The task of reforming such a discredited doctrine as privity, however, is far from
straightforward. It is one thing to condemn the doctrine as unfair and inconvenient,
but how is reform best effected? Essentially, there are two models as to how to
According to the first model, in a climate that is no longer rigidly
reliance may be placed on the judiciary to relax orthodox privity
restrictions where they give rise to concern (so that a simple enabling provision –
for example, of the kind proposed by the Ontario Law Reform Commission
explicitly authorising the courts to exercise such a discretion is all that is required).
The Commission, however, prefers a second model, recommending (as in its
Consultation Paper) that a detailed legislative scheme is required. The practical
advantage of laying down a calculable legislative scheme for third party rights is
obvious; moreover, the Commission fears that it could be accused of ducking its
responsibilities if it left major questions of principle to be settled by the courts.
However, even in an ideal world, free of the pressure to deliver a politically
‘sellable’ package, the challenge, as Professor Andrew Burrows has put it, is the
familiar one of striking the right balance between the interests of certainty
(calculability) and flexibility (fairness in the individual case).
As might already
be apparent, the centrepiece of the proposed scheme, the test of enforceability, is
an heroic attempt to compromise the needs of contractors to be able to predict and
to plan with the need to reserve some degree of flexibility (conspicuously so in the
proviso to the second limb of the test).
Even if we agree that a detailed legislative scheme is the right way ahead, there
remain controversial questions about how far, and how fast, we should proceed.
For example, should the legislation make special provision for consumer
contractors along the lines currently being debated in the European Union?
should the legislation tackle the vexed question of whether sub-contract exclusions
or restrictions should bind a third-party head-contractor?
In both instances, the
Commission prefers to keep these questions at arm’s length and generally the
Commission favours a cautious approach, putting to one side ‘more radical
possibilities . .. for fear that the central reform would otherwise be endangered’
advancing instead a package of what it perceives to be ‘relatively conservative and
calculated to modify the privity doctrine in a way that will
9 A third model invites incremental relaxation of the rule in specific contexts — for example, as was
by Sea Act, 1992: and see the Report, paras 2.59 and 12.7–12.11). However, if the reform of privity
is to be of a general nature, the incremental model is not appropriate.
10 See, eg Johan Steyn, ‘Does Legal Formalism Hold Sway in England?’ (The 1996 Presidential
Lecture to the Bentham Club, University College, London); Robert Stevens, ‘Judges, Politics,
Politicians and the Confusing Role of the Judiciary’ (Hardwicke Building Lecture, London, 21 May
1996); and generally, see John Adams and Roger Brownsword, Understanding Law (London:
HarperCollins, 1992; Sweet and Maxwell, 1996) chs 4 and 5.
11 For discussion, see the Report paras 5.5–5.6.
12 See ibid para 5.6.
13 Professor Andrew Burrows, ‘Reforming Privity of Contract: Law Commission Report No. 242’
SPTL Annual Conference, Cambridge, 11 September 1996, especially 1 and 9.
14 See European Commission, Green Paper on Guarantees for Consumer Goods and After-Sales
Services, COM (93) 509 final, 1993; on which, see Stephen Weatherill, ‘Consumer Guarantees’ (1994)
110 LQR 545. Most recently, see the draft Directive on the Sale of Consumer Goods and Associated
Guarantees, COM (95) 520 final, 1996; on which, see Proposal for a European Parliament and
Council Directive on the Sale of Consumer Goods and Associated Guarantees: A Consultation
Document (Department of Trade and Industry, 18 September 1996). And, for discussion of whether
there should be a special test of enforceability for consumers, see the Report paras 7.54–7.56.
See eg Morris vC.W. Martin and Sons Ltd  1 QB 716; The Pioneer Container  2 All
ER 250 (noted by Phang (1995) 58 MLR 422); and see discussion in text below.
16 See the Report, para 1.9.
17 ibid para 5.10.
March 1997] Privity of Contract
The Modern Law Review Limited 1997 239