Contracts (Rights of Third Parties) Act 1999 - A Reminder 2
The Contracts (Rights of Third Parties) Act 1999 comes into full force on Thursday 11th May 2000 - TODAY.
The Act gives a person who is not party to a contract the right to enforce a term of that contract in specified circumstances and so marks a significant change to the rule of privity of contract in English law.
It is possible to contract out of the provisions of the Act so that third parties are not able to enforce a term under the contract, but it must be clear on a proper construction of the contract that the parties did not intend the term to be enforceable by a third party.
It is important that this issue is considered for all contracts and other documents signed from now on.
For further information, in the first instance, please contact Simon Johnston of the Banking and International Finance Department, Project Finance Group (sjj@cms-cmck.com, telephone 0207 367 2008).
