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Brief Fact Summary. Plaintiff Black Industries, Inc., contracted with Defendant, George F. Bush, for Defendant to provide certain components at a specified price, which Plaintiff then resold at a significant profit.
Synopsis of Rule of Law. A contract is void as against public policy if: (1) it is a contract by the defendant to pay the plaintiff for inducing a public official to act in a certain manner; (2) it is a contract to do an illegal act; or (3) it is a contract that contemplates collusive bidding on a public contract.
The law looks to the general tendency of such agreements; and it closes the door to temptation, by refusing them recognition in any of the courts of the country.
View Full Point of LawIssue. Is this contract void as against public policy?
Held. No. A contract is void as against public policy if: (1) it is a contract by the defendant to pay the plaintiff for inducing a public official to act in a certain manner; (2) it is a contract to do an illegal act; or (3) it is a contract that contemplates collusive bidding on a public contract. Certainly, none of these situations are present here. Further, the contract was entered into between businessmen dealing at arm’s length without any evidence of fraud. Hence, the contract is not void.
Discussion. Voiding a contract on public policy grounds is very difficult. The situations calling for the voiding of a contract are rare. A court is unlikely to intervene in a contract between businessmen dealing at arm’s length.