Contract 8 - Privity & 3rd P

Question 1

What is privity of contract?

Answer 1

No person can be sued or sue on a contract unless they are a party to it

Question 2

What common law methods are there for circumventing privity?

Answer 2

• Agency: principal named & clear agent acting on their behalf; authorised to act as agent; consideration moved from principal 🥸
• Assignment 👉
• Collateral contract (paint case) 🙏👨‍🎨
• Actions in tort 🥊
• Other judicial attempts 👨‍⚖️

Question 3

What is the albazero principle?

Answer 3

A contracting party can recover in relation to losses suffered by a 3rd party, if 3rd party has no other means of recourse

Question 4

In what circumstances can a 3rd P use the Contracts (Rights of Third Parties) Act 1999?

Answer 4

Allows 3rd parties to enforce contract where:
- contract provides they can 📝
OR
- contract confers a benefit on them & right not excluded 🎁❌

Question 5

To enforce a term under 1999, how must a 3rd party be identified?

Answer 5

• named in contract, 🧔‍♀️
• a member of a class, or 🧑‍🏫
• answering a particular description 💃
  (need not be in existence at time contract entered)
  (must be expressly identified, cannot rely on implication)

Question 6

Where does the Contracts (ROTP) Act not apply?

Answer 6

Where parties did NOT intend a term to be enforceable by a third party e.g. with an ‘exclusion of third party rights’ clause
😡🗯️😭

Question 7

What remedies are available to third parties under ROTP?

Answer 7

Any remedy available as if he had been a party to the contract

Question 8

When can contracting parties not vary/rescind a contract without permission from a third party?

Answer 8

• 3rd party communicated assent to P 📮
  OR
• promisor aware 3rd party relied on the term 👀
  OR
• promisor can reasonably be expected to have foreseen 3rd party would rely on the term & ⚖️🧐 & 3rd party has relied on it 😇

Unless express provision in the contract

Question 9

What is required for agency
🥸

Answer 9

• Agent authorised by principle (express, implication) 🥸
• Principal named 🧔‍♀️
• Clear agent acting on Principal’s behalf 👷
• Consideration moves from Principal 🧔‍♀️🎁

Question 10

What’s a collateral contract?

Answer 10

SP employed painters to paint pier. SP asked D what paint to use and then told painters to buy D’s paint. Paint was rubbish. Painters bought D’s paint not SP so could SP sue D for rubbish paint?

Collateral contract

• D gave consideration by telling SP which paint to buy.
• SP gave consideration by instructing painters to buy that paint.

🇵🇲👨‍🎨👷‍♂️🗑️

Question 11

How do actions in tort work
🥊

Answer 11

End user owed duty of care by manufacturer even if no contract between the two
🐌🧃🤮