“Separated spouses' agreements presumed legally binding unlike harmonious domestic arrangements”
The Court of Appeal held that the agreement was legally binding and enforceable. The husband was required to transfer the house to his wife.
A husband and wife separated, and the husband signed a written agreement promising to pay the wife £40 per month and transfer the matrimonial home to her once she paid off the mortgage. After the wife paid off the mortgage, the husband refused to transfer the house, claiming their agreement was merely a domestic arrangement without legal force.
Whether an agreement between separated spouses creates a legally binding contract, and whether the presumption against contractual intention in domestic agreements applies to separated couples.
The court distinguished this case from Balfour v Balfour, holding that when spouses are separated or their marriage has broken down, there is a presumption that they intend their agreements to be legally binding. The formal written nature of the agreement and the parties' separated status indicated contractual intention, overcoming any domestic arrangement presumption.
This case created an important exception to the general rule that domestic agreements lack contractual intention, establishing that separation changes the legal presumptions applicable to spousal agreements.
Agreements between separated spouses are presumed to create legal relations, unlike agreements between cohabiting spouses which are presumed not to be legally binding.
The Court of Appeal held that the agreement was legally binding and Mrs Merritt was entitled to the house transfer.
It establishes when domestic agreements create legal relations, distinguishing separated from cohabiting couples and limiting the Balfour v Balfour principle.
The court emphasized that the context of separation fundamentally changes the nature of spousal agreements compared to those made during harmonious cohabitation.
OSCOLA Citation
Merritt v Merritt [1970] 1 WLR 1211 (CA)
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[2026] UKSC 1
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