If you look at the wording of some of the statutory provisions “abolishing” the rule, it seems clear to me at least that the action by a third party beneficiary is on the contract.
In reversing the decision in Vandepitte, the Ontario Insurance Act provides:
244. Any person insured by but not named in a contract to which section 239 or 241 applies may recover indemnity in the same manner and to the same
extent as if named therein as the insured, and for that purpose shall be deemed to be a party to the contract and to have given consideration therefor.
The statute does not give a cause of action, it deals with the precise problems with the third party beneficiary rule and removes them. In any case, I think that that rule
should now be largely ignored. There are so many “exceptions” and refusals by courts to follow it that it hardly qualifies as a rule. And good riddance!
Angela Swan
From: William Swadling <william.swadling@law.ox.ac.uk>
Sent: April 18, 2023 12:51 PM
To: 'Lionel Smith' <ls2019@cam.ac.uk>; obligations <obligations@uwo.ca>
Subject: RE: Statutory Exceptions to Privity
CAUTION -- EXTERNAL E-MAIL - Do not click links or open attachments unless you recognize the sender.
To make the same point another way, we can classify rules according to their source (common law, equity, statute) or their content (criminal, tort, contract, property, etc). What we can’t do, however, is mix these taxonomies.
It would, therefore, be a nonsense to say of a rule that it was a property rule, not a statutory one.
Bill
From: Lionel Smith <ls2019@cam.ac.uk>
Sent: Tuesday, April 18, 2023 5:46 PM
To: obligations <obligations@uwo.ca>
Subject: Re: Statutory Exceptions to Privity
I agree that the distinction between the Code and other statutes is crucial, but I don’t think that touches my point, which is that it is a mistake to think that there is a mutually exclusive distinction between ‘contract’ and ‘statute’.
A rule can be a statutory rule of contract, or a codal rule of contract, or a judge-made rule of contract.
In other words what makes something a rule of contract law, or not one, is not what Benoît Moore calls the ‘formal source’ of the rule or what Hart might have called the applicable rule of recognition.
From: Stéphane Sérafin <Stephane.Serafin@uottawa.ca>
Date: Tuesday, April 18, 2023 at 12:39
To: Lionel Smith <ls2019@cam.ac.uk>, Jason Neyers <jneyers@uwo.ca>, ODG <obligations@uwo.ca>
Subject: RE: Statutory Exceptions to Privity
I’m not sure it’s so strange from a civil law vantage point, actually. There has historically been a rather important difference between a Code, which is meant to embody enduring principles of private law, and a mere statute. That a statutory
rule happens to affect contract law does not mean that it is of the same nature as a rule contained in a Code.
Stéphane
From: Lionel Smith <ls2019@cam.ac.uk>
Sent: Tuesday, April 18, 2023 11:39 AM
To: Jason W Neyers <jneyers@uwo.ca>; obligations <obligations@uwo.ca>
Subject: Re: Statutory Exceptions to Privity
Attention : courriel externe | external email
I don’t know the article, but anyone who has interacted with the civilian tradition (where most of private law is in statutory form) will find the author’s position that you describe rather strange.
If Ontario codified its contract law into a Contracts Act (cf India) would that mean that all contracts made in Ontario would be ‘statutory claims’ and no one had any ‘contractual rights’ any more?
I think the position confuses an inquiry into what makes a rule count as a legal rule (judge-made or statutory) and what makes a rule count as a rule of contract law (see Steve Smith,
Contract Theory).
Lionel
From: Jason Neyers <jneyers@uwo.ca>
Date: Tuesday, April 18, 2023 at 10:16
To: ODG <obligations@uwo.ca>
Subject: ODG: Statutory Exceptions to Privity
Dear Colleagues:
Many months ago I read a reference to an article arguing that the statutory exceptions to privity of contract are not really exceptions since a person relying on a statutory claim is
in essence suing to enforce an entitlement granted by statute rather than relying solely on the contractual right. Unfortunately, and embarrassingly I cannot seem to find where I found that article referenced (I believe that it was in an Australian treatise
but I have looked and looked to no avail). Does anyone know of this article? I would like to read it and cite it potentially.
Thank you in advance for any assistance!
Sincerely,
Jason Neyers
Professor of Law
Faculty of Law
Western University
Law Building Rm 26
e. jneyers@uwo.ca
t. 519.661.2111 (x88435)
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