A contract that can be brought before the court of law and is enforceable is deemed as a justiciable contract. In order to determine whether a contract is justiciable, the court shall consider the intention of the parties to become legally bound by the contract. If the parties to the contract have legal intention to bind the contract, that is, they have legal relations between themselves and intend to create a justiciable contract, and then the courts shall treat such contract as a justiciable contract.
The court may apply the objective test while determining the validity and enforceability of contract. An objective test considers how a reasonable person would perceive and comprehend the circumstances to be tested. An objective test is applied in independent of the views of the actual parties to the contract. A rebuttable presumption is a presumption that the court may apply as a default position but either party to the contract may rebut such presumption by adducing evidence in order to establish that such presumption shall not apply.
The legal intention of the contractual parties may be determined by establishing the nature of the agreement that is, whether such agreement is social or commercial in nature. Thereafter, the rebuttable presumption may be applied to the agreement using an objective test to determine whether such presumption holds true for the particular agreement. A social agreement is an agreement that may take place between the family members or between friends where the relationship is social or personal, unlike commercial agreements.
In Wakeling v Ripley [1951] and Todd v Nicol [1957], wealthy, single, and lonely elderly person convinced their relations to give up their career and possession to give company to the older person and promised to alter their will leaving their property to the migrating members. The presumption related to the agreement was that these are social agreements between family members and therefore not justiciable. Any reasonable person would feel it is beyond the social agreement and owing to the sacrifices made, the families should rely on the promises of their relatives, if required, in court.
In the given case, Emily did not find any job in Queensland but continued to look after June. After she passed away, her oldest son Lewis claimed that June promised him to give her house in exchange for a rare Mozambique orchid plant. In this case, the presumption related to the agreement between June and Emily is a social agreement as June shares personal relationship with June. Similarly, presumption relating to the agreement between Lewis and June is a social agreement and therefore, is not justiciable.
However, regarding the agreement Emily, she had to make a significant decision regarding giving up her career and possession o her apartment. If the objective test is applied, any reasonable person, looking at the importance of the agreement, would probably agree that the agreement is beyond a social agreement and the Emily may rely on the promise made by June, if required, in the court. However, Lewis may also claim the title of the house in exchange for an orchid on the ground that if a contract is supported by consideration, it amounts to a valid contract. In the peppercorn agreement, the rule states that consideration need not be equal in value to the promise that is bought by the consideration. Hence, it is upon the court to decide who is entitled to the title of June’s property.
Reference List
McKendrick, Ewan. Contract law: text, cases, and materials. Oxford University Press (UK), 2014.
Poole, Jill. Textbook on contract law. Oxford University Press, 2016.
Todd v Nicol [1957] SASR 72
Wakeling v Ripley [1951] SR (NSW) 183
