Question

Solve.
X Ltd. was appointed as an agent by Y Ltd. by an agreement. One of the causes of the agreement provided, This agreement is not entered into as a formal or legal agreement and shah not be subject to legal jurisdiction in the law courts Is this agreement a valid contract?

Answer 1

• 'Intention to create legal relations', is a doctrine used in contract law which establishes whether a court should presume that parties to an agreement with it to be enforceable at law, and it states that an agreement is legally enforceable only if the parties are deemed to have intended it to be a binding contract.
  
• Moreover in the famous case of Rose and Frank Co. vs JR Compton & Bros Ltd, it was held that the argument that clauses restricting the legal enforceability of a contract apply solely when the document is otherwise unquestionably of legal force.
  
• In this case, the agreement by which X Ltd appointed Y as Ltd., did not intend to create any legal interest, and the clause expressly precluding the agreement’s legal enforceability applies that this contract is not valid.