There is an international food festival held in Canberra during March each year.

Question

There is an international food festival held in Canberra during March each year. Individuals and companies can hire stalls and sell food and drink to the public. a) Lucie sells Belgium beer at the festival each year. In January 2018 she enters into a contract with Fiona, Festival Manager, to hire a stall. In February 2018 the ACT government enacts a new law requiring stallholders to have a liquor licence if they sell beer. A liquor licence costs $2000. This is too expensive for Lucie and she wants to get out of the contract.

Explanation / Answer

In this case, Lucie has entered into a contract when selling beer does not required a licence but After a month, Government has changed the rule, so selling beer without a license has become illegal business. Such contract will not be enforced by law and legally court will declare it a void or null and court will treat it as never existed contract because.It case will be treated under "defense of illegality". So, such contract are unenforceable under law because it is against public policy. In this case selling Beer without license will violate public Policy.

Reference case: Pearce vs. Brooks (1866)

In this case of hiring a carriage , court had given verdict that contract is not being enforced by the prostitutes because It is a void case and against the public policy.

A contract reflected by courts under law .When two the parties enter in to a contract they have to go through the laws whichever will be applicable at the time of contract In this case , law has changed about selling the beer under public policy. This change in Govt. policy has made this contract illegal.According to the court, due to change in public policy that is changed because of change in the law, Fiona ,Festival Manger, can not enforce this old contract between Fiona and Lucie.Both party should treat it as it never existed or as void contract.

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