For a binding contract, putative offer must reveal an intention to give rise, upon acceptance, to an obligation

In Levingston v. Levingston (Australia), Robert Ian Edwin Partridge died on 6 October 2008. By his will made on 29 December 1995, he appointed Appellant, Mrs. Lola Levingston, as his executrix and left his estate to his only son, Mr. Rhys Partridge, second Respondent. Late Mr. Partridge and Mrs. Levingston lived together as husband and wife for 12 years prior to his death. Mrs. Levingston appeals against dismissal of her action in which she claimed that, late Mr. Partridge agreed to leave her his entire estate or, alternatively, his personal estate. Appellant’s primary claim was in contract and based on a letter dated 13 April 2005 that, she and Ian signed and sent to their solicitor. Mrs. Levingston claimed that, letter constituted an agreement in writing between Ian and Mrs. Levingston, terms of which were that Ian would be entitled to live in a property owned by Mrs. Levingston for rest of his life, and her will would so provide, and Ian would leave his personal estate to Mrs. Levingston.

Primary judge found that, constructive and resulting trust claims failed as a consequence of failure of Mrs. Levingston's contract and estoppel claims. Primary Judge observed that, language of letter does not suggest the existence of an agreement. Absence of any words reflecting existence of a consensus was described by primary judge as a significant factor in his reasoning that Ian and Mrs. Levingston did not have an intention to create contractual relations. Evident purpose of letter was not to make an agreement but to provide documents to their lawyer and to set out legal advice they required from him. Ian and Mrs. Levingston had not documented any of their financial dealings with each other, as they trusted one another. That suggested, it was unlikely that Ian and Mrs. Levingston intended to create a binding agreement between them in relation to their respective testamentary intentions. Primary judge concluded that, they both signed letter in order to assure Mr Meyer that, contents of letter reflected their instructions.

 In order that a contract be constituted by an offer and acceptance, putative offer must reveal an intention to give rise, upon acceptance, to an obligation. Intention is assessed objectively; that is done by reference to what is conveyed to a reasonable person in the position of parties by what was said and done, and having regard to circumstances in which those statements and conduct happened. In making that assessment, conduct of parties subsequent to making of alleged agreement may be taken into account. As primary judge pointed out, it is important to notice that Mrs. Levingston's case is that, letter of 13 April 2005 constituted agreement. It was not said to evidence an agreement that had been made orally or by conduct. Nor does Mrs. Levingston allege that, parties made an inferred agreement without an identifiable offer and acceptance. Thus, language and evident purpose of letter is of central significance. In cases where a letter is said to constitute an agreement, letter would usually be sent by one party to agreement to other party to agreement. That is not so in present case. Rather, letter is sent by two alleged parties to agreement to a third person - their solicitor - who is not said to be a party to alleged agreement.