UNLOCKING CONTRACT LAW
Formation of a Contract: Intention to Create Legal
Relations
(see Chapter 4 of Unlocking Contract Law, Third Edition)
Juan married Andrea five years ago. They had two children and lived in a house in
London. The couple's life became progressively less happy, and they decided to split
up. Andrea promised Juan that, if he kept the children in the family house, took care of
them and made sure they were happy, she would make monthly payments of £2,000 up
until the children left school. Juan accepted, but Andrea stopped making the payments
after three months.
Advise Juan (only as regards his rights under the law of contract).
In resolving problem questions it is best to use the ISAC formula:
• Identify the issues
• State the law
• Analyse
• Conclude
Relevant Issues: The issues relevant to Juan's problem are:
• Whether there is intention to create legal relations, and
• whether there is consideration to support his promise to take care of his children.
Law and Analysis: As Juan and Andrea are family, the presumption that agreements
between them lack intention to create legal relations (Balfour v Balfour [1919] 2 KB 571) will
need to be rebutted. While it is true that agreements between couples will not carry an
intention to create legal relations, when couples are in the process of separating, and they
seek to arrange their obligations in a formal manner, the presumption will be rebutted (Merritt
v Merritt [1970] 1 WLR 1211). On the issue of consideration, the problem is that the
performance of a statutory duty (taking care of one's children for instance) cannot be deemed
as consideration for a private agreement as a matter of public policy. However, when one
exceeds the statutory duty (making sure the children are happy, for example), the promise will
be supported by consideration (Ward v Byham [1956] 1 WLR 496).
Conclusion: If Juan sues Andrea for not honouring the promise to pay monthly maintenance
for the children, he is likely to be successful as their agreement was supported by
consideration and had the intention to create legal relations.
Summary: Relevant issues are:
• intention to create legal relations, and
• consideration.
Juan is likely to succeed.
Unlocking Contract Law Third Edition
© Ioannis Glinavos 2011