When the Agreement Is Contrary to the Public Interest

In addition, a tax exemption must also be interpreted strictly in the hands of a person clearly entitled to do so. These provisions include provisions that nullify contracts entered into under duress or that are unscrupulous transactions; the protection of minors and incompetents; and formal requirements that protect against reckless assumption of obligations. Thus, Paragraph 138 of the BGB declares null and void any contract `by which a person who benefits from the difficulties, irresponsibility or inexperience of others` acquires a disproportionate transaction. In addition, more general social requirements and views affect contracts in a variety of ways. Some agreements are illegal, such as – in the United States – trade restriction agreements. Others, such as.B. an agreement to commit civil injustice is considered by the courts to be contrary to the public interest. Some schemes discourage certain purposes, such as taking on a legally binding obligation to grant another currency or other free benefit, through various specific requirements. In most cases, courts will help a person who has been harmed by a breach of contract if they can prove that a breach actually occurred. The exception to this rule is when the contract is contrary to public policy. If the court finds that a contract has violated a law or policy, it does not help the contracting parties.

If a contract promotes an immoral act, such as. B the commission of a criminal offence, it is presumed contrary to public order and will not be maintained. Second, a business incorporation can be considered a franchise that constitutes a personal or property right in the hands of the owners and is therefore considered acquired solely for abuse or in accordance with its own terms. This is how some of the early state courts viewed it from the beginning.2128 This is also how Blackstone saw it in terms of royal supremacy, but not in terms of the sovereignty of parliament, and the same view found expression in stories of concurring opinion in Dartmouth College v. Woodward, as was the case in Webster`s reasoning in this case.2129 Whether these two cases provide for active judicial review of economic regulatory activities, as opposed to extreme compliance with these laws under due process and equal protection clauses, is problematic. Both cases contain language that emphasizes the extent of the government`s police powers that can be used to promote the public interest and allow for limited judicial review. Nevertheless: «If the contractual clause must retain any meaning .. it must be understood as limiting the power of a State to shorten existing contractual relations, even in the exercise of its otherwise legitimate police power.

2229 On the other hand, repeated attempts to subject tax exemptions to the doctrine of inalienability, even though they were sometimes supported by powerful minorities within the bank, failed.2171 It was not until January 1952 that the Court held that the Georgia Railway Company was entitled to obtain an injunction from the federal courts against an attempt by the Georgian Tax Commission to compel it to pay ad valorem taxes. which violated the provisions of its Special Charter. in 1833. In response to the argument that this was a lawsuit in violation of the Eleventh Amendment, the court said the immunity created by the amendment is «not extended by federal jurisdiction to persons acting as public servants without constitutional authority.» 2172 «Public order is a horse raised to ride, and it is difficult once you have climbed it.» [i] It would hardly be sufficient today for an enterprise to invoke its statutory privileges or special concessions made by a State to oppose the application of measures allegedly adopted under its police authority; If this right is maintained, the obligation of the contractual clause will not be invoked and, if not, the due process clause of the Fourteenth Amendment will provide sufficient confidence. .