Contractfordifference

Contractfordifference is a concept in contract law that refers to the principle that a contract must be supported by a genuine intention to create legal relations between the parties. This principle is rooted in the common law tradition and is designed to prevent the creation of contracts that are unconscionable, oppressive, or against public policy. The term "contract for difference" specifically refers to a situation where one party promises to pay the difference between the price of a commodity at two different times, without specifying the actual price at either time. This type of contract is generally considered unconscionable because it lacks certainty and can lead to significant financial risks for one of the parties. The courts have consistently held that such contracts are void, meaning they are not legally enforceable. The principle of contractfordifference serves as a safeguard to ensure that contracts are fair, reasonable, and in the best interests of all parties involved. It is an important aspect of contract law that helps maintain the integrity and fairness of the legal system.