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1. ‘The common law exceptions alone were sufficient to get around the doctrine of privity.’ Critically discuss.
Introduce your answer by acknowledging your approach. The question requires you to detail the limits and scope of the common law exceptions to the doctrine of privity as a means to criticise the statement. It is necessary to explain the doctrine first.
Start by explaining the privity rule and refer to its development based as a distinct requirement beyond consideration - Tweddle v Atkinson (1861) and Dunlop v Selfridge [1915].
Explain the reasons for the privity rule including the points from the Law Commission.
Now criticise the application of the rule with a view to the potential unfairness and the failure to reflect the parties’ intentions. Also refer to the judicial criticism addressed by Steyn LJ in Darlington Borough Council v Wiltshier Northern [1995].
That leads to the detail on the judicial developments to get around the harshness of the privity rule (with each, acknowledge the limits as a criticism): the use of collateral contracts (Shankin Pier v Detel Products [1952]); agency (The Eurymedon [1975]); assignment of the contract benefit to a third party (Linden Gardens Trust v Lenesta Sludge Disposals [1994]); trusts for the benefit of the contract (Les Affréteurs Réunis Société Anonyme v Leopold Walford [1919]); the tort of negligence (White v Jones [1995]); specific performance (Beswick v Beswick [1968]); consumer contracts to benefit others (Jackson v Horizon Holidays [1975] and the criticism from Woodar Investments v Wimpey Construction [1980]; Transferred Loss (The ‘Albazero Exception’) and Alfred McAlpine Construction Ltd v Panatown).
Conclude on the effectiveness of the common law developments in the light of their limits. Mention that the inadequacy of the common law was precisely why Law Commission recommend legislation in the form of the Contracts (Rights of Third Parties) Act 1999.
2. ‘The Contracts (Rights of Third Parties) Act 1999 provides a satisfactory resolution to a longstanding problem in the common law.’ Critically discuss.
Introduce your answer by addressing the scope of the question and what it requires you to do. This is about the limits of the legislation introduced to correct the problems associated with the privity rule. In terms of your approach, you will need to explain the problems associated with the strict privity rule before turning to the impact of the Act.
Begin the main body of your answer by explaining the privity rule and its function (Tweddle v Atkinson (1861) and Dunlop v Selfridge [1915]).
Criticise the application of the rule with a view to the potential unfairness and the failure to reflect the parties’ intentions. Also refer to the judicial criticism addressed by Steyn LJ in Darlington Borough Council v Wiltshier Northern [1995].
Now turn to the Act and explain what it does and how it applies in turn with reference to the key provisions. The scope of its application would determine how satisfactory it is as a solution.
Remember do not copy the provisions, simply summarise their significance. Lead with section 1 and then its requirements – s.1(1) on intention, in particular the role of s.1(1) (b) and what it means with the relevant case law (Prudential Assurance Co Ltd v Ayres [2007]); s.1(2) rebuttal (Nisshin Shipping v Cleaves [2003]); s.1(3) identification of the third party (Charity Commission v Framjee [2014] and Avraamides v Colwill [2006]). Mention the effect of s.1(4)-(6) on the benefit of the contract; limits on changing the contract (s.2) and of course, the scope in relation to the types of contract outside of the Act in s.6.
Observe that many of the cases representing a way around the privity rule would have been resolved by the Act.
Finally provide a conclusion that addresses the question directly. This should be in the light of the problems with the privity rule itself for example, not reflecting the parties’ intentions and then comment on the extent to which the Act does this based on its limits.
3. As a gift before leaving to explore the rainforests in South America, Devon purchased a one-year subscription to GameStream (an unlimited streaming service for console games) for his sister Lucy. It cost £200, which Devon paid up front. Devon arranged this subscription though Entertainment Supermarket Ltd. Two weeks after Devon left, Lucy attempted to download a game and discovered that GameStream has suspended its service because of technical problems. Advise Lucy as to how she might secure a remedy from Entertainment Supermarket.
In your introduction, observe that the Entertainment Supermarket (ES) might be in breach depending the terms of the contract. If they are, then the issue is one of privity and whether Lucy can enforce the contract against ES for a refund even though the contract for the service was made by Devon. You will need to explain and apply the Contracts (Rights of Third Parties) Act 1999 to advise Lucy.
Begin your main body with the privity rule and its function (Tweddle v Atkinson (1861) and Dunlop v Selfridge [1915]) because doing then explains why you need to apply the Act.
Apply the traditional privity rule to show that it acts to prevent Lucy from enforcing the contract.
Now turn to the Act, address each requirement and apply it in turn.
Refer to s.1 – Cite Christopher Clarke J from Dolphin Maritime & Aviation Services v Sveriges Angfartygs Assurans Forening, The Swedish Club [2009]) and Nisshin Shipping Co. Ltd v Cleaves & Co. Ltd [2003].
Apply the point from the cases. This will also require you to ask the questions about the facts you are not told. By subscribing for the benefit of Lucy as the user, could it be intended for her to enforce it? Alternatively, does it ‘purport to confer a benefit’ on her? Was Lucy entered as the user?
Next, address the identification requirement in s.1(3) and Avraamides v Colwill [2006].
Apply it. Was Lucy named as a user? Failing that would it be enough to provide her email address?
Observe that no issues can arise in relation to s.1(4)-(6) in terms of the benefit because it would have been the same even if Devon had subscribed for himself.
Summarise the potential for Lucy to enforce the contract, i.e. it is dictated by the extent to which she was identified.
Briefly address any relevant common law exceptions such as collateral contracts (Shankin Pier v Detel Products [1952]) and enforcement on behalf of another in consumer contracts (Jackson v Horizon Holidays Ltd [1975]) and explain why these would not work for the same reasons why the Act might not.
Finally conclude on the likelihood of Lucy being able to enforce the contract – how the outcome depends on further facts that are needed.