Intention of Legal Relations

You have to admire the guile of these question writers, don’t you!

Intra-family contracts / arrangements have always been tricky – and, of course, that’s why they get taken to Court!

The general presumption in a family arrangement is that there is no intention to create legal relations. But, as with all presumptions (well, nearly all) that underlying presumption can successfully be rebutted.

In the case Parker v Clark, the presumption was rebutted by the niece showing that she and her husband had changed their position (sold their house and moved to live with her aunt). Where, as a result of a promise given and received, the promissee changes their position and gives to the promisor something in exchange for the promise received, that would suggest that the promise was made with the intention to create legal relations.

In Amy’s case, she treated the promise as an enforceable contract and went ahead with the work that Ben had asked for.

Choice A – The law presumes that no intention to create legal relations exists between Ben and Amy because they are related – is the ‘normal’ approach adopted by the law

Choice B – The law presumes that intention to create legal relations exists between Ben and Amy because they are entering into a form of business transaction – no! The presumption in a family context is that there is no intention
Choice C – There is clear evidence to rebut the presumption that intention exists – on the contrary, the evidence clearly shows intention

Choice D – There is clear evidence to rebut the presumption that intention does not exist – as explained

I can empathise with your choice of B / C, but …

Choice A cannot be paired with either choice B or choice C – neither of those, when combined with choice A, makes any sense

Similarly, neither choice B nor C makes any sense when combined with choice D.

So the crux of this question is the correct selection between choices A and B and that fundamental presumption (until rebutted) is that, in a family contract, there is no intention to create legal relations.

Does that help?

Yes, the presumption is that ‘Intention does not exist’ That’s our start point.

But, as suggested by choice D, there is sufficient evidence to rebut that general presumption.

Consider option D as you have typed it

‘There is clear evidence to rebut the presumption that intention does not exist’

The presumption – no intention

Evidence to rebut – work carried by Amy in exchange for promise received from Ben.

Does Amy’s work and Ben’s promise combined give us sufficient evidence to say that ‘Yes, in fact, the general presumption should be set aside (rebutted) and we should accept that, in this case, the facts would support the idea that there is, in fact, an intention to create legal relations.

Now look at choice D again

‘There is clear evidence to rebut the presumption that intention does not exist’

Is that better?