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Privity of Contract (Exceptions to the doctrine of privity of contract…
Privity of Contract
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Only parties to a contract may sue or be sued on it, and consequently provides rights and imposes obligations on those parties alone. The burden of the contract should not be imposed on a 3rd party.
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Statutory exceptions
Road Traffic Act 1988
the driver is required to take out insurance to cover possible claims by persons who are injured as a result of the actions of the driver of a vehicle. The third party can make a direct claim against the insurance company, although he is not party to the contract.
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Companies Act 2006
S33 - provisions of the company constitution bind the company and its members to the same extent as if there were covenants between the company and its shareholders, and shareholders amongs themselves.
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The Contracts Act 1999
applies to all contracts made on or after 11 May 2000, where the privity rule should no longer apply.
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