Legality of Object and Consideration – Meaning, Unlawful Agreements, and Legal Effects
UNLAWFUL OBJECT OR CONSIDERATION MEANING AND EFFECTS (Sec. 23)
| Circumstances in which object or consideration is unlawful | An agreement something forbidden by law | An agreement is unlawful if, It involves doing of an act which is forbidden by any law for the site being in force |
| Defeating the provisions of any law | An agreement is unlawful if It is of such a nature that if permitted It would defeat the provisions of any law Even though it is not directly prohibited by any law | |
| Fraudulent | An agreement is unlawful if It is made to make a fraud on any person | |
| Involves injury to any person or his property. | An agreement is unlawful if It is made for the purpose of causing injury to- -Any other person: or -Property of another person | |
| Immoral: or opposed to public policy | An agreement is unlawful If the Court regards that object consideration of such agreement is -Immoral or – opposed to public policy | |
| Legal effect | Every agreement of which the object or consideration is unlawful is void. |
IS OBJECT OR CONSIDERATION SAID TO BE AGAINST PUBLIC POLICY
- Agreement for trading with enemy.
- Agreement interfering with personal liberty.
- Agreement interference with parental duties.
- Agreement interfering with marital duties.
- Agreement interfering with course of justice.
- Agreement for improper promotion of litigation.
- Agreement for stifling prosecution.
- Maintenance agreement.
- Champerty agreement.
- Agreement to do an act against the duty of a person.
- Marriage brokerage agreement.
- Agreement not to bid.
- Agreement to create monopolies or to eliminate or reduce competition.
- Agreement for sale of public offices and titles.
MAINTENANCE AND CHAMPERTY AGREEMENT
| Meaning of maintenance agreement | • A party agrees to provide assistance (Financial or otherwise) to another party to institute or defend a suit • The person providing such assistance has no interest in such suit. • The party who receives such assistance agrees to pay something in return to the person who provides such assistance. |
| Legal effect maintenance agreement | • The maintenance agreement is valid, if it is Bonafede and the payment the person providing such assistance is reasonable |
| Meaning of Champerty agreement | • A party agrees to provide assistance (financial or otherwise) to another party to institute or defend a suit • The person providing such assistance has no interest in such suit. • The party who receives such assistance agrees to share the proceeds from the suit received by him in return to the person who provides such assistance |
| Legal effect of champerty agreement | • The Champerty agreement is valid if it is Bonafede and the share of proceeds paid to the person providing such assistance is reasonable |
AGREEMENTS UNLAWFUL IN PART (Sec. 25)
| An agreement containing legal and illegal parts. | Whether unlawful part can be separated from unlawful part- If yes -Lawful part can be enforced: or -Unlawful part cannot be enforced. If ‘no -The whole agreement is void |
| A reciprocal agreement containing legal and illegal parts | The reciprocal promise to do- • Legal things-can be enforced •Illegal things cannot be enforced |
| An agreement containing legal and illegal parts | The alternate promise to de- • Legal things-can be enforced • Illegal things cannot be enforced |
