All Illegal Agreements: An Overview of Their Validity and Enforceability
When it comes to agreements and contracts, legality is essential to their validity and enforceability. In particular, any agreement that goes against the law is considered illegal. But what exactly happens to such agreements? Are they automatically void? Or can they still be enforced?
To answer these questions, it`s essential to understand the different categories of illegal agreements. Generally, there are three categories of illegal agreements, namely: void ab initio, voidable, and enforceable.
Void Ab Initio
Agreements that are void ab initio are those that were never valid from the start. They are considered void because they are against the law and, as such, have no legal effect. Void ab initio agreements are often referred to as “illegal per se.” This means that they are illegal by their very nature, regardless of the circumstances or parties involved.
Examples of void ab initio agreements include contracts to commit a crime, agreements to defraud or deceive, and agreements that contravene public policy. In essence, anything that goes against the law is considered void ab initio and, therefore, unenforceable.
Unlike void ab initio agreements, voidable agreements are initially valid but can be legally repudiated or avoided by one or both parties involved. They become voidable because they are against the law or go against public policy in some way. However, they still have the potential to be enforced if neither party challenges their validity.
Examples of voidable agreements include contracts entered into by minors, agreements entered into under duress or coercion, and agreements made by someone who lacked the necessary mental capacity to understand the terms and conditions of the agreement.
Lastly, there are enforceable illegal agreements. These are agreements that are illegal or against public policy, but for some reason, they are still considered legally binding. Enforceable illegal agreements are only enforced if they are not against public policy, and the parties involved had equal bargaining power.
For instance, an employment contract that restricts a person`s ability to work for a competitor may be considered illegal. However, if it is reasonable, necessary, and the employee receives appropriate compensation, a court may find it enforceable.
In conclusion, all illegal agreements are not automatically void. Instead, they are either void ab initio, voidable, or enforceable depending on the circumstances. It`s important to understand the different categories of illegal agreements to determine whether they can be enforced or not. As such, it is crucial to seek legal advice if you`re unsure about the legality of an agreement you`ve entered into.