§ 80a-46. — Validity of contracts.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 15USC80a-46]
TITLE 15--COMMERCE AND TRADE
CHAPTER 2D--INVESTMENT COMPANIES AND ADVISERS
SUBCHAPTER I--INVESTMENT COMPANIES
Sec. 80a-46. Validity of contracts
(a) Waiver of compliance as void
Any condition, stipulation, or provision binding any person to waive
compliance with any provision of this subchapter or with any rule,
regulation, or order thereunder shall be void.
(b) Equitable results; rescission; severance
(1) A contract that is made, or whose performance involves, a
violation of this subchapter, or of any rule, regulation, or order
thereunder, is unenforceable by either party (or by a nonparty to the
contract who acquired a right under the contract with knowledge of the
facts by reason of which the making or performance violated or would
violate any provision of this subchapter or of any rule, regulation, or
order thereunder) unless a court finds that under the circumstances
enforcement would produce a more equitable result than nonenforcement
and would not be inconsistent with the purposes of this subchapter.
(2) To the extent that a contract described in paragraph (1) has
been performed, a court may not deny rescission at the instance of any
party unless such court finds that under the circumstances the denial of
rescission would produce a more equitable result than its grant and
would not be inconsistent with the purposes of this subchapter.
(3) This subsection shall not apply (A) to the lawful portion of a
contract to the extent that it may be severed from the unlawful portion
of the contract, or (B) to preclude recovery against any person for
unjust enrichment.
(Aug. 22, 1940, ch. 686, title I, Sec. 47, 54 Stat. 845; Pub. L. 96-477,
title I, Sec. 104, Oct. 21, 1980, 94 Stat. 2277.)
Amendments
1980--Subsec. (b). Pub. L. 96-477 provided that a contract whose
terms violated this subchapter or any rule, regulation, or order
thereunder would be unenforceable by either party or by a nonparty to
the contract who acquired a right under such contract with knowledge of
the facts by reason of which the making or performance of the contract
would violate this subchapter, struck out provisions declaring such
contracts void as regards the rights of the violators or nonparties to
the contract with actual knowledge of its illegality, authorized the
court to enforce such contracts where the court found that under the
circumstances enforcement would produce a more equitable result than
nonenforcement and such enforcement would not be inconsistent with the
purposes of this subchapter, authorized the same two-part test to save
from rescission any portions of such contracts which had been performed,
and provided that subsec. (b) was not to apply to a lawful portion of a
contract to the extent it could be severed from an unlawful portion of
such contract, or to preclude recovery against any person for unjust
enrichment.
Section Referred to in Other Sections
This section is referred to in sections 80a-6, 80a-58 of this title.
