A treaty is a legally binding agreement. Once an offer has been accepted, there is an agreement, but not necessarily a contract. The element that turns any agreement into a real treaty is “the intention to create legal relations”. It is necessary to demonstrate that the parties envisaged that the agreement would be subject to contract law. If evidence of intent is found, the agreement creates legal obligations that allow for the prosecution of any party who initiates an offence. The same principles apply when there is a third party in the agreement who is not the family. In Simpkins against Pays (1955), the applicant, an assistant, brought together the defendant and the defendant`s granddaughter and regularly participated in a selection procedure in which eight objects were to be listed on their merits. Each woman made a list, and the three entries were filed on a form in the name of the accused. They had agreed that if one of them won, they would share the profits among themselves. When one of the lines won and was paid to the defendant, the applicant brought a claim for recovery of a third party on its behalf. The judge found that, despite the family relationship, there was a binding contract, since the tenant was also a contracting party. “The parties [at Balfour v Balfour] lived together in friendship. In such cases, their national agreements are generally not intended to establish legal relations.
It is quite different when the parties do not live in friendship, but are separated or are about to separate. They negotiate with zeal. They do not rely on honourable agreements. It can be assumed that they intend to create legal relationships. In assessing each case, the courts applied certain presumptions to different types of contracts; Thus, it was generally assumed that national or social contracts had not been concluded for the purpose of creating legal relations and it was assumed that trade agreements had such an intention. However, the High Court of Australia has recently stated that presumptions should not be taken into account when determining intent – in any event, intent must be demonstrated without the help of such presumptions. In 1919, Lord Atkin, at Balfour v Balfour  (where a husband promised his wife to pay alimony while working in Ceylon) stated that there was “no intention to be legally bound”, although the wife depended on payments. The judge noted that agreements between spouses are generally not legally enforceable: the party who invokes the absence of legal relations must prove this; and all concepts intended to rebut the presumption must be clear and clear.  In Edwards/Skyways Ltd, when a worker committed to pay a bonus called “ex gratia”, it was found to be legally binding.
He relied on the promise for the adoption of a redundancy package and his employer was unable to sufficiently demonstrate that he did not intend to make their promise a contractual clause.