Intention to Enter Legal Relations

Much academic controversy has been generated over whether an intention to enter into legal relations between parties is necessary to make an agreement enforceable. Some academics are of the view that it should not be necessary, and parties should generally be held bound by their promises. While this is true for commercial agreements, the same cannot be said for social and domestic agreements. Should a husband who has promised to buy his wife a house if she goes with him to see his family be held bound by such a promise?

This argument is purely academic in nature has the courts have reached the conclusion that there should be an intention to enter into legal relations before a person can be held bound by a promise. A person, who either from his words or conduct, has shown that he does not what to be legally bound by his promise should not be held bound by that promise. While in some cases like in social and domestic agreements, there is a presumption that parties do not intend to be legally bound by their promises, there is a presumption that parties intend to be bound by their promises in commercial agreements.

Domestic and Social Agreements

The presumption of the court in domestic and social agreements is that there is no intention to be legally bound by the parties. If a man promises his brother to pay him for sweeping a room, there shall be an assumption by the court that there was no intention to be legally bound by the promise. In Balfour v. Balfour, a Briton was employed by the Government of Ceylon. He returned home on leave with his wife but she was unable to return to Ceylon with him because of her ill health. He promised her an allowance of 30 pounds every month until she was able to join him. When the husband later did not send the money to her and she brought an action, the court held that the promise could not be enforced as there was no intention to enter into legal relations. Other cases where promises were held to not be binding for lack of intention to enter legal relations are Spellman v. Spellman and Jones v. Padavatton.

While there is a presumption by the court that there is no intention to enter into legal relations in domestic and social agreements, this presumption may be rebutted by proving otherwise. Three situations in which the domestic agreements might be held to be binding is when couples have been separated or are estranged, when the agreement is in writing, or when there has been great sacrifice on the part of one or both of the parties. In McGregor v. McGregor, a couple had taken out cross-summonses against each other for assault. It was agreed in settlement that each should withdraw their action, the parties should live apart and that the husband should pay a weekly sum for the maintenance of the wife and children. The agreement was held binding. In Meritt v. Meritt an agreement between a separated couple was held binding.

An agreement shall also be binding if one or both of the parties has made great sacrifice in furtherance of the agreement. In Parker v. Clark, the defendant invited the plaintiff, his nephew, to move into his house and sell his own house. After a quarrel between the couples, the Clarks attempted to evict the Parkers on the claim that the agreement was not binding. The court held that the agreement was binding since great sacrifice had been made by the Parkers in selling their house.

Commercial agreements

There exists a presumption in commercial agreements that agreements made are binding as there is an intention to be legally bound. A person who has agreed to sell his house for a sum of money cannot claim that he did not intend to be bound by his promise. This presumption may also be rebutted. When the statement is a mere puff and not intended to be taken seriously or literally and when the agreement itself contains a clause expressly excluding the intention to create legal relations, then the agreement shall not be binding even if it is a commercial one.

Some statements are made only as a mere puff and are not intended to be taken seriously by a reasonable person. If an energy drink producer promises that the drinks will make a man jump higher than a house, a reasonable person should not expect such a statement to be true. The statement is only made to excited individuals into using their products and there is no intention to be legally bound. In Weekes v. Tybald, the defendant told the plaintiff that he would give 100 pounds to any man who married his daughter. It was held that it was a mere puff and there was no intention to enter into legal relations when the plaintiff sued to enforce the payment. In Carlill v. Carbollic Smoke Ball Co., the defendants tried to claim that their promise to give 100 pounds to whoever used their smoke ball and still got influenza was a mere puff and was not intended to be taken seriously. The court held it binding since the defendant showed from their conduct to be serious, especially by claiming that 10,000 pounds had been deposited in the bank in furtherance of such.

In the second scenerio, a person may show that he does not intend to be legally bound by a promise if such is stated expressly in the contract. The parties to such contracts can only hope that the promisor shall honour a promise made under such contracts. This is common in football pools where the pool houses state that there is no intention to be legally bound to prevent being taken to court every time a person feels he has won. In Amadi v. Pool House Group and Nigerian Pools Co. and Jones v. Vernon's Pools Ltd., the courts held that the defendants had successfully shown a lack of intention to enter legal relations by stating such expressly.

Intermediate Situations

Intermediate situations refer to situations which are not quite social and domestic agreements and are not commercial agreements either. In these kinds of situations, is there an intention to enter legal relations? One example is an agreement by parents who live close together to take turns in taking their children to school. There comes up the question of whether there is an intention to enter legal relations in such a situation. In the case of Coward v. Motor Insurers Bureau, it was held that in the absence of evidence to show that the parties intended to be bound contractually, the courts should be reluctant to conclude that the daily carriage by one of another to work upon payment of some weekly sum involved them in any legal contractual relationship. In ACB v. Nwodika, the court held that the contractual effect of an agreement between employers and employers would depend on a number of factors. Therefore, in the absence of express statements on whether or not there is an intention to be legally bound in intermediate situations, the decision of the court would depend upon the facts and circumstances of each case.