Even though it is illegal Because of the serious consequences and the overall scope of the doctrine, California courts have developed exceptions to the doctrine of illegality, based on the facts. For example, as long as the party seeking its performance is less morally guilty than the party against whom the contract is claimed, and as long as there is no overriding public interest that can be served by the cancellation of the agreement and the parties are not in default, the illegal contract can be performed. ( McIntosh v. Mills, 121 Cal.App.4th 333, 347 (2004). A contract may also be performed if (1) the breach has not resulted in serious moral reprehensibility; (2) the opposing party would be unfairly enriched if enforcement were refused; and (3) the confiscation would be disproportionately harsh to the extent of the illegality. (See Lewis & Queen v. N.M. Ball Sons 48 Cal.2d 141, 153 (1957), Tri-Q v. Sta-Hi Corp. 63 C.2d 199, 219 (1965); Asdourian v. Ajar 38 C.3d 276, 292, 293 (1985)).
The courts have also concluded that illegality is not a defence for parties who are not members of the group in which the respective law should protect. ( Henry v. General Forming Ltd. (1948) 33 Cal.2d 223; R.M. Sherman Co.c. W.R. Thomason (1987) 191 C.A.3d 559). Conclusion When analyzing infringements (or when drafting contracts), it is always necessary to analyze in depth whether there is a problem of illegality. A party may have a slam dunk breach of contract in which the existence of the contract, breach and damages are clearly established. However, if illegality is an issue, there is a chance that the customer will not end up with anything. Family law The defence of illegality has also been applied in the field of family law with regard to post-marriage agreements. For example, in In re Marriage of Mehren & Dargan (2004) 118 Cal.App.4th 1167, the husband and wife entered into a post-marital agreement under which the husband granted the wife his entire interest in the property of the community of the parties in case he used illegal and illegal drugs.
The Court of Appeal found that the agreement was unlawful because the husband`s only consideration was to refrain from committing a crime or misdemeanour, or from unlawfully deceiving or violating the promisor or a third party. (Id. to 1173). The legality of the contract depends on the content of the contract. For example, let`s say there is an employment contract for a poker dealer in a state where gambling is illegal. The contract would be illegal because it forces that employee to engage in illegal activities, in this case gambling. In addition, you should also consult a contract lawyer before entering into any type of contract or agreement. An experienced lawyer will be able to draft and review the contract and ensure that the contract is legally enforceable and that your rights under the contract are adequately protected. A contract that is prohibited by law (for example. B a contract between traders which provides for minimum prices for resale) or which is unlawful on grounds of public policy under customary law. An illegal contract is totally invalid, but neither party (unless they are innocent of the illegality) can recover the money paid under the contract or the assets transferred under the contract (see ex turpi causa non oritur actio).
Related transactions may also be affected. A related transaction between the same parties (e..B g. if X Y gives a promissory note for money it owes under an illegal contract) is also affected by the illegality and therefore void. The same applies to a related transaction with a third party (for example.B. if Z X borrows the money to pay Y) if he is aware of the initial illegality. In certain circumstances, illegal contracts can be saved by severance pay. As a result, it can sometimes be difficult to prove whether a contract is illegal or not. A general rule is this: if the contract requires one of the parties to do something illegal, it is usually unenforceable.
When the parties enter into contracts, they believe they have a binding agreement and can enforce the contract no matter what. However, one defence that defendants often use to avoid liability is the defence of illegality or “nullity contrary to public policy”. Parties who want to enforce contracts must be careful and careful in drafting and concluding agreements, as the defense of illegality has been widely applied and the consequences can be very serious. .
