Blue v Ashley
A promise made jokingly in a pub, which no reasonable person would take seriously, is not a binding contract.
Facts
Mr Blue, a financial consultant, was drinking with Mike Ashley, the founder and majority shareholder of Sports Direct, in a London pub in 2013. Mr Blue said that Mr Ashley promised to pay him £15 million if he could increase the company's share price to £8 a share. The share price later reached £8, and Mr Blue sued for the money.
Legal principle
Leggatt J held that there was no binding contract. Applying the objective test, no reasonable person present in the pub would have thought that Mr Ashley's offer was serious or intended to create legal relations. The conversation was jocular, the setting was a social drinking session, the sum was out of proportion to anything Mr Blue had been paid for his work, and the terms were vague. Mr Blue himself had treated the remark as a joke at the time.
Related cases on intention to create legal relations
- Attrill v Dresdner Kleinwort Ltd [2013] EWCA Civ 394, [2013] 3 All ER 607
- Baird Textile Holdings Ltd v Marks & Spencer plc [2001] EWCA Civ 274, [2002] 1 All ER (Comm) 737
- Balfour v Balfour [1919] 2 KB 571
- Edwards v Skyways Ltd [1964] 1 WLR 349
- Esso Petroleum Co Ltd v Commissioners of Customs and Excise [1976] 1 WLR 1
- Jones v Padavatton [1969] 1 WLR 328
- Jones v Vernon's Pools Ltd [1938] 2 All ER 626
- Kleinwort Benson Ltd v Malaysia Mining Corp Bhd [1989] 1 WLR 379
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This summary is for study and revision and is not legal advice. Although our case summaries are checked for accuracy, we do not guarantee that they are free from errors or omissions. Always read the full judgment for the court's reasoning.
