Question :
The law of contract in the United Kingdom provides the parties forming contractual relationships with the rules and provisions that are to be followed. In the case of Merritt v Merritt (1970), Mr and Mrs Merritt were married to each other since 1941 but eventually, the husband lost interest and grew attachment for some other woman. They owned a joint property on which the husband agreed to make the wife the sole owner of it and later he denied. In this case, the principle which was laid down in Balfour v Balfour was reversed stating that Domestic arrangements between the spouses sometimes do form agreements.
- What do you mean by the law of contract?
- What are the essentials of a valid contract?
- What are the facts of the “Mr and Mrs Merritt” case?
- What was the judgement given under “Mr. and Mrs. Merritt” case?
- How the case of “Mr. and Mrs. Merritt” is different from “Balfour v Balfour”
Answer :
Background
The law of contract basically is the law that deals with the relationship between the parties that is the result of the contract that they have entered into. The English Contract Act is followed in the UK while considering contracts and their relationships. The law of contract provides four essentials under the act which are to be fulfilled to make the contract valid, legal, and binding. The first essential towards forming a contract is offer. It is when one party makes an offer to the other party for either its acceptance or rejection. The second essential is acceptance, where the other party to whom the offer is made either accepts or rejects it. When the offer is made and the other party accepts it, it forms an agreement between the parties. The third essential is the intention of both the parties to form a legal relationship between them. The intention must be clear and the parties must not enter into such an agreement if it is influenced or forced. The last and most important essential of forming a valid contract is the presence of consideration without which the contract is invalid. The consideration is some amount of money or anything of value. When any party enters into a contract they must fulfill all the conditions or essentials given under the act to make the contract valid. The contracts which are valid, create a binding effect upon the parties which is legally enforceable by law. If any party does not fulfill the terms and conditions made upon making the valid contract, such a person will be liable for breach of contract. The contract is breached when the parties do not fulfill their duties mentioned in the contract towards other parties. Parties that make a breach of contract are liable to pay damages, compensation, etc. to the innocent party. If it is mentioned in the terms and conditions of the contract about the termination or expiry date of the contract then such a contract can not be termed as being breached by the parties. Termination of contract and breach of contract are two different things. Termination can be valid based upon the conditions mentioned in the contract but breach of contract is punishable and the person breaching the contract is held liable.
(Illustration 1: Contract Law, 2016)
Facts
Mr. and Mrs. Merritt were married since 1941. After the war of 1949, both the couple bought land in Chessington. The house initially was in the name of the husband. The couple lived there with their three children. The wife was working out and was contributing to the expenses of the house. In the year 1966, the couple came to an agreement to put the said house on joint names. Both wife and husband were equally contributing to the expenses of the house. Unfortunately, after some time, the husband formed attachments with some women other than his wife. He left the house for that woman and started to live with her. The wife suggested they make some arrangements as they were not living together. They both met and the husband made a statement that he would pay his wife a monthly payment of £ 40 in order to pay the mortgage due on the house. Mr. Merritt later signed a contract with his wife which stated that the wife would be paying off the mortgage money and after all the dues were clear, the husband would transfer the said property in her name. After some time, when all the dues were paid off, the husband reduced the pay from £ 40 to £ 25 per month. When Mrs. Merritt asked him to transfer the property in her name, he refused to do it.
Mrs. Merritt filed a suit against Mr. Merritt in the chancery division, claiming that she was the sole owner of the property.
(Illustration 2: Explore law, 2021)
Legal issues
- Whether an agreement made between the parties form a binding contract?
Judgment
It was held by the court that the agreement made between the parties had a binding effect and therefore Mr. Merritt is supposed to transfer the property in Mrs. Merritt's name. It was further stated by the court that both the husband and wife were in the process where they were separating from each other. The agreement made by the parties was when they both were separated. This shows that they had a legal intention to create legal relations.
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The judgment under this case was given after analyzing it with the case of “Balfour v Balfour” as both cases talked about the intention to create a legal relationship. In both cases it was considered that the couples were married in the case of “Balfour v Balfour” and in the case of “Merritt v Merritt” the couples were already separated from each other. The agreement in the case of “Merritt v Merritt” was formed after the couple was separated and were not in good terms. This showed that the couple had the intention to create a legal relationship as they both signed the contract stating Mrs. Merritt to be the sole owner of the property after the payment of all the dues remaining on its mortgage.
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