The Only Way You Can Rescind a Contract in New York
Sometimes, 20/20 hindsight isn't such a bad thing.
And it can have very real, practical application in the world of contracts, because there are instances where you can essentially go back in time and get a do-over.
In legalese, this is called "rescission," which means that the court undoes the contract, and puts everybody back in the same (or substantially the same) position they were in before the agreement was made.
There are a number of reasons that a party who wants out of an agreement might want to pursue this remedy, such as where the other side deliberately concealed vital information that, had you known about it at the time of the contract, you would never have signed the agreement in the first instance.
There is a critical condition that must be fulfilled before you can seek to rescind a contract - at least under New York law - however:
"[T]he equitable remedy [of rescission] is to be invoked only when there is lacking complete and adequate remedy at law and where the status quo may be substantially restored" (Rudman v Cowles Communications, 30 NY2d 1, 13 ).
In other words, rescission is only available if two conditions are met:
(1) money damages can't make you whole; and,
(2) rescinding the contract will actually be effective in putting each party back into roughly the same position they were in before the agreement.