ABSTRACT
The object of the locus poenitentiae exception is not to do justice between the parties by reversing unjust enrichment; it is to advance the policy of the illegality defence by encouraging parties to abandon the illegal scheme before it is carried out. Some textwriters say that it is “debatable” how far this limitation applies to the doctrine of locus poenitentiae in its modern form. Buller J. said long ago in his classic statement in Lowry v. Bourdieu that withdrawal under the locus poenitentiae “can only be done on the terms of restoring the other party to his original position”. The policy behind the exception, to encourage withdrawal from the illegal purpose, is not advanced if the illegal purpose has already been defeated by an event other than the plaintiff’s voluntary withdrawal. Since title can pass under an illegal transaction, the question arises whether, if the title has passed to the defendant, the plaintiff can recover by withdrawing from the transaction.
