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Mr. and Mrs. Balfour, were living in Ceylon, where the husband worked for the government. The couple went to England in 1915 after Mr Balfour’s work leave, but Mr Balfour had to return to Ceylon in 1916 due to the resumption of his work. Mrs Balfour (plaintiff) was, however, told to remain home after being diagnosed with rheumatoid arthritis.
Prior to the defendant’s return to Ceylon, the pair made a contractual pact, according to which Mr Balfour said he would pay Mrs Balfour £30 per month for her upkeep before she returned.
- As time passed, the couple’s differences grew, prompting Mr Balfour to advise them to separate. He gradually stopped paying the bills. As a result, the wife (plaintiff) sued the husband (defendant) for failing to follow through with their verbal agreement.
- Mr. and Mrs. Balfour were a husband and wife from Ceylon (Sri Lanka), and they took a holiday to England in 1915. Sadly, Mrs. Balfour became ill during the vacation, and she needed immediate medical treatment.
- They then determined and agreed that Mr. Balfour would return to Ceylon, while his wife, Mrs. Balfour, would remain in the country until she recovered from her illness.
- They also agreed that at that period, Mr. Balfour would pay Mrs. Balfour 30 pounds a month in repair before everything fell into place, unless she recovered and returned to Ceylon.
- This understanding and meaning was reached when their partnership was in good faith and there was no animosity between them.
- However, their relationship deteriorated over time, resulting in Mr. Balfour failing to pay his maintenance obligations to Mrs. Balfour.
- Mrs. Balfour, on the other hand, wanted to seek enforcement of the arrangement and went to court.
- Mr. Balfour wrote his wife a letter proposing that they divorce permanently.
- Later on, they legally split, which meant that they were divorced.
- In the year 1918, Mrs. Balfour filed a lawsuit in court against Mr. Balfour for failing To Pay The Sum Owed To Her.
- If the plaintiff’s (Mrs. Balfour) and defendant’s (Mr. Balfour) verbal arrangement constituted a contract?
- Is it true that Mr. Balfour ever intended to reach an agreement with his wife, Mrs. Balfour?
- Is Mr. and Mrs. Balfour’s agreement in any way legitimate in nature?
- Is a court of law willing to impose a contract between a husband and wife?
When Mrs. Balfour first went to court to request maintenance, an additional judge from the King’s Bench division, presided over by Justice Sargant, ruled that the husband is indeed liable and obligated to provide maintenance and care to his wife. Mr. and Mrs. Balfour had a legal contract, according to the court. In general, the lower court sided with the plaintiff (Mrs. Balfour) and against the defendant (Mr. Balfour). The obligation of the defendant to pay the maintenance was enforceable.
The consideration to the arrangement of a monthly transfer of funds was legal and included contractual obligations. As a result, she issued the decree nisi in July of 1919 and the alimony order in December of the same year. The contract was observed and held binding by the lower court, but Mr. Balfour appealed to the higher court.
A contract, according to English contract law, is an arrangement that results in legal obligations that are followed or recognised. In common law, there are three fundamental requirements for forming a contract:
ii) contractual intent
iii) monetary value
The theory of creating legal intentions states that in order for a contract to survive, all parties must intend to enter into a legally binding contract and be willing to face legal consequences if one of them fails to perform.
Consideration is described as “something of value” provided in exchange for a promise and is necessary in order for the promise to be enforceable as a contract in common law. This has historically been either a disadvantage to the promisee or a favour to the promisor.
Before the husband returned to England, the partnership was merely a marital arrangement between the pair. Their division was not mutually agreed upon. As a result, it was not contractually enforceable. In addition, the wife showed little concern. As a result, the appellant has no contractual obligations.
The respondents argued that since a contract could form between a husband and wife in the same way that it could form between any other entity, the wife was entitled to continue receiving compensation under the verbal arrangement that the couple had made before Mr. Balfour left for Ceylon.
Warrington LJ expressed his thoughts by stating that the agreement was friendly. It can be decided by either expression or inference, he said. Since the wife did not negotiate for the sum of money given to her, there was no such contract made in express words. As a result, it’s thought that she was satisfied with the £30. The partner, on the other hand, suggested that he would not pay the money until he was able to. As a result, he came to the conclusion that this was a minor marital arrangement that could not be brought to court. Furthermore, the husband had no legitimate intention of entering into a legally binding contract because he was only able to pay the amount before he could.
Duke LJ went on to say a few more important things. To begin with, their contact was based on their friendship, which cannot be reduced to a suit. Second, this understanding was reached when they were living in peace, not during their separation. Finally, there was no discussion between the wife and the husband, and no commitment was made by the husband in the first place. As a result, there was never a deal.
Finally, Atkin LJ claimed that such arrangements between the parties do not constitute contracts under the law. The most common non-contractual relationships seem to be those between a husband and wife. Since the only consideration that matters to them is love and affection, failure to perform by any of them must not result in legal ramifications. Lord Justice Atkin held that a husband and wife never plan to establish a civil partnership when they enter into an arrangement. When both parties enter into an arrangement, they must intend to establish a legal relationship; only then can it be enforceable in a court of law.
Furthermore, a court would never consider domestic arrangements made between partners in the ordinary course of their lives. The arrangement was not a contract in the traditional sense. As previously stated, the agreement was not legally binding; agreements made in personal family relationships are not counted in contract law, and agreements between partners to provide capital or monetary benefits are not legally binding. In certain cases, partners or parties to a marriage may make plans for personal and household expenses, although this is never done on a legal basis. Mr. Balfour and Mrs. Balfour did not have such an enforceable arrangement, according to the court of Appeal. Mr Balfour was then granted permission. Essentially, the law is based on the idea that all parties must intend to form a legal relationship in order for a contract to be valid. This was the case’s ratio decidendi. Examining the circumstances in which the contract was executed determines whether the parties intended to establish a legal agreement or not.
Initially, Justice Sargant held that Mrs. Balfour’s allegations were legitimate, and that Mr. Balfour should be entitled to pay her the maintenance that he agreed to pay. Mr. Balfour then filed an appeal in the court of appeals. The bench of judges in the Court of Appeal, Warrington LJ, Duke LJ, and Atkin LJ, ruled that the arrangement is not enforceable in a court of law. It was noted by Atkin LJ because of its domestic existence. Warrington LJ and Duke LJ did so because they didn’t believe Mrs. Balfour gave it much thought. Atkin LJ effectively invoked the doctrine of purpose to establish a legal relationship.
The doctrine, it was said, was about public policy and had little to do with domestic agreement. The court cannot get involved in such minor matters as personal and family agreements.
While there are some cases under which a husband and wife may enter into a legally binding arrangement, there were none in this case. The doctrine drew attention and grew in popularity. An animus contrahendi is a term used to describe this purpose.
Salmon LJ claimed in one of the later cases of Jones vs. Padavatton that this is factual in nature. There is no legal presumption attached to it. One of the most important requirements for entering into a contract is the need to form a legal relationship.
The Judgment’s Current Effect:
The case of Balfour v Balfour is one of the most important in English law since it established that arrangements between husband and wife are not called contracts because the two parties are believed not to have a legitimate purpose to create legal relations. It is a landmark case because it established the “doctrine of creating legal intentions.”
There was no deal, according to the court. It was only a domestic relationship between the husband and wife since neither party intended to establish legal links. By researching and analysing the case of Balfour vs. Balfour, we can see that a simple social arrangement made within a family cannot be implemented in a court of law; these agreements have no legal force. The second requirement is that the parties must intend to form a legal relationship. As a result of all of this, Mrs. Balfour was unable to sue Mr. Balfour in a court of law. Merritt vs. Merritt is a case that is often mentioned in connection with this one. In this situation, even though the couple was married, they were still divorced when the agreement was made, so any agreement between them had to be deemed legal in nature in this scenario.
 Balfour v Balfour, 2 KB 571.
 Merritt v. Merritt, (1970) 2 All ER 760; (1970) 1 WLR 121.