Contract law Essay Example | Topics and Well Written Essays - 2000 words - 4

Contract law - Essay Example The Law reform Commission, in its Consultation Paper titled â€Å"Privity of Contract: Third Party Rights† launched on 14 November 2006, has recommended that the rules of privity be amended such that where the parties to a contract clearly intend a third party to benefit, then that party be allowed to sue if terms are not carried out.2 Moreover, the existing exceptions to the Rule of Privity are also to be preserved. However, in view of the numerous exceptions and exclusions that exist to the Doctrine of Privity of Contract, the question that arises is whether these reforms are really necessary? As stated by Trietel, â€Å"the many exceptions to the Doctrine [of Privity] make it tolerable in practice but they have provoked the question whether it would not be better further to modify the doctrine or to abolish it altogether.†3 For example, one of the exceptions that exist is the provision for collateral contracts, where one of the parties to the original contract may have a collateral contract with a third party that relates to the same subject matter of the original contract. In the case of Shanklin Pier v Detel Products4 the Plaintiffs had a contract with some contractors. However these contractors recommended that the plaintiffs purchase paint from the defendants, which was guaranteed to last seven years. When it lasted for only three months, the plaintiffs sued and the Court held that despite the existing contract with the Contractors, plaintiffs could sue defendants under the collateral contract arrangement which existed, thereby allowing for action against a third party. Collateral contracts also provided the means for a third party to circumvent the doctrine of Privity in the case of Andrews v Hopkinson.5In this case the Plaintiff bought a car from a defendant who assured him that it was in good condition. The Plaintiff bought the car on a hire purchase arrangement and had it financed through a finance Company and