Doctrine Of Privity Explained

Summary

The doctrine of privity in contract law restricts the ability to enforce contract terms to the parties directly involved in the contract. Third parties typically cannot enforce or be bound by the contract, unless the contract explicitly benefits them. In commercial agreements, there is a strong presumption that parties intend to create legal relations, which can be rebutted by clear language indicating otherwise. Exceptions to this presumption include subject to contract clauses or gentlemens agreements, which may suggest no legal intent. Understanding these principles is crucial for determining who can enforce contract terms and under what circumstances.