Refer to the case Red Devil Fireworks Co. v Siddle (648 P2d 468).
1) Plaintiff is a seller of fireworks that sold to defendant who did not had the required license to purchase fireworks as required in the State of Washington. Plaintiff was aware of defendant's lack of license and delivered it to him.
2) Plaintiff was unable to receive payment from defendant and sued. Defendant argued contract is void based on illegality.
3) Trial court granted damages for plaintiff. Defendant appealed
Relevant Terms, Laws, and Cases
Illegal Contract contracts with illegal terms (e.g. hire for murder, corporate espionage) are not enforceable. However, if only one part of the provision of a contract is illegal and does not affect the contract as a whole the other parts of the contract may still be enforced.
RCW 70.77.480 a Washington state regulation prohibiting sale, transport, or delivery of fireworks without a license.
The contract is illegal. It is clear that plaintiff and defendant violated the by their act. Hence, the court denied recovery for damages based on the fact that plaintiff knowingly acted illegally. The only remedy is return of the fireworks from the defendant restoring both to their positions before the sale.
Appeals court reversed the decision.
Refer to the case Nemard Construction Corp. v Deafeamkpor (863 NY S2d 546).
1) Plaintiff is a construction company that did construction work for defendant in New York City. Defendant failed to pay the entire balance on work done by plaintiff. Plaintiff sued for damages. Jury found for plaintiff
2) Defendant motioned to dismiss claim and set aside jury verdict, on grounds that plaintiff does not have a contractor's licensed as required by under Code of City of NY ("The Code" see below) and hence is not owed pay.
Relevant Terms, Law, and Cases
Code of City of NY § 20-385-402 Home Improvement Business concerns the regulation of home improvement businesses in New York City, it requires in most cases for constructors to have proper license.
Public Policy Argument (contracts) is an argument that the contract or certain provisions of it is against public policy and shouldn't be enforced.
The court applied the public policy argument that the Code was enacted to protect homeowners from fraudulent practices by construction companies. Hence, the contract can't be enforced even if it is unfair to the plaintiff.
Court granted motion to dismiss and judgment notwithstanding verdict to defendant.
F hired company A to construct homes in a state requiring contractor license. However, A's builders did not have a contractor license while A 's owner did. This is a public policy issue as the state clearly wants home builders to be licensed and regulated, F may defend on the ground that they did not have the proper license required by the state. For example, a doctor can't tell his secretary to perform medical work and be billed for medical services as regulation require these work to be done by the medical professional.