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  • Read the passage given below and answer the question that follow. The doctrine of privity of contract in the common law of contract provides that a contract cannot c

Read the passage given below and answer the question that follow.

The doctrine of privity of contract in the common law of contract provides that a contract cannot confer rights or impose obligations arising under it on any person or agent except the parties to the contract. The premise is that only parties to contracts should be able to sue to enforce their rights or claim damages in case of breach. The traditional law was very strict and third parties had no redress of any manner if they were affected. However, in modern times the doctrine of privity has been relaxed to a large extent. Now third parties can claim compensation provided he is an intended beneficiaries under the contract, and infringement is proved. Though the doctrine of privity was recognised and established in the case of Tweddle v. Atkinson, its foundations had been laid by the English courts over the years, starting from as early as the end of 16th century. But in these cases, it can be seen that the Courts rather decided upon them by keeping in mind the so-called 'Interest Theory'. This theory basically meant that only he who had an interest in the promise could bring up an action before the court, or in the words of the Court, "He that hath interest in the promise shall have the action".The first recorded case of such an instance was decided upon in 1599. This was the case of Levettv Hawes. In this case, a father brought an action of assumpsit upon a promise made directly to him that marriage money would be paid to his son. The court was of the opinion that the action ought to have been brought by the son, "for the promise is made to the son's use and the ordinary covenants of marriage are with the father to stand seized to the son's use; and the use shall be changed and transferred to the son as if it were a covenant with himself, and the damage of non-performance is thereof to the son."
However, later the English courts accepted the view that if a promise in a simple contract was made expressly for the benefit of a third person in such circumstances that it was intended to be enforceable by him, then the common law would enforce the promise at his instance, although he was not a party to the contract.

Question :-  Which of the following could be logically deduced from the passage?

 

 

 

Option: 1

The beneficiary must have knowledge of the contract.


Option: 2

The knowledge of the beneficiary is immaterial.

 


Option: 3

The beneficiary must be a minor.

 


Option: 4

Only the parties to the contract can enforce a contract.

 


Answers (1)

best_answer

Option B is the correct option answer as with reference to the case law and the interest theory stated in the passage it can be inferred that it is an interest of the beneficiary which gives it the right to claim action and the knowledge of the beneficiary is immaterial.

 

Posted by

himanshu.meshram

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