Intention to create Legal Relations Readings R&D contract Law chapter 3 Certainty refers to cases where there was a deliberate use of vague or ambiguous language. Or cases where the parties have deliberately made the contract vague to discuss certain terms at a later date. . An agreement can be incomplete without being vague. - leaving the terms to be discussed at a later date. · Vague cases always shade into incompleteness. Vague agreement If an agreement has vague terms that courts cannot understand or specifically enforce the agreement is classed void and is not a contract. Scammel V Ouston 1941 The buyer purchased a lorry with the price to be paid 'on hire purchase terms' House of lords thought it was uncertain, so the contract was void. The courts try to execute the contracts so they will look for a way to find the meaning such as the action of the parties as in the case of Hillas & co ltd v arcos ltd. Incomplete agreements The court will not enforce agreement which is missing essential elements. May & Butcher v the king 1929 There was an agreement with the date and price to be agreed upon later date. The house of lords held it is incomplete. The argument was that if you had asked the buyer and the board how much they would pay and receive and when, they would not have been able to tell you. Vidscount Dunedin accepted that an agreement may leave something to be determined in the future- for instance, by a third party and still be certain but it must not rely upon the parties coming to an agreement in the future. This case has also had an important point on interpretation of SOGA Act 1979. The courts will accept an agreement to agree as workable when the parties provide a mechanism for completion in the event of their not being able to agree. Folley v Classique coached 1934 Same agreement as may case but later clause included that if any disputes should arise this will be passed to arbitration the courts were happy to enforce that as it's being ascertained. If the agreement has been partly performed the SOGA act says that the court should enforce a reasonable price rather than scrapping the agreement.
An intention to create a legal relationship. There are two rules but they are prima facie meaning first impression rules which can be reversed in appropriate circumstances. They are called rebuttable presumptions. The first presumption is that domestic and social agreements lack an intention to create a legal relationship. The second presumption is that commercial agreements are intending to create a legal relationship between parties. Which means in a commercial agreement situation it is up to the purpose to prove the assumptions wrong. Domestic agreements Balfour v Balfour 1919 A husband promised to pay his wife £30 per month while he is away working and upon separation wife sued the husband for that but courts said there was