Intention to Create Legal Relations Flashcards
Introduction?
After offer and acceptance an offer is not complete. There must be an intention from both parties to create legal relations and make the contract legally binding. It is presumed to exist in business agreements but not social arrangements.
Business Agreements rule?
Esso v Customs and Excise - Must business agreements are presumed to have legal relations.
Business Agreements exceptions: Gentlemans agreement?
Jones v Vernon Pools - Gentleman’s Agreement.
Business Agreements exceptions: Vague Words?
Kleinworth v Malaysian Mining Corportation - Letter of Comfort (Vague Words).
Business Agreements exceptions: exclusion?
Rose and Frank v Crompton - Words in a contract that directly exclude a binding agreement.
Business Agreements exceptions: Free Gifts?
McGowan v Radio Buxton - Free gifts do presume legal intentions if the free gift is used to promote business.
Business Agreements/Social Arrangements?
Sadler v Reynolds - Where the agreement falls between business and social the burden of is on the claimant to prove that there was an intention to create legal relations.
Social Arrangements Rule?
They are presumed to not be legally binding.
Balfour v Balfour - There was no intention to create legal relations as it was a domestic arrangement between husband and wife, burden of proof is on the claimant.
Social Arrangements Exception: Love and Affection?
Merrit v Merrit - There was an intention to create legal relations as the husband and wife were separated when the agreement was made. Parties no longer acting on basis of love and affection.
Social Arrangements Exception: Money has changed hands?
Simpkins v Pays - If money has changed hands there is an intention to create legal relations. There is a reliance by one party on the promise of another.
Social Arrangements Exception: Legal Intent?
Snelling - There will be legal intent where there is a commercial basis to the contract.
