The Types of Intentions in a Contract

Intentions in a Contract to be Legally Binding

The cases that involved where the parties illustrate to be legally or not legally bonded by a contract include the following case:

• Carlill v Carbolic SmokeBall Co (1983)

Contracts between Family Members

In most of the cases, once an agreement is established among or between family members, it is regarded as an enforceable agreement. The reason is that there is no intention by the family members to legally enforce the contract. The following case illustrates this:

• Balfour v Balfour (1919)
• Cohen v Cohen (1929)
• Merritt v Merritt (1970)
• Wakeling v Ripley (1951)

Contracts between Friends

When a party establishes an agreement with a friend or friends, which is voluntary or charitable, then the agreement is not enforceable. However, an objective assessment of the agreement may be done in terms of the circumstances involved in the establishment of the agreement. The following cases illustrate this:

• Teen Ranch Pty Ltd v Brown (1995)
• Ermorgenous v Greek Orthodox of Community of SA Inc (2002)

Commercial Agreement

An agreement reached in a commercial context is inferred to be legally binding. With this on hand, if a party negates that the agreement commercial agreement, then the said party must present substantial pieces of evidence to prove that the agreement is not commercial. This is illustrated in the following cases:
Esso Petroleum Co Ltd v Commissioners of Customs and Excise (1976)

Conditional Agreement

In instances when the parties in a contract still await the delivery of a certain action or the occurrence of an event, the establishment and enforceability of the contract can still be delayed. However, there must be due care and diligence on the sides of the involved parties. This is important in order to avoid any misconception of avoiding contractual obligations.

• Masters v Cameron (1954)
• Perri v Coolangatta Investments Pty Ltd (1982)