Privity

• The concept of ‘privity’ is contractual privacy, and determines who has a right of action when there is breach of contract.
• Tweddle v Atkinson [1861]


  Consideration must move from the promisee.

  The General Rule
• Rules of Privity:

  1. General Rule
  2. Agents making agreements
  3. Restrictive covenants
  4. Claiming damages on behalf of others
  5. Collateral contracts
• Agents making agreements 


  The law treats agent and principle as one and the same.

  An agent is someone who enters into a contract on your behalf.
• Restrictive covenants 


  These are promises not to treat land in a certain way.

  They run with the land and bind successors.
• Tulk v Moxhay [1848]


  Although the contract was not between Tulk and Moxhay specifically, the covenant ran with the land so D was in breach of the restrictive covenant.
• The General Rule 


  Only a person that has provided consideration can sue.
• Jackson v Horizon Holidays [1975]


  C paid a month long holiday for his family.

  Claiming damages on behalf of others.
• Claiming damages on behalf of others 


  This happens where someone has been detrimentally affected by a contract they were not party to if it is fair.
• Collateral Contracts

  1. Two contracts are in place
  2. The second is in place as a result of making the first
  3. The second involved a guarantee of quality
• Shanklin Pier v Detel Products [1951]


  D assured C the paint would last 7 years. It lasted 3 months.

  Collateral contracts
• Contract (Rights of Third Parties) Act [1999]


  s1(1)(a) express right to sure

  s1(1)(b) purporting to confer a benefit

  s1(2) excluding the right to sue
• Nissin Shipping v Cleaves [2003]


  s1(1)(b) applied because the contract is specific in how much C should be paid and therefore purports to confer a benefit, giving him the right to sue.
• s1(1)(a) of the Contracts (RTP) Act [1999]


  agreement provides an express right to third parties to sue
• s1(1)(b) of the Contracts (RTP) Act [1999]


  agreement purports to confer a benefit implying that third parties can sue.
• s1(2) of the Contracts (RTP) Act [1999]


  third party right to sue excluded