Intention to Create Legal Relations

when are the parties presumed to intend to create legal relations?

in business or commercial agreements

when do the courts presume that parties do not intend to create legal relations?

in social or domestic agreements

what does rebuttable mean?

that the presumptions can be defeated to prove that the presumption was no true

when can a presumption that intention does exist be rebutted?

where there is clear wording that the agreement is not intended tobe legally binding

edwards v skyways

• skyway tried to avoid paying edwards after his redundancy

• failed since ex gratia suggested that a payment is only voluntary

jones v vernon's pools

• jones claimed he had a winning football pool coupon. the coupon was 'in honour only'

• due to the contract being 'in honour only', there was no attempt to create legal relations

mcgowan v radio buxton

• C entered a radio competition to win a renault clio. when c won, they received a model renault clio. buxton claimedthat they was no intention to create legal relations

• court decided that there was intent to create legal relations

kleinwort benson ltd v malaysian mining corp

• K lent £10m to part of mmc. mmc sent a letter of comfort stating their intention to pay k back. part of mmc went bankrupt without repaying k, k claimed based on the letter.

• a letter of comfort is not usually deemed a legally binding document