Chapter Five: Written Documents 1 Unsigned Documents 1

b) A common Intent to Perform a Contract Illegally

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Issue	Ratio	Notes
P hired D to transport big equipment Load was too heavy for truck, both parties knew-> performance was illegal	•Illegality in the performance of a contract may void it if both parties are aware even though the contract was not illegal ab initio •In equal fault, better is the condition of the defendant "In pari delicto, potior est conditio defendantis"

Because there are so many ways in which a contract may be or be performed illegally there have been exceptions made to mitigate
These exceptions are criticized as overly technical, lacking in logic and consistency

Issue	Ratio	Notes
P is evicting D Lease is contrary to law Can D be evicted?	• If a party has a right to the property prior to the illegal lease it will be respected and override the principle that the defendant is in the better condition. •Property interest cannot transfer via a contract void ab initio	This might apply specifically to leasing property. If contract is illegal you can’t bring action to enforce right, but you can bring action for eviction because there is no longer an agreement that has transferred a right to the tenant

General principle of restitution:
- Where benefits have been conferred by one party on the other to an agreement that is unenforceable by reason of a doctrine of common law or equity, restitutionary relief will be available to the conferring party to enable recovery of the value of the benefit conferred

Complicated in cases with illegal transactions
- "no court will lend its aid to a man who founds his cause upon an immoral or illegal act"
  - There are some exceptions
Exceptions:
- Restitutionary relief is made out in circumstances where the party conferring the benefit was unaware of the facts that render the transaction illegal
- Circumstances where the defendant has induced the plaintiff to enter the agreement by oppressive conduct such as fraud or undue influence

Issue

Ratio

Notes

In cases where one party is trying to recover money paid or property transferred under an illegal contract:

If two parties enter into an illegal contract, and money is paid upon it by one to the other, money may be recovered back from the execution of the contract, but not afterwards, the court will not lend aid if the contract has been executed unless it appears that the parties were not in pari delicto (equal fault)

If the contract is fully executed (determining if the parties are not in pari delicto):

If there is something in the defendant's conduct which shows that, of the two of them, he is the one primarily responsible for the mistake, then it can be shown that the parties are not in pari delicto and the plaintiff can recover

Typically courts won’t allow an action regarding something done in contravention of an Act of Parliament -> but that is to do with enforcing an illegal contract not recovering

Issue	Ratio	Notes
Pyramid scheme D recruited P P wanted out before they started executing scheme P wants to recover the $2000 buy-in	Two exceptions to the rule that there can be no recovery under an illegal contract: i. The parties are not in pari delicto ii. Where the plaintiff repents before the contract has been performed •The contract is still executory •Must repent in time (unclear how much)	Policy: It would incentivize performance of illegal contracts if it was impossible to recover money once contract is agreed to. Something about: if you bring a restitution action generally the person needs to still have your (particular) money

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