Question

Explain how the traditional presumption to determine a party’s intent to be legally bound works for social/domestic contracts including a citation for legal authority. In your answer, provide two examples (one for the presumption and one for the rebuttal).

Answer 1

In a social/domestic contract, the presumption is that parties did not intend to create legal relations. If a contract has both an"honour clause" and clause that attempts to exclude a court's jurisdiction, the court may apply blue pencil rule which strikes out offending part.

An example of presumption:- Legal conclusion is that a person who has disappeared and with whom no one has made contact is 7 years is most likely to be dead.

An example of rebuttal:- A person who has been judicially declared incompetent is presumed incompetent unless there is sufficient proof usually in the form of medical testimony, the person has regained competency.