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Contracts • Defenses to Enforcement and Formation
K#065
Legal Definition
If the subject matter or consideration for a contract is illegal, then the agreement is not enforceable.
Plain English Explanation
Courts will not assist people in breaking the law. Thus, if the purpose of a contract or its consideration are illegal, a court will not enforce the contract.
Hypothetical
Hypo 1: Bob offers to pay Sam $100 to purchase some crack cocaine. Sam agrees and takes Bob's money. Sam spends the money on tacos instead. Bob demands his money back. Sam says no. Bob sues Sam. Result: Though Sam technically breached his contract with Bob, the subject matter of the contract (to purchase crack cocaine) is illegal, and so a court will not enforce the agreement.
Hypo 2: Bob asks Sam to paint his house. In exchange, Bob will give Sam some crack cocaine. Sam agrees and paints Bob's house. When Sam asks Bob for his crack, Bob says, "Whoops -- I smoked it all." Sam sues Bob. Result: Though Bob technically breached his contract with Sam, the court isn't going to force Bob to give Sam crack cocaine. The consideration was illegal, and thus the contract is not enforceable. Note: whether or not a court will allow Sam to sue Bob for unjust enrichment (painting his house for free) is a separate issue.
Hypo 2: Bob asks Sam to paint his house. In exchange, Bob will give Sam some crack cocaine. Sam agrees and paints Bob's house. When Sam asks Bob for his crack, Bob says, "Whoops -- I smoked it all." Sam sues Bob. Result: Though Bob technically breached his contract with Sam, the court isn't going to force Bob to give Sam crack cocaine. The consideration was illegal, and thus the contract is not enforceable. Note: whether or not a court will allow Sam to sue Bob for unjust enrichment (painting his house for free) is a separate issue.
Visual Aids
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