Yes. Where a person enters into contract for the benefit of others, where there is breach, the person who entered into the contract can sue for damages. If he sues only for himself, he will be awarded only nominal damages, but where he sues for himself and on behalf of the beneficiaries who actually suffered the damage, special damages as well as general damages shall be awarded. BESWICK v. BESWICK (1967) 2 All ER 1197.
As an exception to the general rule on privity of contract, where a party to a contract declared either orally or by writing that his interest in the contract entered into with a third party be channeled to a particular, where such party fails to enforce the trust, the beneficiaries thereof can go ahead and sue the third party in order to enforce the trust. HARMER v. ARMSTRONG (1933) All ER Rep. 778.
For the rule in Tulk v. Moxhay to be functional and serve as an exception to privity of contract, the covenant therein must be negative in nature (a command not to do a particular thing); the existence of a dominant tenement. That is, the person trying to maintain the observance of the restrictive covenant must have other lands capable of benefiting from the restriction in the agreement; and finally, the covenant must have been intended to run with the land. HAYWOOD V. BRUNSWICK PERMANENT BENEFIT BUILDING SOCIETY (1881) 8 QBD 403; LONDON CITY COUNCIL V. ALLEN (1913-14) All ER Rep. 1008; TULK v. MOXHAY (1843-60) All ER Rep.9.
Yes. Under the Motor vehicle (Third Party) Act, Cap. M22 Laws of the Federation of Nigeria, 2004, the law makes it mandatory for motorist to enter into insurance that will cover other third party road users in the event of accident. This third party can claim indemnity against the insurance company even though they were not a party (privy) to the insurance contract. This is a statutory exception to the general rule of privity of contract. Section 6 (3) of the Motor vehicle (Third Party) Act, Cap. M22 Laws of the Federation of Nigeria, 2004.
The surviving spouse or children of the deceased who took out the life insurance policy have the right and capacity to enforce the life insurance policy to their benefit. In this instance, the beneficiaries can sue the insurance company as though they were a party (privy) of the contract.
In this instance, Party C can sue the Party A for the dishonouring of the cheque. By virtue of the provisions of the Bill of Exchange Act, Cap.B8 Laws of the federation of Nigeria 2004 a third party can sue on a bill of exchange. The holder of the cheque at the time being (time of presentation at the bank) is entitled to its face value. UNITED DOMINIONS TRUST LTD. v. KIRKWOODS (1966) 1 All ER 968, 980.
Where a third party who earlier chartered or took on leased a vessel and the owner thereafter sold the chartered vessel to another, the later purchaser who has knowledge of the existence of the chartered vessel must observe the terms and conditions of the earlier charter. Where there is a breach thereof, the third party who is not a party to the sale can sue for damages or performance of the terms of the charter. DE MATTOS v, GIBSON (1843-60) All ER Rep.803; 45 ER 108.
A collateral contract is a contract that is entered into for the purpose of inducing the parties to enter into another separate contract. For instance, where Party A purchases goods from Party B and A uses the Point of Sale (POS) machine as provided by B to pay for the purchase, the contract of purchase of goods between A and B, is different from the contract between the POS company and party B. Where there is a breach emanating from the POS company in paying B, if A was in good financial standing and he actually paid the POS company, A can sue the POS company in order to show his credit worthiness. SHANKLIN PIER LTD v. DETEL PRODUCTS LTD. (1951) 2 All ER 471. Where there is a breach of contract in the second ambit of the contract as constituting a collateral contract, a party that was privy in the first contract and not a privy in the second contract, can sue for the breach in the second contract.
Yes. In claiming damages in the suit against the party that caused the accident, the third party can join the insurance company in the suit even though he had no direct contract with the insurer. ANDREW O. AJUFOR v. CHRISTOPHER AJABOR & 3 ORS (1978) 6-7 SC 39, 52.
Restrictive covenants is an exception to the doctrine of privity if contract. Where in a contract, the parties thereto inserts certain restrictive covenants, it shall be binding on them even subsequent purchasers with knowledge of the restrictive covenant shall be bound by it. TULK v. MOXHAY (1843-60) All ER Rep.9.
A person whom the property of a deceased person devolves on, has same right to the property as if he was a party to the conveyance or other instrument conferring title upon the original purchaser. Despite the fact that the beneficiary was not a party (privy) to the contract of transfer, he will have the full right as though he was a party. See Section 56(1) of the Law of Property Act, 1925.
The doctrine of agency is an exception to privity of contract. Where a person represents another and he presents a particular position on a contract and based on the presentation of the agent to the third party, the third party agreed and entered into the contract, and the master went ahead to ractify the representation made by his agent, in the event of any breach thereof, the third party is entitled to sue the master and he will be held liable. CHIEF (HON.) C. A. MODEBE v. DR. CHUBA OKADIGBO & ORS (1992) 9 NWLR (Pt.263) 1, 20.
Where a person entered into a contract not for his own personal benefit but did so for the interest of the beneficiaries, the beneficiaries can sue the third party with whom the trustee entered into the contract though the beneficiaries were not parties to the contract.