Reciprocal Promises to Do Legal and Illegal Things

The words "under specified circumstances" are part of the structure. The illegal set is conditional, triggered by a stated event, which is what makes it a separate set rather than part of the first.

Section 58: an alternative promise

"In the case of an alternative promise, one branch of which is legal and the other illegal, the legal branch alone can be enforced."

Its illustration:

"A and B agree that A shall pay B 1,000 rupees, for which B shall afterwards deliver to A either rice or smuggled opium.

This is a valid contract to deliver rice, and a void agreement as to the opium."

An alternative promise is one promise that may be performed in either of two ways, the choice usually lying with the promisor. Where one way is unlawful, the law simply removes that option: the promisor must perform the lawful way.

Note that the promisee is not worse off. He bargained for either rice or opium, so rice was always a performance he had agreed to accept.

The three sections compared

This is the table an answer should carry, because the whole topic is the distinction.

The diagnostic question: ask whether the lawful thing has a price of its own. If it does, section 57 or 58 saves it. If the whole is paid for by one undivided sum, section 24 destroys it.

A worked example

Test four arrangements between Ganesh and Harish.

• "Ganesh shall sell Harish his warehouse for sixty lakh rupees, and if Harish uses it to store contraband he shall pay a further twenty lakh." Two sets of reciprocal promises. The sale at sixty lakh is a contract; the arrangement about the contraband is a void agreement. Section 57 and its illustration in modern dress.
• "Ganesh shall pay Harish five lakh rupees, and Harish shall deliver either two hundred quintals of wheat or two hundred quintals of a banned pesticide, at Harish's option." An alternative promise. Section 58: the contract is a valid contract to deliver wheat, and a void agreement as to the pesticide.
• "Ganesh shall pay Harish eight lakh rupees a year to manage his warehouse and to bribe the municipal inspector." One single, undivided consideration for two objects, one unlawful. Section 24 applies and the whole agreement is void. Harish recovers nothing, even for the lawful management.
• "Ganesh shall pay Harish six lakh a year to manage the warehouse, and two lakh a year to handle the inspector." The considerations are apportioned, so the unlawful part is severable and the six lakh management contract stands. This is severance under section 24 rather than section 57, because the promises are not two reciprocal sets but one arrangement with a divided price. Either route reaches the same result.

What it does NOT mean

"Any contract with an illegal element can be saved." Only where the structure allows the lawful part to be identified separately. Section 24 remains the rule for a single undivided consideration.

"Section 57 makes the illegal set merely unenforceable." It is a void agreement, and it is void from the outset.

"Under section 58 the promisee may choose the illegal branch." He may not. The illegal branch is void, and only the legal branch can be enforced.

"Section 57 and section 24 conflict." They do not. They apply to different structures, and the difference is whether the lawful part has a consideration of its own.

Quick revision

• s.57: where parties reciprocally promise, firstly legal things and secondly, under specified circumstances, illegal things, the first set is a contract and the second is a void agreement. Illustration: the house at ten thousand, plus fifty thousand if used as a gambling house.
• s.58: in an alternative promise with one legal and one illegal branch, the legal branch alone can be enforced. Illustration: one thousand rupees for either rice or smuggled opium, valid as to rice.
• s.24: where a single consideration covers both, the whole agreement is void.
• The diagnostic: does the lawful thing have a price of its own? If yes, s.57 or s.58 saves it; if the price is one undivided sum, s.24 destroys it.

Test yourself

1. State section 57 and its illustration. Where persons reciprocally promise, firstly to do certain things which are legal, and secondly, under specified circumstances, to do certain other things which are illegal, the first set of promises is a contract but the second is a void agreement. The illustration has A selling B a house for ten thousand rupees with a further fifty thousand payable if B uses it as a gambling house: the sale is a contract and the gambling arrangement is a void agreement.

2. What is the rule for an alternative promise? Section 58 provides that in the case of an alternative promise, one branch of which is legal and the other illegal, the legal branch alone can be enforced. In the illustration a payment of one thousand rupees for the delivery of either rice or smuggled opium is a valid contract to deliver rice and a void agreement as to the opium.

3. How do sections 57 and 58 differ from section 24? Section 24 applies where a single undivided consideration covers both lawful and unlawful matter, and it makes the whole agreement void. Sections 57 and 58 apply where the structure keeps the lawful part separate, either as its own set of reciprocal promises with its own consideration, or as one branch of an alternative promise, and in both cases the lawful part survives.

4. A agrees to pay B one lump sum to run a lawful shop and to smuggle goods. Advise. The consideration is single and undivided, so section 24 applies and the whole agreement is void. Neither section 57 nor section 58 helps, because there is no separate set of reciprocal promises for the lawful work and no alternative branch; nothing in the bargain attributes any part of the sum to the shop alone.

5. Under section 58, may the promisee insist on the illegal branch? No. The illegal branch is a void agreement and cannot be enforced by anyone. The section preserves only the legal branch, and the promisee is not prejudiced, since delivery of the lawful alternative was always a performance he had agreed to accept.