I bought a BMW 3 series from a car garage in Swansea, the car looked like it was in really good condition, but 3 months after I bought it, it broke down. I went to the car garage and told them about this and they did some checks and told me that they had discovered that the car garage who they bought it from had lied to them about the condition of the engine.
They said they had no idea that the engine was in a poor as condition as it was, as the paperwork that they got from the other garage said otherwise. I now know that blame for my car breaking down is with the garage that told lies about the condition of the engine.
I am considering suing them that particular garage, but a friend told me that I may not be able to sue them as I was not privy to the contract between the two garages. Can you please explain what is privity of contract and how it applies to such a situation as mine?
The Answer from Solicitors Online
What is privity of contract?
Privity of contract means that a person who is not party to a contract cannot sue or be sued in relation to the contract.
Privity of contract prevents strangers to a contract from taking advantage of that contract.
For example in the case that a buyer buys some tyres from a seller and part of the contract states that the buyer cannot resell the tyres below the sellers listed prices, and the buyer must also impose a similar term on anyone they sell the tyres to. If the buyer sells them to Luke, and Luke later then sells them below the original seller listed prices, the original seller cannot sue Luke, for selling them below the listed price. As Luke is not part of the contract was made between the original seller and original buyer.
The rule of privity of contract is in place to prevent third parties from unfairly being imposed with contractual obligations. However in the case that a contract wants to give a third party a benefit or the right to sue in relation to the contract, the Contracts (Rights of Third Parties) Act 1999 caters for this.
The privity of contract rule is solely in place to ensure the protection of third parties from unfair contractual obligations that they did not directly agree to.
If you need legal advice on the privity of contract, you can get legal advice online from our Solicitors online right now.