Privity of contract Flashcards
What is the rule of privity?
can only be enforced by and against to the contract ~ Dunlop v Selfridge, Beswick v Beswick
comes from the need for parties to give consideration ~ Tweddle v Atkinson
What is the exception under Section 1(1) of the contract (rights of a third party) act 1999?
gives a third party the right to enforce the contract in two circumstances:
contact expressly states the right under S1(1)(a)
the contract purports to confer a benefit to the third party which can be interpreted under S1(1)(b)
What does S1(1)(3) state?
Third party must be identified either by name, as a member of a class or as answering a particular description
if they do not the C(RTP) act will not be available
What does S1(2) state?
third party cannot enforce S1(1)(b) if party did not intend them to
Prudential v Ayers
What does S2 state?
where a party has the right under S1 the party to the contract may not manipulate the contract in any way which means the third party cannot enforce the contract
What does S3 state?
allows the contracting party to have a defence against the third party
What are case laws?
provide other special case exceptions where the rule of privity will not apply
What does the case of Shanklin Pier v Detel state?
there could be a collateral contract which is a subcontract if a contracting party to the main contract insists on the collateral contract they will have the rights over a party in the subcontract
What does the case of Tulk v Moxhay state?
there could be a restrictive covenant for example to build on land which runs with the land and binds subsequent purchasers
What is the rule on agency agreements?
agent makes a contract with another party on behalf of his client the client can enforce their right to that contract
What does the case of Jackson v Horizon Holidays state?
where the contract is made by one person in behalf of a larger group each person can enforce their rights under that contract
