Intention

A contract must exhibit an intention by the parties to be legally bound. This is decided objectively on the facts, with a court taking into account the nature of the transaction and the relationship between the parties in the particular factual context.

Two presumptions have traditionally been seen as operating in this area. The first is the absence of intention in contracts of a social and domestic nature. The second is the presence of intention in contracts of a business or commercial nature. Both presumptions are rebuttable on the facts. The future role of the presumptions may be in question, with greater emphasis being placed on an objective assessment of the facts and circumstances of each case, with the party asserting the contract bearing the onus of proof.

See Intention.