intention to create legal intentions

Question 1

3 categories of agreements

Answer 1

social + domestic agreements
commercial agreements
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Question 2

social + domestic

Answer 2

presumption that there is no intention to create legal relations in social or domestic agreements; but this may be rebutted

Question 3

husbands + wives

Answer 3

• presumed not to create legal relations unless the agreement itself states that it does
  [balfor v balfor]

Question 4

Balfor v Balfor 1912

Answer 4

• husband worked overseas, wife lived with him overseas
• came back to England during his leave
• wife developed rheumatoid arthritis, doctor advised to return overseas
• husband promised to pay £30 per month until she could return overseas
• husband wrote to say it was better they remained separated
• wife sued to enforce continued payment of the £30 monthly
• CoA held agreement not enforceable since there was a general presumption that there is no intention to create legal relations between family members
• in these cases, parties are considered to be required to sort out their finances in more precise terms and therefore any agreement between them is more likely to carry an intention to create legal intentions, hence to be legally binding

Question 5

parents and children

Answer 5

presumed not to create legal relations

Question 6

parties sharing a house

Answer 6

court will consider all circumstances of the agreement, more likely to find the intention to be legally bound where money has changed hands

Question 7

commercial agreements

Answer 7

presumed there is an intention to create legal relations
-> can generally rebutted only by express provision in the contract

Question 8

Rose & Frank Co v Crompton Bros Ltd 1925

Answer 8

held a commercial agreement between a British manufacturer and its appointed distributor in the USA, which stated ‘not subject to legal jurisdiction’; sufficient to rebut the presumption that it was intended to be a contract
-» even so if agreement appears to be gratuitous in nature; e.g involving ex gratia payment

Question 9

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Answer 9

first parties often make claims in advertisements that are generally treated as mere puff, and such do not generally create legal intentions
- a statement will not be binding if the court considers that it was not seriously meant