As businesses and individuals enter into contracts, they often rely on the law to protect their interests. However, there are situations where a contract may be deemed illegal and therefore unenforceable. This is where the concept of illegality defence comes into play.
Illegality defence refers to a legal defense that can be used by a party to a contract when the performance of the contract would be illegal or contrary to public policy. This defense can be used to avoid liability or to argue that a contract is unenforceable.
There are several types of illegality that can render a contract unenforceable. Some of the most common include:
1. Statutory illegality: This occurs when a contract is illegal because it violates a statute or law.
2. Common law illegality: This occurs when a contract is illegal because it is against public policy or morality.
3. Illegality by association: This occurs when a contract is illegal because one of the parties is involved in illegal activity.
Regardless of the type of illegality, the party seeking to rely on the defence must prove that the contract is illegal and therefore unenforceable.
It is important to note that the illegality defence can be difficult to prove and is not always successful. In some cases, a court may deem that the illegality does not go to the core of the contract and therefore the contract can still be enforced. In other cases, a court may determine that the illegality is outweighed by other considerations, such as the public interest or the protection of innocent parties.
To avoid potential issues with illegality defence, it is important to ensure that contracts are drafted with care and that all parties are aware of any potential legal issues. Consulting with legal counsel can also be helpful in identifying potential pitfalls and risks associated with a contract.
In conclusion, the illegality defence is an important concept in contract law that can be used to avoid liability or to argue that a contract is unenforceable due to illegal activity or violations of public policy. It is important to understand the types of illegality that can render a contract unenforceable and to ensure that contracts are drafted with care to avoid potential legal issues.