To what extent do judges establish the existence of a contract based on the intention of the parties?
To what extent do judges establish the existence of a contract based on the intention of the parties?
In 1893, the famous case of Carllil v Carbolic Smoke Ball Co.1 demonstrated the extent of the establishment of a legally binding contract based on the intention of the parties via advertisements. However, the formation of contracts is not solely based on the intentions between parties. After the invitation to treat, there should be an offer and acceptance, intention to create legal relation, consideration, capacity, legality, possibility and certainty, and only when both parties have fulfilled all these requirements would a traditional binding contract be formed. Therefore, would a contract be legally binding or does it even exist if it is solely based on the intention of the parties? In my answer, I will be discussing why the existence of some contracts are recognised based on the intention of the parties and some do not.
The intention to create legal relations means that the agreements between parties will be legally binding and enforceable by law if things do not go as planned. Traditionally, a formal contract is formed (as mentioned before) by a way of a deed where all elements such as offer and acceptance, consideration and certainty are involved, and therefore, there is no doubt that there is legal intent. Other less formal agreements can be into three categories which are social and domestic agreements (i.e. a father promises his son to buy him a video game if he passes his exam); commercial agreements (i.e an employer promises his/her employee to raise his/her wages) and advertisements (i.e. a supermarket promising their customers to pay them the difference if their products are more expensive than other supermarket). As these agreements can be in verbal, written or implied form, it is often vague and unclear in whether the agreement is legally intent or a puff to attract people's attention. Therefore, the role of court is to identify the initial
In 1893, the famous case of Carllil v Carbolic Smoke Ball Co.1 demonstrated the extent of the establishment of a legally binding contract based on the intention of the parties via advertisements. However, the formation of contracts is not solely based on the intentions between parties. After the invitation to treat, there should be an offer and acceptance, intention to create legal relation, consideration, capacity, legality, possibility and certainty, and only when both parties have fulfilled all these requirements would a traditional binding contract be formed. Therefore, would a contract be legally binding or does it even exist if it is solely based on the intention of the parties? In my answer, I will be discussing why the existence of some contracts are recognised based on the intention of the parties and some do not.
The intention to create legal relations means that the agreements between parties will be legally binding and enforceable by law if things do not go as planned. Traditionally, a formal contract is formed (as mentioned before) by a way of a deed where all elements such as offer and acceptance, consideration and certainty are involved, and therefore, there is no doubt that there is legal intent. Other less formal agreements can be into three categories which are social and domestic agreements (i.e. a father promises his son to buy him a video game if he passes his exam); commercial agreements (i.e an employer promises his/her employee to raise his/her wages) and advertisements (i.e. a supermarket promising their customers to pay them the difference if their products are more expensive than other supermarket). As these agreements can be in verbal, written or implied form, it is often vague and unclear in whether the agreement is legally intent or a puff to attract people's attention. Therefore, the role of court is to identify the initial