Merritt v Merritt
The presumption against legal intention does not apply to agreements between spouses who have separated.
Facts
Mr and Mrs Merritt owned their matrimonial home jointly, subject to a mortgage. In 1966 Mr Merritt left to live with another woman. At a meeting in his car, he agreed to pay his wife £40 a month, out of which she would pay the mortgage. At her insistence, he signed a note stating that, in consideration of her paying all the charges in connection with the house until the mortgage was repaid, he would transfer his share in the house to her. She paid off the mortgage, but he refused to transfer the house.
Legal principle
The Court of Appeal held that the agreement was legally binding. Lord Denning MR said that the presumption in Balfour v Balfour does not apply where the spouses are not living in amity but are separated or about to separate, because they then bargain keenly and do not rely on honourable understandings. In such a case it may safely be presumed that they intend to create legal relations. The written note and the circumstances showed that intention, and Mrs Merritt had given consideration by paying off the mortgage.
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
- Blue v Ashley [2017] EWHC 1928 (Comm)
- 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
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