Andrew Burrows, ‘Illegality as a Defence in Contract’

The English law on illegality as a defence across the law of obligations is in a mess. There have been three recent UK Supreme Court decisions (and we await another) which have, so far, failed to cut through the difficulties. This paper focuses on the core question as regards illegality as a defence in contract: which is, what is the impact of criminal conduct on the enforceability of a contract? It begins by explaining why illegality is such a difficult topic. It goes on to draw a critical distinction between two exercises (or stages): the legislative effect on the contract of the criminal conduct and its effect on the contract at common law. It goes on to favour a multifactorial approach to the effect at common law in preference to a rule-based approach (including the reliance rule favoured by the House of Lords in Tinsley v Milligan [1994] 1 AC 340); and it explains how that preferred approach would apply to some hypothetical examples.

Burrows, Andrew, Illegality as a Defence in Contract (April 3, 2016).

First posted 2016-04-07 06:13:21

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