Privity 3B Flashcards
(15 cards)
What is the basic rule of privity?
Tweddle v Atkinson says only a person who is a party to a contract (who has given consideration) can sue.
What is the first common law exception to the rule of Privity?
Agency: where one person (an agent) is authorised to make a contract on behalf of another (the principal) with a third party.
This does not have a case law.
What is the 2nd common law exception to the rule of privity?
Restrictive covenants that run with land: Tulk v Moxhay says that covenants run with land not the original party therefore, anyone who owns the land after the convenant is made, will become party to it.
What is the 3rd common law exception to the rule of privity?
Damages on behalf of another: Jackson v Horizon Holidays says that when a contract is made for a family by an individual of said family, damages can be claimed by the whole family.
This is only used in special circumstances.
How do collateral contracts work?
A makes with B and B makes with C.
A wants to sue C but no contract?
Can sue if:
There are two contracts.
The 2nd made because of 1st.
2nd involved a guarantee of quality from C.
What is the 4th common law exception to the rule of privity?
Collateral contracts: Shanklin Pier v Detel Products says party A can sue party C despite not having a contract together due to:
1. 2 contracts had been made.
2. The 2nd was made due to A telling B to use C’s products.
3. C had given A a guarantee of quality.
What Act sets out the 2 statutory exceptions to the rule of privity?
Contracts (Rights of Third Parties) Act 1999.
What is the 1st statutory exception to the rule of privity?
S1(1)(a): Where the contract expressly states that a third party can enforce it.
What is the 2nd statutory exception to the rule of privity?
S1(1)(b): Where a contract purports to confer a benefit on a third party.
(suggests they have rights)
What does S1(2) say?
A contract can exclude a third party’s rights to sue if it is expressly stated.
What case used S1(1)(b) in 2003?
Nisshin Shipping v Cleaves.
What is the structure of evaluation?
Intro - Explain what privity is.
Law - All content of AoL
Evals - x4 developed
Conc - Good or bad overall
Where can you find Evaluation points for privity?
On Google Drive/ study directory.
What are some positives to privity?
Certainty - those who give consideration can sue (Tweddle v Atkinson)
Flexibility - many exceptions to avoid injustice.
Freedom of contract - Can only be sued by someone he has chosen to contract with.
What are some negatives to privity?
Rigidity - Can lead to injustice where cannot sue due to bancruptcy or death.
Uncertainty + freedom of contract - Tulk v Moxhay.
Uncertainty - who can sue and when S1(1)(b).
