Privity

Question 1

Basic rules of privity

Answer 1

• A person cannot be subject to a burden under a contract to which they are not a party and cannot sue on a contract to which they are not a party even if the object of the contract is for their own benefit cases include: Tweddle v Atkinson, Beswick v Beswick
• Conforms to the rule that consideration must move from the promisee - Tweddle v Atkinson

Question 2

Common Law exceptions to the strict rule problems of privity developed by the courts

Answer 2

Collateral Contracts - contracts that are independent contracts and are made between two parties to a separate agreement or between one of the original parties and a 3rd party. Illustrated in Shanklin Pier v Detel (paint)
Agency
Restrictive covenants - Tulk v Moxhay
Holiday cases - Jackson v Horizon

Question 3

Statutory Exceptions

Answer 3

Road Traffic Act - s148(7) Road Traffic Act - 3rd party insurance
Contracts (Rights of Third Parties) Act 1999
- s1(1) explicitly gives a right of enforcement to ‘a person who is not a party to a contract (a “third party”) in his own right if a term of the contract:
- s1(1)(a) expressly provides that he may
- s1(1)(b) if the contract purports to confer a benefit on him.
Can be disapplied under s1(2) or s2(3)