Business Law (Legality) questions with answers

Business Law (Legality) questions with answersLegality - correct answer The subject matter of the contract must be _______ . the purpose of the contract must not be criminal, tortious, or otherwise against public policy. If performance of the contract would, at the time of contracting, be prohibited by law, the contract is void. Neither party to an illegal contract can enforce it. Pari Delicto means equal fault = no relief. Illegality by Statute (Contracts in violation of a Licensing Statute.) - correct answer 1. Regulatory license (Protect the public, Revenue Raising) 2. Criminal statute 3. Usury Laws 4. Contracts in Violation of Public Policy (Restraint of Trade Agreements) Protect the public (Regulatory license) - correct answer designed to protect the public from unlicenced workers; e.g. contractor, lawyer, accountant. Unlicenced party usually cannot recover for professional services. Revenue raising (Regulatory license) - correct answer sole purpose of statute to raise money for the State. The contract is generally enforceable; e.g., party doesn't have Business license. Agreements for such unlicenced services are usually enforceable. Criminal statute - correct answer contract in furtherance of such activity is void, e.g., contract in violation of a gambling statute. Usury Laws - correct answer Maximum amount of interest it is lawful to charge when lending money. Depending upon the particular State, a lender in violation may forfeit principal and interest, interest, or only the interest in excess of the maximum permitted.