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Contract Law


Should the law on intention be changed or improved? If so, how? Discuss within the scope of contract law, and also analyse from a feminist perspective


The 'intention to create legal relations or 'animus contrahendi' is essential for a contract to be considered enforceable. It denotes a situation where both parties to an agreement intend the assurance to be enforceable or intend to enter into legal relations.


The law on intention to contract is based on a presumption, i.e., it can only be considered for market transactions. That is to say, it excludes contracts of social, domestic, or voluntary nature, and such agreements are not be considered by Courts at all. Precisely, for every commercial or market transaction, there is a presumption that parties intended it to be enforceable and for non-market transactions, there is no such presumption.


The distinction between market and non-market transactions has affected women's rights for decades now. When the contract law was drafted, the market was only for men. Only men could be participants in a commercial transaction. Women were not considered qualified enough to enter into contracts in their name. Women can enter into a contract only in the name of their husbands.


Therefore, this division also fails to render contracts having legal sanctity to be enforceable merely because the parties are spouses to each other.


The judiciary has guided these presumptions well in cases like Cohen v Cohen and Balfour v Balfour. In Balfour v Balfour, the husband promised to provide his wife with an allowance. In this case, the presumption that domestic contracts are not created with an intention to create legal relations was upheld on the following arguments:


i) The parties must not have considered their agreement's enforceability, so proof of intention is not possible.

ii) Only commercial agreements are prima facie enforceable, whereas domestic agreements are prima facie unenforceable.

iii) Behavioural decision theory indicates that parties are less likely to depart from their status quo legal principles. Therefore, parties would not intend to make a prima facie unenforceable contract enforceable.


In this case, the Court stripped the wife of her right to spousal maintenance based on the presumption of contract law. Moreover, if extended to criminal law, this presumption permits the commission of grave offences against women, including domestic violence, marital rape, no right to maintenance, etc.


Even though the void is filled by the law of estoppel and the Family Law Act 1975 (Cth), the contract law still runs contrary to the basic principles of feminism, i.e., equality of men and women. It promotes the exclusion of women from entering into contracts, and those only men can enter a contract. Today, women are a part of the market, and a domestic contract with their spouses stays out of contract law's purview merely due to this presumption.


It is, therefore, essential to extend the scope of the law on intention to contract. The presumption backing the law on intention to contract should be modified to presume the enforceability of domestic contracts. Such a modification would promote the rights of women, who are still not able to reach the market and be able to enter into contracts in their name.

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