‘In the cases where the issue is litigated, it seems likely that one party

intended to a legal agreement and the other wanted the agreement to be

merely morally binding. This contradiction removes any possibility of
justifying the limits of contracts on the basis of the joint intent of the parties.
We are forced to the conclusion that the courts must rely on hidden policy
considerations when determining the intentions of the parties’

Critically assess the doctrine of intention to create legal relations in the

light of the above statement and relevant legal developments.

The idea that parties must have an intention to be bound by the terms of their
agreement is known generally as the ‘doctrine of intention to create legal
relations.’ After first being acknowledged by Professor Simpson in Carlill v
Carbolic Smoke Ball Co Ltd,1 the establishment of the idea as an essential
independent element required for the formation of a contract was highlighted
in Balfour v Balfour CA 1919. However, the principle is not so clear cut.
Academics have expressed their doubts and ‘the origins of dispute on the
need for an intention to create legal relations are ancient. Professor
Zimmerman has traced the history from the classical Roman Stipulatio.’2
This essay will subsequently assess these difficulties and analyse the
doctrine’s justification in relation to legal developments and the future of
contract law.

The doctrine has generally run smoothly in reference to commercial

agreements where the assumption that parties intend to be legally bound is
strong. However, intention to create legal relations plays its most important

1
McKendrick, Ewan, Contract Law: Text, Cases and Materials, second edition, Oxford University Press
Inc, New York, 2005, p.295
2
McBryde, William, ‘The Intention to Create Legal Relations’, Judicial Review, 274 (1992), p.275

Page 1 of 6
role in the context of domestic and social agreements3 where the inverse is
presumed and thus difficulties arise as to the policy articulated – that law
should in general, keep out of the regulation of domestic and social
agreements.4

As mentioned, the landmark development of the principle was Balfour v

Balfour.5 Here, the defendant promised to pay his wife (plaintiff) £30 per
month as maintenance, but failed to keep up the payments when the
marriage broke up. Following an appeal to the Court of Appeal, it was held
D was not liable as (1) there was no consideration moving from the wife to
husband for the promise to pay £30;6 and (2) agreements between husbands
and wives are not contracts because the parties do not intend them to be
legally binding.7 The precedent was therefore set by Lord Atkin that
‘agreements such as these are outside the realm of contracts altogether.’8
The case of Pettitt v Pettitt further extended the scope of the presumption set
in domestic agreements. It was promoted that Balfour must also apply by
analogy to parties who cohabit, whether married or not.9 Thus in Jones v
Padavatton, the presumption was once again maintained between a mother
and daughter. In this case judgment though, Salmon LJ indicated that
bargain was used as the test of contractual intention, hence implying the
doctrine of intention to create legal relations as futile.10

3
Op.Cit. McKendrick, Ewan,1 p.295
4
Ibid, p.295
5
Balfour v Balfour [1919] 2 KB 571, Court of Appeal
6
Balfour v Balfour [1919] 2 KB 571, Court of Appeal, p.577/578 per Duke LJ
7
Ibid, p.578 per Atkin LJ
8
Ibid, p.579 per Atkin LJ
9
Op.Cit. McKendrick, Ewan1 p.301
10
Hepple, B.A, ‘Intention to Create Legal Relations’, The Cambridge Law Journal 122 (1970), p.129

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Generally, complications in relation to the doctrine arise when the strict
policy presumptions are rebutted. In Merritt v Merritt, the courts
distinguished the case from the precedent as it was held that even though it
concerned an agreement between husbands and wives as in Balfour v
Balfour, the relationship between the parties had broken down. The
agreement was therefore binding.11 Evidently, the issue of rebuttals is a
controversial one as the law in effect is interfering. It is contended though
that the context in which the agreement was concluded is vital and cannot be
overlooked.12 Consequently, where social agreements are connected to
commerce or the running of a family business as in the case of Snelling v
John G Snelling Ltd, it was declared the agreement was intended to give rise
to legal relations.13

Rebuttals in commercial law are much less of an occurrence. Here, the

presumption in favour of intention to create legal relations can only be
rebutted by express words as in Rose v. Frank Co. v. J.R. Crompton and
Bros Ltd.14 The House of Lords ruled that the clear words used meant the
agreement should ‘not be subject to legal jurisdiction in the law courts.’15

Following the above legal developments, the doctrine has been suspect to its
worthiness. The key issues lie with the rationale behind it. Criticism has
been expressed as to the basis of the presumption in domestic agreements.16
‘The judgment of Lord Atkin in Balfour suggests that the initial presumption

11
Merrit v Merritt [1970] 1 WRL p.1211
12
Op.Cit. McKendrick, Ewan1 p.302
13
Snelling v John G Snelling Ltd [1973] 1 QB p.88
14
Rose and Frank Co. v JR Crompton and Bros Ltd [1925] AC 445
15
Duxbury, Robert, Contracts in a nutshell, Sweet and Maxwell Limited, London, 2003, p.16
16
Op.Cit McKendrick, Ewan1 p.304

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is derived from the law, rather than the intention of the parties…i.e. the
common law does not regulate the form of agreements between spouses…’17
Professor Kahn-Freund defended the precedent as being a wise decision in
which the courts allowed the realities of life to determine the legal norm
formulated.18 On the contrary, Professor Freeman utters that marriage has
become a personal rather than a social institution, thus implying that Balfour
no longer echoes the realities taking place in family life today.19

Another angle of the doctrine’s assessment is its necessity i.e. if as expressed

by the judgment of Duke LJ in Balfour, the doctrine has a link with the
independent element of consideration. Thus, it is claimed that the ‘intention
to create legal relations’ is just another obstacle that a claimant must
overcome.20 The case of White v Bluett reiterates this critique that the two
distinct doctrines can often overlap. In this case, the overlap concerned the
vagueness of promises.21

Lord Stowell submits his support for the doctrine that ‘contracts must not be
the sports of an idle hour, mere matters of pleasantry and badinage, never
intended by the parties to have any serious effect whatever.’22 Professor
Williston though challenges that the doctrine is only adopted in systems
which lack the test of consideration, thus emphasizing that only
consideration, bargain and legal consequences are interrelated concepts.23

17
Ibid, p.304
18
Kahn-Freund, ‘Inconsistencies and Injustices in the Law of Husband and Wife’ (1952) 15 MLR 133, 138
19
Halson. R, ‘Contracting in the Haven: Balfour v. Balfour Revisited’, Exploring the Boundaries of
Contract (Dartmouth, 1996), p.75-77
20
Op.Cit. McKendrick, Ewan1 p.305
21
Ibid, p.306
22
Cheshire, Fifoot & Furmston, Law of Contract, fourteenth edition, Butterworth’s, London, 2001, p.121
23
Ibid, p.121/122

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Further assessment of the doctrine as a whole concerns the question of the
parties’ intent. Instead of rebutting the presumption that parties intend to
create legal relations, a defendant may well claim a lack of contractual
intent, which encompasses additional evaluation of whether parties had in
fact reached agreement.24 Once again, the matter is an overlap of theory
particularly where agreements are expressed in vague terms, which could
suggest both that parties failed to reach agreement on the same terms and
that they were short of intent to create legal relations.25

It is argued though that these two issues are distinguishable when

establishing the burden of proof. In other words, when proving a contract
has been achieved, the burden of proof rests with the claimant. Yet, once the
existence has been established, the responsibility lies with the defendant to
contend that there was no intention to create legal relations.26

In conclusion, the underlying question that rests before us is whether the law
of contract requires the doctrine of intention to create legal relations. Having
contemplated the main criticisms, I personally feel that the law already
consists of technicalities and that simplification of it would be beneficial. I
believe what weakens the doctrine the most is its overlap with the principle
of consideration, which actually adds more weight to the argument of
Professor Williston. On the other hand, it is important to bear in mind the
floodgates argument explained by Lord Atkin in Balfour. This promoted the
view that without the intention to create legal relations, ‘the small courts of
24
Op.Cit McKendrick, Ewan1 p.313
25
Ibid, p.313
26
Ibid, p.313

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this country would have to be multiplied one hundredfold if these
arrangements were held to result in legal obligations.’27 This therefore
implies that if this further ‘hurdle’ as such to prove a contract was not
required, there would be social unrest and litigation would be necessary to
mediate every social agreement. On this point, I feel the doctrine can be
justified but that it will remain an issue of controversy.

Bibliography

- Balfour v Balfour [1919] 2 KB 571, Court of Appeal

- Cheshire, Fifoot & Furmston, Law of Contract, fourteenth edition,
Butterworth’s, London, 2001
- Duxbury, Robert, Contracts in a nutshell, Sweet and Maxwell
Limited, London, 2003
- Halson. R, ‘Contracting in the Haven: Balfour v. Balfour Revisited’,
Exploring the Boundaries of Contract (Dartmouth, 1996)
- Hepple, B.A, ‘Intention to Create Legal Relations’, The Cambridge
Law Journal 122 (1970)
- Kahn-Freund, ‘Inconsistencies and Injustices in the Law of Husband
and Wife’ (1952) 15 MLR 133
- McBryde, William, ‘The Intention to Create Legal Relations’, Judicial
Review, 274 (1992)
- McKendrick, Ewan, Contract Law: Text, Cases and Materials, second
edition, Oxford University Press Inc, New York, 2005
- Merrit v Merritt [1970] 1 WRL
- Rose and Frank Co. v JR Crompton and Bros Ltd [1925] AC 445
- Snelling v John G Snelling Ltd [1973] 1 QB
-

27
Op.Cit. McKendrick, Ewan1 p.304

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