Intentions to create legal relations Flashcards
What makes an agreement legally binding
Whether the parties had an intention to create legal relations.
What is the legal presumptions for commercial agreements
With Commercial agreements there is a very strong presumption that the parties intended their agreement to have legal consequences.
Important to note that this is rebuttable, if the facts show otherwise.
What is the legal presumptions for domestic agreements
With domestic agreements, i.e agreements reached between family members or friends, the presumption is that the parties did not intend to create legal relations. This presumption is rebuttable, if the facts show otherwise.
what does this case tell us Esso Petroleum V Commisssioners Custom Excise?
Even if the subject matter of the transaction is trivial, the law still presumes that the agreement is intended to be legally binding.
In this case whilst the coins might of been of minimal value, the incentive to soccer enthusiasts to collect all 30 coins was strong and to that extent the offer of the coins was of sigiganifcant economic value to Esso.
How can the legal presumptions of whether an agreement is binding or not in an commercial context be rebutted
A clear express statement that the agreement is not meant to be legally binding. For example a statement to the effect the agreement is ‘binding in honour only’
If a husband and wife are settling the financial terms of their divorce, will their be intentions to create legal relations?
Yes. The parties are dealing at arm’s length. Solicitors are involved and any agreement will need to be formalised. Therefore the legal presumption of their not being an intention to create legal relations will be rebutted.
If two friends reach an agreement on how they contribute to a joint business venture, will there be an intention to create legal relations?
Yes. a lot of money will be at stake. Therefore the legal presumption of their not being an intention to create legal relations will be rebutted.
If a brother and sister expressly agree that their agreement will be legally binding, will there be intentions to create legal relations.
Yes. The presumption will be rebutted as the parties have reached an express agreement.
If one cousin sells his house to another cousin will there be intentions to create legal relations
Yes. The relationship is not particularly close but the agreement is about an asses of considerable worth and will have been formalised. Therefore the legal presumption of their not being an intention to create legal relations will be rebutted.
Will there be an intention to create legal relations, where a Parent and child agree what the child must do in order to get their weekly financial allowance of £10.
No. The relationship is very close and the sum involved is nominal.
What factors might rebut the presumption of their not being an intention to create legal relations in domestic agreements?
- If solicitors are involved.
- A lot of money at stake.
- An express agreement to create legal relations.
- If the assets is of considerable worth and will have been formalised.
