Exception to the Rule: Stranger to a Contract

The general rule states that a stranger to a contract cannot file a suit in case of a breach of contract. However, there are certain exceptions to this rule as per the provisions of the Indian Contract Act, 1872. These exceptions allow certain individuals who are not parties to the contract to enforce or claim rights under the contract. Let's explore these exceptions in detail:

1. Beneficiary of a Contract:
If a contract is made for the benefit of a third party, who is not a party to the contract, that third party can enforce the contract. This exception is known as the doctrine of privity of contract. However, for a third party to enforce the contract, it must be clearly mentioned in the contract that the parties intended to confer a benefit upon that third party.

2. Assignment of Contract:
If a party to a contract assigns their rights under the contract to a third party, that third party can enforce the contract. The assignee steps into the shoes of the original party and can sue for breach of contract.

3. Agency:
If a contract is made by an agent on behalf of a principal, the principal can enforce the contract even though they are not a party to it. This is because the agent is acting on behalf of the principal, and therefore, the principal can sue for breach of contract.

4. Trusts:
In cases where a trust is created and a contract is made in relation to the trust, the beneficiaries of the trust can enforce the contract. The beneficiaries are not parties to the contract, but they have an equitable interest in the subject matter of the contract.

5. Government Contracts:
In certain cases, the government can file a suit for breach of contract, even if they are not a party to the contract. This is because the government has special powers and privileges to enforce contracts for public purposes.

These exceptions to the rule of stranger to a contract provide avenues for individuals who are not parties to the contract to enforce their rights or claim benefits under the contract. It is important to note that these exceptions are subject to specific conditions and requirements as outlined in the Indian Contract Act, 1872.

Good