was a

landmark A landmark is a recognizable natural or artificial feature used for navigation, a feature that stands out from its near environment and is often visible from long distances. In modern-day use, the term can also be applied to smaller structures ...

English contract law English contract law is the body of law that regulates legally binding agreements in England and Wales. With its roots in the lex mercatoria and the activism of the judiciary during the Industrial Revolution, it shares a heritage with countries ...

case on

privity of contract The doctrine of privity of contract is a common law principle which provides that a contract cannot confer rights or impose obligations upon anyone who is not a party to that contract. It is related to, but distinct from, the doctrine of considera ...

and

specific performance Specific performance is an equitable remedy in the law of contract, in which a court issues an order requiring a party to perform a specific act, such as to complete performance of a contract. It is typically available in the sale of land law, b ...

. The

House of Lords The House of Lords is the upper house of the Parliament of the United Kingdom. Like the lower house, the House of Commons of the United Kingdom, House of Commons, it meets in the Palace of Westminster in London, England. One of the oldest ext ...

, overruling the decision of

Lord Denning Alfred Thompson Denning, Baron Denning, (23 January 1899 – 5 March 1999), was an English barrister and judge. He was called to the Bar of England and Wales in 1923 and became a King's Counsel in 1938. Denning became a judge in 1944 when he w ...

in the

Court of Appeal An appellate court, commonly called a court of appeal(s), appeal court, court of second instance or second instance court, is any court of law that is empowered to Hearing (law), hear a Legal case, case upon appeal from a trial court or other ...

, ruled that a person who was not party to a contract had no independent standing to sue to enforce it, even if the contract was clearly intended for their benefit. Today the judicial precedent has been codified by statute in the United Kingdom, and Lord Denning's decision has largely been given effect by the

Contracts (Rights of Third Parties) Act 1999 The Contracts (Rights of Third Parties) Act 1999 (c. 31) is an Acts of Parliament in the United Kingdom, Act of the Parliament of the United Kingdom that significantly reformed the common law Privity in English law, doctrine of privity and "there ...

. However the case remains good law in many other Commonwealth

common law jurisdictions Common law (also known as judicial precedent, judge-made law, or case law) is the body of law primarily developed through judicial decisions rather than statutes. Although common law may incorporate certain statutes, it is largely based on prece ...

Facts

Lord Denning in the Court of Appeal started describing the facts of the case in the following way. The agreement was that Peter assign his business to his nephew in consideration of the nephew employing him for the rest of his life and then paying a weekly annuity to Mrs Beswick. Since the latter term was for the benefit of someone not party to the contract, the nephew did not believe it was enforceable and so did not perform it, making only one payment of the agreed weekly amount of 5 pounds. The nephew argued that as Mrs Beswick was not a party to the contract, she was not able to enforce it due to the doctrine of

Decision

Court of Appeal

Lord Denning held that Mrs Beswick was entitled to claim in her capacity as a third party intended to benefit from the contract. He said, 968Ch. 538, 557 Danckwerts LJ and Salmon LJ concurred in the result, though not with Lord Denning's reasoning.

House of Lords

The House of Lords disagreed with Lord Denning in the Court of Appeal, that the law allowed third parties to sue to enforce benefits under a contract. However, they held that Mrs Beswick ''in her capacity as Mr Beswick's administratrix'' (i.e. as the person representing someone's estate who dies without a will) could enforce the nephew's promise to pay Mrs Beswick an annuity. Furthermore, Mrs Beswick was entitled to

of the contract. Lord Reid's judgment outlined the details, with which Lords Hodson, Pearce, Upjohn and

Guest A guest is person who is given hospitality. Guest or The Guest may refer to: * Guest (surname), people with the surname ''Guest'' * USS ''Guest'' (DD-472), U.S. Navy ''Fletcher''-class destroyer 1942–1946 * Guest appearance, guest actor, guest ...

concurred.

Significance

In '' Smith and Snipes Hall Farm Ltd v River Douglas Catchment Board'' 9492 KB 500, 514, Denning LJ had already tried to dispose of the English doctrine of privity. He had said, In Australia, ''Coulls v. Bagot's Executor and Trustee Co Ltd'' (1967) 119 CLR 460 shows the approach has been similar. Here the contract was between a husband (Mr Coulls) and a company (Bagot's). Mrs Coulls was not a party to it. Even if she was, she would not be able to enforce it, as she gave no consideration. Bagots was entitled to the benefit of this contract as executor of Mr Coull's Estate. Many people, including judges had called for statutory reform and in England this came in the form of the

, which gives a general right to enforce the benefit of a contract when one was either expressly identified as being able to enforce it, or one was intended to benefit.

Notes

{{reflist

External links

full text of House of Lords decision

Lord Denning cases English privity case law English remedy case law 1967 in United Kingdom case law House of Lords cases