Merritt v Merritt

Merritt v Merritt
St Mary's Church, Chessington
Court	Court of Appeal
Decided	27 April 1970
Citation(s)	[1970] EWCA Civ 6, [1970] 1 WLR 1211
Keywords
Creating legal relations, enforceability

Merritt v Merritt [1970] EWCA Civ 6 is an English contract law case, on the matter of creating legal relations. While under the principles laid out in Balfour v Balfour, domestic agreements between spouses are rarely legally enforceable, this principle was rebutted where two spouses who formed an agreement over their matrimonial home were not on good terms.

Mr. Merritt and his wife jointly owned a house. Mr. Merritt left to live with another woman. They made an agreement (signed) that Mr. Merritt would pay Mrs. Merritt a £40 monthly sum, and eventually transfer the house to her, if Mrs. Merritt kept up the monthly mortgage payments. When the mortgage was paid Mr. Merritt refused to transfer the house.

The Court of Appeal held that nature of the dealings, and the fact that the Merritts were separated when they signed their contract, allowed the court to assume that their agreement was more than a domestic arrangement. Lord Denning MR stated:

Early in 1966 they came to an agreement whereby the house was to be put in joint names. That was done. It reflected the legal position when a house is acquired by a husband and wife by financial contributions of each. But, unfortunately, about that time the husband formed an attachment for another woman. He left the house and went to live with her. The wife then pressed the husband for some arrangement to be made for the future. On 25 May, they talked it over in the husband’s car. The husband said that he would make the wife a monthly payment of £40 and told her that out of it she would have to make the outstanding payments to the building society. There was only £180 outstanding. He handed over the building society’s mortgage book to the wife. She was herself going out to work, earning net £7 10s a week. Before she left the car she insisted that he put down in writing a further agreement. It forms the subject of the present action. He wrote these words on a piece of paper:

‘In consideration of the fact that you will pay all charges in connection with the house at 133, Clayton Road, Chessington, Surrey, until such time as the mortgage repayment has been completed, when the mortgage has been completed I will agree to transfer the property in to your sole ownership. Signed. John B. Merritt 25.5.66.’

The wife took that paper away with her. She did, in fact, over the ensuing months pay off the balance of the mortgage, partly, maybe, out of the money the husband gave her, £40 a month, and partly out of her own earnings. When the mortgage had been paid off, he reduced the £40 a month to £25 a month.