Privity of contract refers to the doctrine in which only those parties are involved who had made contract and enforce or bound by the terms of the contract. Other third parties will not be entertained or involved in the contract and they don’t have any kind of rights and obligation in the contract.
There are some key points of privity of a contract let us see what are they;
- The third party in this contract will not enforce any contractual obligations but if he or she is a part of the contract’s benefits then they can file sue if their rights under the contract have been violated.
- Obligations and rights of contract can be given to the third party unless a prohibited contract.
- An agent can perform the contract on behalf of the principal, which binds the principal to the contract.
- In the contract beneficiaries of the trust, can enforce the terms of the contract made by the trustees for their benefit.
