1. Cf the wider principle that a person can be burdened by a contract only if he assents and communicates his willingness to be bound: Felthouse v Bindley (1862) 11 CBNS, affd (1863) 1 New Rep 401.

2. A, B and C denote the promisor, promisee and third-party beneficiary respectively. When attention turns to a simple two-party contract, X and Y refer to promisor and promisee

3. ‘Immunity’ embraces a promise not to sue, and exemption or limitation clauses of whatever sort.

4. (1861) 1 B & S 393.

5. [1915) AC 847.

6. [1962) AC 446.

7. Viscount Haldane in Dunlop v Selfridge (1915) AC 847 at 853. See n 15 infra.

8. ‘Active right’ will be adopted as convenient short-hand to refer to these two rights. When reference is restricted to one of these two rights, for example to C's direct right of action, this will be stated explicitly.

9. Treitel, G.H., The Law of Contract (7th edn) (1987, London) at p 458Google Scholar, hereafter ‘Treitel’ .

10. Lord Diplock in Moschi v Lep Air Services (1973) AC 331 at 350–351; Photo Production Ltd v Securicor Transport (1980) AC 827 at 848–851. W.N. Hohfeld, Fundamental Legal Conceptions (ed W.W. Cook) (1923, New Haven) at pp 202–3 referred to the right to sue as a power correlated with a liability. This is described in this article as a right because it is correlated with the courts' duty to facilitate its exercise.

11. [1968) AC 58.

12. The author has assumed that the courts will not introduce an active right and that legislative intervention is almost as unlikely. Therefore, it seems best to consider other avenues of change. See also Lord Scarman in Woodar Investment Development Ltd v Wimpey Construction (UK) Ltd (1980) 1 All ER 571 at 591.

13. See Woodar v Wimpey, n 12 supra.

14. Note also the common assumption, not in fact an argument, that only a party to a contract can sue. For the Roman parallel, see Buckland, W.W., Textbook on Roman Law (3rd edn, ed P. Stein) (1963, Cambridge) at pp 426Google Scholar et seq. Obviously no further progress can be made if this is accepted a priori.

15. [1915) AC 847 at 853: ‘Our law knows nothing of a ius quaesitum tertio arising by way of contract. Such a right may be conferred by way of property, as for example, under a trust, but cannot be conferred on a stranger to a contract as a right to enforce the contract in personam. A second principle is that if a person with whom a contract not under seal has been made is to be able to enforce it, consideration must have been given by him to the promisor or to some other person at the promisor's request’ . Followed by Lord Wright in Vandepitte v Preferred Accident Insurance Corpn of New York (1932) All ER 527 at 532.

16. For discussion of consideration and privity, see Treitel, pp 452–3 and 457–8; Furmston (1960) 23 MLR 383-4; Coote (1978) CLJ 301; Cullity (1969) 85 LQR 530; Winterton 47 Can BR 483; P.S. Atiyah, Essay on Contract (1986, Oxford) pp 219–222.

17. (1967) 119 CLR 460 at 478-9 and 493. See also McEvoy v Belfast Banking Co (1935) AC 24 at 43 and 52.

18. In the absence of a trust of a promise.

19. (1861) IB & S 393 per Crompton J at 398: ‘It would be a monstrous proposition that a person was a party to the contract for the purpose of suing upon in for his own advantage, and not a party to it for the purpose of being sued’.

20. Price v Strange (1978) Ch 337; Lyus v Prowsa (1982) 1 WLR 1044; G.H. Jones and W. Goodhart, Specific Performance (1986, London) pp 22–7.

21. [1943) 2 All ER 768, esp at 779, per Du Parcq LJ. See also P.B.H. Birks, vol 1, Polytechnic Law Review, 39 at 42 et seq.

22. P.S. Atiyah, Introduction to the Law of Contract (3rd edn) (1981, Oxford) p 277.

23. See Treitel, p 487.

24. Treitel p 488, n 18.

25. Birks, op cit n 21 supra would require B to be joined unless the negative benefit were intended to be ‘immediate and unconditional.’ With respect, this seems too cautious.

26. The New Zealand reform, see n 102 infra is interesting since A and B can vary the contract only where an express power of variation is spelt out in the contract.

27. [1962) AC 446 at 473, ‘As was said in Tweddle v Atkinson [(1861) I B & S at 398], the stranger cannot “take advantage” from the contract’.

28. ‘Claim-right’ is that species of right which is correlated with a duty.

29. In Cosgrove v Horsfall (1945) 62 TLR 140, Du Parcq LJ said merely that it is ‘an elementary principle’ of law that the third party cannot take advantage of A and B's contract. Elder, Dempster v Paterson, Zachonis and Co (1924) AC 522 was not cited. Cosgrove was affirmed in Adler v Dickson (1954) 3 All ER397 by Jenkins and Morns LJJ. (Denning LJ (at 402 H) reached the same result, but only because he thought that the wording of the clause was inapt to confer such an immunity upon C. He repeated his view in Smith and Snipes Hall Farm v River Douglas Catchment Board (1949) 2 All ER 179 at 188, 189, that C can in principle take advantage of A and B's contract provided C participates in performance.).

30. See Lord Reid's verbatim citation of Tweddle v Atkinson n 27 supra. This aspect of the reasoning in Midland Silicones reveals the danger of holding that a ratio decidendi is contained in the ipsissima verba of a decision. On this issue, see N.H. Andrews (1985) 5 LS 205 at 209–222.

31. Diplock J at (1959) 2 All ER 289; Hodson, Pearce and Upjohn LJJ at (1960) 2 All ER 737, following Cosgrove v Horsfall (1945) 175 LT 334; Adler v Dickson (1954) 3 All ER 397; Wilson v Darling Island Steverdoring & Lighterage Co Ltd (1956) 1 Lloyd's Rep 385 (High Court of Australia); and Green v Russell (1959) 2 All ER 525.

32. Midland Silicones might be distinguishable as a denial of a third party beneficiary's primary right in the context of negative benefits, but this is patently arbitrary. Cf though Lord Denning in Beswick (in the Court of Appeal) [1966) 3 All ER 1 at 9.

33. Cf R v Shivpuri (1986) 2 All ER 334 where the House of Lords overruled its recent decision in Anderton v Ryan (1985) AC 560.

34. The suggestion in this article is that specific performance was given to vindicate this right of C in Beswick v Beswick. The conventional view represented by, among others, Treitel editing his chapter of Chitty on Contract (25th ed), vol 1, (1983, London) (hereafter' Chitty) paras 1794, 1801; J.D. Davies (1967) ASCL 387 et seq, and F.H. Lawson in Remedies of English Law (2nd edn) (1981, London) at 219-224, esp 223, is that the remedy was awarded to vindicate B's and not C's right to A's performance. This is also the approach of Windeyer J in Coulls v Bagot's Executor & Trustee Co Ltd see n 17 above, which is cited in Beswick.

35. The absence of a right of enforcement can be to C's advantage: Re Miller (1947) 2 All ER 78 (disapproved by Lord Denning in Beswick (1966) 3 All ER 1 at 9).

36. Re Schebsman (1944) Ch 43 is authority that B cannot ordinarily vary or revoke A's promise by unilateral act. Coulls (see n 17 supra) and Re Danish Bacon Company Staff Pension Fund Ltd (1971) 1 WLR 248 are examples of C's interest being revocable by B. (Cf Olsson v Dyson) (1969) 120 CLR 365).

37. In systems recognising an ius quaesitum tertio this joint capacity ceases to be exercisable once C has accepted or adopted the right: B. Nicholas, French Law of Contract (1982, London) at pp 177 et seq. For comment on this aspect of the Law Revision Committee's proposals of 1937 (Sixth Interim Report, Cmnd 5449), see Treitel pp 496–497.

38. Beswick v Beswick (1968) AC 58 at 71 D, 94 E, 96 C-F, overruling Re Engelbach's Estate (1924) 2 Ch 348 so far as it is authority for the converse.

39. See Lord Denning in Beswick (1966) 3 All ER I at 7 et seq. Yates (1976) 39 MLR 202 at 206 dubitante.

40. Re Schebsman (1944) Ch 43 is indirect authority for this.

41. In favour: Jackson v Horizon (1975) 1 WLR 1468 at 1473 (Lord Denning); Beswick (Lord Denning, Court of Appeal) (1966) 3 All ER 1 at 7; Beswick (House of Lords) (1968) AC 58 at 82A (Lord Hodson) and 92A (Lord Pearce). Cf Lord Russell in Woodar Investment Development Ltd v Wimpey Construction UK Ltd (1980) 1 All ER 571 at 585 A.

42. Treitel (1967) 40 MLR 686 at 693. In substance Jackson v Horizon Holidays Ltd (1975) 1 WLR 1468 involves a restitutionary claim unencumbered by the need to show total failure of consideration.

43. There are three respects in which a promisee can waive his rights: (i) exclude or limit the promisor's liability for breach; (ii) leave unenforced his right to sue the promisor for breach; and (iii) refuse to accept or otherwise decline the benefit of the promisor's performance. In the absence of a trust of a promise, (ii) does not apply to the third party beneficiary, but (iii) undoubtedly is relevant. There seems no reason why (i) might not also be relevant.

44. Seen 10 supra.

45. Finnis, J., Natural Law and Natural Rights (1980, Oxford) pp 320Google Scholar et seq. Holmes' statement is as follows: ‘The only universal consequence of a legally binding promise is that the law makes the promisor pay damages if the promised event does not come to pass. In every case it leaves him free from interference until the time for fulfilment has gone by, and therefore free to break his contract as he chooses.’‘The Path of the Law’ (1897) 10 HLR 457 at 461; Holmes, The Common Law (1881) (1911 edn, MacMillan, London) p 301. See also, Holmes-Pollock letters, vol 1, pp 21, 79, 119; vol 2, pp 55, 200, 233.

46. Holmes, The Common Law p 316; Nicholas, op cit n 37, at pp 154–164 on potestative conditions; and Mackintosh, Roman Law of Sale (2nd edn) (1907, Edinburgh) pp 22, 71.

47. P.M.S. Hacker, ‘Sanction Theories of Duties’, in Oxford Essays in Jurisprudence Series II (ed A.W.B. Simpson) (1972, Oxford) p 131; D.N. MacCormick, ‘Legal Obligation and the Imperative Fallacy’, ibid p 100; H.L.A. Hart, Essays on Bentham (1982, Oxford) ch VI; J. Harris Law and Legal Science (1979, Oxford) ch 2; N. Lacey, ‘Obligations, Sanctions and Obedience’, in The Legal Mind, Essays Dedicated to Tony Honoré (1986, Oxford) p 219.

48. Hart, , The Concept of Law (1961, Oxford)Google Scholar chapters I-VI and X.

49. See n 10 supra.

50. Johnson v Agnew (1980) AC 367; Chitty paras 1629 et seq.

51. Holmes was uncomfortable when considering this remedy: see The Common Law p 300.

52. Lake v Bayliss (1974) 2 All ER 1114; Oughtred v IRC (1960) AC 206.

53. Other than debt: see Weir (1986) CLJ 503 at 506–7.

54. Kronman (1978) 45 U Chi LR 351; Schwartz (1979) 89 YLJ 271; Muris (1982) Duke LJ 1053; MacNeil (1982) 68 Virg LR 947.

55. Certain strands of contract law are inconsistent with a strong obligation to perform: (i) striking down penalty clauses, thus proscribing attempts to deter breach in this way; (ii) if X anticipatorily breaches, Y's choice whether to accept repudiation is circumscribed by the need to show a ‘legitimate interest’ in continuing the contract: White & Carter v McGregor (1962) AC 413 and Clea Shipping v Bulk Oil (1984) I All ER 129. X's duty is therefore diluted.

56. This choice arises when the guilty party has committed a breach of a condition, or a serious breach of an innominate term, or has repudiated the contract.

57. H.L.A. Hart, The Concept of law, pp 77–88; MacCormick, H.L.A. Hart (1981, London) pp 30–32.

58. [1964) Ch 288.

59. See generally Clerk and Lindsell on Torts (15th edn) (1982, London) paras 15-20. In Torquay Hotel Ltd v Cousins (1969) 1 All ER 522, Russell and Winn LJJ held (at 534 E and 537 G) that X breached his primary obligation, but X's secondary obligation to pay damages had been excluded by an exemption clause.

For earlier criticisms to this effect, see Pollock, n 45 ante, Buckland (1942) 8 CLJ and Some Reflections on Jurisprudence (1945) pp 97–98, Finnis, see n 45 ante. For further discussion, see G. Fridman, (1974) 7 Loyola of Los Angeles LR I; Atiyah, Essays on Contract (1986, Oxford) ch 3.

60. Also a defendant's right to enter a defence or to make a counter-claim is not correlated with a duty owed by the plaintiff.

61. The author has coined the term ‘specific implementation’ since it captures the feature which unifies specific performance, injunctions and the action for an agreed sum.

62. Fuller and Perdue, 46 YLJ 52 at 53-4.

63. See Sky Petroleum v V.I.P. Petroleum (1974) 1 WLR 576. For dicta supporting a primary duty to perform, see, inter alia, Cooper v Jarman (1866) LR 3 Eq 98 at 102; Ahmed Angullia v Estate & Trust Agencies (1927) Ltd (1938) AC 628 at 635; Windeyer J in Coulls (cited n 17 supra); Lord Pearce in Beswick (1968) AC 58; Lord Diplock in Moschi v Lep Air Services Ltd (1973) AC 337 at 346 G.

64. See Sky Petrolcum v V.I.P. Petroleum [ 1974 ] 1 WLR 576. For dicta supporting a primary duty to perform, see, inter alia, Cooper v Jarman (1866) LR 3 Eq 98 at 102; Ahmd Angullia v Estate & Trust Agencics (1927) Ltd [19381 AC 628 at 635; Windeyer J in Coulls (cited n 17 supra); Lord Pearce in Beswick [ 1968 ] AC 58; Lord Diplock in Moschi v Lep Air Services Ltd [1973] AC 337 at 346 G.

65. There are two classes of case. (i) Positive promises to do ‘p’, eg, to build a wall. If X breaches, Y will be awarded the sum of money which enables him to carry out ‘p’ by employing a substitute contractor. See, eg, Radford v DeFroberville (1977) 1 WLR 1262; Tito v Waddell (No 2) (1977) 3 All ER 129. (ii) X damages Y's property while performing. Should Y receive the difference between the damaged property and its former state or the (greater) amount needed to restore the property to its un-damaged state? See Harbutt's ‘Plasticine’ v Wayne Tank and Pump Co Ltd (1970) I QB 447; Bacon v Cooper (Metals) Ltd (1982) 1 All ER 397; Ward v Cannock Chase DC (1985) 3 All ER 537; Chitty para 1682 n 70; Harris, Ogus, Phillips (1979) 95 LQR 581 at 589-594.

66. On damages for non-pecuniary interests: Jackson (1977) 26ICLQ 502; Harris, Ogus, Phillips, op cit n 65, pp 595–597. There are two main situations: (i) stress etc, due to breach of an obligation designed to alleviate or remove the plaintiffs problems, Heywood v Wellers (1976) QB 446, or to give pleasure or recreation, Jackson v Horizen Holidays Ltd (1975) I WLR 1488; Jarvis v Swan Tours Ltd (1973) QB 283; (ii) contracts where the main purpose is not to give relief, nevertheless breach can cause stress etc (for example, wrongful demotion, Cox v Philips Industries Ltd (1976) 1 WLR 638 or a surveyor's negligent work, Perry v Sidney Phillips & Son (1982) 3 All ER 705).

67. Hohfeld, op cit n 10 supra pp 91 et seq.

68. Chitty, para 1296. Cf Re Schebman and Olsson v Dyson cited n 36 supra: B (or his representatives) attempted unilaterally to re-direct the benefit of A's payment to his trustee in bankruptcy or estate respectively. The substitution envisaged in the text does not involve B being benefited.

69. [1968) AC 58 at 88A-F.

70. Ibid, at 102C.

71. See n 80 infra.

72. Ibid, at 88F.

73. Ibid, at 73C.

74. Ibid, at 77G.

75. Ibid, at 81F.

76. [1966) 1 Ch 538 at 560 D-E.

77. [1968) AC 58 at 72 F and 86 A respectively.

78. [1968) AC at 72D-F.

79. See also nn 39 and 40 supra.

80. In addition to the two issues discussed in the text, there are four further arguments in Beswick: (i) successive actions would be inconvenient: (Lord Hodson, ibid at 81F; Lord Upjohn, ibid at 97-98 citing Swift v Swift (1841) Ir Eq R 267); cf Lord Pearce (implicit at ibid at 88); Hanbury and Maudsley, Modern Equity (12th edn, ed J. Martin) (1985, London) pp 706–708. (ii) Unjust enrichment of A (Lord Reid, ibid at 73A; Lord Hodson, ibid at 83A; Lord Upjohn, ibid at 97A and 102C; see also Danckwerts LJ (1966) I Ch 538 at 558G-559); Treitel p 786, interprets the case as turning on this potential unjust enrichment. This appears too restrictive. Hart v Hart (1881) 18 ChD 670 establishes that specific performance is appropriate if the promisee B has executed his consideration and the decision does not require more narrowly that A should have received a tangible material benefit. (iii) Should B's general creditors obtain some of A's promised payments? Lord Hodson (at 82F-83) and Lord Upjohn (at 100G-101D). (iv) Section 56 of the Law of Property Act 1925.

81. With the exception of Lord Pearce, see n 69 supra.

82. Trusts and agency are the main exceptions, these being fiduciary relations (see the discussion in Woodar cited n 12 supra); but there are minor examples: see The Albazero (1977) AC 774; Weir (1977) CLJ 24; Treitel, p 462.

83. Ibid, at 72 SF, contrasting the position of a trustee-promisee.

84. At text following n 66.

85. Ibid, at 95 G.

86. Ibid at 102 D.

87. Ibid at 89 D.

88. Ibid, at 88 F.

89. Ibid, at 78 D.

90. Ibid, at 71 F.

91. Ibid, at 72 A.

92. Ibid, at 72 D.

93. It might be objected that the claim that Beswick is consistent with protection of C's primary and secondary rights conflicts with the maxim that ‘equity will not assist a volunteer’. Surely the maxim requires merely that the party seeking the remedy, that is B, should have provided consideration, including ‘marriage consideration’, see Hanbury and Maudsley, op cit n 80 supra, pp 123 et seq. Perhaps B needs to have executed his consideration, a feature emphasised in Beswick.

94. Assignment is an inferior way of protecting the third party for a number of reasons. (i) It is unclear whether in general there can be assignment of part of an obligation (it is established that a part of a debt cannot be assigned, Chitty, para 1276, Treitel, p 502; as for other obligations, there is no clear answer). If B must generally assign all or nothing, he will relinquish all control of the contract and will in fact fall out of the picture. This might be inconvenient in the case of a continuing contract such as an annuity. (ii) C, following assignment by B, will be able to sub-assign to D, and so on. Quaere whether B could bar a sub-assignment (by C to D)? (iii) Quaere too whether there can be assignment to an infant or another person who is not sui iuris (no discussion in Chitty, ch 8 (Incapacity), or ch 19 (Assignment)? (iv) No assignment is possible of certain contracts (Chitty paras 1291-1297).

95. See s 1 supra.

96. S.F.C. Milsom, Historical Foundations of the Common Law (2nd edn) (1981, London) p 7: ‘Lawyers have always been preoccupied with today's details, and have worked with their eyes down’.

97. [1917) 1 Ch 234.

98. [1939) Ch 329.

99. [1965) Ch 902.

100. [1966) 1 Ch 538 at 557C: ‘The general rule undoubtedly is that “no third person can sue, or be sued, on a contract to which he is not a party”; but at bottom that is only a rule of procedure. It goes to the form of the remedy, not to the underlying right. Where a contract is made for the benefit of a third person who has a legitimate interest to enforce it, it can be enforced by the third party in the name of the contracting party, or jointly with him or, if he refuses to join, by adding him as a defendant. See also Smith and Snipes Hall Farm, n 29 supra.

101. Lord Pearce in the House of Lords also appears to hold that the third party has a primary right, which by ‘a mechanical defect’ he is unable himself to vindicate. See n 24 above. In the author's opinion, the defect consists not in the absence of an ius guacsitum tertio but in B's inability to sue on C's behalf.

102. A most intriguing legislative abolition of the privity doctrine is The Contracts (Privity) Act 1982 (NZ).

103. I would like to record my thanks to Professor Gareth Jones who generously assisted me in the final stages of this article and to Hugh Collins who encouraged me in my early attempts to analyse this doctrine. I take full responsibility for remaining imperfections.