Enforceable Contracts: Intention To Create Legal Relations

Contrary to the general view of non-lawyers and laymen; not all promises or agreements can be accepted \nor are enforceable at law. An agreement is enforceable if an aggrieved party whose rights have been \nbreached by the other party to the agreement can enforce those rights or get his remedies from the courts \nof law. In order for a contract to be enforceable, a promise or agreement must be valid and binding \nbetween the parties; meaning that they must be capable to be legally construed as contracts that are valid \nand binding at law. The elements of an enforceable contract is judicially explained by VC George in the \ncase of Kajang Sri Rock Products Sdn Bhd v Maybank Finance Bhd & Ors1 in that “To constitute a \nvalid contract there must be separate and definite parties thereto; those parties must be in agreement, that \nthere must be consensus ad idem, those parties must intend to create legal relations in the sense that the \npromise to each side are to be enforceable simply because thay are contractual promises and the promises \nof each party must be supported by consideration.’ This paper seeks to explain what is ‘intention to \ncreate legal relations,’ for abject failure to understand this most basic of a contractual element apart from \nthe classic ‘offer’ and ‘acceptance’ requirements, will render a promise or agreement unenforceable at \nlaw thereby throwing many precious business relationships and business ventures into the floors of the \ncourts with very lengthy and expensive court battles therein.