ILLEGALITY
P A E
T R
H C 15
“In a free society the
state does not administer
the affairs of men [and
women]. It administers
justice among men [and
women] who conduct
their own affairs.”
Walter Lippman
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Illegality - Bussiness Law - Lecture Slides, Slides of Commercial Law
This lecture is from Business Law. Key important points are: Illegality, Administers, Walter Lippman, Meaning of Illegality, Types of Illegal Agreements, Effect on Contracts, Special Doctrines, Agreement, Consideration, Capacity
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2012/2013
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ILLEGALITY
C H A P T E R 15
“In a free society the state does not administer the affairs of men [and women]. It administers justice among men [and women] who conduct their own affairs.” Walter Lippman
CONTRACT LAW
- Introduction to Contracts
- The Agreement: Offer
- The Agreement: Acceptance
- Consideration
- Reality of Consent
- Capacity to Contract
- Illegality
- Writing
- Rights of Third Parties
- Performance & Remedies
ELEMENTS OF A CONTRACT
- 1) AGREEMENT
- 2) CONSIDERATION
- 3) CAPACITY
- 4) LAWFUL OBJECT
- An illegal agreement involves an act
or promise that violates a law or is
against public policy
- even if there was voluntary consent between
two parties
- not necessarily criminal
ILLEGALITY DEFINITION
AGREEMENTS THAT VIOLATE STATUTE:
TWO WAYS
- STATUTE DECLARES AGREEMENT ILLEGAL
- AGREEMENT FRUSTRATES PURPOSE (POLICY) OF THE STATUTE
- COMMIT CRIME
- PROMOTE VIOLATION (factors: importance of policy, extent of interference, seriousness of wrongdoing, connection to agreement) i.e. Straub v. BMT
- PERFORM ACT WHERE PARTY IS NOT LICENSED (depends on if “regulatory” versus “revenue”) i.e. Riggs v. Woman v. Woman PC
- AGREEMENT FRUSTRATES PURPOSE (POLICY) OF THE STATUTE
PUBLIC POLICY PER COURTS
- AGREEMENTS IN RESTRAINT OF
COMPETITION
- NON-COMPETE AGREEMENTS
- EXCULPATORY CLAUSES
EXCULPATORY CLAUSES
• 1. NOT VALID IF BEYOND NEGLIGENCE
• 2. NOT IF PUBLIC DUTY
• 3. NOT VALID IF NON-DELEGABLE PER COMMON LAW
OR STATUTE
i.e. McCune v. Myrtle Beach Indoor Shooting Range
UNCONSCIONABILITY
- PROCEDURAL = bargaining process
economic need lack of time market conditions
- SUBSTANTIVE = terms so unfair that
they shock the conscience
deprived of remedy price excessive to market one party bears disproportionate amount of risk