Avraamides v Colwill

Under the 1999 Act the third party must be expressly identified in the contract by name, class or description.

Citation
[2006] EWCA Civ 1533
Court
Court of Appeal
Year
2006
Subject
Contract Law
Topic
Privity of contract

Facts

Mr and Mrs Avraamides had a bathroom refurbished by a company that later went into liquidation. The work was defective. Mr Colwill and another person bought the company's business under a contract that stated that they would complete outstanding customer installations and remedial work in a proper and workmanlike manner and pay in the normal course of business for liabilities properly incurred by the company. The customers sued the buyers under the Contracts (Rights of Third Parties) Act 1999.

Legal principle

The Court of Appeal held that the customers could not enforce the term. Section 1(3) of the 1999 Act requires the third party to be expressly identified in the contract by name, as a member of a class or as answering a particular description. The undertaking to pay liabilities properly incurred by the company did not expressly identify the customers as a class of persons on whom a benefit was to be conferred. The court would not imply words into the contract to create a third party right where the Act requires express identification.

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