If a contract was formed for an illegal purpose, what will the courts typically do?

When a contract is formed for an illegal purpose, the courts typically will not enforce the contract and will avoid intervening to resolve any disputes arising from it. This is based on the principle that the legal system should not assist a party in enforcing a contract that is inherently unlawful. As a result, the courts commonly choose not to return the parties to their pre-contract positions, as doing so would indirectly validate the illegal agreement.

The rationale behind this approach is that enforcing illegal contracts would undermine the public policy and integrity of the law. Instead of providing remedies, courts often allow the parties to bear the consequences of their actions, which may include the losses incurred from the illegal contract. In essence, the legal framework aims to prevent any potential reinforcement of illegal activity through judicial means.