Privity of Contract: Logic, Experience and Expansion

Abstract

This Project deals with the legal principle that only the parties to a contract and those who take under them by succession or assignment can have rights or obligations under that contract. The principle is commonly referred to as the doctrine of privity of contract.

It became an established part of the common law as a result of decisions in England in the nineteenth century, and it survives in England, Australia, Canada, India and New Zealand with limited judicial and statutory qualifications. We conclude by recommending the enactment of legislation giving enforceable rights to strangers to the contract in certain circumstances.

The whole project will be dealt with in three different topics, as the name suggests, i.e. Logic, Experience and Expansion of Privity of Contract.

The first part of the project will be dealing with Logic for Privity of Contract. In this part we will be studying what were the reasons for the evolution of Privity of Consideration and how, with due course of time, it evolved in England. Then, evolution of Privity of Contract in India will be also dealt in this part. This part will then deal with what actually Privity of contract is, its legal definition and how it is?

The next part of the project will be dealing with the development of Privity though out the history till date. Its initial years in England and introduction in India will be covered under this same topic. Then, one of the most important developments which took place, i.e. Contract (Third Party Rights) Act, 1999, will be dealt and explained dully under this part. To understand the present scenario in the country, recent judicial trends of Indian judiciary will be studied. This all will cover the experience part of the project.

Expansion, the last part of the project, will be actually criticism of the Privity of Contract and then some suggestions, probable reforms and extension for the Doctrine of Privity of Contract.

Keywords: contract, privty of contract, third party contract, agreement