Unenforceable Contracts for Public Policy Reasons

Question 1

RS 178: When a Term is Unenforceable on Grounds of Public Policy

Answer 1

(1) A promise or other term of an agreement is unenforceable on grounds of public policy if legislation provides that it is unenforceable or the interest in its enforcement is clearly outweighed in the circumstances by a public policy against the enforcement of such terms.
(2) In weighing he interest in the enforcement of a term, account is taken of:
(a) the parties justified expectations
(b) any forfeiture that would result if enforcement were denied, and
(c) Any special public interest in the enforcement of a particular term.
(3) In weighing public policy against enforcement of a term, account is taken of:
(a) The strength of that policy as manifested by legislation or judicial decisions.
(b) The likelihood that a refusal to enforce the term will further that policy.
(c) the seriousness of any misconduct involved and the extent to which it was deliberate, and
(d) the directness of the connection between that misconduct and the term.

Question 2

What is the best source for public policy?

Answer 2

Legislature

Question 3

An illegal contract must be what to be unenforceable?

Answer 3

Illegal and contrary to public policy

Question 4

Define: Doctrine of Clean Hands

Answer 4

Court will not enforce a contract that is legal on its face but underneath it is based on illegality and corruption.
Courts will not enforce a contract where the contract itself is so integrally related to illegal or unlawful agreement.
A PARTY COMING TO THE COURT SEEKING AN EQUITABLE REMEDY, MUST COME TO THE COURT WITH CLEAN HANDS.