Certain types of contract which subvert the common good have traditionally been held to be illegal under UK law. Some of these contracts clearly go against the concept of public policy, some offend morality and others are deemed socially inexpedient. Those illegal contracts are classed as follows:
- Contracts to commit a crime, tort or fraud on a third party: An agreement which has as its object, whether direct or indirect, the commission of a crime or tort is illegal and void. Agreements which have the effect of defrauding or deceiving another also fall into this category.
- Contracts that are sexually immoral: Contracts which have aspects that are sexually reprehensible are illegal on the grounds of public policy. Agreements relating to the division of the proceeds of prostitution, or the provision of sexual services are illegal. The definition of public policy as it relates to sexual mores, is one that changes over time.
- Contracts prejudicial to public safety: Contracts entered into which are detrimental to the interests of the UK are prohibited, such as those which benefit an enemy state, or disturb good relations between the UK and other states. Contracts made during war with an alien enemy are illegal. A contract to raise money to support insurrection or rebellion in a foreign friendly state is illegal, in that a contract contemplating the performance of an act against public welfare of that country is a breach of international comity, illegal under UK law.
- Contracts prejudicial to the administration of justice: Contracts or agreements which in any way affect the administration of justice are illegal and void. Examples of such contracts include agreements to prevent lawful criminal prosecutions, agreements to obtain monies by false pretences and forgery offences.
- Contracts liable to corrupt public life: An agreement which tends to corrupt the administration of the nation’s affairs is illegal. Agreements which influence or diminish the responsibility of holders of public office are also outlawed.
- Contracts to defraud the revenue: Contracts which directly or indirectly have the effect of defrauding or interfering with the operation of the revenue, local or national, go against public policy and are illegal.
The categories of illegal contracts have evolved under common law over time and it may be that further categories of contract will emerge where socially or economically expedient as the concept of public policy develops.
