Contract, illegal

Updated: Aug 20, 2021

A contract formed for an illegal purpose, or one declared illegal by statute, such as

(1) a gaming contract which does not fulfil the conditions of the Betting, Gaming, and Lotteries Act 1963 (all gaming contracts are void, if not illegal).

(2) agreements to commit an indictable offence or civil wrong,

(3) agreements against the national interest,

(4) agreements to defraud the Inland Revenue,

(5) agreements to pervert the course of justice,

(6) agreements involving maintenance or champerty.

(7) agreements of an immoral character.

Illegal contracts are void ab initio. If both V parties are equally at fault, neither can sue the other. Money or property can be recovered, however, (I) by an innocent party from a guilty party. (2) before performance or on frustration, (3) where this can be done without pleading, or relying on, the particular illegality.

Reference: The Penguin Business Dictionary, 3rd edt.

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James Knight
Editor of Education
James is the Editor of Education for Invezz, where he covers topics from across the financial world, from the stock market, to cryptocurrency, to macroeconomic markets.... read more.