Intention To Create Legal Relations Flashcards
What is the presumption regarding intention to create legal relations in business contracts?
There is a presumption that there is an intention to create legal relations, making them legally binding.
This is supported by the case Esso Petroleum v Customs.
What must both parties provide for a business contract to be legally binding?
Both parties need to give consideration.
Consideration refers to something of value exchanged between the parties.
Under what circumstances can the presumption of legal intent in business contracts be rebutted?
Clear words indicating no legal intent or vague language can rebut the presumption.
Examples include terms like ‘act of goodwill’ or ‘gentlemen’s agreement’.
What is an example of a case where the presumption of no legal intent was established?
Edwards v Skyways.
The case involved clear language showing no legal intent.
Are contracts involving free gifts and competition prizes legally binding?
Yes, they can be legally binding.
Supported by cases like McGowan v Radio Buxton.
Who has the burden of proof when claiming no legal intent in a contract?
The party trying to establish no legal intent.
This is usually the defendant in the case.
What presumption exists for domestic/social contracts?
There is a presumption that there is NO intention to create legal relations, making them not legally binding.
Supported by the cases Balfour v Balfour and Jones v Padavatton.
What can rebut the presumption of no legal intent in domestic contracts?
A commercial basis, consideration exchanged, or evidence of acting on the promise.
Cases like Simpkins v Pays and Merritt v Merritt illustrate these points.
In what scenario can family business agreements be legally binding?
If there is no rebuttal to the presumption of no legal intent.
The case Snelling v Snelling supports this.
How are pre-nuptial agreements viewed by the courts?
They are increasingly seen as legally binding.
This is supported by the case Granatino v Radmacher.
Fill in the blank: Domestic arrangements may be held to be business arrangements if they go beyond _______.
social kindness.
This concept is illustrated in the case Albert v Motor Insurer’s Bureau.
True or False: A contract between family members is always legally binding.
False.
Even with a commercial basis, clear words indicating no legal intent can nullify the binding nature.
Who has the burden of proving that the rebuttal applies in establishing legal intent?
The party trying to establish legal intent
This refers to the individual or party attempting to demonstrate that a rebuttal to a presumption exists in the context of a contract.
In the case discussed, what must the person seeking to enforce the contract show?
Legal intent
This is particularly pertinent when the contract is not clearly domestic or commercial.
What presumption exists regarding domestic/social contracts, such as between mother and son?
There is a presumption that there is no intention to create legal relations
This presumption can be rebutted under certain circumstances.
What can rebut the presumption of no legal intent in the discussed case?
A clear commercial basis to the contract
This includes scenarios where the relationship has evolved beyond personal affection, such as business dealings.
What action by C supports the argument for a legally binding contract?
C helped his mother’s business and acted on her promise
This indicates that C’s actions were not merely based on familial affection but involved a business transaction.
What is another factor that could rebut the presumption of no intention to create legal relations?
Money has changed hands in exchange for services
This transforms the nature of the relationship from social to commercial.
What conclusion can be drawn about the contract between C and his mother?
The contract is legally binding and C is entitled to be paid
This conclusion is based on the evidence presented regarding the nature of the contract.
Fill in the blank: The rebuttal of the presumption of no legal intent is applicable in this case if there is a clear _______.
commercial basis to the contract
