Contract 3 - Parties

Question 1

Privity of contract

Answer 1

Usually only between two contracting parties
Tweddle v Atkinson (1861)

Question 2

Third party can acquire rights if

Answer 2

-expressly provides they may acquire a benefit
-term purports to confer a benefit to them

Contracts (Rights of Third Parties) Act 1999
-second one does not apply if no intention to be enforceable.

Question 3

Agency

Answer 3

Actual authority
- look at what parties have done and said.
Express or implied.

Apparent authority
-at some stage principal must have represented the agent had authority
-the third party must rely on that representation believing the agent has authority
-third party must alter their position

Contract between principal and other party (agent drops out).

Question 4

Capacity

Question 5

Minors

Answer 5

Generally do not bind minors

Contract for ‘necessities’
-suitable to the condition in life of the minor and his actual requirements at time of sale and delivery.
Bound where generally beneficient.

The other party is still bound.

Question 6

Mental incapacity

Answer 6

• Drunk or mentally impaired when contract made.

Not valid if;
Incapable of understanding at time AND other party knew this.

Question 7

Statutory corporations

Answer 7

-Any contract outside of stated powers will be declared ultra vires and void.