To determine whether the presumption applies in the domestic or social context, the nature of the relationships of the parties entering into the agreement is relevant. For example, the relationship between man and woman or a de facto relationship is a strong indicator of lack of intent. The presumption may also extend to agreements between parents and children or between friends. Whether social contracts are explicit or implicit, they provide a valuable framework for harmony in society. At Wakeling v Ripley (1951) 51 SR (NSW) 183, a wealthy old man invited his sister and husband (both living in Britain) to settle in Australia to care for him, as he would provide them with an income and also his property after his death. The couple agreed, the husband gave up a stable job in the UK to move. There was an argument, and the couple filed a complaint for breach of contact. They are successful because the agreement is “more than just a family or social agreement.” 3. If there is one third of the agreement (Simpkins/Country ) If you enter into an agreement in a social or domestic situation, there is a presumption that you did not foresee that the agreement would have legal consequences.
On the other hand, if you enter into the contract in a commercial/commercial environment, there is a presumption that the required legal intent existed. In the end, a court would ask, “Would a reasonable person consider the agreement to be binding?” Whether or not the document is binding relates to whether there is an intention to be legally bound. A “treaty” is legally binding and an “agreement” is not. To enter into a contract, the parties must have a common intention to establish legal relationships that are communicated either explicitly or implicitly (Rose and Frank Co/JR Crompton – Bros Ltd  2 KB 261). In most cases, there will be no doubt about the intent of a legal relationship, or just as clearly as it was not, but there are many cases where the matter remains questionable.