Sinnar v. LeRoy

Supreme Court of Washington · Contracts

ContractsIllegalityPublic Policyillegal contractpublic policyunpleaded illegalityin pari delictobeer license

Facts

Plaintiff operated a grocery store in Seattle and had previously been denied a beer license by the Washington state liquor control board. Defendant, a friend and customer, told plaintiff he thought he could get the license and later said it would cost $450; plaintiff gave him that amount in cash. Both parties knew a third party would be involved, and defendant testified that he gave the money to a Mr. Lewis. Plaintiff never received the license, and he testified defendant had promised either the license or the return of the money.

Issue

May a court grant recovery of money paid under an agreement to obtain a beer license or return the money when the evidence shows the transaction was seriously illegal, even though illegality was not pleaded as a defense? Relatedly, was this particular agreement an illegal transaction such that the court should leave the parties where it found them?

Rule

If illegality is of a serious nature, especially where public policy is implicated, it need not be pleaded; if the evidence establishing the claim also establishes the illegality, the court must deny relief. A court will not knowingly aid an illegal transaction and will leave the parties where it finds them when the transaction contains the germ of possible corruption or contemplates unlawful means to accomplish its end.

🔒

See the holding & full analysis

Create a free KwikCourt account to unlock the rest of this brief — and practice the case.

The court's holding and reasoning
Doctrine tests, pitfalls & exam hypotheticals
10 practice questions + 4 AI-graded essays on this case

Free sample · practice this case

Test yourself

One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Portland, Oregon, Nina Cortez pays Omar Vance $8,000 after Omar says he can "make sure" she receives a state cannabis retail permit through a contact in Salem and promises either the permit or her money back. At trial on Nina's suit for the $8,000, the evidence shows the permit could be issued only by a state licensing board, but Omar never pleaded illegality as an affirmative defense.

How should the court rule?

Explanation. When the illegality is serious and implicates public policy, failure to plead illegality does not bar the court from considering it. If the plaintiff's own evidence reveals an arrangement contemplating improper means to secure a state-controlled license or permit, the court must deny relief rather than aid the transaction. (Derived from Sinnar v. LeRoy (n.d.).)