What commonly results from an illegal contract?

Study for the CII Insurance Law (M05) exam. Enhance your preparation with quizzes featuring multiple choice questions, detailed hints, and explanations. Get ready to ace your test!

An illegal contract typically results in the contract being considered void. This means that it has no legal effect from the moment it is created because it involves activities that are against the law or public policy. When a contract is deemed void, neither party can enforce the contract, and the courts will not provide any remedy to enforce the terms of the agreement.

In legal terms, "void" implies that the contract is as if it never existed. Thus, any performance of the contract or expectation of benefit from it is negated due to its illegal nature. This principle is crucial in maintaining the integrity of legal systems, which do not support illegal activities or obligations.

The other options present scenarios that do not align with the legal implications of an illegal contract. For instance, stating that a contract becomes enforceable overlooks the foundational legal principle that illegal agreements cannot be upheld. Similarly, suggesting that parties may still recover damages or that the contract remains valid contradicts the legal stance that void contracts do not have enforceable rights or obligations attached to them.

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