Intention to create legal relations; consideration and causa
Parties must intend legal consequences. English law also needs consideration, but Sri Lanka's Roman-Dutch law accepts causa: a serious and deliberate reason for the promise.
Intention to create legal relations
An agreement becomes a contract only if the parties intend it to have legal consequences. Courts start from two presumptions. In social and domestic agreements, the presumption is that there is no such intention: in Balfour v Balfour, a husband's promise to pay his wife a monthly allowance while he worked in Ceylon (as Sri Lanka was then called) could not be enforced. In commercial agreements, the presumption is that the parties do intend to be bound. It can be rebutted only by clear words, as in Rose and Frank Co v Crompton Bros, where the written agreement said it was an honourable pledge and not a legal agreement.
Consideration in English law
| Rule | Meaning | Example |
|---|---|---|
| Definition | Some right, benefit or profit to one party, or some loss or detriment to the other (Currie v Misa) | Paying Rs. 50,000 for a laptop |
| Must move from the promisee | The person enforcing the promise must have given something | A stranger to the bargain cannot sue on it |
| Need not be adequate | The court does not judge whether the bargain was fair | Selling a car for Rs. 1,000 is still valid |
| Must be sufficient | It must have some value in the eyes of the law | A real act, payment or promise |
| Past consideration is no consideration | Something done before the promise does not count (Re McArdle) | Paying for repairs already finished, without an earlier request |
| Existing duty is not enough | Doing what you are already bound to do is not consideration (Stilk v Myrick) | Sailors promised extra pay for doing their contracted work |
Causa in Roman-Dutch law
Sri Lanka's general law of contract is Roman-Dutch law, and it does not require consideration. A promise is enforceable if it is made seriously and deliberately, with the intention of being legally bound. This ground or reason is called causa (justa causa, a lawful cause). There need be nothing given in return, so a seriously made promise of a gift can be binding. In Jayawickreme v Amarasuriya (1918), the Privy Council enforced a brother's promise to pay his sister money to settle a family property claim. It held that under the Roman-Dutch law of Ceylon, causa is far wider than English consideration: a promise deliberately made to discharge a moral duty, or out of generosity, can be enforced. Where English law governs a matter through statute, consideration still matters: for example, a bill of exchange needs value.
Consideration and causa compared
| Point | Consideration (English law) | Causa (Roman-Dutch law) |
|---|---|---|
| Basis | A bargain: something given in return | A serious and deliberate intention to be bound |
| Promise of a gift | Not enforceable (unless made by deed) | Enforceable if made seriously and deliberately |
| Where it applies in Sri Lanka | Matters governed by English law, e.g. bills of exchange | General contracts governed by Roman-Dutch law |
| Leading case | Currie v Misa | Jayawickreme v Amarasuriya |
If the owner of a hardware business in Kandy seriously promises in writing to donate Rs. 500,000 to a school building fund, Roman-Dutch causa may make the promise enforceable, even though he receives nothing in return. Under English law, the same promise would fail for want of consideration.
Short answer: “What is meant by causa?” In Roman-Dutch law, the serious and deliberate reason or intention behind a promise, which makes it enforceable without consideration.
Structured question: “Explain intention to create legal relations with decided cases.” Domestic agreements presumed not binding (Balfour v Balfour); commercial agreements presumed binding, rebuttable by clear words (Rose and Frank v Crompton).
Essay: “Compare the English doctrine of consideration with the Roman-Dutch doctrine of causa as applied in Sri Lanka.” Define both; give the rules of consideration with cases; explain causa and Jayawickreme v Amarasuriya; compare in a table; show where each applies in Sri Lanka.
English law asks 'What did you get in return?' (consideration). Roman-Dutch law asks 'Did you mean it seriously?' (causa).