Privity of Contract

Question 1

privity of contract

Answer 1

person who is not a party to the contract cannot sue or be sued under it (Tweedle v Atkinson)

Lord Haldene: only a person who is a party can sue on it (Dunlop Tyre v Selfridge)

Question 2

consequences

Answer 2

(1) person receiving goods as gift can’t sue if defective

(2) prevent enforcement of services already paid for (Price v Easton)

(3) benefactors express wishes being denied (Tweddle v Atkinson)

Question 3

exceptions

Answer 3

(1) common law exceptions - contracts for benefit of a group (Jackson v Horizon Holidays)

(2) statutory exceptions - 3rd party motor insurance

(3) restrictive covenants - party selling land retains rights over it

Question 4

statue altering the rule

Answer 4

Contracts (Rights of Third Parties) Act 1999

Question 5

Contracts (Rights of Third Parties) Act 1999

Answer 5

s1: third party can enforce contract if
(a) expressly identified by name, as a member of a class, or as answering a particular description AND
(b) expressly provided that TP may enforce the contract OR
(c) contract term is an attempt to confer a benefit on the third party

s3:
- can sue directly
- if contract is being enforced by TP, D can rely on a defence or valid exclusion clause that was available to the original contracting party