Page
  1. 1
    1
  2. 2
    2

Intention to create legal relations

Extracts from this essay...

Introduction

~ ~ âA mere statement of intention made in the course of conversation will not constitute a binding promise, though acted upon by the party to whom it was madeâ¦â¦â¦â According to this questionit asks whether the mere fact that a statement of intention to createa contract which is formed when an offer by one party is accepted by the other party, how the parties becomes legally bounded to act accordingly to the actions of the agreement? A contract does not exist simply because there is an agreement between people. The parties to the agreement must intend to enter into a legally binding agreement. To discuss this first we have to think about the legal capacity of a contract. So then we have to see whatâs the difference between a legally binding promise or an agreement and a mere promise which has no legal consequences. For this purpose theremust be a clear view to see what are requirements of an agreement to be a legally binding contract. First the parties must intend the agreement to be legally binding.

Middle

Balfour. She did not rebut the presumption.ââ. This statement clearly shows that the rebuttable presumption on social and domestic agreements is that parties do not intend to be legally bound when they enter in to agreements. But as it is meant to be the presumption can be rebutted. Merritt v Merritt (1970) is a best example for such a rebutted presumption. In this case the husband left the matrimonial house to live with another women and he agreed to his wife in writing to pay her £40 per month maintenance from which she had to repay the mortgage and, when the repayment was completed, to transfer the house into a sole ownership. The wife did in fact pay off the mortgage but the husband changed his mind. She sued and succeeded because the court of appeal decided that there was clear intent. Crucially, they were legally separated.So itâs clear in Balfour, on the other hand Merritt case illustrates that the courts want to avoid unwanted litigations rushing in the courts by these social and domestic agreements and the parties had entered a binding contract as the setting of the agreement was commercial and no domestic or social.

Conclusion

And it statedthat it was a basic condition of the relationship between the parties that any transaction entered into in respect of the pool should not be attended by or gives rise to any legal relationship. And it was held that the words âBinding in honour onlyâ were contained on each coupon and these words were sufficient to rebut the presumption. On these examples clearly shows when the agreements arrive in a commercial context the courts presume that the parties of the agreement do intent to create legally binding relations and that presumption can be rebutted. According to the above facts itâs clear that an agreement of the parties is becomes with the all three combination of intention, offer and acceptance crucial element to make a legally binding agreement. So, only just saying that a party to create an agreement with intention to create legal relation does not make any sense to the other party if the agreement even carried out and then breached, but there must be clear evidence to justify that whether or not the parties really intended them to be so exposed or to find really what is in the parties mind. Reference, 1. P. Richards: The law of contract 09thEd.

The above preview is unformatted text

Found what you're looking for?

  • Start learning 29% faster today
  • Over 150,000 essays available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Over 180,000 student essays
  • Every subject and level covered
  • Thousands of essays marked by teachers

Related University Degree Contract Law

  1. Critically discuss the presumptions relating to the intention to create legal relations.

    Here the husband had left his wife to live with another woman. The husband in writing stated that he would pay £40 for maintenance, which she had to pay the mortgage with, and when the mortgage was complete he would transfer the house to her name.

  2. A contract is a legally binding agreement between two or more parties. An agreement ...

    if not he would have to make arrangements in order to accept delivery of the total. As the claimant had heard nothing further from the offeror he sent his letter of acceptance. Upon discovering that the iron had been sold to a third party the claimant then proceeded to sue for breach of contract.

  1. The mere prescence of consideration normally implies the existence of an intention to ...

    The intention requirement requires the manifestation of objective intention. The argument in effect introduces a rule of formality into the formation contracts. The formal requirements become not writing, or signature, but offer, acceptance and consideration. The parties who fulfil these basic elements will be deemed to have made a bargain, unless proved otherwise.

  2. To make a contract legally binding, there must be an explicit offer and acceptance, ...

    "In a unilateral contract the offeror promises payment or reward in exchange for the offeree performing a particular act or acts"2. The above rule regarding invitations to treat does not apply to unilateral contracts. Captain Puffin makes the first offer in the form of his posted letter to Lucia.

  1. Determine the legal position of Mr Sagar and Mr Grove.

    acknowledged several factors as being relevant aids to determining the application of the intention test. These include: the importance of the statement; reliance of the other party on that statement; and the relative knowledge and expertise of the parties. In Esso Petroleum Co Ltd v Mardon (1976), Mardon bought a

  2. Contract law - Carlill V Carbolic. - House of Lords Appeal case.

    by any act of her own establish a claim, for, to establish her right to the money, it was necessary that she should be attacked by influenza - an event over which she had no control. The words express an intention, but do not amount to a promise: Week v.

  1. Advise Anna of her legal position

    or would have acted as they did without any such contract, there is no necessity to imply a contract. It is merely putting the same point another way to say that no intention to make any contract will be inferred."

  2. Doctrine of Intention to Create Legal Relations

    to be a contract.4 A couple of exceptions are where the family circumstances have changed drastically for the worse since when the contract was formed, in which case intention to create legal relations usually stands. For example, in Merritt v Merritt the wife's action was rebutted, because in comparison to

  • Over 180,000 essays
    written by students
  • Annotated by
    experienced teachers
  • Ideas and feedback to write
    your own great essays

Marked by a teacher

This essay has been marked by one of our great teachers. You can read the full teachers notes when you download the essay.

Peer reviewed

This essay has been reviewed by one of our specialist student essay reviewing squad. Read the full review on the essay page.

Peer reviewed

This essay has been reviewed by one of our specialist student essay reviewing squad. Read the full review under the essay preview on this page.