A New Dawn for the Law of Illegality

Abstract

English law on illegality in private law has long been regarded as both difficult and unsatisfactory. In 2016, the Supreme Court, sitting as a panel of nine, looked at the area again in Patel v. Mirza. Here £620,000 had been paid for the defendant to bet on share prices using inside information (thereby committing the crime of insider dealing). The agreement was not carried out because the information was not forthcoming. Was the claimant entitled to repayment of that money? In answering that question, a majority of the Supreme Court set out a controversial new approach to this area of the law, which was vigorously rejected by the minority judges. This paper examines the reasoning in the case and argues that Patel v. Mirza constitutes a triumph for the law of illegality.

Keywords: illegality, contract, tort, unjust enrichment, property