
Why would a signed contract be considered invalid?
In a previous column, we talked about what makes a contract legally binding—i.e., an offer, acceptance, and a mutual exchange of promises. But as is always the case, there are exceptions to every rule of law. Here are some reasons why a court might find a contract invalid, even when all parties have signed on the dotted line:

  1. Impossibility: Probably the most well-known reason in today’s world, courts can deem a contract as unenforceable if it is “impossible” for a party to perform.  Legal impossibility is usually a lower threshold than literal impossibility; if a party could perform a contract but only by an unreasonably difficult or costly effort, a court might still find performance to be legal impossible. For example, if travel restrictions made air traffic impossible at ASCE’s national convention, it might still be literally possible for ASCE to pay for bus tickets for all its attendees; but a court would likely find that to be unreasonably difficult or expensive. 
  2. Unconscionability/duress/undue influence: Generally speaking, these involve situations where a court deems a person to have been unfairly compelled into a contract. For example, if a shipper took possession of a Student Chapter’s concrete canoe and then refused to deliver unless the team signed a new contract with a much higher cost, this might well be deemed unenforceable.
  3. Public policy: If a court feels that a type of contract might prove detrimental to society as a whole, it might deem the contract unenforceable as against public policy. Most courts will not enforce a liability waiver in cases involving gross negligence or willful misconduct; they feel that a business should not be able to escape legal liability in cases involving reckless or intentional misconduct.
  4. Capacity: Is the party legally capable of making a binding agreement? While this is most commonly raised in questioning whether a person was “of sound mind” when making a will, it is perhaps most relevant in an association setting to signatures by minors. In most cases, a person under the age of 18 cannot legally sign an image release, waiver, or other binding contract; and a few states set the minimum age for contracts at 19 or even older.
  5. Mistake or fraud/misrepresentation: Courts can void a contract in cases of a mutual (both parties) or unilateral (one party) mistake, if they feel that enforcement would be unjust.  Similarly, courts are unlikely to enforce a contract made due to a material misrepresentation. For example, if ASCE contracted to buy what it believed to be original Da Vinci sketches, and the seller either was mistaken about their legitimacy or was intentionally selling fakes, a court would likely not enforce the contract.