9. Contracts against liability for is difficult to express a rule of universal acceptance in Canada upon this subject. According to French law, it is very doubtful whether a man may stipulate for freedom from the consequences of his ordinary negli gence. Against his wilful negligence, which is assimi lated to fraud, it is said that he cannot stipulate. A person may stipulate, of course, that he will not be liable for loss under circumstances. Thus if a re pairer of antiques is asked to repair some very fragile article, he may stipulate that he will not be responsible if the article goes to pieces in the course of repair. The effect of the various Workmen's Compensation Acts, whatever may have been the law before, is to prevent employers stipulating against liability as toward workmen.
At English common law, it is said that in the ab sence of statute to the contrary, a carrier may stipu late for total exemption from liability for negligence. In the English law provinces, this rule has in several instances been altered by statute. In Quebec, under the authority of a decision of the Supreme Court, a carrier may stipulate by express contract that he shall not be liable for the negligence of his employees or servants.' The rule laid down by the Dominion Railway Act is, however, that a railway, that is, a Dominion rail way, cannot contract itself out of liability for its negli gence or that of its servants by any notice, condition or declaration.. A company may, however, with the approval of the Railway Board, stipulate that its liability be limited to a fixed sum, even in case of negligence. It may also stipulate that unless notice of claim is given to it within a certain delay, it shall not be liable. Ordinarily, carriers are liable as in surers of goods carried. In other words, a carrier is bound to deliver in good condition articles received and carried by it, tho there be no negligence on its part. It is evident that the carrier may contract against this liability.
10. Effect of an illegal stipu lation in a contract will void the contract as a whole or only in part will depend upon the circumstances.
It is not sufficient to assert merely that an unlawful agreement cannot be enforced. Where there is a law ful promise made for a lawful consideration, the con tract is not necessarily void because there is an un lawful promise made at the same time for the same consideration.
It is well established that if in a deed, for instance, there are certain covenants or conditions which are good and lawful, and others which are contrary to law, the latter will be struck out and the former will stand good. That is, where there are distinct en gagements in a contract by which a party binds him self to do certain acts, some of which are legal and some illegal, at common law the performance of those which are legal may be enforced, tho the performance of those which are illegal also been laid down that where a transaction which is partly valid and partly invalid is deliberately separated by the parties into two agreements, one ex pressing the valid and the other the invalid part, the party who is called upon to perform his part of the agreement, which is on the face of it valid, will not be allowed to urge that the transaction as a whole is unlawful and void. If the illegal cannot be sep
arated from the legal part of the covenant, the con tract is entirely void, but if they can be severed, the bad part may be rejected and the good part retained.
Thus Kent lays down that "if the part which is good depends upon that which is bad, the whole is void ; and so I take the rule to be, if any part of the consideration be malum in se, or the good and the void consideration be so mixed, or the contract so en tire, that there can be no apportionment, the contract is void." Where any part of a single consideration for a promise or set of promises is unlawful, and the con sideration cannot be severed so as to assign a lawful consideration to any of the promises, the contract as a whole is void. The immediate object or considera tion may not be unlawful, but the intention of one or both parties in making the contract may be unlaw ful, in which case there are two possibilities: if the un lawful intention when the contract is made is shared by both parties, or is entertained by one to the knowl edge of the other, then the contract is void; if one of the parties, unknown to the other, has an unlawful intention when the contract is made, it may be voided by the innocent party, if he discovers the intention be fore the contract is executed.
Thus if the lessee of a house, which he knows is used by the tenants for immoral purposes, assigns the lease, and he knows that the person to whom he assigns it in tends to continue the same use, he will not be allowed to recover on a contract made by the person to whom he assigns the lease to indemnify him against the cove nants of the original lease. , A person who owns a property and who has undertaken to sell or lease it, but who finds that the purchaser or lessee intends to use it for unlawful purposes, is entitled and may even be bound to rescind the contract. It has been laid down that lie need not even give his reasons for doing so, as he may justify his refusal later. But where a contract has been com pletely executed, as for example by the transfer of property, the consideration may be paid or the trans fer may have been made for some unlawful purpose of which both parties were aware, but once executed it cannot be set aside. Thus in an English case, where two promissory notes were secretly given to a creditor by a debtor who was making a compromise with his creditors, the notes being in excess of the amount of the creditor's rightful composition share, judgment was given on one of the notes; a third person inter vened and gave the creditor a guarantee for the amount involved, upon the creditor's staying proceed ings. An action on this guarantee was dismissed.