In brief: Privity of contract law reform proposed

The Law Commission has recommended reform of the “privity of contract” rule under which a third party to a contract has no right to enforce it. In its report on contracts for the benefit of third parties, published last week, the commission argues the present law is unfair to third parties, prevents effect being given to the intentions of contracting parties and is out of step with most European Union legal systems. In a draft Bill, the commission proposes amending the law so that contracting parties can confer a right to enforce a contract on a third party, where that is their intention.