Privity and Law of Contract
Contents
QUESTION -1 3
The Doctrine of Privity 3
The meaning, history and evolution of the doctrine 3
Relationship between privity and consideration 4
Privity under different laws 5
PRIVITY AND THE LAW OF AGENCY 5
Privity and Agency by Estoppels or Holding out 6
Privity when Sub-agents or Substitute agents are appointed 6
PRIVITY AND THE LAW OF PARTNERSHIP 7
Privity and the act of civil and criminal liability of partners 8
Privity and the liability for holding out 8
PRIVITY AND THE LAW ON SALES OF GOODS 9
Contracts Concerning Land 10
PRIVITY AND THE LAW ON HIRE PURCHASE 10
QUESTION 2 11
Analysis of the case to establish formation of contract 12
Was Mike obligated to sell furniture to Nilam 13
Nilma’s Rights and remedies against Mike 13
Remedies 14
1. Rescission of Contract: 14
2. Suit for Damages 14
Specific performance 16
Compensation for loss of profit 16
REFERENCE 17
QUESTION -1
The Doctrine of Privity
A contract is an agreement between two or more parties that creates an obligation to do or not to do something. The parties to the contract are under an obligation to perform the terms and conditions which are laid down in the contract. Thus a contract can give rights or impose obligations arising under the contract on the parties to the contract. Third parties cannot be under such an obligation to perform or demand performance under a contract. This is referred to as Privity of contract.
The meaning, history and evolution of the doctrine
The doctrine of privity means that as a general rule, a contract cannot bestow rights or impose obligations arising under the contract to any person except the parties to it. An individual or corporate entity that is not a party to the contract are called third parties. A third party does not have enforceable rights or obligation under the contract. Even if a person is mentioned in the contract and the contract was intentionally to benefit this third party, he cannot rely on or put into effect the
QUESTION -1 3
The Doctrine of Privity 3
The meaning, history and evolution of the doctrine 3
Relationship between privity and consideration 4
Privity under different laws 5
PRIVITY AND THE LAW OF AGENCY 5
Privity and Agency by Estoppels or Holding out 6
Privity when Sub-agents or Substitute agents are appointed 6
PRIVITY AND THE LAW OF PARTNERSHIP 7
Privity and the act of civil and criminal liability of partners 8
Privity and the liability for holding out 8
PRIVITY AND THE LAW ON SALES OF GOODS 9
Contracts Concerning Land 10
PRIVITY AND THE LAW ON HIRE PURCHASE 10
QUESTION 2 11
Analysis of the case to establish formation of contract 12
Was Mike obligated to sell furniture to Nilam 13
Nilma’s Rights and remedies against Mike 13
Remedies 14
1. Rescission of Contract: 14
2. Suit for Damages 14
Specific performance 16
Compensation for loss of profit 16
REFERENCE 17
QUESTION -1
The Doctrine of Privity
A contract is an agreement between two or more parties that creates an obligation to do or not to do something. The parties to the contract are under an obligation to perform the terms and conditions which are laid down in the contract. Thus a contract can give rights or impose obligations arising under the contract on the parties to the contract. Third parties cannot be under such an obligation to perform or demand performance under a contract. This is referred to as Privity of contract.
The meaning, history and evolution of the doctrine
The doctrine of privity means that as a general rule, a contract cannot bestow rights or impose obligations arising under the contract to any person except the parties to it. An individual or corporate entity that is not a party to the contract are called third parties. A third party does not have enforceable rights or obligation under the contract. Even if a person is mentioned in the contract and the contract was intentionally to benefit this third party, he cannot rely on or put into effect the