The second class of cases in which one party is regarded as the lesser offender consists of those in which, al- in which it appeared that the statute explicitly gave to the buyer of liquor sold in violation of law the right to recover payments made upon such purchase though the prohibition is not for the protection of one person against another, one is actually induced or constrained to enter into or to perform a prohibited contract by the fraud, duress or oppression of the other. Fraud is a tort and in some cases an action to recover the value of a benefit conferred in the performance of a contract induced by fraud is allowed as a remedy alternative to that of an action for damages (post, Sec. Sec. 179, 281). Furthermore, not only fraud but duress and undue influence are always ground for rescinding a contract. The right to rescind usually implies the right to recover a benefit conferred before rescission; but when the contract is illegal one who seeks restitution encounters the rule of policy that courts will not assist a party to an illegal transaction. This obstacle is overcome by the doctrine of this section - that one who has been defrauded or unduly influenced is not in pari delicto. The doctrine has been relied upon in a variety of cases, - most frequently, perhaps, in actions to recover money paid or property transferred under contracts entered into for the purpose of stifling a threatened prosecution 1 or of obtaining the acceptance of a composition with creditors,2 but occasionally in other cases.3
Laws prohibiting lotteries have likewise been held to be for the protection of one class from another. Jaques v. Golightly, 1776, 2 W. Bl. 1073; Browning v. Morris, 1778, Cowp. 790; Jaques v. Withy, 1788, 1 H. Bl. 65; Barclay v. Pearson,  2 Ch. 154; Gray v. Roberts, 1820, 2 A. K. Marsh. (9 Ky.) 208; 12 Am. Dec. 383; Mount v. Waite, 1811, 7 Johns. (N. Y.) 434. In Gray v. Roberts, supra, the court said (p. 209): "The Act of 1769, for preventing and suppressing private lotteries, which was the law in force at the time of the contract in this case, appears manifestly, from the preamble of the act, to have been designed by the legislature to protect the interest of others against the devices of those who should set up a lottery; and the enacting clause is made to operate upon the latter only. For it is only persons who set up the lottery, and not those who purchase the ticket, that offend against the provisions of the act."
1 Also : Williams v. Hedley, 1807, 8 East 378, (usury); Stansfield v. Kunz, 1901, 62 Kan. 797; 64 Pac. 614, (liquor); Mason v. McLeod, 1896, 57 Kan. 105; 45 Pac. 76; 41 L. R. A. 548; 57 Am. St. Rep. 327, (patents); Gray v. Roberts, 1820, 2 A. K. Marsh. (9 Ky.) 208; 12 Am. Dec. 383, (lottery); Smart v. White, 1882, 73 Me. 332; 40 Am. Rep. 356, (pension claim); White v. Franklin Bank, 1839, 22 Pick. (Mass.) 181, (deposit in bank for time certain); Bateman v. Robinson, 1882, 12 Neb. 508; 11 N. W. 736, (sale of preemption claim); Edgerly v. Hale, 1901, 71 N. H. 138; 51 Atl. 679, (excessive fees); Tracy v. Tal-mage, 1856, 14 N. Y. 162; 67 Am. Dec. 132, (bank's ultra vires purchase of stock); Curtis v. Leavit, 1857, 15 N. Y. 9, (banking loans); Burk-holder v. Beetem's Admrs., 1870,65 Pa. St. 496, (illegal sale of stock by bank cashier). See Walan v. Kerby, 1868, 99 Mass. 1,
1 Woodham v. Allen, 1900, 130 Cal. 194; 62 Pac. 398, (threatened prosecution of plaintiff's husband); Klein v. Pederson, 1902, 65 Neb. 452; 91 N. W. 281, (threatened prosecution of plaintiff); Corringe v. Reed, 1901, 23 Utah 120; 63 Pac. 902; 90 Am. St. Rep. 692, (threatened prosecution of plaintiff's husband); Hinsdell v. White, 1861, 34 Vt. 558, (threatened prosecution of plaintiff's son). And see Schoener v. Lissauer, 1887, 107 N. Y. Ill ; 13 N. E. 741, (threatened prosecution of plaintiff's son). Contra: Haynes v. Rudd, 1886,102 N. Y. 372; 7 N. E. 287; 55 Am. Rep. 815, (threatened prosecution of plaintiff's son); Johnson v. Douglas, 1903, 32 Wash. 293; 73 Pac. 374, (money paid to secure dismissal of prosecution).
2 Smith v. Cuff, 1817, 6 Maul. & Sel. 160; Atkinson v. Denby, 1861, 6 Hurl. & Nor. 778; 7 Hurl. & Nor. 934; Brown v. Everett, etc., Co., 1900, 111 Ga. 404; 36 S. E. 813.
3 Osborne v. Williams, 1811,18 Ves. Jr. 379, (sale of post office packet: illegal consideration secured by vendor); Wright v. Stewart, 1904, 130 Fed. 905, (aff. Stewart v. Wright, 1906, 147 Fed. 321; 77 C. C. A. 499), (fake foot race); In re Arnold Co., 1904, 133 Fed. 789, (money advanced for gambling); American Mutual Life Ins. Co. v. Bertram, 1904, 163 Ind. 51; 70 N. E. 258; 64 L. R A. 935, (assignment or insurance policy to person without insurable interest); Metropolitan
In American Mutual Life Insurance Company v. Bertram,1 the plaintiff had been induced to take an assignment of a policy of insurance upon a life in which she had no insurable interest by the fraudulent representations of the officers and agents of the company that the policy was valid and that she would be entitled to recover upon it in case of loss, whereas in fact the policy had been issued originally without the knowledge of the person whose life was insured and to a person having no insurable interest therein. In an action to recover the assessments paid, the court said:
"It cannot be said that the parties to this transaction were in pari delicto, or that the appellant ought, in good conscience, to retain the moneys paid to it by the appellee. The representations made to the appellee by the officers and agents of the company - one of them being its vice president and treasurer - were calculated to impose upon and mislead any one contemplating the purchase of a policy previously issued by the company. The parties did not stand upon an equal footing, and the officers and agents making the false representations to the appellee had every advantage over her which their special knowledge of the facts of the case, and of the law of insurance applicable to their company could give."
In Webb v. Fulchire,2 one who had bet that he could tell which of three cups covered a ball and had lost because of dishonest manipulation by the winner was allowed to recover the money paid. Said Ruffin, C.J.:
Life Ins. Co. v. Blesch, 1900, 22 Ky. Law Rep. 530; 58 S. W. 436, (insurance policy without insurable interest); Musson v. Fales, 1820, 16 Mass. 332, (contract with alien enemy); Hess v. Culver, 1889, 77 Mich. 598; 43 N. W. 994; 6 L. R. A. 498; 18 Am. St. Rep. 421, (Bohemian oats: illegal bond); Prewett v. Coopwood, 1855, 1 George (30 Miss.) 369, (assignment to defraud alleged creditors); Ford v. Harrington, 1857, 16 N. Y. 285, (assignment to defraud creditors); Duval v. Well-man, 1891, 124 N. Y. 156; 26 N. E. 343, (marriage brokage); Webb v. Fulchire, 1843, 3 Ired. (25 N. C.) 485; 40 Am. Dec. 419, (pea game). Contra: Plaisted v. Palmer, 1874, 63 Me. 576, (assumpsit to recover back the price of a horse on account of fraud of the vendor: recovery denied because the sale was made on Sunday); Kitchen v. Greenabaum, 1875, 61 Mo. 110, semble.
1 1904, 163 Ind. 51, 62 ; 70 N. E. 258; 64 L. R. A. 935.
2 1843, 3 Ired. (25 N. C.) 485, 486; 40 Am. Dec. 419.
"It is not denied that the law gives no action to a party to an illegal contract, either to enforce it directly, or to recover back money paid on it after its execution. Nor is it doubted, that money fairly lost at play at a forbidden game and paid, cannot be recovered back in an action for money had and received. But it is perfectly certain, that money, won by cheating at any kind of game, whether allowed or forbidden, and paid by the loser without knowledge of the fraud, may be recovered. . . . Surely, the artless fool, who seems to have been alike bereft of his senses and his money, is not to be deemed a partaker in the same crime, in pari delicto, with the juggling knave, who gulled and fleeced him."
In the last mentioned case, it may be noted, the fraud which led the court to hold that the parties were not in pari delicto was not in the inducement to contract which the defendant held out to the plaintiff, but was committed after the contract had been entered into. In other cases of a like character, the same conclusion has been reached,1 but in Babcock v. Thompson2 the Supreme Court of Massachusetts declared that one who, by entering an unlawful gambling game, " puts himself in a condition to be cheated," will not be assisted by the court but must look out for himself.