Contracts That Are Contrary to Established Law or Public Policy Are
Contracts That Are Contrary to Established Law or Public Policy Are
Contracts that are Contrary to Established Law or Public Policy are Unenforceable
In the world of business, contracts are an essential part of the daily operations. They are the legally binding agreements that govern the interactions between the parties involved in a transaction. However, not all contracts are enforceable. If a contract is contrary to established law or public policy, it is considered unenforceable, and the parties cannot rely on it to settle disputes. This article explores the concept of contracts that are contrary to established law or public policy and their implications.
What is a contract that is contrary to established law or public policy?
A contract that is contrary to established law or public policy is an agreement that violates legal principles or societal values. In other words, when a contract goes against the law or social norms, it is unenforceable. The courts consider such contracts void from the inception, meaning they have no legal validity. A contract that is contrary to law or public policy can arise from different situations.
For instance, a contract that seeks to engage in criminal activities or promotes illegal conduct is contrary to established law. Similarly, a contract that goes against public policy, such as agreements that promote discrimination or monopolies, is also unenforceable. This is because they go against the values and beliefs of a society and are considered harmful.
What are the implications of a contract that is contrary to established law or public policy?
If a contract is found to be contrary to established law or public policy, it is deemed unenforceable. The parties cannot rely on it to settle disputes, and the courts will not enforce it. This can create significant implications for the parties involved in the contract.
For example, if a contract is unenforceable, any benefits that the parties received from the contract would have to be returned. This includes any monetary payments or proceeds from the transaction. Additionally, parties may face legal consequences if the contract was in violation of established law. They may be subject to fines or imprisonment, depending on the specifics of the case.
Moreover, an unenforceable contract can lead to damaged relationships between the parties. It can also harm their reputation in the business community and lead to a loss of future business opportunities. Businesses must, therefore, ensure that their contracts comply with the law and public policy.
Conclusion
Contracts are critical to the smooth functioning of businesses. However, if a contract is contrary to established law or public policy, it is unenforceable, and the parties cannot rely on it to settle disputes. This can have significant implications for the parties involved, including the return of benefits received, legal consequences, and damaged relationships. Therefore, it is essential for businesses to ensure that their contracts align with the law and public policy. By doing so, they can avoid any negative consequences and ensure a smooth transaction process.