LEGAL PRINCIPLE: CONTRACT LAW – Illegality – Contracts Prohibited by Statute – Public Policy Basis
PRINCIPLE STATEMENT
The general principle which is founded on public policy, is that any transaction that is tainted by illegality in which both parties are equally involved is beyond the pale of the law as no person can claim any right or remedy whatsoever under an illegal transaction in which he has participated. No court will lend its aid to a man who founds his cause of action upon an immoral or illegal act.
RATIO DECIDENDI (SOURCE)
Per Ogwuegbu, JSC, in Pan Bisbilder Nigeria Ltd. v. First Bank of Nigeria Ltd. (2000) NLC-1141991(SC) at p. 10; Paras B–C.
"The general principle which is founded on public policy, is that any transaction that is tainted by illegality in which both parties are equally involved is beyond the pale of the law as no person can claim any right or remedy whatsoever under an illegal transaction in which he has participated. No court will lend its aid to a man who founds his cause of action upon an immoral or illegal act."
EXPLANATION / SCOPE
Public policy forbids courts from assisting parties to illegal transactions where both are equally at fault. No right or remedy arises from an illegal act. The court will not lend its aid to anyone whose cause of action rests on illegality. This principle deters illegal conduct by denying judicial relief. The court leaves the parties where it finds them. The maxim ex turpi causa non oritur actio applies. Even if one party would otherwise have a claim, illegality bars enforcement. The court’s role is not to punish but to refuse participation in illegal arrangements.