Illegality Definition

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What does Illegality mean?

A bar to the enforcement of an otherwise enforceable contract as the courts cannot compel one party to complete an immoral or illegal act even if that act would not have been illegal at the time of contracting.

An agreement of mandate for the performance of an immoral or illegal act cannot be enforced, as no court will enforce an illegal contract or transaction or allow itself to be made the instrument of enforcing obligations alleged to arise out of a contract or transaction that is illegal. Illegality could be considered to be a frustrating event. A contract may be discharged on the happening of some event that renders the continuance of the contract unlawful. Typically, an event likely to render performance unlawful would be the outbreak of war or hostilities where legislation prohibits dealings in affected countries or involving property of the enemy.

View the related checklists about Illegality

Vertical agreements—drafting for MVBEO—checklist

Vertical agreements—drafting for MVBEO—checklist This Checklist sets out the essential points that should be considered under The Competition Act 1998 (Motor Vehicle Agreements Block Exemption) Order 2023 (No 2) (MVBEO) when drafting new vertical agreements, or updating existing vertical agreements, in relation to motor vehicle aftermarkets for the provision of repair and maintenance services or the distribution of motor vehicle aftermarket goods (together, the motor vehicle aftermarket). This Checklist is not intended to be a comprehensive guide to the MVBEO but should be used where a commercial lawyer wants to ensure that the vertical agreement falls within the MVBEO (and any guidance issued under it). For further information, see: CMA Guidance: MVBEO. A flowchart is also provided at the end of this Checklist, setting out the main steps to follow when assessing whether an agreement falls under the MVBEO. Introduction to MVBEO Any agreement which affects trade and restricts competition in the UK may be subject to the prohibition on anti-competitive agreements under the provisions of Chapter I of the Competition...

The EU Digital Services Act—checklist

The EU Digital Services Act—checklist The Checklist considers which service providers Regulation (EU) 2022/2065, the EU Digital Services Act (EU DSA) applies to, outlines what they will need to do to comply with the key obligations of the Act, and notes some of the key concepts. The EU DSA entered into force on 16 November 2022. The deadline for the publication of the number of active monthly users was 17 February 2023. On 25 April 2023, the Commission has designated 17 Very Large Online Platforms (VLOPs) and two Very Large Online Search Engines (VLOSEs). The designated companies are required to comply, within four months of their designation, with obligations under the EU DSA (see: LNB News 25/04/2023 74). On 19 December 2023, the Commission designated three additional VLOPs (see: LNB News 20/12/2023 32). All other intermediary provider services had until 17 February 2024 to comply with their obligations when the majority of the EU DSA provisions come into effect. For further information on the EU DSA, see Practice Notes: The EU Digital...

Void contracts

This Practice Note summarises the circumstances in which a contract may be declared void and the consequences when that happens. It distinguishes between void, voidable and unenforceable contracts and considers when a contract may be void due to: common mistake, unilateral mistake as to contractual terms, mistaken identity, non est factum and void under statute, as well as recognition of the separate category of illegality.For a summary, in tabular format, of the key and illustrative judgments handed down since 1 January 2020, considering contract law issues, see Practice Notes:•Contract disputes—key and illustrative decisions (2024)•Contract disputes—key and illustrative decisions (2020–2023)When is a contract a void contract?A void contract is one that is wholly lacking in legal effect. A contract will be void where:•the parties contract on the basis of a fundamental common mistake•one party contracts on mistaken terms and the other party knows of the mistake•one party is mistaken as to the other party’s identity•a party executes a document under a fundamental misapprehension as to its nature (non est factum)•a statute...

Comparing negotiations of the 1992 ISDA Master Agreement (Multicurrency Cross-Border) and the 2002 ISDA Master Agreement

Comparing negotiations of the 1992 ISDA Master Agreement (Multicurrency Cross-Border) and the 2002 ISDA Master Agreement The International Swaps and Derivatives Association, Inc. (ISDA) publishes two versions of its commonly used master agreement, which sets out the terms and conditions for over-the-counter (OTC) derivatives transactions. They are: • the ISDA Master Agreement (Multicurrency—Cross Border) (the 1992 Master Agreement); and • the ISDA 2002 Master Agreement (the 2002 Master Agreement) This Practice Note summarises the key changes brought about in the 2002 Master Agreement and highlights issues to consider when negotiating a 2002 Master Agreement as compared to the 1992 Master Agreement. Payments on early termination—close-out amount replacing market quotation, loss and first and second methods Perhaps the most significant change to the Master Agreement relates to the manner in which payments are calculated on an early termination. The inclusion of 'Close-out Amount' in the 2002 Master Agreement has eliminated the need for two of the key elections in the 1992 Master Agreement: the choices...

Discover our 362 Practice Notes on Illegality

Short-form facility agreement (term loan): single company borrower—bilateral—unsecured

Short-form facility agreement (term loan): single company borrower—bilateral—unsecured Facility agreement This Agreement is made on [date] Parties 1 [insert name of Borrower], a company incorporated in England and Wales with registered number [insert company number] whose registered office is at [insert address] (the Borrower); and 2 [insert name of Lender], of [insert address] (the Lender). It is agreed as follows: 1 Definitions and interpretation 1.1 In this Agreement, unless otherwise provided: Business Day • means a day, other than a Saturday, Sunday or public holiday, on which banks are open for business in London; Commitment • means £[•] ([•] Sterling) minus any amount reduced or cancelled in accordance with this Agreement; Commitment Period • means the period commencing on the date of this Agreement to and including [•]; Default • means an event that with the giving of notice, lapse of time or other applicable condition would be an Event of Default under Clause 16; Drawdown • means [the OR a] utilisation of the...

Connection agreement for private wires

Connection agreement for private wires Date of Agreement _____________________________________20[XX] Parties 1 [name of company], a company incorporated in [insert jurisdiction] (registered number [insert co. number]) whose registered office is at [insert address] (Company); and 2 [name of company], a company incorporated in [insert jurisdiction] (registered number [insert co. number]) whose registered office is at [insert address] (Customer). Background (A) The Customer is the owner and operator of the Customer’s Installation. (B) The Company is the owner and operator of the Distribution System. (C) The Customer wishes to export electricity generated by the Customer’s Installation to the Company’s Distribution System. (D) [The Parties wish to enter into a contract on or about the date of this Agreement, under which the electricity generated by the Customer’s Installation shall be supplied to the Company by the Customer (‘Power Supply Agreement’). (E) In consideration of the Parties entering into the Power Supply Agreement, the Company shall allow the electricity generated by the Customer’s Installation to be exported to the Distribution System in...

Dive into our 52 Precedents related to Illegality

What are the implications for an insured who participates in clinical trials but fails to notify his insurers of any existing health conditions or potential changes to his health which he discovers as a result?

What are the implications for an insured who participates in clinical trials but fails to notify his insurers of any existing health conditions or potential changes to his health which he discovers as a result? The following questions potentially arise: • has there been an increase in risk which the insured is obliged to disclose during the currency of the policy? • must the information be disclosed at renewal? • does it attract the operation of an exclusion for pre-existing conditions? • has there been any non-disclosure or misrepresentation? The insured’s state of health may be relevant to a wide variety of insurance policies, including long-term policies (eg life assurance, income protection or critical illness) and short-term policies (eg private medical, accident, or travel insurance). Some policies may be fully underwritten at the outset by means of a detailed proposal form. Others may only require minimal disclosure at inception but exclude cover for pre-existing medical conditions and/or require notification of changes in the insured’s health. It is therefore...

A UK company has engaged an EU manufacturer to undertake some specialist construction work. The EU manufacturer has engaged a subcontractor due to the specialist nature of the work. The EU citizens (who are employees of the subcontractor) will need to be in the UK for a number of months, possibly up to 12 months due to the nature of the work but will be travelling back to the EU to see family at various points. The EU citizens have not been to the UK before so they are not eligible for the EU Settlement Scheme or a frontier worker permit. Are there any routes available to enable the EU citizens to enter and work in the UK legally? Are there any risks to the UK company?

A UK company has engaged an EU manufacturer to undertake some specialist construction work. The EU manufacturer has engaged a subcontractor due to the specialist nature of the work. The EU citizens (who are employees of the subcontractor) will need to be in the UK for a number of months, possibly up to 12 months due to the nature of the work but will be travelling back to the EU to see family at various points. The EU citizens have not been to the UK before so they are not eligible for the EU Settlement Scheme or a frontier worker permit. Are there any routes available to enable the EU citizens to enter and work in the UK legally? Are there any risks to the UK company? For the purposes of this Q&A, we have not considered the provisions within the EU-UK Trade and Cooperation Agreement (TCA), as that is not directly enforceable, and it is for the UK to implement its provisions (to the extent not already...

See the 48 Q&As about Illegality

India—Delhi High Court rules on appointment of arbitrator by a High Court in an international commercial arbitration (Hala Kamel Zabal v Arya Trading Ltd and others)

Arbitration analysis: the Delhi High Court (Delhi HC) has held that the appointment of an arbitrator in an international commercial arbitration (ICA) by a High Court (instead of the Supreme Court) does not vitiate the arbitral award if the appointment was in accordance with the arbitration agreement. The Delhi HC explained that an arbitral award can be set aside under the (Indian) Arbitration and Conciliation Act, 1996 (A&C Act) if the composition of the arbitral tribunal was (a) not in accordance with the arbitration agreement, and (b) the arbitration agreement was in conflict with a non-derogable provision of the A&C Act. The Delhi HC noted that Section 11(6) of the A&C Act, which requires the Supreme Court to appoint an arbitrator in an ICA, is a derogable provision. Hence, non-compliance with the procedure for appointment under Section 11(6) does not constitute a ground for setting aside the award. Written by Adimesh Lochan (member) and Vyapak Desai (head) of the International Dispute Resolution and Investigations Practice at Nishith Desai Associates.

Lord Hodge says ‘no truth’ to claims of Supreme Court ‘power grab’

The Deputy President of the Supreme Court has denied that the court has taken on too much power since its creation in 2009. Lord Hodge made his remarks in a lecture at Senedd Cymru on 10 October, one of a range of events marking the court’s 15th anniversary.

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