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There is still Life in the Doctrine of Privity

Topic:

After the enactment of the Contract (Rights of Third Parties) Act 1999, it had been argued by many that the doctrine of privity is now dead and is now made redundant. However, it is submitted that the doctrine is not made redundant as the Act has its flaws. The other ground of argument is that the Courts had substantially departed from the initial rules that the rule is merely a façade and does not carry any significance at all today.

The purpose of this article is to consider the impact of the Act and to examine its flaws and then followed by the common law position.

The Doctrine which kind of started of in the Case of Tweedle V Atkinson where in which it was held that the plaintiff; William Tweedle Could not sue the estate of William Guy to enforce the agreement that William Guy had entered with John Tweedle for the benefit of William Tweedle. The reason that was given towards this ratio was that William Tweedle was a stranger towards consideration in the said contract.

Crompton J stated that, "… the consideration must move from the party entitled to sue upon the contract. It would be a monstrous proposition to say that a person was a party to the contract for the purpose of suing upon it for his own advantage, and not a party to it for the purpose of being sued. It is said that the father in the present case was agent for the son in making the contract, but the argument ought also to make the son liable upon it".

The rationale for this is that under the law of contract, a promisee would only be able to enforce a particular promise when they had actually provided consideration to the promise; failing which the promise would only be a bare promise and would not be able to be enforceable. Taking into account the definition of consideration given by Sir Federick Pollock which was adopted by Lord Dunedin in the case of Dunlop Pneumatic Tyres v Selfridge i.e. that a promisee must do something in order to purchase the promisor's promise.

On the facts of Tweedle, Tweedle did not provide any consideration (see Thomas v Thomas ; Price v Easton ). This is because he was not a party to the contract.

One of the arguments raised against this judgement is that the rule would only apply with regards to failure on the part of the promisee to provide consideration to the agreement. Hence if the promisee had provided consideration then he may be able to enforce a contract even though that he is not privy to it. It is submitted that the line to be drawn here is very fine. William Tweedle could be said that he had provided consideration on the facts i.e. getting married to William Guy's daughter.\

However, the matter seems to be resolved after the case Dunlop Pneumatic Tyre v Selfridge. Here, there was a contract between Selfridge and Dew. Selfridge promised Dew that if they will not sell Dunlop tyres below the listed price. They also promised Dew that if they sold Dunlop tyres below the listed price, they will pay Dunlop € 5 for each tyre sold below the listed price. Selfridge sold 2 tyres below the listed price and Dunlop brought an action for damages and injunction.

Viscount Haldane L.C. in the House of Lords, said: "...in the law of England certain principles are fundamental. One is that only a person who is a party to a contract can sue on it...A second principle is that if a person with whom a contract not under seal has been made is to be able to enforce it consideration must have been given by him to the promisor or to some other person at the promisor's request...A third proposition is that a principal not named in the contract may sue upon it if the promisee really contracted as his agent. But again, in order to entitle him so to sue, he must have given consideration either personally or through the promisee, acting as his agent in giving it."


In short, the case would indicate to us that in order for a person to enforce a contract, he must have provided consideration and in the event that this person is not privy to the contract, he cannot enforce it unless he was acting as an agent of the promisee.

However, one has to note that it is not easy to establish that a third party is an agent of the promisee.

In Scruttons Ltd v. Midland Silicones Ltd. , House of Lords were called to discuss the issue of agency.

On the facts of this case, the bill of lading was between the claimant and the carrier and that the carrier's liability for damage to the claimant's goods was limited to $500. There was a similar limitation clause in the contract between the carrier and the stevedores (who were hired by the carrier to unload the goods when they arrived in England). The stevedores negligently damaged the claimant's goods.

The claimant sued the stevedores in tort for negligence and the stevedores tried to rely on the limitation clause. It was contended on behalf of the stevedores, that the carrier contracted not only on its own behalf, but also as the agent of the stevedores, when it entered into the contract with the claimant.

Lord Reid stated the conditions necessary for the success of the agency argument as follows: "...(first) the bill of lading makes it clear that the stevedore is intended to be protected by the provisions in it which limit liability, (secondly) the bill of lading makes it clear that the carrier, in addition to contracting for these provisions on his own behalf, is also contracting as agent for the stevedore that these provisions should apply to the stevedore, (thirdly) the carrier has authority from the stevedore to do that, or perhaps later ratification by the stevedore would suffice, and (fourthly) that any difficulties about consideration moving from the stevedore were overcome."

Applying these 4 conditions Lord Reid found that the carrier did not act as agent of the stevedores, so that the stevedores could not take advantage of the limitation clause

It is submitted that following this case, in order for us to establish an agency agreement; the promisee must be expressly stated to be an agent for the third party. Therefore, we would realise that in most situations, a third party would not be expressly named in the contract to be an agent.

The 4 conditions of Lord Reid were satisfied in the case for New Zealand Shipping Company v A.M. Satterhwaite & Co. Ltd., The Eurymedon . On the facts of the case, the bill of lading had expressly stated that the independent contractors (which class includes stevedores) are protected by the exemption clause and that in respect of this clause, the Carrier was contracting as an agent for the independent contractors.

The problem of consideration moving from the promisee  was overcome by stating that the shipper had offered to exempt the stevedores from liability and that the stevedores accepted this offer and provided consideration by their act of unloading the goods.

Hence, after this case, one would have to realise that apart from a third party being identified in order to establish a case under the common law, the third party would have to have provide consideration as well.

Lord Reid's 3rd condition was later discussed in Southern Water Authority v. Carey . It was held that for the creation of agency by ratification, the third party must be in existence at the time the parties entered into the contract.

In this case when the Water Authority and the main contractors entered into the contract, the sub-contractors were not yet in existence. So although the limitation clause in the main contract made it clear that the sub-contractors were to be protected; the main contract made it clear that the main contractors were acting as agents for the sub-contractors; there was no problem about consideration as the contract was under seal; yet the sub-contractors could not take advantage of the clause.

In conclusion thus far, the in order for a third party to be able to enforce a contract under the common law, the promisee must be acting for the third party (expressly identified), the third party must provide consideration and the third party must also be in existence at the time of the contract.

We would now have to consider as to the impact of the Contracts (Rights of Third Parties) Act 1999 and to consider as to how the Act would have changed the situation.

Under S 1(1) of the Act; it had been stated that a person who is not a party to the contract may in his own right enforce the contract  if he falls within this said section.

It is submitted that this is a warm welcome to the doctrine and cases like Tweedle would be decide differently today.

However, the only problem that a third party would face is to be able to fall within the definition of the Act. S 1(1)(a) states that a third party could enforce it if the contract expressly provides that the third party could enforce. It is submitted that this clause would not created any ambiguity as the courts would always want to give consideration to the freedom of contract and if the parties had expressly provided that such third party may enforce the contract, the courts would definitely allow for it.

The problematic and the most beneficial section would be S 1(2)(b) of the Act. Most often than not, the parties to the contract would not have expressly state as that the third party would be able to enforce the contract. Hence this said section would now need to be considered (S 1(1)(a) and s 1(1)(b) to be read disjunctively). S 1(2)(b) of the Act provides that a third party is allowed to enforce the contract if the terms of the contract purports to confer a benefit upon the third party.

It would be good that one could consider the case of Beswick v Beswick at this juncture. On the facts of this case, Peter Beswick assigned his business to his nephew, in return for the nephew's promise to pay Peter a weekly sum of money during Peter's life and after his death to pay Peter's wife a weekly sum. After Peter died his wife was paid the first £5, but the nephew refused to make any more payments thereafter. Peter's wife brought this action against the nephew in two capacities.

Firstly, she claimed in her personal capacity relying on S.56 (1) of the Law of Property Act 1925 (LPA 1925). The court held that S. 56 (1) did not extend to cover the facts in the case, so that her claim fell within the common law rule that a third party to the contract cannot acquire rights in a contract between two other parties.

Secondly, she sued in her capacity as administratrix of her husband's estate. In this claim she was suing on behalf of the estate. The estate had not in fact suffered any loss, as Peter had been paid the money owing to him. So, the estate would have only been awarded nominal damages. Mrs. Beswick asked the court to grant the remedy of specific performance, i.e. a court order compelling the nephew to carry out his promise to Peter Beswick. The House of Lords did award a decree of specific performance.

It is submitted that this case would be decided differently today after the Act. The argument would be that the contract that was entered between Peter and the nephew was to benefit the wife as he would want somebody to ensure the well being of his wife after his death. Peter could have easily sold off the business and take the whole some of money. The reason that he decided so was that by this way, he would know that the wife would continuously receive support (my arguments).

Therefore, after S 1(1)(b) of the Act, the wife would be able to sue in her personal capacity and need not rely on the position of administratrix to claim for specific performance of the contract. Moreover, it is submitted that it is not always the case that the intended beneficiary is also the administrator or administratrix. In the event that the deceased had appointed an Executor, there is nothing to guarantee that the executor would be willing to sue as the litigation process is a tedious process.

However, S 1(2) of the Act should be borne in mind at all times. S 1(2) indicates that S 1(1)(b) would not be applicable when upon construction of the contract, the parties did not intend the term to be enforceable by the third party.

It is submitted that this particular section had creates certain problems. This is due to the reason that it requires construction of terms. Whenever the courts are required to construe a particular term, it is submitted that the clause may not be construed according to the true intention of the parties, as the courts would take an Objective and not a subjective construction.

For example, the case of White v Jones . Here, the testator fell out with his daughters and sought to remove them from benefiting under his will. After that, he patched up with his daughters and instructed the solicitors to draw up a new will that would include them as beneficiaries. However, the solicitor failed to draw up the will before the death of the testator. The daughters sought to sue the Solicitor based on the contract between the testator and the solicitor. However, the general rule would apply in such a circumstance as the daughters were not privy to the contract and thus would not be able to sue the solicitor.

The question that arise is whether the daughters could rely on the Act and now thereby sue the solicitor under contract? It is submitted that Act would not be able to assist the daughter as upon proper construction of the terms of the contract between the Solicitor and the testator, one would realise that the contract is for the administration of the estate of the testator and it is not for the benefit of the third party i.e. the daughters (although it may be argued that the testator intended to benefit the third party).

Another case that could be called into consideration is the case of Junior Books v Veitchi . There is a contract between the owner and the main contractor and then there is a further subcontract. However, although the subcontractor was going to do the work upon the premises of the owner, they found that the reason for the subcontract is merely to regulate the parties relationship and is not for the benefit of the owner. Therefore, the Act would be applicable here as well.

Therefore, the Act is not without flaws although the Act is much better that the common law in the sense that third party need not be in existence at the time the contract is being entered into (s 1(3)) .it is submitted that the scope of the Act is rather limited as S 6 of the Act  excludes certain types of transactions.

The question is what would happen if the act does not apply? One has to note that in such a circumstance the common law rule would still apply. How then could there be arguments that privity of contract is dead? The Act is not without flaws, but it was argued that the courts had tried to depart from the original rule so dramatically that it could be a said to have squeezed the final breath out of the doctrine.

We would now be required to consider the common law exceptions.

  1. Collateral Contracts

The concept of a collateral contract is another device used by the courts to confer the right on a third party to bring an action against a party to the main contract.

In Shanklin Pier Ltd. v. Detel Products Ltd . the claimant company, the owner of Shanklin Pier wanted the pier painted. It entered into a contract with a firm of painters. Detel Products approached the claimant to interest the claimant in a paint manufactured by Detel. The representative for Detel assured the claimant's representative that the paint made by Detel would last for at least seven years.

Shanklin Pier then asked the firm of painters to buy and use the paint made by Detel. The painters bought the paint from Detel and used it on the pier. The paint lasted only three months. When Shanklin sued Detel, the defendant argued that the contract to sell the paint was made with the painters and that Shanklin was a third party to the contract. While agreeing with this, the court nevertheless held that there was a collateral contract between Shanklin and Detel which permitted Shanklin to sue Detel. Detel had offered their paint to Shanklin. The acceptance was when Shanklin asked the painters to use the Detel paint. When the painters bought the Detel paint, at the request of Shanklin, the latter conferred a benefit on Detel, which amounted to consideration.

However, one has to realise that the third party who is going to sue must be in existence and the contracting party must know of this third party. Failing which the third party would not be able to enforce the contract and that the third party must also provide consideration.

2. Trust concept

When two parties enter into a contract, and one party promises the other that the promisor will do something for a third party, e.g. pay money, the courts have, on some occasions, treated the promisee as a trustee of the contractual rights of the third party (the beneficiary of the rights), If the promisor fails to carry out what he or she undertook to do, the trustee and the beneficiary are allowed to join together as co-claimants to sue the promisor for breaking his promise.

The trust concept was utilised to get round the privity rule was found in the case Gregory and Parker v. Williams Here Parker (the debtor) had two creditors - Gregory and Williams. He entered into a contract with Williams to assign all his property to Williams, in return for the latter's promise to pay Gregory, the money which Parker owed Gregory. Williams did not honour his promise. Under the strict rule as to privity, Gregory was a third party. So he could not bring an action against Williams at common law. But Gregory was allowed to join with Parker and sue Williams in equity. Parker, the promisee was regarded as trustee of the contractual rights of Gregory, the beneficiary of the rights.

Another case where the court resorted to the trust concept to assist the third party was Les Affreteurs Reunis SA v. Walford (London) Ltd. The contract, a charterparty, was between the owners and charterers of a ship. One of the terms of the contract stated that the owners will pay the brokers (Walford) of the charterparty a commission. This was not paid. Walford sued the owner. Under the common rules as to privity he could not succeed as he was a third party. However, the House of Lords said that the charterer could be regarded as a trustee of Walford's right to receive a commission. The court allowed Walford's action against the owner to proceed, as if the charterer had been joined as a co-claimant.

An attempt was made by a third party to use the trust concept in Vandepitte v. Preferred Accident Insurance Corporation of New York . However, this attempt did not succeed and Lord Wright said: "...the intention to constitute a trust must be affirmately proved; the intention cannot necessarily be inferred from the mere general words of the policy..."

The court was not prepared to infer a trust in the case of Re Schebsman  Du Parcq L.J. said: "...unless an intention to create a trust is clearly to be collected from the language used and the circumstances of the case, I think that the court ought not to be astute to discover indications of such an intention."

The last two cases cited suggest that if a third party wishes to make use of the trust concept, to take the benefit of a contract between two other parties, he or she must prove an intention to create a trust. However, one has to realise that the courts are slowly moving away from the idea of trusts as the elements of Knight v Knight must be well established before the trusts concept could be utilised. It is submitted that the trust concept is a good way of getting around the privity rule. However, it is submitted that in the event that concept or the rule is to be extended to contract law, coupled with the method of the Courts establishing it, it may result in undermining the rule altogether.

3. Assignment

This is where the rights under the contract had been assigned to the third party and the third party would now be able to enforce the contractual rights once the assignment is an effective assignment.

In Darlington Borough Council v. Wiltshire Northern Ltd ., the Council wanted a recreation centre built on land which it owned. It employed Morgan Grenfell (MG) to organise this task. MG entered into a contract with the building contractor, Wiltshier.

MG assigned the contractual rights to the council. The council found serious defects in the building works and brought this action against Wiltshire. It was recognised that the Council had the right to sue Wiltshire. The dispute was the amount of damages which it could claim.

The assignor cannot assign a better right than he or she had acquired under the contract. Therefore, the vital question was how much damages could MG have claimed if it had sued Wiltshire. MG was not the owner of the property. So MG did not suffer any loss, which meant that it was only entitled to nominal damages. Wiltshire argued that the council, as assignee, was only entitled to nominal damages.

The Court of Appeal held that the Council was entitled to substantial damages. They relied on the judgements of Lord Browne-Wilkinson and Lord Griffiths in the St. Martins Property case. Steyn L.J. said:

"I would rule that the present case is within the rationale of Lord Browne-Wilkinson's speech. I do not say that the relevant passages in his speech precisely fit the material facts of the present case. But it involves only a very conservative and limited extension to apply it by analogy to the present case. For these reasons I would hold that the present case is covered by an exception to the general rule that a plaintiff can only recover damages for his own loss...I am in respectful agreement with Lord Griffiths wider principle. And I gratefully adopt it as part of my reasoning."

Therefore, although assignment may be, it is submitted a good way to allow a third party to enforce the rights. However, there are not too many times that the contracting party would expressly assign the rights. Moreover after the case of Darlingtonone would realise that this method, it is submitted is redundant as the third party would only be able to get nominal damages as it would be reliant on the on the harm the contracting party would suffer.


4. Contracting party sues on behalf of a third party

 

This is where the contracting party, who would want to enforce the rights of the third party. One has to note from the out set that this rule may cause some problems. This is because that contracting party most often than not would not have suffered any harm and therefore should only receive nominal damages. Moreover, the contracting parties may not want to sue as the litigation process is a long process that one has to go through.

One should consider first the case of Jackson v. Horizon Holidays Ltd in order to illiustrate this point. On the facts of this case Mr. Jackson booked a holiday for himself, his wife and children. The holiday provided was not as advertised by the defendant. Mr. Jackson sued for damages for distress on behalf of himself as well as on behalf of his wife and children.

The issue was whether Mr. Jackson, the contracting party could claim damages on behalf of his wife and children (third parties). Lord Denning M.R. said:

"It would be a fiction to say that the contract was made by all the family,...and that he was only an agent for them...It would be absurd to say that the twins of three years old were parties to the contract or that the father was making the contract on their behalf as if they were principals...the father was making a contract himself for the benefit of the whole party. In short, a contract by one for the benefit of third persons.

What is the position when such a contract is broken? At present the law says that the only one who can sue is the one who made the contract. None of the rest of the party can sue, even though the contract was made for their benefit. But when that one does sue, what damages can he recover?...He can,...recover his own damages. But can he not recover for the others? I think he can."

Lord Denning concluded that the damages of £1,100 awarded to Mr. Jackson by the judge at first instance was about right, considering that Mr. Jackson was entitled to obtain damages on behalf of his wife and children.

One has to note that the House of Lords did not really agree with the decision of Lord Denning but did not expressly overrule the finding and thought that the sum awarded was justified.

Another case that should be taken into consideration is the case of Woodar Investment Development Ltd v. Wimpey Construction UK Ltd. . Here, Wimpey (the purchaser) of land, had promised to pay some money to a third party on completion of the sale. It was discussed obiter whether Woodar could have sued for damages on behalf of the third party.

The House of Lords said that the Jackson case must be confined to family situations and should not be extended to commercial situations.

An interesting development of the common law approach as to privity of contract took place in two cases which were heard together - Lindens Gardens Trust Ltd v. Lenesta Sludge Disposals Ltd. and St. Martins Property Corp. Ltd. v. Sir Robert McAlpine & Sons Ltd .. In these cases the owner of a property development contracted with a building contractor for the contractor to carry out work in the buildings. An assignment of this contract was prohibited unless both parties consented.

While the work was being carried out, the owner assigned the benefit of the building works to a third party. The assignment was invalid, as the owner did not obtain the consent of the building contractor. After the ownership of the property had passed to the third party, the building contractor committed a breach of contract which caused loss to the third party.

Had there been a valid assignment of the benefit of the building works, the third party would have had a direct action against the builder. But as the assignment was invalid, the third party had no direct cause of action. The issue was whether the original owner of the property, who retained the contractual rights against the builder, could recover damages, and if so, for whom damages were recoverable. The counsel for the building contractor argued that the owner could recover damages only on behalf of itself, and as the owner had not suffered any loss, the damages should be nominal.

The House of Lords disagreed. It was clear that the third party had suffered loss. It was also clear that the third party had no cause of action against the builder. The only way of compensating the third party for the loss was to allow the original owner to sue for damages on behalf of the third party.

Lord Griffiths said:

"I cannot accept that in a contract of this nature , namely for work, labour and the supply of materials, the recovery of more than nominal damages for breach of contract is dependent upon the plaintiff having a proprietary interest in the subject matter of the contract at the date of the breach. In everyday life contracts for work and labour are constantly being placed by those who have no proprietary interest in the subject matter of the contract. To take a common example, the matrimonial home is owned by the wife and the couple's remaining assets are owned by the husband and he is the sole earner. The house requires a new roof and the husband places a contract with a builder to carry out the work. The husband is not acting as agent for his wife, he makes the contract as principal because only he can pay for it.. The builder fails to replace the roof properly and the husband has to call in and pay another builder to complete the work. Is it to be said that the husband has suffered no damage because he does not own the property? Such a result would in my view be absurd and the answer is that the husband has suffered loss because he did not receive the bargain for which he had contracted with the first builder and the measure of damages is the cost of securing the performance of that bargain by completing the roof repairs properly by the second builder. To put this simple example closer to the facts of this appeal - at the time the husband employs the builder he owns the house but just after the builder starts work the couple are advised to divide their assets so the husband transfers the house to his wife...If the roof turns out to be defective the husband can recover from the builder the cost of putting it right and thus obtain the benefit of the bargain that the builder had promised to deliver. It was suggested in argument that the answer to the example I have given is that the husband could assign the benefit of the contract to the wife. But what if, as in this case, the builder has a clause in the contract forbidding assignment without his consent and refuses to give consent...? It is then said that neither husband nor wife can recover damages; this seems to me to be so unjust a result that the law cannot tolerate it."

Lords Keith and Bridge, while expressing sympathy with Lord Griffith's approach, based their decision on the narrower approach of Lord Browne-Wilkinson. Lord Ackner agreed with the reasoning of Lord Browne-Wilkinson, which thus constitutes the ratio of the case, and which is as follows:

"In my judgment the present case falls within the rationale of the exceptions to the general rule that a plaintiff can only recover damages for his own loss. The contract was for a large development of property which, to the knowledge of both Corporations and McAlpines, was going to be occupied, and possibly purchased, by third parties and not by Corporation itself. Therefore it could be foreseen that damage caused by a breach would cause loss to a later owner and not merely to the original contracting party, Corporation...there would be no automatic vesting in the occupier or owners of the property for the time being who sustained the loss of any right of suit against McAlpines. On the contrary, McAlpines had specifically contracted that the rights of action under the building contract could not without McAlpines' consent be transferred to third parties who became owners or occupiers and might suffer loss. In such a case, it seems to me proper,...to treat the parties as having entered into the contract on the footing that Corporation would be entitled to enforce contractual rights for the benefit of those who suffered from defective performance but who, under the terms of the contract, could not acquire any right to hold McAlpines liable for breach. It is truly a case in which the rule provides 'a remedy where no other would be available to a person sustaining loss which under a rational legal system ought to be compensated by the person who has caused it.'.

One has to note the judgement of Alfred McAlpine Construction Limited v. Panatown Limited . Here, the case concerns a situation that the promisee wants to sue on behalf of the third party. Panatown employed McAlpine to build a building on land owned by UIPL. The work was defective. Panatown has sought to terminate the contract on the ground of McAlpine's failure in performance. Panatown has suffered no loss. UIPL owns a defective building, which requires a significant expenditure for its repair, and has been unable for a considerable period to put the building to a profitable use. Panatown now seeks to recover from McAlpine the loss which UIPL has suffered.

The appeal concerns the circumstances in which the employer in a contract of services may claim from the contractor on the ground of breach of contract damages in respect of a loss which has been suffered by a third party.

Lord Clyde mentioned in this case that the case does not fall within the situation of Woodar v Wimpey where in which one party enters into a contract as an agent or trustee for the other person and thereby the trustee would have the right to sue on behalf of the third party therefore, Panatown should not be entitled to sue on UIPL's behalf.

His lordship referred to the case of Dunlop v Lambert wherein which it was laid down that a consignor may recover substantial damages from the carrier where there was privity of contractor between the consignor and the carrier, even although the goods were neither his property nor at his risk. However, the reason why Dunlop could actually sue on behalf of the third arty was due to the fact that under their contractual arrangements made between the parties, the risk of loss of cargo had remained with Dunlop.

His Lordship also referred to Professor Emeritus Brian Coote stating that the argument raised by the professor was correct in the sense that in order for the consignor to sue, there must be sufficient interest left with the consignor to entitle him to sue.

In conclusion, Lord Clyde found that in order for a contracting party to sue on behalf of a third party, the contracting party must still have the liability or must actually bear the risk that runs. In short, a promisee could only sue in limited circumstances upon true construction of the original contract and would not be automatically allowed to sue as the promisee would only be able to claim nominal damages as there would usually be no loss.

It is rather unclear as to what is the position of the law today with regards to the position of the law today. This is because if the case of Jackson were to be decided again, it is not too clear as to whether the father could actually sue on behalf of his family or not. There would not be any provisions between the father and his family that the father shall bear the risk. Or maybe that the case of Jackson should be confined to family situations as suggested in Woodar v Wimpey .

It is submitted that the rule of privity of contract is still moving strong today. The exceptions to the rule as listed above may be exceptions to the rule but the exceptions does not fall squarely based on contract law for e.g. trusts (the courts seem to have refused to allow for this after Re Schebsman) and assignment (Darlington) as well as land law. The only contractual exception it is submitted would be the collateral contract as well as the promisee suing on behalf of the third party which discussed earlier may be faced with a lot of problems as well.

Therefore, the 1999 Act is really a warm welcome but it seems to have its flaws and not all inclusive. Hence in the event the Act does not apply, privity of contract is not only still alive but still going strong.

 

written by Adrian Choong Ewe Lim

 

[1861] 1 B. & S. 393

[1915] A.C. 847 HL

[1842] 2 Q.B. 851

[1833] B. & Ad. 433

[1962] A.C. 446

[1975] A.C. 154, Privy Council

Tweedle v Atkinson (supra)

[1985] 2 All ER 1077

Supra

[1968] A.C. 58

[1995] 2 A.C. 207

[1983] 1 A.C. 520

contrast Southern Water Authority v. Carey

[1951] 2 K.B. 854, King's Bench,

[1817] 3 Mer 582

[1919] AC 801, House of Lords.

[1933] A.C. 70.Privy Council

[1944] Ch. 83, Court of Appeal.

[1840] 3 Beav 148

[1995] 3 All ER 895, Court of Appeal

[1975] 1 WLR 1468, Court of Appeal,

[1980] 1 WLR 277, House of Lords

[1993] 3 All ER 417, House of Lords

[2001] 1 A.C. 518

supra

[1839] 6 Cl. & F. 600

"Dunlop v Lambert: the search for a rationale"

supra

supra

[1932] A.C. 562, House of Lords,

[1980] Ch. 297

(1848) 2 Ph 774

  (1858) 4 De G

[1926] A.C. 108. Privy Council,

[1958] 2 Q.B.146,

[1979] Ch. 548,

[1993] 2 All ER 355