Is violating a valid contract illegal?

[BaldiMac]

This is a continuation of a discussion from a thread that was completely off topic. We were discussing whether violating a valid contract is illegal.

Let's just make this real simple. "Illegal" = violation of the criminal code. Simply failing to abide by the terms of a contract is not a violation of any criminal code I'm aware of. A "legally binding" contract simply means that if your counterparty fails to abide by the terms of the contract, you have the weight of the state behind you in forcing him to either perform or pay you damages for failing to perform. Failing to abide by the terms of the contact is not in and of itself an illegal aka criminal act. Do you get it now?

Except your first sentence is incorrect. Illegal does not equal criminal. Illegal equals against the law. Civil or criminal law.

 

[snberk103]

Not a lawyer. But while many people use the term that way, it is not "illegal" to break a contract, as far as I know. Illegal means to break the law. A contract is a binding agreement between two or more parties. If you break that contract then you can be sued for damages ... but you can not be charged under the law for merely breaking the contract. You can't be fined, nor can you be tossed in jail. There are probably exceptions where the services you were contracted to provide are somehow 'listed' by a legislature because they are somehow 'special'. But a contract for commercial services between two private entities would not invoke criminal penalties merely for breaking the contract. imho, of course....

Which is different than "Fraud" - which is illegal. Fraud may involve the breaking of a contract, but that's not what gets you charged. Fraud involves much more than just a contract - there is intent, motive, etc etc.

 

[KnightWRX]

Not a lawyer. But while many people use the term that way, it is not "illegal" to break a contract, as far as I know. Illegal means to break the law. A contract is a binding agreement between two or more parties.

There is such a thing as Contract Law. Depends on the contact really. Some entities need to follow certain regulations and rules when performing contracts, and as such, breaking such a contract could be deemed illegal under any number of laws (Consumer protection laws have tons of rules related to contracts for products and services rendered).

 

[BaldiMac]

Not a lawyer. But while many people use the term that way, it is not "illegal" to break a contract, as far as I know. Illegal means to break the law. A contract is a binding agreement between two or more parties.

The key word here is "binding". What makes a contract (legally) binding? The law!

 

[NewbieCanada]

Except your first sentence is incorrect. Illegal does not equal criminal. Illegal equals against the law. Civil or criminal law.

There are indeed plenty of things that are illegal but not criminal. Building a building without proper permits, for example. But violating a contract is not one of those many things that are illegal.

The difference between illegal and violating a contract is:

1. If I do something illegal, and the government knows about it, they'll take action.

2. If I contract to build an extension on your deck and don't do a proper job, the government couldn't care less. You're free to sue me, of course, but if you don't take action, no one else will. It's not even REMOTELY illegal for me to do a bad job, or make it smaller than the contract specifies, or not finish in the agreed time.

 

[snberk103]

There is such a thing as Contract Law. Depends on the contact really. Some entities need to follow certain regulations and rules when performing contracts, and as such, breaking such a contract could be deemed illegal under any number of laws (Consumer protection laws have tons of rules related to contracts for products and services rendered).

Consumer Protection would come under the "exceptions" that I mentioned in my post. The "contract" when you buy something is more implied and understood than negotiated. It's still a contract, but the parties enter into it in a different way than say a supplier of ball bearings contracting to sell those to a factory.

The key word here is "binding". What makes a contract (legally) binding? The law!

The act of negotiating a contract is covered by contract law, but not necessarily the contract itself. For instance the law may that an offer must be honest portrayal of the product. That the buyer has 48 hours to change their mind (for some services). That there are certain types of conditions that can't be included in a contract (for instance you can't pledge one of your children as collateral ).

The legally binding merely means that the contract is enforceable... that duress was not used to get agreement. That the contract does not force someone to do something that criminal. That all parties involved in the contract have the authority to sign a contract (not minors, etc). However... once that "legal" contract is signed... then it is civil matter and not a criminal matter. If you break the contract, the cops can't be called to arrest you... you have not broken a law (with the exceptions around consumer protection etc etc).

If you want to take someone to court to enforce a contract, or to get damages there are laws to make that happen too. But these laws are based on you proving civil damages. Here, the offending party might go to jail... not because they broke a law, but because they ignored a court order to pay up. The law supports the suing party... but the offending party does not get a criminal record.

 

[BaldiMac]

There are indeed plenty of things that are illegal but not criminal. Building a building without proper permits, for example. But violating a contract is not one of those many things that are illegal.

The difference between illegal and violating a contract is:

1. If I do something illegal, and the government knows about it, they'll take action.

2. If I contract to build an extension on your deck and don't do a proper job, the government couldn't care less. You're free to sue me, of course, but if you don't take action, no one else will. It's not even REMOTELY illegal for me to do a bad job, or make it smaller than the contract specifies, or not finish in the agreed time.

1. That's not true. For example, copyright infringement is illegal. The government does not prosecute basic infringement cases. The copyright holder sues the infringer.

2. Again, what do you think makes a contract binding if not the law?

----------

The legally binding merely means that the contract is enforceable... that duress was not used to get agreement. That the contract does not force someone to do something that criminal. That all parties involved in the contract have the authority to sign a contract (not minors, etc). However... once that "legal" contract is signed... then it is civil matter and not a criminal matter. If you break the contract, the cops can't be called to arrest you... you have not broken a law (with the exceptions around consumer protection etc etc).

If you want to take someone to court to enforce a contract, or to get damages there are laws to make that happen too. But these laws are based on you proving civil damages. Here, the offending party might go to jail... not because they broke a law, but because they ignored a court order to pay up. The law supports the suing party... but the offending party does not get a criminal record.

Again. Illegal does not equal criminal. Violating civil law is still illegal. No jail time necessary.

 

[snberk103]

1. That's not true. For example, copyright infringement is illegal. The government does not prosecute basic infringement cases. The copyright holder sues the infringer.
....

Again. Illegal does not equal criminal. Violating civil law is still illegal. No jail time necessary.

I'm not sure how copyright got into this. If someone is infringing on copyright, then they either have no contract at all... or they are using the IP beyond what they had agreed to.

In both cases the the owner of the copyright may sue for damages - but they are not obligated to. The law merely specifies that in fact there were civil damages, that you may collect on those damages, that those damages are calculated in a specific way. But the law does not say that you have to sue for damages.


Maybe we need to establish what we mean by civil law? I'm not sure what you mean by that ... so anything I say about it is going to be off the mark for sure.

 

[BaldiMac]

I'm not sure how copyright got into this. If someone is infringing on copyright, then they either have no contract at all... or they are using the IP beyond what they had agreed to.

In both cases the the owner of the copyright may sue for damages - but they are not obligated to. The law merely specifies that in fact there were civil damages, that you may collect on those damages, that those damages are calculated in a specific way. But the law does not say that you have to sue for damages.

I used copyright infringement as another example of something that is illegal but doesn't require government prosecution. In response to the false claim that "If I do something illegal, and the government knows about it, they'll take action."

Maybe we need to establish what we mean by civil law? I'm not sure what you mean by that ... so anything I say about it is going to be off the mark for sure.

This one works:

http://www.google.com/search?client=safari&rls=en&q=civil+law+definition&ie=UTF-8&oe=UTF-8

"The system of law concerned with private relations between members of a community rather than criminal, military, or religious affairs."

 

[Demosthenes X]

You could make an argument either way, depending on your interpretation of "illegal" and "the law". Generally speaking, I think "illegal" refers to criminal law, which involves prosecuting people for breaking codified laws, whereas civil laws simply provide a legal framework for people to resolve wrongs (but those wrongs are not necessarily in contravention of the law).

You are correct that there are laws that make contracts legally binding. However, there is a difference between the sort of laws that make up criminal justice, and the kind of laws that go into making contracts enforceable.

The former set out a strict guideline on what is permissible and one is not. If the law says "do not kill", and you kill someone, you've broken the law. That's illegal.

Contract law does not work like that. The law does not say "breaking a contract is illegal", it says "if a party breaks a contract, here are the methods of redress available to you". You haven't broken any laws, but the law does provide a framework for the wronged party to be compensated.

See also.

 

[BaldiMac]

You could make an argument either way, depending on your interpretation of "illegal" and "the law". Generally speaking, I think "illegal" refers to criminal law, which involves prosecuting people for breaking codified laws, whereas civil laws simply provide a legal framework for people to resolve wrongs (but those wrongs are not necessarily in contravention of the law).

You are correct that there are laws that make contracts legally binding. However, there is a difference between the sort of laws that make up criminal justice, and the kind of laws that go into making contracts enforceable.

The former set out a strict guideline on what is permissible and one is not. If the law says "do not kill", and you kill someone, you've broken the law. That's illegal.

Contract law does not work like that. The law does not say "breaking a contract is illegal", it says "if a party breaks a contract, here are the methods of redress available to you". You haven't broken any laws, but the law does provide a framework for the wronged party to be compensated.

See also.

Again, the term "illegal" is not limited to criminal law.

From your link, the explanation from "Cliff Gilley, JD cum laude" is the most complete, in my opinion.

 

[KnightWRX]

You could make an argument either way, depending on your interpretation of "illegal" and "the law". Generally speaking, I think "illegal" refers to criminal law, which involves prosecuting people for breaking codified laws, whereas civil laws simply provide a legal framework for people to resolve wrongs (but those wrongs are not necessarily in contravention of the law)..

You're missing Penal law. Breaking the speed limit is neither criminal nor is it left to people to resolve wrongs. You get prosecuted by the crown for it, in front of a judge, yet the penalty is a fine, not a criminal record as it is part of penal law.

No really, illegal means to go against the law, all laws, not just the criminal code.

Anyway, it's much more complicated than any of us non-lawyers can explain. Wikipedia doesn't have an article, it has a whole category based on Contract law :

http://en.wikipedia.org/wiki/Category:Contract_law

There's an article specifically about illegality under English law as it pertains to contract law :

http://en.wikipedia.org/wiki/Illegality_in_English_law

Have fun kids.

 

[snberk103]

You could make an argument either way, depending on your interpretation of "illegal" and "the law".....
See also.

This says it better than I could... I think we are going to have to leave this unresolved... my theoretical interest in contract law extends as far as model releases used in photography.... after that, I find it pretty boring. A wise man said... "Have fun kids".

 

[Demosthenes X]

Again, the term "illegal" is not limited to criminal law.

Nor did I claim it was. I said generally speaking. And generally speaking, what I said is true.

You're missing Penal law. Breaking the speed limit is neither criminal nor is it left to people to resolve wrongs. You get prosecuted by the crown for it, in front of a judge, yet the penalty is a fine, not a criminal record as it is part of penal law.

No really, illegal means to go against the law, all laws, not just the criminal code.

Speeding is a case of there being a law that lays out a clear guideline (i.e., maximum speed). You're correct in that it's not a criminal code violation, but that wasn't really my point.

 

[KnightWRX]

Nor did I claim it was. I said generally speaking. And generally speaking, what I said is true.

When I speak generally and I happen to use the word illegal, I'm generally referring to any law, be it criminal, penal or civil. So generally speaking, the general word illegal means breaking any existing law, no matter which code it belongs to.

Generally speaking, what you said was wrong. Now, you could just generally admit it and move on.

----------

Speeding is a case of there being a law that lays out a clear guideline (i.e., maximum speed). You're correct in that it's not a criminal code violation, but that wasn't really my point.

I know, it was my point, to prove you wrong. And it did a good job of it. Unless you don't think speeding is illegal.

 

[Demosthenes X]

When I speak generally and I happen to use the word illegal, I'm generally referring to any law, be it criminal, penal or civil. So generally speaking, the general word illegal means breaking any existing law, no matter which code it belongs to.

Generally speaking, what you said was wrong. Now, you could just generally admit it and move on.

What you personally mean when you use the word "illegal" isn't remotely relevant. I could say that, personally when I use the word "duck" I am referring to "a member of a forum who cannot discern the difference between their use of a word and the generally accepted definition of a word", but that doesn't make that the proper use of the word (which is, for the record, "a waterbird with a broad blunt bill, short legs, webbed feet, and a waddling gait").

Generally (not personally) speaking, illegal refers to criminal acts. Look it up.

 

[KnightWRX]

Generally (not personally) speaking, illegal refers to criminal acts. Look it up.

I see nothing in your link that supports your assertion sorry. In fact, quite the contrary. Criminal is one thing that can be referred to as illegal, amongst others, again according to your own "generally speaking" link.

So do use your own advice : Personally, you don't know about any laws other than criminal law thus you don't realise "illegal" can mean a lot more than criminal.

/end.

 

[trouble747]

- adjective
1.
forbidden by law or statute.
2.
contrary to or forbidden by official rules, regulations, etc.: The referee ruled that it was an illegal forward pass.

The word "illegal" is fairly nonspecific to begin with, but I'd say that contract violation, generally speaking, doesn't qualify (though one could arguably enter into an "illegal contract," one void by statute or common law).

 

[biting-mammal]

Thanks for starting another thread about this.

The definition of illegal quoted above says that it's forbidden by law or statute. Breaking a private contract between two parties is not forbidden by law or statute - anyone can do it and it is up to the aggrieved party to pursue damages in a civil court for a private wrong. So if you break a contract it is not illegal, it is a breach of contract. Of course there is no jail time necessary for breaking a contract, because it is not against law or statute - jail time can only be imposed by statute.

A contract must be legally binding and enforceable, so thus it needs to be between consenting parties, of sound mind, no fundamental errors, etc. But to say that a contract is 'illegal' if it doesn't meet those requirements is wrong, as you could still make a contract like that and it wouldnt be forbidden by law or statute.

Someone mentioned the issue of copyright infringement being illegal. This is wrong - look it up in Wikipedia (not the best source but the easiest at hand). Only signatory jurisdictions who have agreed to prosecute willful infringement on a commercial scale will make copyright infringement a criminal liability, otherwise it is up to the copyright holder to pursue damages or injunctions.

'Not legal' does not equate to 'illegal'.

 

[maflynn]

The key word here is "binding". What makes a contract (legally) binding? The law!

Yes, but is it criminal law or civil law. AFAIK, you generally cannot go to jail for violating a contract. You can be compelled to abide by it, or forced to do some other action, such as pay money to the other party but you generally won't go to jail.

I say generally because I think there always seems to be an exception to every rule when it comes to laws.

If memory serves me, if there is consideration, that is I give you money as a deposit for your car and we sign a purchase and sale. It does not matter if someone else comes after me to by the car for more money. I can sue you to compel you to sell the car, or receive some amount of money as damages for the violation of the contract.

 

[gnasher729]

Violating a valid contract is not per se a crime, but can be an essential part of a crime.

Let's say we have a valid contract that I will give you my car in exchange for $10,000. You take the car and don't pay - violating a valid contract.

Now if you never had any intention to pay for the car, then you have actually committed fraud. I only handed over the car because I believed that you intended to pay me. So if you tricked me into handing over the car by making me believe something that wasn't true, that's fraud.

But if you intended to pay, but can't do it for whatever reason, then it is just breach of contrat.

 

[BaldiMac]

The definition of illegal quoted above says that it's forbidden by law or statute. Breaking a private contract between two parties is not forbidden by law or statute

So if you break a contract it is not illegal, it is a breach of contract. Of course there is no jail time necessary for breaking a contract, because it is not against law or statute - jail time can only be imposed by statute.

A contract must be legally binding and enforceable, so thus it needs to be between consenting parties, of sound mind, no fundamental errors, etc. But to say that a contract is 'illegal' if it doesn't meet those requirements is wrong, as you could still make a contract like that and it wouldnt be forbidden by law or statute.

Someone mentioned the issue of copyright infringement being illegal. This is wrong - look it up in Wikipedia (not the best source but the easiest at hand). Only signatory jurisdictions who have agreed to prosecute willful infringement on a commercial scale will make copyright infringement a criminal liability, otherwise it is up to the copyright holder to pursue damages or injunctions.

'Not legal' does not equate to 'illegal'.

Again, illegal does not equal criminal! Illegal is not defined by jail time. Most common traffic offenses are illegal and yet are only punishable by a fine.

You even acknowledge that contracts can be "legally binding" -- as in bound by law. But you don't seem to acknowledge the law that binds them actually exists.

As far as your copyright claim, I don't know how much more clear it could be that your position is wrong. Just using the limited definition that you chose, copyright infringement is obviously "forbidden by law or statute." Do you need a link to the law?

Yes, but is it criminal law or civil law. AFAIK, you generally cannot go to jail for violating a contract. You can be compelled to abide by it, or forced to do some other action, such as pay money to the other party but you generally won't go to jail.

I say generally because I think there always seems to be an exception to every rule when it comes to laws.

If memory serves me, if there is consideration, that is I give you money as a deposit for your car and we sign a purchase and sale. It does not matter if someone else comes after me to by the car for more money. I can sue you to compel you to sell the car, or receive some amount of money as damages for the violation of the contract.

Violating a valid contract is not per se a crime, but can be an essential part of a crime.

Let's say we have a valid contract that I will give you my car in exchange for $10,000. You take the car and don't pay - violating a valid contract.

Now if you never had any intention to pay for the car, then you have actually committed fraud. I only handed over the car because I believed that you intended to pay me. So if you tricked me into handing over the car by making me believe something that wasn't true, that's fraud.

But if you intended to pay, but can't do it for whatever reason, then it is just breach of contrat.

Again, I am not claiming that it is criminal. It is not. Only that it is illegal.

 

[biting-mammal]

BaldiMac, it is you that is confused.

I never said that illegal is defined by jail time. Of course something can be illegal and you won't be sent to jail for it - your traffic offenses example was a good one. Speeding in your car is illegal.

Contracts are legally binding and bound in law. But then you say that I 'don't seem to acknowledge the law that binds them actually exists.' Which law are you referring to exactly? I studied law in Australia so am not familiar with American legislation, but as far as I know, there is no specific legislation that formally binds specific contracts. When I say 'bound in law' I mean procedurally valid and signed by reasonably consenting adults. There is no such thing as a 'contract statute' or anything of that nature, in Australia or America, as far as I know. As there is no specific statute or legislation to go against when one breaches a contract, it is not 'illegal'.

So for something to be illegal there must be a statute prescribing its legality. Can you point me to specific legislation that specifically says 'breaching a private contract between two individuals' is illegal? I don't believe you can. Therefore, it is not illegal. Do you understand this?

 

[BaldiMac]

I never said that illegal is defined by jail time. Of course something can be illegal and you won't be sent to jail for it - your traffic offenses example was a good one. Speeding in your car is illegal.

Then why did you bring up jail time and a lack of "criminal liability"?

Contracts are legally binding and bound in law. But then you say that I 'don't seem to acknowledge the law that binds them actually exists.' Which law are you referring to exactly? I studied law in Australia so am not familiar with American legislation, but as far as I know, there is no specific legislation that formally binds specific contracts. When I say 'bound in law' I mean procedurally valid and signed by reasonably consenting adults. There is no such thing as a 'contract statute' or anything of that nature, in Australia or America, as far as I know. As there is no specific statute or legislation to go against when one breaches a contract, it is not 'illegal'.

As someone who has studied law, you should be well aware that not all law exists in statute or legislation. I don't know if there are any specific statutes that bind contracts in general, but contract law is a huge area. For example, the Uniform Commercial Code governs commercial contracts in the US. However, I would guess that most contracts are covered under common law.

See this link posted earlier for a good explanation from "Cliff Gilley".
http://www.quora.com/How-should-a-b...qualified-is-it-illegal-is-it-against-the-law

So for something to be illegal there must be a statute prescribing its legality. Can you point me to specific legislation that specifically says 'breaching a private contract between two individuals' is illegal? I don't believe you can. Therefore, it is not illegal. Do you understand this?

I hope this means that you retract your claim that copyright infringement is not illegal.

 

[biting-mammal]

BaldiMac, you seem to still be confused.

There are two ways laws are created - through statute and through common law. Statute is create through Parliament and common law created through courts and precedent.

If something is 'against the law' it is not 'illegal' unless it is against what is written in statute. If its against the settled common law, it is not 'illegal' as it is not necessarily against what is written in a statute.

For example, in Australia, our law of negligence developed solely through common law. For a long period of time, it would not be illegal as such to be negligent and cause harm to someone as it was not against statute. Now, of course, there have been Acts passed by Parliament which can attribute criminal liability to acts of negligence, thus making some actions illegal as they are against statute.

In regards to copyright law, in Australia a breach of copyright is a civil matter and thus must be dealt with by the aggrieved individual. It is not illegal. We have an Act (The Australian Copyright Act 1968) that specifies the rights a copyright holder has, but it also specifies in s 115 that it is up to the copyright holder to bring an action. The only offences are contained in s 132AC relating to commercial scale infringement.

You seem to really be struggling with understanding this and I don't know why you're so persistent in being wrong. Have you studied law? From what you've posted, you don't even seem to have a rudimentary knowledge of the law. Maybe there are some things you just need to accept that you are wrong about. Keep in mind that you are the only one who's been arguing your position, everyone else has been saying what I've been saying too. It seems everyone else has grown tired of trying to get through to you and, frankly, so have I. You can believe what you want to believe, but you will be wrong.