Taylor v Chester (1869) LR 4 QB 309
The defendant was a brothel’s keeper and, as such, supplied Plaintiff with wine and dinner ‘for the intention of being consumed there, by Plaintiff and redirected prostitutes there in a debauch, to provoke them to riotous, disorderly, and unethical conduct.’ When the debauch was over there, the reckoning proceeded in due course. The plaintiff deposited with the defendant half of a £ 50 note as protection, being reluctant or unwilling to pay it at once. He later repented of the action and brought litigation against the defendant in order to seek repayment of the half-bank note.
If the claimant may recover the defendant’s half banknote as a promise to enjoy the facilities of the latter’s brothel?
Section 23 Indian Contract Act, 1872.
It was held that the plaintiff had no right to recover from it. The property of the half note had passed to the defendant, and despite the illegality of the agreement under which it had passed, the defendant was entitled to retain it.
Maxim “in pari delicto potior est conditio possidentis” applies; and that without proving the true existence of the deposit and that he was on an illegitimate account to which he himself was a party, he could not recover anything as the complainant could not recover.
The maxim, “in pari delicto…” is founded on the principles of public policy, which notes that the courts would not help a claimant who has paid money or handed over land in pursuit of an illegal or immoral arrangement, well informed of its nature. The true test to determine whether the plaintiff and defendant were ‘in pari delicto‘ is to question if the plaintiff could make his case without the help of an illegal arrangement to which he was a party himself.
All the facts were mentioned, which showed that if those facts were valid, the claimant and the defendant were in pari delicto. It should be recalled that the respondent challenged the reply in that case and asked a clear question as to whether a plea of that type was an appropriate and appropriate plea to be received by the Court of Justice. Once it has been identified that the parties are in pari delicto, the Court will not, in any way, assist an unlawful transaction, that is, the individual who has asked the Court to do something for his own gain will fail.
Current Day Significance
B.O.I. Finance Ltd vs The Custodian & Ors on 19 March, 1997
In this case, the distinction between an action brought to enforce an unlawful agreement and one brought to assert a right of property already acquired under such an agreement was illustrated by Taylor v. Chester. It was concluded that, under an arrangement to carry out an illegal act, a transaction occurs in the part which would otherwise be legal in the absence of such a prior agreement, that transaction cannot, irrespective of the unlawfulness of the contract, be treated as invalid by itself.
B.O.I. Finance Ltd vs The Custodian & Ors Civil Appeal No. 2104 of 1997
By – Oshin Ratnawat