Illegal agreement, also known as unlawful agreement, refers to a contract that violates the law or public policy. Such agreements are considered to be void or unenforceable, meaning that they have no legal effect.
Illegal agreements can take many forms, such as contracts that involve illegal activities, or those that breach ethical standards or public policy. For example, a contract to sell illegal drugs or to engage in prostitution would be an illegal agreement.
Another example of an illegal agreement is a contract that restricts competition or monopolizes a market. In the business world, this is known as anticompetitive behavior and is strictly prohibited by law. Such agreements could include price-fixing, territory allocation, and bid-rigging, among others.
Illegal agreements can also involve contracts that are deemed to be against public policy. This can include agreements that are considered to be socially or morally unacceptable, such as contracts that restrict a person’s freedom or discriminate against certain groups.
It’s important to note that illegal agreements are not just limited to written contracts. Verbal agreements, as well as agreements that are implied or inferred from conduct, can also be considered illegal if they violate the law or public policy.
In the event that an illegal agreement is entered into, the contract is typically deemed null and void. This means that neither party is legally obligated to fulfill their contractual obligations, and any transactions that have taken place will be considered illegal. Moreover, parties who enter into such agreements may face legal consequences such as fines, imprisonment, or loss of reputation.
To avoid getting into illegal agreements, it’s crucial to ensure that any contract you sign or enter into is legal and complies with the law and public policy. This means conducting due diligence to ensure that your contract is not in violation of any laws or ethical standards.
In conclusion, illegal agreements are contracts that violate the law or public policy. Entering into such agreements can have serious legal and reputational consequences, which is why it’s important to always be aware of what you’re agreeing to and to seek legal advice if needed.