Legal Question in Business Law in California
Is an agreement void if the contract calls for the performance of a crime?
2 Answers from Attorneys
Yes. But if this is just one aspect of a broader contract, the rest of the contract could still be valid. I would need to know more about the circumstances, including the contract's terms.
Although the statutes refer to contracts calling for the commission of a crime "unlawful" rather than "void," the terms have the same effect -- no court will enforce them. See Civil Code section 1596 ("The object of a contract must be lawful when the contract is made, and possible and ascertainable by the time the contract is to be performed.") and sections 1667 and 1668 ("That is not lawful which is: 1. Contrary to an express provision of law; 2. Contrary to the policy of express law, though not expressly prohibited; or, 3. Otherwise contrary to good morals.")
Notwithstanding the foregoing, a court has inherent authority to rewrite a contract so as to snip out a minor portion that call for a criminal act and enforce the rest, if this is in the interest of justice. For example, a contract for the sale of an automobile would not be found void if it happened to contain a provision for a short test drive by someone without a valid driver's license.
The bottom line is that the law is rerasonable and realistic in what it will enforce and what it will treat as unlawful, and hence void and unenforceable.
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I need some consultancy from firm dealing with international corporate matters and... Asked 10/31/12, 7:04 am in United States California Business Law