IIQE Paper 1 Legal Principles question: intention to create legal relations

IIQE Paper 1Legal Principles

Which two of the following agreements are presumed to be made with an intention to create legal relations? (i) a contract to insure a factory (ii) an agreement to supply goods to a shop (iii) a promise between spouses to share household chores (iv) an arrangement among friends to meet for dinner

A (i) and (ii)
B (i) and (iii)
C (ii) and (iv)
D (iii) and (iv)

Show the answer and explanation

Answer: A. (i) and (ii)

Answer: (i) and (ii). Statements (i) and (ii) are true; (iii) and (iv) are not.(i) True. A commercial agreement, so the intention is presumed.(ii) True. A commercial agreement, so the intention is presumed.(iii) False. A domestic agreement is not presumed to have legal consequences.(iv) False. A social arrangement is not presumed to have legal consequences.Why not the others:• (i) and (iii): includes (iii), which is false, and leaves out (ii), which is true.• (ii) and (iv): includes (iv), which is false, and leaves out (i), which is true.• (iii) and (iv): includes (iii) and (iv), which are false, and leaves out (i) and (ii), which are true.Watch out: Treating any firm promise as legally binding, whatever its setting.Rule: Commercial agreements: intention to create legal relations is presumed. Social and domestic: it is not.Source: IA P1 Study Notes, 2024 Edition (8th ed., Nov 2024; for exams from 17 Feb 2025), 2.1.3(f), p. 2/4