The law allows for full respect for the objective of the parties. In Beswick v. Beswick, it was agreed that Peter Beswick would transfer his business to his nephew in exchange for the nephew employing him for the rest of his life and then pay a weekly pension to Mrs. Beswick. Since the latter clause was in favour of a person not party to the contract, the nephew did not believe that it was enforceable and therefore did not fulfil it and made only the payment of the agreed weekly amount. But the only reason Mr Beswick signed a contract with his nephew was in favour of Mrs Beswick. By law, Ms Beswick would be able to perform the contract herself. Therefore, the law recognizes the intentions of the parties. The doctrine of contract confidentiality is a common law principle that provides that a contract cannot impose rights or obligations on a person who is not a party to the contract. This means that a person named in the contract as a person authorized to perform the contract or a person who receives a benefit from the contract may perform the contract unless it appears that the parties intended not to do so.
Queensland, the Northern Territory and Western Australia have adopted all legal provisions that allow third party beneficiaries to perform contracts and have restricted the parties` ability to amend the contract after the third party has relied on it. In addition, section 48 of the Insurance Contracts Act 1984 (Cth) allows third party beneficiaries to enforce insurance contracts. New Zealand has enacted the Deprivation of Contracts Act 1982, which allows third parties to sue if they are sufficiently identified as beneficiaries by the contract, and in the contract, which is express or implied, they should be able to assert that benefit. An example of a case in which “sufficient identification” is not made is that of Field v. Fitton (1988). Contractual deprivation has also played a key role in the development of negligence. In the first case, Winterbottom v. Wright (1842), in which Winterbottom, a mail truck driver, was injured by a defective wheel, attempted to sue the manufacturer Wright for his injuries. However, the courts have ruled that there is no confidentiality of the contract between the manufacturer and the consumer. In Australia, it has been decided that third party beneficiaries may honour a promise made in their favour in an insurance contract to which they are not parties (Trident General Insurance Co Ltd v. McNiece Bros Pty Ltd (1988) 165 CLR 107).
[3] It is important to note that the Trident decision did not have a clear connection and did not create a general exception to the doctrine of privacy protection in Australia. Although damages are the usual remedy in the event of breach of contract in favour of a third party, a specific benefit may be granted in the event of insufficient damage (Beswick v. Beswick, 1968, AC 59). Prior to 1861, there were decisions in English law that allowed the provisions of a contract to be enforced by persons who were not involved in it, usually relatives of a promisor, and decisions that did not allow the rights of third parties. [1] [2] The doctrine of privacy arose in parallel with the doctrine of consideration, whose rules state that consideration must deviate from the promise, that is, if nothing is given for the promise to give something in return, that promise is legally binding only if it is promised as an act. In 1833, there was Price v. Easton, where a contract for the execution of works was concluded against payment to a third party. When the third tried to demand payment, he was considered not to be aware of the contract, and his request therefore failed.
This was fully related to the doctrine of consideration and, as such, established with the more famous case of Tweddle v. Atkinson. In this case, the plaintiff could not sue the executor of his father-in-law`s will, who had promised the plaintiff`s father payment for the plaintiff because he had not provided anything in exchange for the contract. The validity of the contract is concluded only between the contracting parties, most often a contract for the sale of goods or services. Horizontal privacy protection occurs when the benefits of a contract are to be awarded to a third party. Vertical confidentiality involves a contract between two parties with an independent contract between one of the parties and another person or company. If a third party receives a benefit from a contract, he does not have the right to bring an action against the contracting parties beyond his claim for a benefit. For example, when a manufacturer sells a product to a distributor and the distributor sells the product to a distributor.
The retailer then sells the product to a consumer. There is no private contract between the manufacturer and the consumer. This problem appeared several times until MacPherson v. Buick Motor Co. (1916), a case analogous to Winterbottom v. Wright, which concerned the defective wheel of a car. Judge Cardozo, writing for the New York Court of Appeals, ruled that no privacy is required if the manufacturer knows that the product is likely to be dangerous if it is defective, if third parties (for example. B, consumers) will be harmed as a result of this defect and that there have been no further tests after the initial sale. Predictable injuries occurred from predictable uses.
Cardozo`s innovation was to decide that the basis of the action was that it was a crime and not a breach of contract. In this way, he refined the problems caused by the doctrine of privacy in a modern industrial society. Although his view is only law in new York State, the solution he proposed has been widely accepted elsewhere and has formed the basis of the doctrine of product liability. Attempts have been made to circumvent the doctrine by involving trusts (with varying degrees of success), constructing the Property Act of 1925, at p. 56(1), reading the words “other property” to include contractual rights, and applying the concept of restrictive agreements to property other than real property (to no avail). There are exceptions to the general rule that allow rights to third parties and certain obligations. These are: The premise is that only the parties to the contracts should be able to assert their rights or claim damages as such. .