kazzasingh's version from 2017-03-30 12:14

Domestic Arrangements

Question Answer
Balfour v Balfour [1919] There is a rebuttable presumption against an intention to create a legally enforceable agreement when the agreement is domestic in nature.
Maple Leaf Macro Volatility Master Fund v Rouvroy [2009]The case involved a dispute between Maple Leaf, a Cayman incorporated hedge fund, and Astin, an investment manager, on the one hand, and the senior executives of a French drinks company on the other. The defendants sought to raise €30m to fund their acquisition of shares in a large French holding company. The parties negotiated a termsheet with Maple Leaf as lender, which was signed by Maple Leaf, Astin and the defendants but not by another party to the term sheet. The defendants argued that by signing the termsheet, they did not intend to enter into a contract as they said that such documents were not considered legally binding. Instead the termsheet simply signaled a non-contractual commitment to continue negotiations.
Merritt v Merritt [1970]A husband left his wife and went to live with another woman. There was £180 left owing on the house which was jointly owned by the couple. The husband signed an agreement whereby he would pay the wife £40 per month to enable her to meet the mortgage payments and if she paid all the charges in connection with the mortgage until it was paid off he would transfer his share of the house to her. When the mortgage was fully paid she brought an action for a declaration that the house belonged to her. Held: The agreement was binding. The Court of Appeal distinguished the case of Balfour v Balfour on the grounds that the parties were separated. Where spouses have separated it is generally considered that they do intend to be bound by their agreements. The written agreement signed was further evidence of an intention to be bound.
Jones v Padavatton [1969]A mother promised to pay her daughter $200 per month if she gave up her job in the US and went to London to study for the bar. The daughter was reluctant to do so at first as she had a well paid job with the Indian embassy in Washington and was quite happy and settled, however, the mother persuaded her that it would be in her interest to do so. The mother's idea was that the daughter could then join her in Trinidad as a lawyer. This initial agreement wasn't working out as the daughter believed the $200 was US dollars whereas the mother meant Trinidad dollars which was about less than half what she was expecting. This meant the daughter could only afford to rent one room for her and her son to live in. The Mother then agreed to purchase a house for the daughter to live in. She purchased a large house so that the daughter could rent out other rooms and use the income as her maintenance. The daughter then married and did not complete her studies. The mother sought possession of the house. The question for the court was whether there existed a legally binding agreement between the mother and daughter or whether the agreement was merely a family agreement not intended to be binding. Held: The agreement was purely a domestic agreement which raises a presumption that the parties do not intend to be legally bound by the agreement. There was no evidence to rebut this presumption.

Social Arrangements

Question Answer
Coward v MIB [1963]Coward was killed whilst riding pillion on a motorcycle driven by a friend and work colleague on the way to work. The collision was due to the negligence of the friend. Coward's widow sought to claim damages from the Motor Insurance Bureau since the rider's insurance did not cover pillion passengers. The Motor Insurance Bureau would only be obliged to pay if insurance for the pillion was compulsory. Insurance was only compulsory for pillions if they were carried for hire or reward. Coward paid the friend a small weekly sum to take him to and from work each day. The widow therefore argued that this was a contract for hire or reward. However, the MIB argued that to amount to a contract for hire or reward there had to be an intention to create legal relations which was absent in agreements of this nature between friends. Held: There was no contract of hire or reward as it was a social and domestic agreement and therefore no intention to create legal relations. The widow was therefore not entitled to compensation.
Albert v MIB [1971]A docker was killed in a road collision on his way to work. He was a passenger in a car owned and driven by a work colleague. The driver gave lifts to the deceased and other dockers in return for payment. He had given lifts to different dockers over a period of eight years. A claim was made against the Motor Insurance Bureau (MIB) as the driver had no insurance cover for passengers. The MIB was only obliged to pay if there existed a contract between the docker and the driver. Held: The lifts were offered in a commercial context as he had given lifts to different people over a period of time. Therefore there was an intention to create a binding contract.
Hadley v Kemp (1999)K, a member of the pop group, was credited as the author of all the group's songs but shared the income from this with other members of the group and their manager. When K discontinued the payments, they claimed damages for breach of contract → Held no enforceable contract. “I am not persuaded that. .. [K's] decision to share his publishing income, and his statement to the band about it, were made with an intention to create legal relations”
Parker v Clarke (1960)Mrs Parker was the niece of Mrs Clarke. An agreement was made that the Parkers would sell their house and live with the Clarkes. They would share the bills and the Clarkes would then leave the house to the Parkers. Mrs Clarke wrote to the Parkers giving them the details of expenses and confirming the agreement. The Parkers sold their house and moved in. Mr Clarke changed his will leaving the house to the Parkers. Later the couples fell out and the Parkers were asked to leave. They claimed damages for breach of contract. It was held that the exchange of letters showed the two couples were serious and the agreement was intended to be legally binding because (1) the Parkers had sold their own home, and (2) Mr Clarke changed his will. Therefore the Parkers were entitled to damages
Simpkins v Pays [1955]A Grandmother, granddaughter and a lodger entered into a weekly competition run by the Sunday Empire News. The coupon was sent in the Grandmothers name each week and all three made forecasts and they took it in turns to pay. They had agreed that if any of them won they would share the winnings between them. The grandmother received £250 in prize money and refused to share it with the other two. The lodger brought the action to claim one third of the prize money. Held: There was a binding contract despite the family connection as the lodger was also party to the contract. This rebutted the presumption of no intention to create legal relations.

Commercial Arrangements

Question Answer
Edwards v Skyways [1964]The claimant was an airline pilot working for the defendant. He was to be made redundant. The defendants said that if he withdrew his contributions to the company pension fund, they would pay him the equivalent of company contributions in an ex gratia payment. The claimant agreed to this and withdrew his contributions. The company then ran into further financial difficulty and went back on their promise relating to the ex gratia payment.Held:The agreement had been made in a business context which raised a strong presumption that the agreement is legally binding. The claimant could therefore enforce the agreement and was entitled to the money.
Esso Petroleum Ltd v Commissioners of Customs and Excise [1976]Esso ran a promotion whereby any person purchasing four gallons of petrol would get a free coin from their World Cup Coins Collection. The question for the court was whether these coins were 'produced in quantity for general resale' if so they would be subject to tax and Esso would be liable to pay £200,000. Esso argued that the coins were simply a free gift and the promotion was not intended to have legal effect and also that there was no resale.Held: 3:2 There was an intention to create legal relations. The coins were offered in a commercial context which raised a presumption that they did intend to be bound. However, the coins were not exchanged for a money consideration and therefore the coins were not for resale.
Rose & Frank Co v Crompton Bros [1925]The claimants and defendants entered an agreement for the supply of some carbonised tissue paper. Under the agreement the claimants were to be the defendant's sole agents in the US until March 1920. The contract contained an honourable pledge clause which stated the agreement was not a formal or legal agreement and shall not be subject to the jurisdiction of the courts in neither England nor the US. The defendants terminated the agreement early and the claimants brought an action for breach. Held: The honourable pledge clause rebutted the presumption which normally exists in commercial agreements that the parties intend to be legally bound by their agreements. The agreement therefore had no legal affect and was not enforceable by the courts.