1. Legality of Subject Matter
Not all laws involve the same level of ‘‘illegality’’ if broken. There are two broad categories.
The first category contains laws that supposedly support the very nature and fabric of society. Violation of these rules go against our agreed upon public policy, and contracts violating them are void and unenforceable.
The second category includes what we consider to be minor illegalities, the violation of laws created by statute that bar actions which are not, in and of themselves, considered as morally reprehensible. Contracts that violate this second category may still permit the injured party some form of quasi-contractual relief.

2. Malum in Se
First Category. Contracts that violate public policy and are deemed “bad” in and of themselves.

3. Malum Prohibitum
Contracts that are not, by the ARP standard, deemed morally reprehensible or against public policy, but are still minor violations of the law.

4. Contractual Capacity
The parties’ legal ability to enter into a binding contractual relationship

5. Three Major Areas of Contractual Capacity
Age
Mental capacity
Drugs & Alcohol