This section is from the book "Dart's Treatise On The Law And Practice Relating To Vendors And Purchasers Of Real Estate", by J. Henry Dart . Also available from Amazon: A treatise on the law and practice relating to vendors and purchasers of real estate.
As a general rule, an agreement cannot be enforced which is entered into for an illegal purpose, or has a tendency to promote an unlawful act (f), or affect the course of justice (g), or is contrary to the policy of the Law; as, e.g., where an ante-nuptial settlement contemplates a future separation of husband and wife (h): but an agreement executed by husband and wife while living apart, the object of which is to bring the parties together as husband and wife, is not rendered illegal by containing a provision for the event of a future separation (i). If the illegal agreement is to be performed in this country, it is immaterial that it was entered into in a country where it would have been considered valid (k). And there are certain agreements which the legislature has pronounced to be, in their own nature, illegal. The statute 32 Hen. 8, c. 9 (l), declared it to be unlawful to buy or sell any pretenced right or title to any lands or hereditaments, unless the vendors or their ancestors, or the persons through whom the claim was derived, had been in possession of the property, or of the reversion or remainder thereof, or taken the rents or profits thereof, within a year before the sale; but this did not prevent the purchase of a pretenced title by a person in lawful possession of the rents and profits (m). Formerly a right of re-entry, if dealt with otherwise than by way of release to the person in possession (n), came within the statute as a pretenced title; but by the R. P. Act, 1845, s. 6 (mn), a right or title, good in fact, ceased to be a "pretenced" title merely because it was a right of re-entry (o).
Agreements void for illegality.
(b) See cases referred to in last two notes, and Hart v. H., (1841) 1 Ha. 1; 11 L. J. N. S. Ch. 9; Crowther v. Solomons, (1848) 6 C. B. 758; 18 L. J. C. P. 92; Closmadeuc v. Carrel, (1856) 18 C. B. 36; 25 L. J. C. P. 216.
(c) Stamp Act, 1891, 8. 14.
(d) Re Coolgardie Goldfields, 1900, 1 Ch. 475; 69 L. J. Ch. 215.
(e) See Coleman v. C, (1898) 79 L. T. 66, where the purchaser of property sold subject to all tenancies was held entitled to have agreements stamped at the vendor's expense.
(f) Egerton v. Lord Brownlow, (1853) 4 H. L. C. 1; 23 L. J. Ch. 348; and see Hilton v. Eckersley, (1856) 6 E. & B. 47; 25 L. J. Q. B. 199. See comments on Egerton v. Lord Brownlow in Re Wallaoe, 1920, 2 Ch. 274. Cf. Rowlings v. General Trading Co., 1921, 1 K. B. 635; Cohen v. Roche, 1927, 1 K. B. 169.
Sale of pretenced title.
The statute 32 Hen. 8, c. 9, was repealed by the L. T. Act, 1897. The repeal did not, it is conceived, affect the illegality of a sale within the meaning of the section, which was merely declaratory of the Common Law (p), but it abolished the penalty thereby imposed, which was recoverable only within a year of the offence. Agreements may also be illegal on the ground of champerty and maintenance. Where A., possessed of a term of years, died in 1828, and strangers entered and occupied until 1841, when A.'s next of kin took out letters of administration and sold and assigned the term, the assignment was held to be void (q) . And in De Hoghton v. Money (r), it was held that the purchase of an estate for the purpose of setting aside a previous agreement affecting the property on the ground of fraud, partakes of the nature of champerty and will not be enforced in Equity.
(g) Lound v. Grimwade, (1888) 39 Ch. D. 605; 57 L. J. Ch. 725 Cf. Prince v. Kaworth, 1905, 2 K. B. 768.
(h) H. v. W., (1856) 3 K. & J. 382; cf. Re Hope Johnstone, 1904 1 Ch. 470; 73 L. J. Ch. 321; Re Meyrick's Settlement, 1921, 1 Ch 311.
(i) Re Meyrick's Settlement, sup.
(k) Grell v. Levy, (1864) 10 Jur. N. S. 210; 12 W. R. 378; Re Fitzgerald, 1904, 1 Ch. 573.
(l) See s. 2; and Partridge v. Strange, (1553) Plow. 77, 88; Jenkim v. Jones, (1882) 9 Q. B. D. 128; Kennedy v. Lyell, (1885) 15 Q. B. D. 491.
(m) See a. 4. (n) Ib.
(nn) Now L. P. Act, 1925, s. 4 (2). (o) Jenkins v. Jones, sup.
Dispositions void as pre-tenced titles and for champerty or maintenance.
The Act 32 Hen. 8, c. 9, did not extend to an assignment of a purchaser's interest under the agreement for sale (s); nor to an agreement to sell an estate in the event of the party becoming seised of it under the will of the living owner (t); nor to an assignment of the subject-matter of an action (u); even though the assignees were mere volunteers (a;); nor to a security on the subject-matter of a &uit.(y); nor to the assignment of a claim under s. 68 of the L. C. C. Act, 1845 (z). Nor did the Act apply if the purchaser had a previous common interest in the event of the action; as in the case of a purchase, by a second mortgagee, of the interest of the first mortgagee, during an action in which the mortgaged property was claimed under a paramount title (a); nor where parties, having a common interest, entered into an arrangement respecting the litigation for securing it (b); nor where the agreement contained no stipulation for the commencement of a suit, and no suit was pending (c); nor to an agreement to enable the purchaser of an estate to recover for rent due, or injury done to the property prior to the purchase (d); nor to a conveyance to a reversioner or remainderman, with a view to strengthen his estate (e); nor to cases where the right purchased was originally clear, but the litigation resulted from circumstances subsequently arising or subsequently known (f).
What are not void.
(p) See judgment of Tyndal, C. J., in Doe v. Evans, (1845) 1 C. B. 717; 14 L. J. C. P. 237.
(q) Doe v. Evans, sup.; Marquis Cholmondeley v. Lord Clinton. (1821) 4 Bli. 1; and see Wood v. Downes, (1811) 18 Ves. 120; Burke v. Greene, (1814) 2 B. & B. 517; Moore v. Creed. (1838) 1 D. & Wal. 521; Robb v. Dorrian, (1877) 11 I. R. C. L. 292.
(r) (1867) 2 Ch. 164; 15 W. R. 214.
(s) Wood v. Griffith, (1856) 1 Sw. 56; Sug. 14th ed. 356.