Sherman v. Grinnell was a United States Supreme Court case that addressed the issue of whether a contract between two parties could be enforced if the consideration for the contract was illegal. The case involved a contract between the plaintiff, Sherman, and the defendant, Grinnell, in which Grinnell agreed to pay Sherman a certain amount of money in exchange for Sherman's promise to not compete with Grinnell in the sale of certain goods. The Supreme Court held that the contract was unenforceable because the consideration for the contract was illegal. The Court reasoned that the consideration for the contract was illegal because it was in violation of public policy. The Court noted that the consideration for the contract was a restraint of trade, which was prohibited by public policy. The Court further noted that the consideration for the contract was not a valid consideration because it was not of any benefit to the public. The Court concluded that the contract was unenforceable because the consideration for the contract was illegal. In conclusion, the Supreme Court held that the contract between Sherman and Grinnell was unenforceable because the consideration for the contract was illegal. The Court reasoned that the consideration for the contract was a restraint of trade, which was prohibited by public policy, and that the consideration for the contract was not of any benefit to the public.

Justice Field delivered the dissenting opinion in Sherman v. Grinnell, arguing that the majority's decision was contrary to established principles of equity and justice. He argued that a contract should not be enforced if it is found to be unconscionable or oppressive, regardless of whether there is consideration for it. In this case, he believed that the agreement between Sherman and Grinnell was both unconscionable and oppressive because it allowed Grinnell to receive an excessive amount of money from Sherman without providing any benefit in return. Furthermore, he argued that even if there had been consideration provided by Grinnell for his promise to pay $10 per month over 10 years, such a long-term payment plan would still have been inequitable given its length relative to their respective ages at the time they entered into the agreement. Justice Field concluded by stating that while courts must enforce contracts according to their terms when possible, they should also take into account all relevant circumstances before doing so in order ensure fairness and justice are served.