However, a contract that requires only legal performance on the part of each party, such as the sale of packs of cards to a known gambler, where gambling is illegal, will nonetheless be enforceable.
In Bovard v. American Horse Enterprises (1988),[1] the California Court of Appeal for the Third District refused to enforce a contract for payment of promissory notes used for the purchase of a company that manufactured drug paraphernalia.
Although the items sold were not actually illegal, the court refused to enforce the contract for public policy concerns.
To protect her from prosecution, her husband signed a letter of intent prepared by the bank in which he agreed to assume "all liability and responsibility" for the forged cheques.
Because of the contract's illegality, and as a result voided status, the bank was forced to return the payments made by the husband.