Consideration

Good morning Arahn I put Dunlop v Selfridge into my search box and came up with this from The Law Teacher pages Facts Dunlop was a tire manufacturer who agreed with their dealer to not sell the tires below a recommended retail price (RRP). As part of the agreement, Dunlop also required their dealers to gain the same agreement with their retailers, who in this instance was Selfridge. The agreement held that if tires were sold below the RRP, they would be required to pay £5 per tire in damages to Dunlop. This was agreed between the dealer and Selfridges, which effectively made Dunlop a third-party to that agreement. Sometime after this, Selfridge sold the tires below the agreed price and Dunlop sued for damages and an injunction to prevent them from continuing this activity. At the initial trial, the decision was given to Dunlop. This was appealed by Selfridge and the decision was reversed. Dunlop appealed. Issue Selfridge argued that Dunlop could not enforce the contract as Dunlop was not part of the agreement between the dealer and Selfridges. On this basis, the question for the court was whether Dunlop had the right to access damages without a contractual relationship. Decision/Outcome The court held in a unanimous decision that Dunlop could not claim for damages in the circumstances. The court found that firstly, only a party to a contract can claim upon it. Secondly, Dunlop had not given any consideration to Selfridge and therefore there could be no binding contract between the parties. Lastly, Dunlop was not listed as an agent within the contract and could therefore not be included as a valid third-party who had rights to claim on the contract. Now, I found that to be a very clear and brief summary of the case and the rationale. What do you think? OK?

Thanks Mike !

You're welcome - I hope all is much clearer now

Hi Mike. I do understand this case but how does it differ to the definition given by Currie v Misa ?

I'm not sure that I understand your confusion! Currie v Misa provides the definition of consideration. Dunlop v Selfridge hinges around the matter of privity What am I missing?

Thanks Mike. What do you mean about privity ? Is that about a promise ?

No, the word 'privacy' is from the same root as 'private' In an agreement between you and me, no other person should be able to get involved and make a claim against me based on the agreement between you and me Our agreement is private But there are exceptions where the rule has to be set aside and allow some third party to have the legal right to sue one of the original parties I CAN apply the Currie v Misa definition of consideration to the Dunlop case but to do so is to distract from the main issues of that case OK? (Let me know if you're still not happy).

I understand thanks Mike

You're very welcome - glad I could help