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2022-08-02

Intention to contract

Most contracts are agreements. It should now be noted that it is by no means true to say that all agreements are contracts. Many agreements fall outside the scope of the law of contract, either because they concern matters of moral, rather than of legal, obligation or because the parties agree that they are not to be treated as enforceable contracts, or because they are not intended to be such.
A famililar example is the case of a person who drives a friend somewhere in return for payment of the petrol. The courts have, moreover, repeatedly declined jurisdiction over agreements, which are expressed in a way which shows an intention to exclude their jurisdiction. On the other hand, what appears on the face of it to be a business transaction will not lightly be treated as a merely moral obligation, and it should be noted that expressed intention may sometimes have the effect of turning into a binding contract an agreement which might otherwise have been regarded as non-contractual.
A famous example of the latter situation was this: The defendants manufactured balls which they advertised as miraculous cures for influenza. The advertisement stated that 200,-€ reward would be paid to anyone who contracted influenza after having used the ball as prescribed. It was further stated that 2.000,-€ was deposited with a bank to show the sincerity of the Company's intention. A lawyer used one of these balls, but nevertheless contracted influenza; he sued for the promised reward. It was held that he was entitled to recover: normally such advertisements are mere 'puffs' which are not intended to create legal relations, but in this instance taking into account, amongst other circumstances, the reference to the deposit at the bank, the court found that the Company had intentionally made a binding offer which the plaintiff had accepted.

Capacity

Generally speaking any natural or legal person may be a party to a contract; but there are exceptions to this rule. Thus, for reasons of policy, in time of war an enemy subject cannot sue upon a contract in our courts and, by a rule of professional etiquette, a barrister may not sue for his fees. Only these two classes of incapacity call for special mention.