Legality

Also known as: Lawful Purpose

In one sentence

The requirement that a contract's purpose must be lawful and not forbidden by law.

Plain English

For a contract to be enforceable, what the parties agree to do must be legal. You cannot have a valid contract to sell illegal drugs or to commit a crime, even if both sides agree to it. Courts will refuse to enforce contracts that violate laws or public policy. This principle ensures that the legal system does not help people break the law.

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Example

Two parties sign an agreement for one to pay the other to commit arson. A court will not enforce this contract because its purpose—committing a crime—is illegal, regardless of whether both parties signed willingly.

Used in a sentence

“The legality of the contract was questioned because it required one party to work in violation of child labor laws.”

Related terms

Voidable Contract

A contract that one party can cancel or reject, but is otherwise valid.

Doctrine of Impracticability

Performance is excused when it becomes extremely difficult or expensive due to unforeseen events.

Meeting of the Minds

Both parties share the same understanding of a contract's essential terms.

Governing Law

The state or jurisdiction whose laws will interpret and enforce a contract.

Reformation

A court rewrites contract terms to match what both parties actually intended.

Offer

A proposal to enter into a binding agreement on specific terms.

Acceptance

Agreeing to the exact terms of an offer, creating a binding contract.

Consideration

Something of value exchanged by each party to make a contract binding.

This page is a plain-English reference and is not legal advice. Laws vary by jurisdiction and change over time. For specific situations consult a licensed attorney.