Maria,an investor,and Jane,a chef,agreed to run a food catering business as partners.Since they were good friends they did not enter a written agreement.Six months after the business began the partners argued.Maria had threatened to sue Jane if she does not repay Maria's investment of $100 000.Which of the following statements is most accurate in regards to the issue of intention to create legal relations?

Question

Quizplus · Accepted Answer

The common law presumption is that legal intention exists in business agreements, regardless of whether the parties are friends or not. As such, Maria can sue Jane for non-repayment of the investment without a written agreement, as there was an intention to create legal relations in their business partnership. Option A is incorrect as there is no such presumption in agreements between friends. Option C is also incorrect as although it is recommended that partnership agreements be in writing, it is not a requirement. Option D is incorrect as the case of Balfour v Balfour is not relevant to this scenario.

Maria,an Investor,and Jane,a Chef,agreed to Run a Food Catering Business