BU231 Chapter Notes - Chapter 11: The Need, Negotiable Instrument, Accounts Receivable
Document Summary
The limited scope of contractual rights and duties. When parties make a contract, they create a small body of law for themselves. Third party a person who is not one f the parties to a contract but is affected by it. Privity of contract the relationship that exists between parties to a contract. To win a contract lawsuit, the plaintiff must prove privity of contract with the defendant. A reason for preventing a third person from suing on a contract is that the third party has not given consideration for the promise. The privity of a contract rule can have harsh consequences when it prevents a third person from enforcing a contract when the whole object was to benefit him. If a person buys a can of salmon that turns out to be poisonous and that seriously harms her, she may successfully sue the retailed for breach of the implied term that the fish was suitable to eat.
