Research: “privity of contract” in Oxford Reference » The doctrine of contract confidentiality is a common law principle that provides that a contract cannot confer rights or impose obligations on any person who is not a party to the contract. Privity is an important concept in contract law. For example, under the doctrine of privacy, a landlord`s tenant cannot sue the former owner of the property because he or she did not make the repairs guaranteed by the land purchase agreement between the seller and the buyer, since the tenant was not “in private life” with the seller. There are a number of fair and legal exceptions to the doctrine of contract confidentiality, in particular under the Contracts (Rights of Third Parties) Act 1999, which allows a third party to perform a contract if the contract itself expressly provides for it or purports to grant such an advantage. Six months into the one-year lease, April threw a big party and their guests caused $10,000 in damage to the unit. Burt sent Jessica the bill for damages, and in response, Jessica demanded payment starting in April. Unfortunately, April left the apartment and avoided Jessica`s attempts to recover the damage and unpaid rent. Since Jessica is the original tenant named in the lease, she is guilty of the damage to the unit and is responsible for the rents due and the performance of all the obligations set out in the original lease. April has no privilege with Burt; Therefore, Jessica Burt has to pay for the damages or he can take legal action against her. However, she is not defenseless as she can sue April because April has privileges with Jessica.
The relationship between the parties to a contract. The common law doctrine of contract privacy stated that only the parties to the contract, that is, those who provided consideration, could bring an action or be sued under the contract. Third parties could not derive any rights from another person`s contract and did not impose any obligations on them. This position was modified by the Contracts (Rights of Third Parties) Act 1999. Under the law, a person or group of persons may enforce a provision of a contract to which it is not a party, provided that the clause is intended to provide an advantage or that the contract expressly provides for such performance. However, the law does not interfere with the principle that a person may not enter into obligations under a contract that he has not taken into account. The premise is that only contracting parties should be able to take legal action to assert their rights or claim damages as such. However, the doctrine has proved problematic because of its impact on contracts in favour of third parties who are unable to enforce the obligations of the contracting parties. In England and Wales, the doctrine has been significantly weakened by the Contracts (Rights of Third Parties) Act 1999, which created a statutory exception to privacy (enforceable rights of third parties). This means that a person named in the contract as a person authorized to perform the contract or a person who receives a benefit from the contract may perform the contract unless it turns out that the parties intended not to do so. Prior to 1861, there were decisions in English law that allowed the performance of the provisions of a contract by persons who were not involved in it, usually relatives of a promise, and decisions that rejected the rights of third parties.
  The doctrine of privacy arose alongside the doctrine of consideration, whose rules state that consideration must move away from the promise, that is, if nothing is given, so that the promise of something given in return is not legally binding, unless it is promised as an act. In 1833, Price v. Easton saw where a contract for the execution of work was concluded against payment to a third party. When the third attempted to continue the payment, he was considered unaware of the contract, and his request therefore failed. This was fully related to the doctrine of consideration and was established as such with the more famous case of Tweddle v. Atkinson. In this case, the plaintiff was unable to sue his father-in-law`s executor, who had promised the plaintiff`s father that he would make a payment to the plaintiff because he had not provided consideration for the contract. New Zealand has enacted the Deprivation of Contracts Act 1982, which allows third parties to sue if they are sufficiently identified as beneficiaries in the contract, and the contract explicitly or implicitly states that they should be able to assert this benefit.
An example of a case where “sufficient identification” was not made is field v. Fitton (1988). Contract confidentiality is a common law doctrine that provides that you cannot assert the benefit of a contract or be held liable for an obligation under a contract to which you are not a party. The underlying premise is that only the parties to a contract can take legal action or be sued afterwards. Another exception is the manufacturer`s warranties for its products. Previously, a claim for breach of warranty could only be filed by the party to the original contract or transaction; Consumers would therefore have to sue retailers for defective goods, since there was no contract between the consumer and the manufacturer. Now, under modern doctrines of strict liability and implied warranty, the right to sue has been extended to third party beneficiaries, including members of a buyer`s household whose use of a product is foreseeable. In Fraser River, the Supreme Court of Canada established two exceptions in which a third party (not a party) may be able to sue on its terms; Therefore, exceptions to the doctrine of confidentiality of contracts in certain circumstances: In Australia, it has been found that third party beneficiaries may keep a promise made in their favour in an insurance contract to which they are not parties (Trident General Insurance Co Ltd v. McNiece Bros Pty Ltd (1988) 165 CLR 107).  It is important to note that Trident did not have a clear connection and did not create a general exception to The Doctrine of Privacy in Australia. If a third party receives a benefit from a contract, he does not have the right to bring an action against the contracting parties beyond his claim to a service. For example, when a manufacturer sells a product to a distributor and the retailer sells the product to a retailer.
The retailer then sells the product to a consumer. There is no right to confidentiality between the manufacturer and the consumer. Contractual deprivation has also played a key role in the development of negligence. In the first case, Winterbottom v. Wright (1842), in which Winterbottom, a mail truck driver, was injured by a defective wheel, attempted to sue the manufacturer Wright for his injuries. However, the courts have ruled that there is no ownership right between the manufacturer and the consumer. Privity is a doctrine of contract law that states that contracts are binding only on the parties to a contract and that no third party may enforce or be sued under the contract. There is a lack of privacy when the parties have no contractual obligation to each other, thus eliminating obligations, responsibilities and access to certain rights. .