"A mortgagee, consignee or other person having an interest in the subject-matter insured may insure on behalf and for the benefit of other persons interested as well as for his own benefit.".
(iv) Bills of Exchange Ordinance (Cap 19).
A bill of exchange is defined in section 3(1) of Cap 19 as: "an unconditional order in writing, addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future time a sum certain in money to, or to the order of, a specified person or to bearer.".
Under section 38(a), a holder of a bill of exchange may sue on the bill in his own name. A holder of a bill of exchange means a payee or an indorsee of a bill who is in possession of the bill, or a bearer of the bill (section 2).
Arguments against reforming the Privity Doctrine.
Third party should not be able to sue in the absence of consideration.
The idea that a contract requires consideration leads naturally to the view that a stranger to a contract cannot take advantage of its terms because he has not provided consideration. To put matters another way, since a promisee must provide consideration, it would be unreasonable to place a third party who has not provided consideration in a better position than a promisee who has not provided consideration. In the Law Commission's opinion, whilst the privity doctrine determines the question of who may enforce a contract, the doctrine of consideration decides which promises may be enforced. There is a bargain (a valid contract) if consideration has been given, since the promisor's promise has been "paid for", albeit by the promisee and not the third party.
The fact that there has been consideration means that the third party can potentially acquire rights under the contract. These contrasts with the case where the promisee has given no consideration: in that case, there is no valid contract.
