A contract that is contrary to law refers to an agreement between two parties that violates the law or public policy. Such a contract is considered void or unenforceable by a court of law. The principle of a contract contrary to law also applies to contracts that are entered into with illegal objectives, like committing a crime or defrauding someone.
In general, contracts are considered legally binding agreements that can be enforced by law. However, not all contracts are enforceable, especially those that go against public policy or violate the law. If parties enter into a contract that is contrary to law, the court will not enforce the agreement, and both parties will be released from their obligations.
It is important to understand that a contract can be considered illegal or void for several reasons. It could be because the contract violates statutory laws, like contracts that involve illegal activities such as prostitution or drug trafficking. For example, a contract to sell illegal drugs would be considered void because it violates the law.
A contract could also be considered illegal if it violates public policy. Public policy refers to the laws, regulations, and moral standards that guide the conduct of society. For example, a contract to buy stolen property would be considered void because it violates public policy.
Another instance where a contract could be considered void is when it is entered into under duress or coercion. If one party forces the other into signing an agreement against their will, the contract would be considered illegal and unenforceable.
There are several consequences for entering into a contract that is contrary to law. Firstly, the contract will be considered null and void, and both parties will be released from their obligations. This means that neither party can enforce the terms of the contract. Secondly, parties that enter into illegal contracts may face legal consequences, such as fines or imprisonment.
In conclusion, a contract that is contrary to law is a legally unenforceable agreement between two parties. Such a contract goes against the law or public policy and may result in legal consequences for the parties involved. It is essential to ensure that contracts are in compliance with statutory laws and public policy before entering into them to prevent any legal issues. As a general rule of thumb, it is wise to consult with a lawyer before signing any contract to ensure that it is legally binding and enforceable.