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First Principles of Business Law |
| Making a contract |
| 2. The first essential element of formation: Intention to be legally bound |
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2.6. Agreements in trade or commerce |
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Read the facts and the question and then choose the best answer. A, who is a trucker, says to B: "My delivery truck is off the road for two weeks. Will you lend me your spare truck? I'll have it serviced and pay for any repairs that it needs when I return it." B who is a fleet owner replies to A: "Yes, if you promise to pay for a service and all necessary repairs you can use my truck for two weeks." Can it be inferred on these facts that A and B intend to be legally bound by their agreement?
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(a) Yes, because agreements reached in commercial circumstances are likely to be intended as legally binding. (b) No, because even though this agreement takes place in commercial circumstances, A does not agree to pay any money to B. |
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