BU231 Study Guide - Final Guide: Intangible Property, Tangible Property, Negotiable Instrument
Document Summary
A person who is not a party to the contract is called a third person/party. The general rule is that a contract does not give any benefits to or impose any obligations on a stranger to the contract. To win a contract lawsuit, the plaintiff must prove privity of contract with the defendant show that they are both parties to the same contract. Liability of sellers of goods: a consumer who purchases goods from a retailer receives the benefit of an implied term that the goods are reasonably suited for the purpose, which they are sold. If you buy a can of tuna but it"s poisonous you can sue. But members of family who are harmed by eating the salmon can"t because they have no privity of contract with the seller and no rights under the contract. Liability of manufacturers: even though members of the family have no rights against the retailer, the manufacturer may well be liable for negligence.
