Dunlop Pneumatic Tyre Company Limited v. Selfridge and Company (1915) - CLAT PDF Download

Introduction

• This case is important for understanding the doctrine of privity of contract and doctrine of privity of consideration.

Facts

• The plaintiffs, Dunlop, are manufacturers of motor tyres.
• Dew and Co were dealers in motor accessories who agreed to buy tyres from Dunlop and not sell them below Dunlop's list prices.
• Selfridge and Company ordered tyres from Dew and Co in January 1912.
• Selfridge had an agreement with Dew that included discounts from Dunlop's list prices, but they also promised not to sell below those prices.
• Dunlop sued Selfridge for breach of contract.

Issue

• Can Dunlop sue Selfridge even though there is no direct contract between them?

Observations

The Court focused on two key principles:

• Privity of Contract: Only parties to a contract can sue for a breach.
• Privity of Consideration: A promise must be supported by consideration from the promisee, meaning only those who have given consideration can have rights under the contract.
• The Court noted that Dew was not acting as an agent for Dunlop, so the exception for agents did not apply.
• Dunlop had not given any consideration to Selfridge, meaning there was no binding contract between them.
• Dunlop was not named as an agent in the contract, so they could not claim any rights to enforce the agreement against Selfridge.

Conclusion

• The Court concluded that only parties to a contract can sue for breach. This rule holds unless the party involved is acting as an agent for one of the contracting parties.