Contract i project

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Intention to create Legal Relations Page 1

CONTRACT PROJECT

Intention to create legal relations: Whether

it is sustainable in India or not?

Group members

Anand Vardhan Narayan (2011-16/B.A.LL.B/009)-Group leader

Anand Swaroop Das (2011-16/B.A.LL.B/008)

Arepalli Nagababu (2011-16/B.A.LL.B/015)

Jyoti Ranjan Deo (2011-16/B.A.LL.B/024)

Pragalbha Priyakar (2011-16/B.A.LL.B/037)

Utkarsh Kumar Mishra (2011-16/B.A.LL.B/059)

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ABSTRACT

„Intention to create legal relations‟ forms one of the basic elements in establishing a valid

contract across a number of jurisdictions around the world. However the law regarding the

same in India is still unsettled and consideration from both the contracting parties is usually

indicative of their intention to create legally binding relations. This research article will build

upon the same issue and try to establish the relationship between „intention to create legal

relations‟ and consideration. The main hypothesis of the paper will be to prove that

consideration reflects intention of the parties to the contract in India. This article will first talk

about how intention forms a basis of a contractual relationship. It will then shed some light

on consideration and will move on to a relationship between intention and consideration.

Thereafter the focus will shift to how intention is implicit in the consideration of the parties.

Lastly the article will talk about how the abovementioned issue has evolved in India and a

few other countries and will make a comparative study between the same.

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INTENTION AS A BASIS OF CONTRACT Intention, per se, is a quintessential element of transforming a contractual relationship as

legally enforceable. Along with all other elements, the court presumes the presence of

intention in contracts depending upon the context and the circumstances. . Intention has been

defined as “full advertence in the mind of the defendant to his conduct, which is in question,

and to its consequences, together with a desire for those consequences.”1 The agreement has

to be backed by intention of the two parties even if there is the presence of consideration. It is

well settled law in England that “An agreement, even though it is supported by consideration,

is not binding as a contract if it is made without any intention of creating legal relations2.

However in India there is no specific provision for intention to create legal relation in

establishing a valid contract.

Intention has been differentiated on the basis of presumption as-:

1. DOMESTIC/SOCIAL ARRANGEMENTS- In such conditions, the courts assume

that the parties do not intend to create a legal relationship. This is illustrated in the

case situations of Balfour v. Balfour3 and Jones v. Padvatton

4. The former one

exemplifies a domestic contractual setup between husband and wife and the latter

deals with a parent-child agreement. In both these cases, the court ruled that the

parties to the contract, in the capacity of the relationship they share, if at all promise

for a particular object, it is by virtue of the seriousness and inclusive nature of their

relation, to be treated as a trifle. The court stresses on the rule -de minimis non curat

lex5 - the law does not concern itself with trifles which may prevent legal effect being

given to agreements6. It is considered that such agreements do not give rise to any

legal relationship, nor is it intended by the parties that legal consequences shall flow

in these contracts.

1 P.H.Winfield, A Textbook of Law of Tort at 19(5

th edition, 1950)

2“ Chitty on Contracts ” (25th Edition, Volume I, para. 123)

3 Balfour v. Balfour [1919] 2 K.B. 571

4 Jones v. Padavatton [1969] 1 WLR 328

5 The common law concept of de minimis non curat lex was expressed in the English decision of The

"Reward"(1818) 6 See supra note 6

http://en.wikipedia.org/wiki/De_minimis



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2. BUSINESS/ COMMERCIAL AGREEEMENTS- The contracts of such a nature,

encompass a presumption that the parties to the contract do intend to create legal

relations. But, this presumption is open to be rebutted by the clear evidence to the

contrary. In Rose and Frank Co. V. Crompton and Bros. Ltd.7, it was held that there is

no legal relations in circumstances where the contract stated „This agreement is not

entered into as a formal or legal agreement'. Consequently, this presumption was

rebutted by adducing evidences thereby validating the contrary in a plethora of cases

including Evans v Merzario Ltd8 and Burrows v Brent LBC

9.

3. AGREEMENTS ENTERED INTO VOLUNATRILY-An exception to the above

stated rule comes into the forefront, while taking into account agreements entered into

voluntarily such that a person volunteers their services. Here, the law assumes it

unambiguously that the parties do not normally intend to create legal relations. This

presumption helps in analysing those cases where it is important to determine whether

the parties in a work situation intended to create an employment contract and

therefore be covered by worker‟s compensation10

.

The presumption which the courts take into consideration on the basis of the nature of

agreement, are rebuttable in nature11

. This principle usually finds its application in cases

where the factor of intention is implicit or has not been explicitly declared inter alia the

contractual provisions. The 1957 case of Todd v Nicol12

and that of Simpkins v Pays13

clearly

state this situation, where even the agreements of a domestic nature were awarded the status

of enforceable contracts. A Similar course of action was followed in agreements of

commercial nature and the same was adjudged in Jones v Vernon‟s Pools Ltd.14

and Esso

Petroleum Ltd v Commissioners of Customs and Excise15

.

7 Rose and Frank Co. v. Crompton and Bros Ltd. [1925] AC 445

8 Evans v. Merzario Ltd. [1976] 1 WLR 1078

9 Burrows v Brent LBC [1996] 1 WLR 1448 (HL)

10 Teen Ranch v Brown (1995)

11 See supra note 3.

12 Todd v. Nicol [1957] SASR 72

13 Simpkins v Pays [1909] 1 WLR 975

14 Jones v Vernon‟s Pools Ltd [1938] 2 All ER 626

15 Esso Petroleum Ltd v Commissioners of Customs and Excise [1976] 1 All ER 117

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It is pertinent to note at this state the will theory which says that commitments are

enforceable because the promisor has willed or freely chosen to be bound by his commitment

is found drifting away from the intention theory and with certain flaws. It does not explain

the reason why a few promises are legally binding. Enforcing promises because they

excogitate the free choices of the individuals gives license to all such promises made which

are free from coercion to be legally enforceable which would be unjustified. Thus the

presence of intention is of utmost importance.

Intention usually is expressly stated and may also manifest itself as a letter of intent. In

Dresser Rand S.A. v. M/s. Bindal Agro Chemical Ltd. & Another16

; a two-Judge Bench of the

Supreme Court of India signified that whether letters of intent rise to the level of being a

contract lies on the content of the letter itself. It observed as under: - "It is now well settled

that a letter of intent merely indicates a party‟s intention to enter into a contract with the

other party in future”. Similarly, agreements to negotiate are not normally binding:

However, an agreement „locking out' negotiations with a third party is not necessarily void, if

there is consideration and a realistic time limit17

. In the case of Turriff Construction v.

Regalia Knitting Mills18

it was held that letter of intent is a collateral contract for preliminary

work.

Thus we observe that intention forms the basis of contract by giving us the idea that whether

the contracting parties seriously want to bind each other legally or they just intend to fulfil

promises and not take the matter to court. The consequence of lack of intention in a contract

leads to the annulment of the contract and no legal remedy for the party to seek. If a

reasonable man in place of the promise expects performance or equivalent compensation then

the agreement can be construed as a contract. This can only happen when the promisor shows

an intention on his part to be legally bound by the agreement. The intention of the contracting

parties stands frustrated if their perception of a legally binding obligation becomes

unenforceable.

16

Dresser Rand S.A. v. M/s. Bindal Agro Chemical Ltd. & Another, (2006) 1 SCC,751,773 17

Walford v Miles [1991] 28 EG 81 CA 18

Turriff Construction v. Regalia Knitting Mills (1971) 22 EG 169

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CONSIDERATION: AN OVERVIEW Consideration can trace its origin from the concept of doctrine of assumpsit. The debate

among the academician about the origin of consideration will not be discussed in this

research paper .It has been show how doctrine of assumpsit evolved from the concept of quid

pro quo.19

Thereby consideration is based on the idea of quid pro quo.

An offer and acceptance form an agreement between the parties. The law of contracts needed

to adopt some means of distinguishing between those agreements which are enforceable and

those which are not. It has to be ensured that all agreements are not legally binding. The test

of enforceability which is used under our law of contract is the requirement of consideration.

That is to say,

Offer + Acceptance = Agreement.

Offer + Acceptance Consideration=Legally Enforceable Agreements.

The black law dictionary has defined Consideration in this manner-“Consideration is

something (such as an act, a forbearance, or a return promise) bargained for and received by a

promisor from a promisee; that which motivated a person to do something, esp. to engage in a

legal act”.

Defining consideration is one of most difficult task in contract law. The first definition of

consideration was given in leading case of Currie Vs Misa.20

Lush J. said- “A valuable

consideration, in the sense of the law, may consist either in some right, interest, profit or

benefit accruing to one party or some forbearance, detriment, loss or responsibility, given,

suffered or undertaken by the other.”To make the definition more explicit let us take an

example. Consider the case where X (landlord) will not initiate eviction proceedings for three

years for a charge of Rs.1 Lakh. Now in this case the consideration for tenant is the promise

made by X (landlord) to not initiate eviction proceedings. Hence the definition of

19

JohnWilsonTwyford, THE DOCTRINE OF CONSIDERATION (The role of consideration in contract

modification),(Feb.,2002),

http://epress.lib.uts.edu.au/dspace/bitstream/handle/2100/286/02Wholethesis.pdf?sequence=2 20

Currie Vs Misa (1875) LR 10 Exch 153, 162

http://epress.lib.uts.edu.au/dspace/bitstream/handle/2100/286/02Wholethesis.pdf?sequence=2

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consideration in Currie v Misa21

is founded on the idea that one party must suffer a detriment

or receive a benefit of what is promised under contract.22

Rules of consideration in English Law

The rules of consideration can be broken down into 4 elements:-

1. Consideration need to be adequate.23

2. Consideration must move from the promisee.24

3. Consideration must not be past.

4. Consideration must not include a legal duty.25

1. Consideration need not be adequate

It is important to note here that consideration need not be adequate, but it must be legally

recognized. The basis of contract law is that parties must have the liberty to ponder what

should be their consideration in their terms of contract. For example a flat worth Rs. 5 lakhs

can be sold at Rs 100 if both the parties have agreed to it. The court will never inquire

whether it was equivalent to the promise which was given in return.26

In Chappell & Co.Ltd

v. Nestle Co.Ltd27

wrappers from the chocolate bars were held to a part of the consideration

for the sale of record.

2. Consideration must move from the promisee

In England, the consideration can flow only from the promise. If it has came form any other

person/source then it will be not a valid contract. That is the promisee must show that

consideration was provided by him. But the law does not say that the consideration must flow

to the promisor.

21

See supra note 20. 22

Ryan Murray, “Contract Law The Fundamentals” 23

Thomas v. Thomas (1842) 2 Q.B. 851 24

Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 62 ALJR 508 25

Collins v.Godefroy (1831) 1 B & Ad 950 26

Anson‟s Law of contract 28th

edition J. Beatson 27

Chappell & Co.Ltd v. Nestle Co.Ltd [1960] A.C. 87,ANTE,P.90.

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3. Consideration must not include a legal duty

If someone is bound to do a task then that task can never be a consideration. The leading case

in this aspect is Collins Vs Godefroy28

In this case an attorney who had been subpoenaed to

give evidence was promised a guinea a day for attendance. This was held to be “a promise

without consideration” as he was already bound to attend. Thus a public officer cannot

enforce a promise to pay him money for doing his duty (which he is legally liable to

do).Enforcement of such contract will tend to encourage extortion and corruption.

4. Consideration should not be past

The rule is that past consideration is not a consideration. We need to ask ourselves a question

as to what is consideration concerned with? The doctrine of consideration is concerned with

the mutual exchange of promises. That is to say consideration is to be provided at the time of

exchange of promise and not before that. Let us understand past consideration with an

example. X has lost his wallet and Y finds that wallet. Now X is very pleased and says, I will

give you Rs. 500 for having recovered my wallet. The next day X refuses to give Y 500 and

says Rs 100 is good enough. X is not legally liable to give Y Rs.500 because this is a past

consideration. Basically in past consideration the act (consideration) is done prior to the

formation of the contract.

Consideration in Indian Contract Act

Section 2(d) of the Indian Contract Act defines consideration as follows:

“When at the desire of the promisor, the promisee or any other person has done or abstained

from doing, or does or abstains from doing, or promises to do or to abstain from doing,

something, such act or abstinence or promise is called a consideration for the promise.”

As per this section we understand the essential requirement of valid consideration:-

1. The act or the abstinence which forms the consideration must be at the desire

of the promisor.

2. The act which forms consideration can be past, present or future.

28

Chappell & Co.Ltd v. Nestle Co.Ltd. (1831) 1 B. & Ad.

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3. The source of the consideration must be the promisee or any other person.

4. The consideration must have some value in eyes of law.

However there are exception to the general rule which are illustrated in section 25 (1), 25(2)

and 25(3) of Indian Contract Act, 1872. We will not discuss that section since it will be

beyond the scope of our work.

This is complete and exhaustive definition of consideration. We will now point out the

difference between Indian law and English Law.29

1. Past Consideration is valid-Unlike English law; past consideration is recognized as a

valid consideration.

2. Source of consideration can be promisee or any other person-In English law for

contract to be valid the consideration must flow only from the promise. The definition

in section 2(d)30

[ the promisee or any other person] shows us that consideration need

not move from the promisee alone but may proceed from a third party. This means

that even a stranger to consideration can sue provided he is a party to the contract. But

in England a person not a party to consideration is a stranger to the contract and hence

he cannot sue.

29


See Section 2(d) of Indian Contract Act,1872

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INTENTION IN CONSIDERATION

The intention to create legal relations and the existence of consideration form two of the most

significant elements of a valid contract. However, in England till the nineteenth century the

intention to create legal relations had not gained much prominence as a separate element in

contract. But after that it came to enjoy a position as a separate condition to form a valid

contract. Thus in countries like US and UK one has to prove besides „consideration‟ the

„intention of the parties to create legal relations‟. However in common law countries,

consideration should be itself indicative of the intention and a separate proof of the latter is

not required. Thus, in emerging economies like India and China „intention to create legal

relations‟ is not an independent condition for a valid contract but is implied under the

existence of consideration of the two parties.31

The Indian Contract Act does not provide for a specific provision which says that an offer or

an acceptance be made with the intention to create legal relations32

.To decide such an

intention the courts usually make presumptions depending upon the nature of agreements i.e.

whether it is a domestic agreement or a commercial agreement. However the increasing

interactions between familial and commercial relations have blurred the line of distinction

between domestic agreements and commercial agreements.33

And intention being a very

subjective concept poses another challenge. Sometimes one party commences work and

exposes himself to large expenses, while the other party has little or no intention of finally

completing the contract. The social and cultural background of the parties also determines

how they perceive situations differently. Such complexities give rise to the debatable

question as to whether intention to create legal relations should be regarded as a separate

condition or be implied from the consideration.

Consideration forms one of the most essential elements of a valid contract in India. Under

section 2(d) of the Indian Contract Act consideration is defined as “When, at the desire of the

promisor34

, the promisee35

has done or abstained from doing, or does or abstains from doing,

or promises to do or to abstain from doing, something, such act or abstinence or promise is

31

Bhawna Gulati, „Intention to Create Legal Relations‟:A Contractual Necessity or an Illusory Concept (Bejjing

Law Review), (Sept. 3, 2011), http://www.scirp.org/Journal/PaperInformation.aspx?paperID=7721 32

Lisa P.Lukose & Versha Vahini, (rev.), I.C.Saxena, “ Commercial Law”, Joseph Minattur, INDIAN LEGAL

SYSTEM, 2nd ed.2008, p.507 33

See supra note 26

34

Section.2(c) of the Indian Contract Act, 1872. 35

Ibid.

http://www.scirp.org/Journal/PaperInformation.aspx?paperID=7721

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called a consideration for the promise.” An agreement without consideration is not

recognized as a valid contract in India. Consideration need not be adequate however it must

amount to something which has some value in the eyes of law36

The Indian Contract Act says nothing about intention to create legal relations. This is not

surprising, as the founding case on this, Balfour vs. Balfour37

, came decades after the making

of the act. This entire concept of intention to create legal relationship has to deal with

intention of the parties, express and implied communication between the parties, and the

formation of agreement. This is important in the sense that section 10 of Indian Contract Act

tells us that which agreement are contract. The law regarding this aspect in India is not settled

and there is confusion regarding whether Intention to create legal relation is an essential

ingredient for an agreement to be a contract.

The Supreme Court of India has recognized the principle of Intention to create legal

relationship in some of the cases. The first case on this matter is Commissioner of Wealth-

Tax, vs. Abdul Hussain Mulla Muhammad Ali38

. A study regarding the facts, issues and

judgement of the same case has been discussed subsequently. The respondent has advanced a

sum of Rs. 4,00,000 to is partner Faizullabhai Mandlawala.The borrower employed the sum

as part of his capital in the firm.When A‟s wealth was suppose to be calculated by the

Commissioner of Wealth-Tax,Bhopal he contended that tax cannot be calculated on this

amount of loan on the claim that this loan was what was known to Muslim Law as 'Quaraza-

e-Hasana‟. Basically „Quaraza-e-Hasana‟ is a debt of good faith and goodwill carrying with it

no legal obligation on the part of the debtor to repay and no right on the part of the assessee

to except it.39

The tax payer gave an argument that the parties did not intend to create legal

relations, thus there was no obligation to pay the debt or for him to enforce it. The Supreme

Court accepted that a valid contract can be set aside on the grounds that the parties did not

intend to create legal relations.(They fully endorsed the British law).The Supreme Court said

that “The contention has, no doubt, its possibilities” But the assessee have failed to establish

the practice such as Quaraza-e-hasana exist or not. Further it has been shown that there was

no consideration in this case since Faizullabhai was not suppose to pay any rate of interest. If

there was a consideration in this case then that itself would have shown that parties intended

36

Forbearance to sue at the promisor‟ s desire constitutes consideration. Similarly, restoration of

family peace is a good example of a valid consideration. 37


Wealth-Tax, vs. Abdul Hussain Mulla Muhammad Ali AIR 1988 SC 1417 39

Commissioner of Wealth-Tax, Bhopal vs. Abdul Hussain Mulla Muhammad Ali, AIR 1973 MP 26

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to come into a legal relation. The researchers are trying to show that once consideration has

been established in a commercial agreement then it itself show that the parties intend to come

into a contract. It was stated in this case that “Here, one partner has lent a large sum to the

other to be utilised as capital in the partnership venture. The transaction is in the context of a

commercial venture. The presumption is that legal obligations are intended.” If the parties

want to show that they never intended to create a legal relationship in a commercial

agreement then the onus of proving it is very heavy. But in domestic agreement there is

always a necessity to prove that the parties intended to come into a legal relationship.

It has been argued that commercial agreements „are not governed by contractual intentions,

but reflect a variety of influences, including social norms and the norms of conduct that

develop within the relationship.‟40

The parties while contracting do not provide for all

contractual obligations and rules and thus it becomes unreasonable when the intention of the

parties at the time of contracting is questioned. Thus in such cases the consideration flowing

from both the parties should be taken into consideration. If there is consideration then

intention is also present.

Common law recognised that usually parties do not define their intention to enter into legal

relations. Casting their agreement into the form of bargain (offer, acceptance, and

consideration) provides a practical test for the intention. Thus the test of bargain is proof

enough to show the presence of intention in consideration. A deliberate promise seriously

made is enforced irrespective of the promisor‟s views regarding his legal liability.41

40

E. Posner, “A Theory of Contract Law under Conditions of Radical Judicial Error,” 94 North-western

University Law Review 749,( 2000). 41

S. Williston, “Williston on Contracts,” 3rd Edition, Rochester, New York, 1957.

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EVOLUTION OF THIS CONCEPT

Although it‟s not, that the intention to enter into legal relationships is not taken care of in India, but

the emphasis should again be on the hypothesis of this paper which talks of the assumed intention

to create a binding relation as implicit in the consideration which is provided by the promisee to the

promisor.

Intention as a distinct and identically discrete element has been envisaged to be a crucial element of

a contractual relation in England since long, but there is no specific provision in the Indian Contract

Act which requires that a proposal or its acceptance be made with the intention of creating a legal

relation42

. Much similar to this, is the arrangement in China. As per article 14 of the contract law of

the Public Republic of China, an offer would mean the manifestation of the party‟s intention to

enter into a contract with another party43.

For this reason, the terms of the offer should be definite

and specific and should indicate the party‟s willingness to be bound by a contract on acceptance of

the offer44.

It is also to be analysed that intention per se, in the Chinese context, can be an

implication of the acceptance which can and usually is, manifested as under the provision of

consideration45

. In this regard it should be noted that the Indian Contract act clearly distinguishes

between „consideration‟ and „adequate consideration‟46

. While it should be made clear that

„adequate considerations‟ intensifies the binding nature and the sanctity of a contract, this is not so

as far as „consideration‟ in general, is concerned.

This conception may differ from context to context. As the sociological relativism and

societal evolution and its organisation get distinct, with much simulation it casts a shadow on

the legal system of a political arrangement. It is well acknowledged universally that one can

be bound by a contractual obligation only if one has so intended. French law favours and

controls, in principle, the actual subjective intention; it does, however, also take into account

the declaration of intention, in an attempt to protect legal security47

. Complementary to this,

acceptance may be expressed by any means, provided that it is not ambiguous. Acceptance

42


Article 14, Contract Law of the People‟s Republic of China. 44

Mubashshir Sarshar, Comparative study of the principles of Contract formation of India, China, USA and

France, (January 2009), Offer and acceptance, p.14 45

Article 21, Contract Law of the People‟s Republic of China. 46

Sec. 2 (d) Indian Contract Act, 1872 47

See supra note 10.

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may not therefore be implied from the promisee‟s silence, since such behaviour does not have

a clear meaning. Under some specific circumstances, the meaning of silence may however be

explicit and it is therefore possible to admit that it expresses an intention to contract48

. Under

the Indian Contract Law, when one person signifies to another his willingness to do or to

abstain from doing anything, with a view to obtaining the assent of that other to such act or

abstinence, he is said to make a proposal49

in comparison to Article 14 of the Contract Law of

the People‟s Republic of China which states that, an offer means the manifestation of the

party‟s intention to enter into a contract with another party. Under Chinese Contract Law,

offer made to the public at large is considered as an invitation to offer rather that an offer, as

under the Indian Contract Act, 1872. Secondly a proposal becomes effective only when it

reaches the promisee and not when it leaves the promisor as in Indian Law50

. Under the

Indian Contract Act, a contract is not a mere exchange of an offer and acceptance as under

Chinese Law. It is an exchange of promises which has to be assisted by a „consideration‟, a

characterstic which is yet again absent from the Contract law of China. This further affirms

the claim that the facet of intention gets expressed through various modes and parameters.

Contrary to this, the social dynamics of the libertarian and individualistic thought which

flows within the western society has enabled the contract law in U.S. to be firm in the regards

of stipulating the presence of intention explicitly. Implied intention, in the case of U.S. laws,

thus can never be validated even if it happens through affirmative expression or an act51

. If

we delve upon the question of intention as implicit in consideration further, the path towards

the validation of the hypothesis of this paper comes closer. The Indian Contract law being

highly influenced by the Contractual provisions of the common law aides this understanding.

Both in common law and the legal system as practised in India, a gift is not considered to be a

contract as there no consideration which is involved there. On the other hand, a gift is

considered to be a contract in US contract law. If the promisor communicates a proposal to

the promisee regarding his intention to gift the promisee a book, and acceptance is

communicated thereof, then the promisor is under a legal obligation to give the book to the

promisee. The promisor cannot change his mind regarding the gift thereafter. Here, it is

48

Ibid. 49

Sec. 2(a), Indian Contract Act, 1872. 50

Rule of Arrival, Article 16, Contract Law of People‟s Republic of China. 51

See supra note 12

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quintessential to note that at times it is the intention which testifies the declaration, in the

same manner as at other times; the declaration purports to express the intention.

The principle of „autonomy of will‟ which finds its mention under the French Civil Code

takes into account, in general, no absolute distinction between the “real” intention and its

manifestation. As evident, the necessities of commercial life demanded that some value

should be placed on outward behaviour. It is not astonishing that the french writers were

forced to come up with a theory which gives effect to outward behaviour while appearing to

concur to the principle that only the “real” intention of the parties count. This theory

maintains that there is no conflict between the “real” and apparent intention in as much as

outward behaviour is a means whereby the “real” intention may be deduced. The argument,

no doubt, appears artificial for it ignores a possible clash between real and apparent intention

by assuming that the former must necessarily associate with the latter. But in practice, the test

adopted by French law is not very different from the objective test of English law52

.

Therefore, the prime difference between the French subjective system versus the more

objective system envisaged by the rest of the world, “it is only a matter of emphasis, since all

legal systems have to work with exteriorized indications of inner psychological elements in

order to appraise and evaluate their legal effects53

.”

CONCLUSION All in all, it thus comes to light that irrespective of the contractual provisions which persist in

various countries; the element of consideration in India finds itself sufficient to envisage per

se the intention of the contracting parties to enter into a legal relationship. This validates the

hypothesis of the present research article.

52

Chloros, supra note 8, at 615-16 (citing Planiol et Ripert, Traité Élémentaire de droit civil 69 (1949)). 53

Parviz Owsia, Formation of Contracts: A Comparative Study under English, French, Islamic and Iranian Law

219 (1994).

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‘Intention to Create Legal Relations‟: A Contractual Necessity or An Illusory

Concept, Beijing Law Review,2011,2,127-133

Cohen, “The Basis of Contract,” Harvard Law Review,Vol.46,1933,pp.553,575

Lisa P.Lukose & Versha Vahini, (rev.), I.C.Saxena, “ Commercial Law”, Joseph

Minattur, Indian Legal System, 2nd ed.2008, p.507

E. Posner, “A Theory of Contract Law under Conditions of Radical Judicial

Error,” 94 North-western University Law Review 749, 2000.

Parviz Owsia, Formation of Contracts: A Comparative Study under English,

French, Islamic and Iranian Law 219 (1994).

Akhileshwar Pathak,”Oxford Contract Law”, 1st ed. 2003

Ryan Murray, “Contract Law: The Fundamentals”, 1st ed.

A. Singh, “Contract and Specific Relief,” 10th

edition.

J. Beatson, Andrew Burrowsa, John Cartwright, “Anson‟s Law of Contract,” 29th

edition.

Balfour v. Balfour [1919] 2 K.B. 571

Jones v. Padavatton [1969] 1 WLR 328

Rose and Frank Co. v. Crompton and Bros Ltd. [1925] AC 445

Evans v. Merzario Ltd. [1976] 1 WLR 1078

Burrows v Brent LBC [1996] 1 WLR 1448 (HL)

Teen Ranch v Brown (1995)

Todd v. Nicol [1957] SASR 72

Simpkins v Pays [1909] 1 WLR 975

Jones v Vernon‟s Pools Ltd [1938] 2 All ER 626

Esso Petroleum Ltd v Commissioners of Customs and Excise [1976] 1 All ER 117

Dresser Rand S.A. v. M/s. Bindal Agro Chemical Ltd. & Another, (2006) 1

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Thomas v. Thomas (1842) 2 Q.B. 851

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