De­clar­a­tion of intent–what’s behind it?

Every time you enter into a legal trans­ac­tion, you must express your intention to cooperate: “I would like to buy this car!” or: “I would like to commit to this rental agreement!” This might sound banal at first, but it is the deciding factor in civil law - without an orderly de­clar­a­tion of intent, no contract can be signed, and no legal trans­ac­tion can be suc­cess­fully completed.

Every contract requires at least one de­clar­a­tion of intent – without this, no legal trans­ac­tion can take place. The number of involved de­clar­a­tions – whether it’s just one person ex­press­ing their wishes, or two people are involved – depends on whether a one-sided or two-sided legal trans­ac­tion is to take place. With purchase or rental agree­ments, for example, two people are always involved: One side makes an offer, the other accepts it. In this case, both parties must ef­fect­ively express their intention to enter a legal relation – with an emphasis on “effective.” Not every de­clar­a­tion of one’s in­ten­tions acts as an effective de­clar­a­tion of intent.

The most important thing is that a statement is made. Without this, you can’t complete a legal trans­ac­tion, whether verbal or written. In addition, the receiver must also receive the de­clar­a­tion of intent, unless this step isn’t necessary. No obstacles should stand in the way of you making an effective de­clar­a­tion.

We can dif­fer­en­ti­ate between two types of de­clar­a­tion of intent. The most common type is the uni­lat­er­al de­clar­a­tion of intent. When you make a statement that expresses intent to enter legal ob­lig­a­tions, a second party is usually involved. For example, it can involve direct contact between two parties.

Even if the recipient is absent, a de­clar­a­tion of intent can still be expressed. If, for example, a letter of cor­res­pond­ence is sent, the statement is only valid once the recipient receives it and it’s ir­rel­ev­ant whether the recipient is aware of it. Most im­port­antly, the recipient must be given the op­por­tun­ity to read the de­clar­a­tion of intent – so it is within their sphere of influence.

The second type is a de­clar­a­tion of intent requiring com­mu­nic­a­tion. For this to be valid, it’s enough that the de­clar­a­tion is submitted. It’s not necessary that someone becomes aware of it. The most common example of this is a will or testament. Whether it is sent to someone or not, it is still valid.

Every de­clar­a­tion of intent is made up of two prin­ciples:

• Sub­ject­ive intent
• Objective intent

Sub­ject­ive intent is based on the state of mind of the subject, i.e. the person declaring their intent. Three elements define this form of intent. For one, a desire to act is required, i.e. a known inner intent must exist to do something or have something done. This also means that un­con­scious people (including those sleeping) cannot provide a valid de­clar­a­tion of intent.

In addition, the subject must be aware that they are making the statement. This means that they want to express their desire to act. According to this, they must be aware that their actions will lead to a legal trans­ac­tion, for example, the signing of a contract. After all, the subject must also have an intent to create legal relations. This relates to the con­clu­sion of a concrete legal trans­ac­tion, including its related con­sequences.

These elements are all directed at the subject and his in­ten­tions. To make a de­clar­a­tion of intent valid, it must however also be outwardly expressed. And the ex­plan­a­tion must be sub­ject­ively un­der­stand­able.

Objective intent is fulfilled when the de­clar­a­tion is ex­pli­citly made in written or verbal form or where this is implied. This means that a person’s implied behaviour can serve as an ex­plan­a­tion for a person’s intent. For example, if you board a train, you’ve implied that you want to travel on this train. An objective third person can observe that you’ve accepted the legal con­sequences of your action. Ut­ter­ances made, for example with the threat of violence, do not count.

Beyond this, the intention to create a legal com­mit­ment con­sti­tutes a valid de­clar­a­tion of intent. The subject must signal that he wants to enter the legal trans­ac­tion, for example by signing a contract. However, this does not apply to re­com­mend­a­tions or favours. The side that offers to help does not want to enter a legal agreement and does not want to be held ac­count­able for the con­sequences of their actions. When it comes to the intention to create a legal com­mit­ment, it must be clear to an objective third party that the statement is correctly in­ter­preted. If not, the subject was too ambiguous in their statement

To make a de­clar­a­tion of intent valid, two con­di­tions must be fulfilled: It must be made in an effective way, and it must (if required) ef­fect­ively register with the recipient.

A de­clar­a­tion of intent begins with a de­lib­er­ate and voluntary ex­pres­sion. If we’re talking about a uni­lat­er­al de­clar­a­tion of intent, the process is already complete.

A de­clar­a­tion of intent that requires com­mu­nic­a­tion is different. In this case, the statement must be directed at the recipient. In addition, you must dif­fer­en­ti­ate between re­cip­i­ents who are present and absent. A person that’s present will instantly receive the de­clar­a­tion of intent, while for those absent the trans­ac­tion is only suc­cess­ful once it has followed a delivery process. For example, by placing a letter into the letterbox, the trans­ac­tion to those absent is regarded as complete.

There are two problems that can arise with a de­clar­a­tion of intent that requires com­mu­nic­a­tion:

In­cid­ent­al in­form­a­tion: In this case, one party provides a de­clar­a­tion of intent, and is made aware of something intended for them, just ahead of time. The de­clar­a­tion of intent shouldn’t have reached the recipient at this stage. This is the case, for example, if a landlord overhears a con­ver­sa­tion between two tenants, where one states: “I have a new job. In two months, I’ll be ter­min­at­ing my lease.” Although this statement was intended for the landlord, it shouldn’t have reached him yet. He has only overheard the statement by chance. In this case, the de­clar­a­tion of intent is not regarded as received, since the tenant didn’t willingly bring it to the landlord’s attention.

Lost de­clar­a­tion of intent: It’s possible that a person for­mu­lates a written de­clar­a­tion of intent and signs it without bringing it to the attention of its recipient. Should a third person get involved with the de­clar­a­tion of intent, without the knowledge and against the will of the declaring party, then its validity is not granted. An example: Business owner B leaves a completed order form for a new dish­wash­er on her desk. Her secretary assumes that the order should be placed as soon as possible and sends it off.

The declaring party (= B) has not made a de­clar­a­tion of intent with the intention to act. The de­clar­a­tion was not submitted. But in legal speak, there is another opinion: If B provoked this behaviour by way of neg­li­gence, then the recipient can deem the trans­ac­tion as binding.

There are various grounds for in­valid­ity that can nullify a de­clar­a­tion of intent:

• Legal in­ca­pa­city: According to UK law, if you do not have legal com­pet­ence, you cannot make a de­clar­a­tion of intent.
• Joke ex­plan­a­tion: A de­clar­a­tion of intent is not valid if it’s intended as a joke. It’s also not valid if the recipient isn’t aware that it’s a joke. However, the declarant must be prepared to refund any costs that occurred due to the mis­un­der­stand­ing. Should the recipient ac­know­ledge the joke, then the de­clar­a­tion of intent is com­pletely off the table.
• Mental re­ser­va­tion: If you keep to yourself that the de­clar­a­tion should not be taken seriously, and if this re­ser­va­tion is not re­cog­nised, then the de­clar­a­tion of intent is still valid. However, if the recipient is aware of this re­ser­va­tion, then the de­clar­a­tion is invalid.
• Fic­ti­tious trans­ac­tion: If you make a de­clar­a­tion of intent under false pretences, whereby the con­trac­tu­al partner is in the know of this (for example to deceive a third party), the de­clar­a­tion is also deemed invalid.

Mis­un­der­stand­ings don’t auto­mat­ic­ally make a de­clar­a­tion of intent invalid, but they do provide reasons to appeal.

• Content error: If the contents of a contract are mis­un­der­stood and the de­clar­a­tion has already become legally binding, then it is still valid, but it can be appealed. Example: mis­un­der­stand­ing a foreign word.
• Ex­plan­a­tion error: If the ex­plan­a­tion of the de­clar­a­tion un­know­ingly deviates from the actual de­clar­a­tion, then it can be appealed. Example: a typo.
• Trans­mis­sion error: If an error occurred while it was being trans­mit­ted elec­tron­ic­ally and the actual de­clar­a­tion is falsified, it can be appealed. Example: a mistake in the elec­tron­ic man­age­ment system.
• Property error: If as­sump­tions are mis­tak­ably made about certain at­trib­utes sur­round­ing the item in question or the con­trac­tu­al partner, then the de­clar­a­tion of intent can be appealed. Example: jewellery made of brass instead of gold.
• In­ten­tion­al deception: Should the de­clar­a­tion of intent be created in the context of de­lib­er­ate or malicious deception, it can be appealed. Example: a used car that’s sold as “accident-free” although the seller had a traffic accident in the car.

What can’t be appealed is a so-called motive error: While forming the de­clar­a­tion, the declaring party is basing his as­sump­tions on a false motive, which informs the de­clar­a­tion. In this case, the declaring statement cannot be appealed. Example: wrongly assuming the cheapest price.

The best way to un­der­stand a de­clar­a­tion of intent is by way of examples. We’ll introduce you to various situ­ations that might arise in the delivery of the de­clar­a­tion based on two types of de­clar­a­tion of intent (de­clar­a­tion of intent requiring com­mu­nic­a­tion/uni­lat­er­al de­clar­a­tion of intent).

A uni­lat­er­al de­clar­a­tion of intent is not that common. It can include:

• Com­pet­i­tions (the promise of a reward for a specific action or activity)
• Found­a­tions (a document that explains that assets can benefit a specific goal of the found­a­tion)
• Testament or will

In this example, we assume that you want to create a testament to plan the dis­tri­bu­tion of assets in a timely manner. In the UK, the two main will types are the written will and the holo­graph­ic hand­writ­ten will. The written will must bear the testator’s signature at the bottom and the signature of at least two attesting witnesses. The holo­graph­ic will must be witnessed in the UK and there must be proof that the testator created the will them­selves. The will has to be written entirely by the testator’s own hand and must be signed.

By writing a testament, you fulfil all re­quire­ments for a de­clar­a­tion of intent. You have the intention to bequeath your assets. The intention of doing so with an un­der­stand­ing of legal con­sequences is demon­strated by recording it in the testament. And your intent to enter legal relations is also provided: In death, you would like the piece of legal writing in question to be dis­trib­uted. Sub­ject­ively, your intent to act is clearly un­der­stand­able, and as long as you stick to all legal re­quire­ments, there is little potential for mis­un­der­stand­ings. The intention to enter legal relations is also clearly no­tice­able by a third party, for example, an executor: It is clear, that the document forms a legally binding agreement.

A testament is directed at one or several people, who become part of the legal trans­ac­tion in the process. Contrary to other de­clar­a­tions of intent, though, a will does not have to reach someone to become valid. Once you have signed the document, it’s valid. Even if you die directly after signing it and no one else but you saw the testament. There are no grounds for in­valid­ity.

Every day we enter a de­clar­a­tion of intent which involves legal trans­ac­tions – for example, when shopping for breakfast rolls at the bakery. This involves a de­clar­a­tion of intent that requires com­mu­nic­a­tion. But first, you’re still forming your de­clar­a­tion: you would like to buy some breakfast rolls. Your intention to act is therefore clear. You also have an intention of doing so with legal con­sequences, as well as to enter legal relations. You can bring this across in different ways. Since the con­trac­tu­al partner in question is the person on the opposite side of the counter and is present, a statement in writing isn’t necessary.

Generally speaking, orders are placed verbally: “Four rolls and two crois­sants, please!” It’s even possible to (partially) com­mu­nic­ate non­verbally: by pointing to the product and holding up the number of fingers relating to your order. The other person can now interpret your intent. The price tag next to the baked goods informs you of the con­sequences of the legal trans­ac­tion. A mis­un­der­stand­ing can arise if the items are not correctly labelled – for example, if a rye roll turns out to be a spelt roll when you bite into it, then this is a content error. In this case, you can, the­or­et­ic­ally, appeal the de­clar­a­tion of intent.

Contrary to buying bread, renting or letting an apartment is a very formal affair. Contracts are signed, either directly at the site with all involved con­trac­tu­al partners, or the rental agreement is sent in the mail. In this case, you’re dealing with a de­clar­a­tion of intent requiring com­mu­nic­a­tion between absentees.

Here, it’s clear that both sides will submit their de­clar­a­tions of intent – not only the tenant but the landlord also expresses his intent. If you’re a pro­spect­ive tenant and you receive the contract in the mail, then this will most likely already have the landlord’s signature on it. In doing so, the landlord has expressed their intent that they want to offer you the apartment based on the agreed-upon con­di­tions, which are stated in the contract. With your signature, you’re declaring your intent. Now, you only have to send it off to the recipient.

However, the de­clar­a­tion of intent only becomes valid once it’s been received by the tenant. It’s also important that the tenant receives the signed copy. It’s enough that this is in their sphere of influence. Once the post service has signed for the delivery and the envelope is accepted by a secretary or clerk, it’s possible for the tenant to read the contract without any problems. It’s different if the mailman throws in the letter on a Saturday, as you can’t expect the tenant to check his mail at the office on the weekend. That’s why the de­clar­a­tion of intent is regarded as valid only from the following Monday.

Although we’re dealing with a de­clar­a­tion of intent between absentees, the danger of a trans­mis­sion error is minimal. The messenger of the news is the mail carrier, who hardly has the pos­sib­il­ity to falsify the contents of the de­clar­a­tion, as this is a written document inside a sealed envelope. It’s different if the mail carrier were to deliver a verbal de­clar­a­tion. In this case, the mail carrier may un­know­ingly make a mistake.

But another error may occur and could lead to legal pro­ceed­ings: Let’s assume that your landlord sends the signed rental agreement to you. Within, it states that the apartment will cost £500 per month. You’re a little confused since you’d always spoken of £600. Happy about the discount, you sign the contract and send it back. However, the landlord has made a mistake by mistyping the monthly amount. Their intent is still to rent the apartment to you at £600 per month. This is a so-called ex­plan­a­tion error.

The question now is: Was it clear to you that you’re dealing with an error? For your reply, it’s less important how you in­ter­preted the de­clar­a­tion as how you should have in­ter­preted the de­clar­a­tion. Both good faith and re­cog­nised customs come into play here. In the example, the contract ne­go­ti­ations must be con­sidered. Since a concrete rate had always been discussed, you should have known that it was a mistake. The landlord can, therefore, appeal the de­clar­a­tion of intent.

Please note the legal dis­claim­er relating to this article