Witham v Holloway (No 1)

The New South Wales Court of Appeal heard an appeal concerning a dispute between the appellant, Mr Witham, and the respondent, Ms Holloway. The core of the disagreement related to the appellant's claim for damages for breach of contract and the respondent's defence that the contract was void for illegality.

The primary legal issue before the Court of Appeal was whether the contract, which involved the sale of a business and was found to contain a "cash-back" component designed to avoid stamp duty, was rendered illegal and therefore unenforceable. The Court was required to determine the consequences of such illegality on the contractual obligations of the parties.

The Court of Appeal, in its reasoning, considered the principles of illegality in contract law. It was held that where a contract is formed for an illegal purpose, or where its performance involves an illegal act, the contract may be void ab initio or unenforceable. The Court found that the intention to evade stamp duty rendered the contract illegal, and therefore void. Consequently, the appellant's claim for damages for breach of contract could not succeed. The appeal was dismissed.