Seeks to explain what the law is and why it is that way and how laws affect the world.
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What is the basic rule?
A person who is not party to a contract cannot sue on it or be subject to obligation imposed by contract.
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What are the two main rationales for the basic (privity) rule?
3rd parties provide no consideration, 3rd parties cannot be sued by contracting parties.
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In which case did the rationale for the Privity Rule emerge?
Tweddle v Atkinson.
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What happened in Tweddle v Atkinson?
Agreement between 2 fathers of engaged couple. Yrs later William Tweddle son of one of contracting parties sought to enforce promise made by father in law Atkinson. Held he was not entitled to sue on the contract.
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What are three problems w the Privity Rule?
Party adversely affected cannot sue, Party entitled to sue not affected, Party could act unconscionably and escape justice (John Beswick almost did).
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Collateral contracts are an attempt to sidestep the doctrine of Privity. What are they?
Contracts created/invented by the courts.
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Shanklin pier 1951, example of collateral contract. What happened?
Plaintiff would have been left without remedy had the court not created collateral contract allowing plaintiff to sue.
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Seven factors in defence of Doctrine of Privity? (5)
Only promisee morally has the right. Consideration would be undermined. Exceptions ensure no practical difficulties. Reform is as problematic. Unjust that person can sue but not be sued.
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Seven factors in defence of Doctrine of Privity? (2)
Contracting parties should retain right to vary or rescind. No justification for 3rd party stepping in where promisee unable or unwilling to enforce .
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Criticism
Steyn LJ
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What does section 1 (a)(b) of the Contracts (Rights of Third Parties) Act 1999 state?
A 3rd party may sue if (a) the contract expressly says so (b) if the contract confers a benefit on the third party.
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What does section 1.3 of the 1999 Act state?
Third party must be expressly identified whether by name, description or as member of a class.
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How does the 1999 Act affect the doctrine of Privity?
It merely chips away at it it still exists. Allows 3rd parties to sue only if it is expressly stated or if a benefit is conferred onto them.
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What are two benefits of the 1999 Act?
Brings English law into line with EU law and Scottish and us law. Harmonisation beneficial to business community.
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Other cards in this set
Card 2
Front
What is positive legal theory?
Back
Seeks to explain what the law is and why it is that way and how laws affect the world.
Card 3
Front
What is the basic rule?
Back
Card 4
Front
What are the two main rationales for the basic (privity) rule?
Back
Card 5
Front
In which case did the rationale for the Privity Rule emerge?
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