When Contracts Are against Generally Accepted Public Policy

When Contracts Are Against Generally Accepted Public Policy

Contracts are essential in business transactions as they help to outline the terms and agreements between two or more parties. However, not all contracts are enforceable by law because some go against the generally accepted public policy. These contracts that violate public policy are considered void and unenforceable.

Generally accepted public policy refers to the broad principles and values that society regards as moral and just. It includes laws, regulations, and ethical considerations that uphold the common good and protect the welfare of the public. When individuals or businesses enter into contracts, they must ensure that their agreements do not undermine these fundamental principles.

Here are some examples of contracts that are against the generally accepted public policy:

Contracts that violate laws and regulations

Contracts that involve illegal activities such as drug trafficking, prostitution, or gambling are void and unenforceable. Similarly, agreements that breach specific laws and regulations, such as environmental laws or anti-discrimination laws, are also against public policy.

Contracts that are unfair or unconscionable

Some contracts are deemed unenforceable if they are found to be unfair or unconscionable. An unconscionable contract is one that is so one-sided that it would be unjust to enforce it. These types of contracts may include terms that are hidden or unclear, excessively harsh or one-sided, or heavily favoring one party over another.

Contracts that harm public safety or welfare

Some contracts may be void if they pose a risk to public safety or welfare. For example, a contract to deliver explosives to a densely populated area would go against public policy. Similarly, a contract that limits access to vital services or resources, such as healthcare or drinking water, could also be considered against public policy.

Contracts that restrict basic freedoms

Agreements that restrict an individual`s basic freedoms, such as freedom of speech, religion, or association, are against the generally accepted public policy. For instance, a contract that requires an employee to waive their right to file a complaint against their employer for any reason would be against public policy.

Contracts that promote illegal or immoral activities

Agreements that promote illegal or immoral activities, such as promoting hate speech or discrimination, are against public policy. Such contracts can harm the well-being of society by perpetuating negative stereotypes or encouraging violence.

In conclusion, contracts that go against the generally accepted public policy are not enforceable by law. As a professional, it is essential to ensure that contracts are in line with the basic principles and values that uphold the common good. By doing so, individuals and businesses can avoid legal consequences and promote ethical and just behavior in their dealings.