Privity / third parties Flashcards
Definition / explanation of the Contracts (Rights of Third Parties) Act 1999
Creates an exception to the rule of privity (sits alongside). Gives effect to the intentions of contracting parties (with regard to third party beneficiaries). NB only protects rights, not burdens.
A case where a “trust of a promise” meant that privity need not be present
Les Affreteurs reunis (trust was implied)
A case where bailment (and sub bailment) was used to circumvent the privity rule
Morris v Martin
A case where the concept of agency was employed to circumvent the privity rule
Eurymedon - Exclusion cause applied to “agents and employees” of D. D was agent for stevedores
A case where the agency concept could NOT be used to circumvent the privity rule
Scruttons v Midland Silicones - stevedores were not party to the contract - NO vicarious immunity
The case that puts a limit on negligence being used to circumvent the rule of privity (the price of a contract reflected the allocation of risk, so it was not fair, just and reasonable to imposer liability on the defendant)
Norwich City Council v Harvey
Examples of the law of negligence circumventing the privity rule
Donoghue v Stevenson; Junior Books; White v Jones
When can the terms of a contract which purports to confer a benefit upon a third party NOT be varied or rescinded
UNLESS the contract states otherwise, where the third party has expressly agreed to the term benefiting them, OR the promissor is aware of actual reliance by the third party OR it was reasonably forseeable by the promissor that the third party would rely on the term and the third party has actually done so.
What is the general rule regarding privity?
Only a party to a contract can enforce rights or have rights enforced against him
List as many common law exceptions and workarounds to the rule of privity as you can
collateral contract, negligence, agency, bailment, trust of a promise, damages recovered on behalf of a third party, covenants
An example of a collateral contract working as an exception to the rule of privity
Shanklin Pier v Detel
Two cases where a party to a contract was able to recover damages on behalf of third party beneficiaries (one in a domestic context, one commercial)
Jackson v Horizon Holidays, Darlington BC v Wiltshire Northern
Cases which would be decided differently under the C(RoTP)A
Tweddle v Atkinson; Beswick v Beswick; Dunlop v Selfridge
A case that shows that Les Affreteurs would not need to rely on a trust of a promise now that we have the C(RoTP)A
Nishin Shipping v Cleaves
When can a third party enforce a right bestowed upon them according to the C(RoTP)A
When the third party is expressly identified AND a) it is expressly provided for in the contract; OR b) the contract purports to confer a benefit upon them UNLESS it seems from proper construction of the rest of the contract that they weren’t intended to be able to enforce it
