Privity of contract

The doctrine of privity of contract consists of two distinct rules: • A person who is not a party to a contract cannot claim the benefit of

it although the contract was entered into with the object of benefiting that third party. In Tweddle v Atkinson (1861), the plaintiff had married Mr Guy’s daughter. The plaintiff’s father and Mr Guy had agreed together that that they would each pay a sum of money to the plaintiff. Mr Guy died before the money was paid and the plaintiff sued his executors. The action was dismissed since the plaintiff was not a party to the contract which was made between the two fathers. In Dunlop Pneumatic Tyre Co Ltd v Selfridge (1915), Dunlop sold tyres to Dew & Co, a wholesaler, and included a term in the contract that Dew would obtain, from any third party to whom they resold the tyres, an undertaking that they would not retail the tyres under the list price. Selfridge gave Dew such an undertaking, but actually resold the tyres under the list price. Dunlop sued Selfridge for damages, but the suit failed on two grounds: (1) Dunlop had not provided any consideration for the promise; the consideration for Selfridge’s promise was given by Dew, and only a person who has provided consideration can enforce a promise; (2) Dunlop was not

You should be familiar with the following areas:

• meaning of privity • circumstances accepted as falling outside the rule • attempts to confer benefits on third parties • attempts to impose obligations on third parties • critiques of the doctrine

a party to the contract between Selfridge and Dew and only a party to the contract can enforce the contract.