The decision of the Supreme Court in Patel v Mirza is now the leading case on the application of the defence of illegality to private law claims, which has resolved a controversy among the Justices of the Supreme Court as to whether the defence should be formulated as a rule of public policy, which applies automatically if certain conditions are met, or a discretion founded on justice to secure a fair result following careful consideration of the factual context of the case. While the decision is of specific relevance to the law of unjust enrichment, it will also be of significance to the operation of the defence to claims, both proprietary and personal, relating to a trust. But, although the nine Justices sitting in the Supreme Court sought to place the law on illegality on a secure and principled footing, the approach that has been adopted is likely to create even more uncertainty.
Graham Virgo, Patel v Mirza: one step forward and two steps back, Trusts and Trustees (2016) doi: 10.1093/tandt/ttw183. First published online: October 3, 2016.