- What is Intention to create legal relations
- When can we say there is intention to create legal relations between parties
WHAT IS INTENTION TO CREATE LEGAL INTENTIONS
The concept of intention to create a legal intent is fundamental to contract law as it provides the basis for the formation and enforceability of a contract. This principle revolves around the intention of the parties to be legally bound by their agreement.
The basic elements under the intention to create legal intentions includes;
A. Offer and acceptance: The parties must make an explicit offer and acceptance to show that both parties are willing to be bound by the law.
B. Intention to establish legal intentions: The parties must have a genuine intention to establish a legal relationship because in the absence of such intent, the agreement may not be binding.
C. Reasonable man test: this is to analyze whether a reasonable person would perceive the intention to establish a legal relationship based on the actions and expressions of the parties.
D. Presumption and rebuttal: this is common under social and family agreements because there is always presumption of absence of legal intent. However, this is rebuttable if evidence shows contrary intent.
E. Business Agreement: under this type of agreement there is presumption of legal intent and it may be refuted under certain circumstances.
F. Consideration: this is about value exchange because the existence of consideration strengthens the inference of legal intention and also support the seriousness of the agreement.
Below are sample cases;
A. Balfour v. Balfour (1919): in this case, social and family agreements are not presumed to have legal intent. This also makes commitments made by spouses during separation not to be binding.
B. Merritt v. Merritt (1970): in this case, separated spouses can reach an agreement in a business context and this would maintain their legal intent based on the context and written nature of the agreement.
C. Carlill v. Carbolic Smoke Ball Co. (1893): in this case, it is proven that advertising constitutes an exception to a unilateral contract where the court found that the company had serious intentions to be bound by the law.
WHEN CAN WE SAY THERE IS INTENTION TO CREATE LEGAL RELATIONS BETWEEN PARTIES
1. Clarification of the agreement: when there is a clear offer and acceptance from both parties this can be seen commitments and also as the will to be bound by the law.
2. Business Agreement: the law always presumes legal intent under business agreements and this can only be rebutted under special circumstances.
3. Written contract: when there is an official document for the contract, it usually indicates serious intentions and the court may infer legal intent from the form of document.
Below are some cases;
A. Carlill v. Carbolic Smoke Ball Co. (1893): this is where advertisement can constitutes a unilateral contract and the company’s specific commitments demonstrate its serious intention to be bound by law.
B. Edwards v Skyways Ltd (1964): this is the case where an employees handbook contains terms that form a binding contract. This demonstrates the importance of context and specific language in inferring legal intent.
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