What is the doctrine of privity?

The doctrine of privity is a fundamental legal principle in contract law in California and throughout the United States. It states that only the parties that have entered into a contract—the contracting parties—can take advantage of or be held liable for anything contained in the contract. This means that anyone not a party to the contract, even if they are closely related to one of the parties, cannot sue or be sued upon the contract. The doctrine of privity has been an accepted part of the law for centuries, but it has recently come under scrutiny as courts have determined that certain exceptions to the doctrine are necessary in certain circumstances. For example, if a third party, such as a subcontractor, has provided goods or services to a party under a contract and is then not paid for their services, they may be able to take legal action against the party that hired them, even though they are not a party to the contract. In California, the doctrine of privity generally still applies, although the courts do recognize certain exceptions. If you have a contract dispute, it is important to be aware of the doctrine of privity, as it may affect your ability to take legal action and recover damages.

Related FAQs

What is consideration in a contract?
What is a liquidated damages clause?
What is a breach of the implied covenant of good faith?
What is a contract of sale?
What is a merger clause?
What is a third-party guarantor?
What is a contract of indemnity?
What is the effect of an anticipatory breach?
What is a contract of indemnification?
What is the Statute of Frauds?

Related Blog Posts

What Every Business Should Know About Contract Law - July 31, 2023
Understanding Contract Enforceability - Key Considerations - August 7, 2023
Drafting an Enforceable Contract: Best Practices - August 14, 2023
Creating an Effective Contract: Tips and Tools - August 21, 2023
Negotiation Strategies for Contract Law - August 28, 2023