True or False: The purpose of a contract must not be to break the law or run counter to public policies.

The assertion is true because the fundamental principle of contract law is that a contract must have a lawful purpose to be enforceable. Contracts that involve illegal activities or that contradict public policy are considered void and unenforceable. Public policy reflects the values and principles that are considered essential for the welfare of society. For instance, a contract to engage in illegal activities, such as drug trafficking or fraud, would not be recognized by the courts, as it is against the law and undermines societal norms.

Establishing lawful purposes in contracts ensures that the agreements entered into serve to advance legitimate interests and protect public welfare. This principle applies universally across all types of contracts, whether personal or commercial, thus solidifying the importance of adherence to lawful purposes in contractual agreements.