Moreover, there must be an intention to benefit the third party.
If the promisee intends the promise to be for his own benefit, there will not be any trust created in favour of the third party. The main difficulty of using the trust device is that the court has confined its usage within narrow limits. The trust device has so far been applied only to promises to pay money or to transfer property. According to Sir Guenter Treitel, the trust device has therefore been treated as an exception to the doctrine of privity but is of limited and uncertain scope.
(iii) Tort of negligence.
A contract between A and B may, in addition to creating contractual obligations between the parties, impose on B a duty of care towards a third party, C, under the law of tort. Breach of a duty of care on the part of B may render him liable to C for negligence.
(iv) Collateral contracts.
A contract between two parties may be accompanied by a collateral contract between one of them and a third party. For instance, A may enter into a contract of repair with B which specifies the use of the paint manufactured by C because of its special quality. If the paint supplied does not have that quality, A cannot sue C on the contract of sale of the paint to B because A is not privy to the contract. The Court may, however, resort to the device of a collateral contract between A and C under which C would be held to have warranted to A the quality of the paint in consideration A's agreement with B to buy the paint.
(v) Assignment.
A person who is entitled to the benefit of a contract may transfer the benefit to another person who is not a party to the contract. This process is known as assignment, and the consent of the party liable under the contract is not needed. An assignment may be seen as a circumvention of the privity doctrine because the person bearing the burden of the contract becomes liable to a person with whom he had no contractual relationship and whom he may not have intended to benefit.
