This Practice Note discusses the common law doctrine of privity of contract; the equitable and statutory exceptions to it; how the doctrine affects enforcing a contract against a third party and what happens when, notwithstanding the lack of privity, a contract has an indirect effect on a third party. For guidance on contracts and third parties more generally and on the Contracts (Rights of Third Parties) Act 1999 (C(RTP)A 1999), respectively, see Practice Notes: • Contracts and third party rights • Third party rights—the Contracts (Rights of Third Parties) Act 1999 What does privity of contract mean? 'Privity of contract' is a common law doctrine, which provides that you cannot either: • enforce the benefit of, or • be liable for any obligation under a contract to which you are not a party. Therefore, at common law, if your client is not a party to a contract (ie they are a third party) then they cannot sue or be sued under that contract. Example: A promises

It is likely in this type of scenario that the grounds for relief would be mistake or misrepresentation rather than breach of contract. In terms of remedies, rescission ab initio (where the contract is treated as if it never

In answering this Q&A, we have assumed that the claim relates to a business-to-business contract. When considering a claim for damages, the court will consider the principles of causation and remoteness. Once causation has been established, the innocent party should consider whether the damage suffered is attributable to the breach in question. Damage which is too remote is not recoverable even if there is a causal link between the breach of contract and the loss. The party claiming damages is also under a duty to mitigate its loss. For more information on causation, remoteness and mitigation of loss, see Practice Notes: Causation and remoteness in contractual breach claims and Mitigation in contractual breach claims. Hadley v Baxendale established the 'two limb test' for assessing whether damage caused is or is not too remote. Damages may only be recovered for: • losses arising naturally, according to the ordinary course of things, from the breach of contract. The defaulting party is

The Agreement, Recitals, Articles and Contract Particulars at the start of a JCT contract set out the project specific details for the particular works to be carried out. It is very important that these are fully completed and that the details are correct to avoid ambiguity and disputes regarding what is required. This Checklist provides practical guidance as to how to complete the details including links to relevant Practice Notes which provide detailed information on the areas covered. It is aimed at those who are relatively new to dealing with JCT contracts. An employer will often arrange for the architect/contract administrator or other consultant to complete the particulars at the start of the contract and will then ask its lawyer to check the contract before the parties execute it. Alternatively, a lawyer may be asked to fill in all of the details but they will need input from the client or its consultants as to the details to be inserted. This Checklist can be used as a reference where completing or checking the particulars. For

The Agreement, Recitals, Articles and Contract Particulars at the start of a JCT contract set out the project specific details for the particular works to be carried out. It is very important that these are fully completed and that the details are correct to avoid ambiguity and disputes regarding what is required. This Checklist provides practical guidance as to how to complete the details including links to relevant Practice Notes which provide detailed information on the areas covered. It is aimed at those who are relatively new to dealing with JCT contracts. An employer will often arrange for the employer’s agent, architect or other consultant to complete the particulars at the start of the contract and will then ask its lawyer to check the contract before the parties execute it. Alternatively, a lawyer may be asked to fill in all of the details but they will need input from the client/its consultants as to the details to be inserted. This checklist can be used as a reference where completing or checking the particulars. For

1 Interpretation 1.1 The following definitions and rules of interpretation apply in this Schedule: Broadly Comparable Pension Scheme • a pension scheme formally certified by the Government Actuary’s Department as broadly comparable to the relevant Public Sector Pension Scheme Customer’s Scheme • the Public Sector Pension Scheme currently operated by the Customer in respect of the Relevant Employees Fair Deal Guidance • HM Treasury Fair Deal for staff pensions—staff transfer from central government (October 2013) Onward Transfer Date • the date of transfer of Onward Transferring Employees of the Supplier pursuant to TUPE 2006 on expiry (or earlier termination) of this [ Outsourcing Contract] Onward Transferring Employees • employees of the Supplier who on expiry (or earlier termination) of the [Outsourcing Contract] automatically transfer under TUPE 2006 to the Customer or another employer for the purpose of provision of the Services Public Sector Pension Scheme • the [Principal Civil Service Pension Scheme (Classic, Classic Plus, Premium or Nuvos, as relevant)/National Health Service Pension Scheme (1995/2008)/National Health Service Pension Scheme (2015)/Teachers’ Pension Scheme (Post-2015)/Teachers’ Pension Scheme (Pre-2015)] Relevant Employees • [refer to employment definitions] [and as listed in Appendix 1 to this Schedule] Services • means the

Schedule of amendments to the jct MANAGEMENT building contract 2016 The Contract comprises the completed the Management Building Contract 2016 published by the JCT subject to the following amendments: RECITALS   ARTICLES Article 2 [ Article 2 ] [ See drafting note ] Article 6 Article 6 Principal Designer After ‘for the purposes of the CDM Regulations’, insert ‘and the Dutyholder Regulations’. Article 7 Article 7 After ‘for the purposes of the CDM Regulations’, insert ‘and the Dutyholder Regulations’.At the end, insert: ‘The Prime Cost and/or Management Fee includes the Management Contractor’s price for fulfilling the duties of Principal Contractor’. Article 11 Article 11 Arbitration Delete Article 11 and insert: ‘All references to arbitration in this Contract are deleted.’ Article 13 Insert new Article 13 as follows: Article 13 [To be added on the face of the contract] ‘Schedule of Amendments The Employer and the Management Contractor agree that the modifications in the Schedule of Amendments attached hereto (as initialled by the parties) are incorporated into this Contract and the provisions of the Agreement, the Conditions, the Schedules and the Annexes annexed to the Conditions shall have effect as modified by the Schedule of Amendments which together comprise the ‘Contract’.

Many businesses are closing their offices or recommending their staff work from home in an attempt to slow the spread of coronavirus (COVID-19). This will mean parties may not be able to meet in person to execute contracts. The Law Society guidance The Law Society provides guidance on how to execute documents when one or more parties to a contract are not physically present. It envisages exchanging copies of signed signature pages via email: Law Society Guidance: Execution of documents by virtual means. The available methods will depend on whether the document to be executed is a deed, guarantee to be executed as a deed or a contract for the sale and transfer of real property. Option 1 is appropriate for the execution of

The requirements set out in section 2 of the Law of Property (Miscellaneous Provisions) Act 1989 (LP(MP)A 1989) do not apply to certain contracts and trusts. This Practice Note sets out what those contracts and trusts are, and how the exceptions are implemented. Excepted contracts The contractual formalities set out in LP(MP)A 1989, s 2 do not apply to contracts: • for leases not exceeding three years (ie short leases under Law of Property Act 1925, s 54) • made in the course of a public auction • regulated under the Financial Services and Markets Act 2000 (other than a regulated mortgage contract, regulated home reversion plan, regulated purchase plan or a regulated sale and rent back agreement) Constructive trusts The statutory formalities set out in LP(MP)A 1989, s 2 do not affect the creation or operation of resulting, implied or constructive trusts. They are not required to be evidenced in writing. A constructive trust arises in connection with the legal title to property where one party has so conducted themselves that it

This Practice Note provides a simplified and brief summary of the general rules of contract interpretation. Although there is no simple set of rules to follow in respect of how terms may be construed and interpreted (as much will depend on the individual facts of the case), some general principles and rules of contract interpretation have been developed by a considerable body of case law. The key cases are discussed below. Investors Compensation Scheme v West Bromwich Building Society The following five principles set out by Lord Hoffman in Investors Compensation Scheme v West Bromwich Building Society have become the leading statements on the interpretation of contracts: • it is an objective test as to what a reasonable person, having all the background knowledge reasonably available, would have understood the contract to mean at the time of contracting • account can be taken of background knowledge and matrix of fact, where such is relevant • previous negotiations and subjective intent are excluded (with a few exceptions—eg rectification cases) • the meaning of words used is to be

Under section 1(4)(d)(i) of the Employment Rights Act 1996 (ERA 1996), the written statement of particulars of employment must include terms and conditions relating to holidays (including public holidays) and holiday pay. The particulars given must be sufficient to enable the worker's entitlement (including any accrued entitlement on termination of employment) to be precisely calculated. For further information see the section of Practice Note: Written statements of employment particulars entitled ‘What the written statement must cover’. If an employer needs to make changes to a part-year worker’s contract to reflect their revised

The sale contract is usually drafted by the seller’s solicitors and may have been provided as early as the heads of terms stage. The seller and buyer’s lawyers will negotiate the sale contract provisions, subject to the findings of the searches and enquiries. Timing The timing of this phase will be dictated by various factors, such as the deadlines set out in the heads of terms, the size and complexity of the transaction and the scope of the buyer’s due diligence: