Which concept is reformed by the Contracts (Right of Third Parties) Act 1999?

The Contracts (Rights of Third Parties) Act 1999 fundamentally reforms the doctrine of privity of contract, which traditionally held that only the parties to a contract had the rights and obligations under that contract. This meant that third parties, who might have benefitted from the contract or been affected by it, had no legal standing to enforce its terms.

With the introduction of this Act, third parties are given the right to enforce a contract if the contract expressly provides that they can do so or if the contract is made for their benefit. This significant shift allows individuals who are not party to the original agreement to seek legal remedies related to that contract, thereby broadening the scope and practical utility of contractual agreements. The Act aims to facilitate and acknowledge the expectations and interests of third parties in contractual relationships, enhancing overall fairness and practicality in contractual dealings.

Other concepts, such as estoppel, proximate cause, and subrogation, do not relate directly to the changes brought about by the Contracts (Rights of Third Parties) Act. Estoppel refers to preventing a party from arguing something contrary to a previous position or representation. Proximate cause typically relates to tort law and the determination of liability for negligence. Subrogation is a principle in insurance law