Napier v National Business Agency

Facts

An employee was paid a salary plus £6 a week for expenses. Both sides knew the expenses never exceeded £1. He was dismissed and claimed salary in lieu of notice.

Issue

Could the lawful salary term be enforced on its own?

Held

No. The expenses term was a fraud on the revenue and tainted the whole contract.

Principle

Where the illegal stipulation is not severable, the whole contract falls.

Why it matters

It is the example of a contract that cannot be cut into a good part and a bad part.

For study only. By lanbuk.com. Always check current sources and consult a qualified professional.