Bob knowingly pays Rob for doing something illegal (handing over an item that Rob has stolen, murdering Alice etc. — you name it).
Both are caught and sent to jail.
Now, will Rob legally own the money Bob paid him? Does the Clean Hands doctrine prevent Bob from obtaining a court order that Rob gives him the money back?
The doctrine says that Bob won't have it as an equitable remedy. But does the remedy necessarily need to be equitable?
(Any common law jurisdiction.)
The maxim is codified in statute, and therefore it binds courts in providing legal remedy as though they provided it in equity; Bob could not obtain legal remedy either.
Cal. Civ. Code § 3317
No one can take advantage of his own wrong.
As the money is the fruit of a crime, it can be sized by the government, and neither Bob nor Rob will retain it.
Stolen property is usually returned to the legal owner, when the owner can be identified, but other fruits of crime, such as the proceeds of unlawful drug sales, are often subject to seizure by the government. See "civil forfeiture".
Clean hands is a requirement for a court to choose to apply an equitable remedy - equitable remedies are always at the discretion of the court.
From the example above, Bob does not have clean hands so cannot be granted an equitable remedy such as, the very applicable unjust enrichment. At the same time, the contract is void ab initio as it is for an illegal purpose so neither Bob nor Rob can enforce it - the court can make no orders regarding the money vis-a-vis Bob and Rob.
Of course, the money might be the proceeds of crime (if the “contract” was for the commission of a crime rather than just being unlawful without being criminal) and subject to state seizure.
