In Transport North American Express Inc. v. New Solutions Financial Corp., various payments were found to be "interest" within the meaning of s. 347 of the Criminal Code. The interest rate applied was illegal. The Supreme Court applied "notional severance", resulting in a reduction of the interest rate. The Supreme Court of Canada outlined four factors to consider when deciding whether to declare an illegal contract void, or to partially enforce it. Which of the following is not one of those factors?
A) whether the contract was a standard form agreement
B) whether the purpose or policy of s. 347 would be subverted by severance
C) whether the debtor would be given an unjustified windfall
D) the relative bargaining positions of the parties and their conduct in reaching the agreement
E) whether the parties entered into the agreement for an illegal purpose or with an illegal intention

Question

Quizplus · Accepted Answer

The four factors outlined by the Supreme Court of Canada when deciding whether to declare an illegal contract void or partially enforce it are: whether the purpose or policy of s. 347 would be subverted by severance, whether the debtor would be given an unjustified windfall, the relative bargaining positions of the parties and their conduct in reaching the agreement, and whether the parties entered into the agreement for an illegal purpose or with an illegal intention. The fact that the contract was a standard form agreement is not one of the factors outlined.