Taj Mahal Hotel v. United India Insurance Co. Ltd
- 2022-02-17
Citation : [1919] 2 KB 571
Facts:
Mr. and Mrs. Balfour were living in England. However, Mr. Balfour had to return to Ceylon, as he was employed there, and Mr. Balfour stayed back in England due to health reason. Mr. Balfour promised Mrs Balfour that he shall pay her monthly maintenance. However certain difference arose between Mr. and Mrs. Balfour, pursuant to which Mr. Balfour stopped paying the monthly allowance. Mrs. Balfour sued Mr. Balfour.
Issues:
Judgement:
During the proceeding, both the parties raised their respective contentions. The
contentions raised by the appellant was that the promise made by Mr Balfour of
providing monthly expenses to his wife was a domestic agreement and not a legal
agreement nor so the husband didn’t have any intention of creating a legal agreement.
Similarly the respondent contended that the wife is deemed to get the given amount of
money as the husband entered into a domestic contract by contract by offering his
wife £30 and the wife agreed and stayed back in England.
The court however held that Agreements made between a husband and wife to
provide capitals are generally not contracts because generally, the parties do not
intend that they should be attended by legal ends. Commonly parties to a marriage
will make arrangements for personal or household expenses. Even though there may
be present what would amount to consider if it had occurred between different parties.
The Court of Appeal unanimously held that there was no enforceable agreement.
Therefore, the balfour law made it very clear that the legal intention to enter into
contract is very necessary. The balfour law mostly moves around the concept of legal
intention as a basic and for most necessity to validate a contract.
Analysis:
Under the Contract law, an agreement cannot be enforceable unless the same is executed with an intention to create legal relationship. The question of legal relationship is determined on the basis of the facts of the case. In Balfour the relationship was clearly a domestic one and there was no intention to create legal intention and therefore the agreement could not considered valid.
Case: Carlill vs Carbolic Smoke Ball Co
Citation: [1892] EWCA Civ 1
Judges: Justice Lindley LJ, Justice AL Smith LJ and Justice Bowen LJ
Facts:
The Defendant company made a product called “Smoke Ball”. It claimed to be a cure to influenza and many other diseases, in the context 1889-1890: Flu pandemic which is estimated to have killed 1 million people. Thereafter the Defendant Company published advertisements in the Pall Mall Gazette and other newspapers claiming that it would pay £100 to anyone who got sick with influenza after using its product according to the instructions set out in the advertisement.
The Plaintiff believing in the accuracy of the statement made in the advertisement with respect to efficacy of the smoke ball in cases of influenza, purchased one packet and used it thrice every day from mid-November, 1891 until 17th Jan, 1892, at which latter date she had an attack of influenza.
Thereupon, her husband wrote a letter for her to the defendants, stating what had happened, and asking for £100 as promised in the advertisement. They refused and this action was brought in court before Hawkins J. and a special jury. Arguments were heard on both the sides and finally the verdict was given.
Issues:
Judgement:
The Defendant contended that the offer was not made for anyone specifically but was an advertisement offer. The Court acknowledged that in the case of vague advertisements, language regarding payment of a reward is generally a puff, which carries no enforceability. In this case, however, Defendant noted the deposit of £1000 in their advertisement, as a show of their sincerity. Because Defendant did this, the Court found their offer to reward to be a promise, backed by their own sincerity.
Analysis
This judgement is significant to understand the concept of unilateral agreements as it points out the problems relating to unilateral agreements. Further, this case stands for the proposition that while sales puffery in advertisements is generally not intended to create a contract with potential product buyers, in this case it did because the Defendant elevated their language to the level of a promise, by relying on their own sincerity.
