Privity Of Contract Essay

The existence of a formal contract formed by both parties, in the event of a dispute, economic loss allegedly caused by the professional’s negligence, the doctrine of privity of contracts will apply. The most significant case of Tweddle v. Atkinson.[1861] discloses that the bride’s father and the groom’s father entered into an agreement which would pay the couple a sum of money. Both parties died without having paid and the groom made a claim against the executor of the will. The court held that the groom was not a party to the agreement and hence he is not entitled to enforce the contract. Therefore, this case illustrate the principle of privity of contract, which implies that only a promisee may enforce the rights and obligations promised

Under tort law, construction professionals would be held liable for their negligent act or omissions which have breached the duty of care against the third parties. Often in time, an original purchaser of a defective building would be able to institute an action under contract law against the construction professionals with the presence of privity of contract. In the absence of privity of contracts, however, the only remedy available to the third parties would be tort law. Be reminded that the occurrences of building defects are not clearly displayed and its occurrence could surface throughout the lifespan of the building thus making the claim under tort law more complex and the rule of causation is by and large harder to establish. Since transactions in relation to real estate’s trading often take place in Singapore, issue arisen as to the rights of the subsequent buyers who purchased the property through the original purchaser which do not have a direct contract with the developer and contractor. Thus, under the judgment of Bryan v. Maloney.(1995), the Australian High Court decision allows the subsequent purchaser to make a claim through tort in the event of defects. This position is similar to Singapore position and hence, a remedy that would have for the subsequent purchaser in the event of