PRIVITY

BY VIKNA PRASHANTHINI LLB HONS, CLP

DOCTRINE OF PRIVITY
Q : Who can enforce a contract?

General Rule : Only parties to the contract are bound by, or are entitled to a remedy for
enforcement of the obligations under a contract

A third party : Person who is not a party to the contract & has
not provided consideration for the contract.
 Parties cannot confer benefit on a third party,
Parties to a contract cannot impose burden on a even if it was made for the benefit for the third
third party party, the third party cannot enforce the promise

Beswick v Beswick (1968)

Uncle (Peter Beswick) sold his business to his nephew (John Beswick) in return for a
promise to pay a sum of money to the uncle for his rest of his life & thereafter a small sum
of money to his widow weekly after uncle’s death. Shortly after his death, nephew ceased
to make payments to the widow & widow brought action against him.
Held : She failed in the action brought under her own capacity because she was not privy
to the contract. However she did succeed in another capacity as personal respresentative
of her husband’s estate.
 Scruttons Ltd v Midland Silicones Ltd (1962)
Claimants (owners of drum) contracted with firm of carriers responsible for the
transportation. The carrier’s liability to claimants were limited to $ 500. Carriers
subsequently hired stevedores to discharge the drums, stevedores negligently dropped it .
Claimants brought an action in tort against stevedores.
Stevedores sought to rely on the limitation clause which was entered between claimants &
carriers & with the contract entered between stevedores and carriers.
HOL held: The limitation clause can only be referred by the carriers & was incapable of
providing protection to the stevedores as they were not privy to the contract.

• It is to be noted that origin of Privity is very much linked to Consideration.

• The relationship can be seen in following cases:
 Tweddle v Atkinson (1861)
The father of the claimant and the future father in law of the claimant made contract providing each of them
would give a certain sum of money to the claimant. The agreement expressly mentioned that claimant has the
power to sue the parties for the promised sums. The father in law failed to pay the sum and the claimant
subsequently sued the executor of the father in law.
Held: Claimant is unable to bring a cause of action as he had provided no consideration

Dunlop Pneumatic Tyre Co Ltd v Selfridge (1915)

Dunlop, a tyre manufacturing company, made a contract with Dew for sale of tyres at a discounted price on
condition that they would not resell the tyres at less than the listed price and that any reseller who wanted to buy
them from Dew had to agree not to sell at the lower price either. Dew sold the tyres to Selfridge who gave
undertaking that $5 liquidated damages will be paid to the appellant for each tyre sold in breach of that
undertaking, but Selfridge proceeded to sell the tyres below the price he promised to sell them for. Dunlop
brought an action against Selfridge.
Held: Dunlop cant sue as he provided no consideration to Selfridge. Viscount Haldane stated ‘only a person who
is a party to the contract can sue on it’ & Dunlop was acting as complete stranger to the contract between
Selfridge and Dew.
 PROBLEMS
1) Failed to give effect to the intentions of the parties
- The intention of the parties are usually given prominence in English Contract
Law, however in respect of application of this doctrine, their intentions are ignored.
2) It is commercially inconvenient
- It creates problems in relation to construction contracts & insurance contracts
3) Leads to unfair/unjust results
- When the contracts expressly provides benefit to third parties, they as
beneficiary may have relied upon the promise but yet left without solution.
4) It is a complex area of law
- In attempt to avoid the doctrine from operating, the legal principles have
 become complex and uncertain
COMMON LAW EXCEPTIONS
Having noted that there are existing problems under Common Law, nevertheless it
has survived this long mainly due to the fact that some transaction under the
English law are not subjected to the doctrine of privity.
The types of transactions are as follows :
1) Agency
2) Assignment*
3) Trusts
4) Collateral contracts
5) Exemptions & limitations of liabilities
COLLATERAL CONTRACT
 • Provides right to third party to enforce promises under a separate
contract with promisor.
Shanklin Pier Ltd v Detel Products Ltd (1951)
Claimants owned Shanklin Pier and required it to be repainted. They contacted Detel &
was told that the paint lasted between 7 to 10 years. Claimants employed contractors to
repaint the pier & specified Detel’s paint to be used. Painting was done but it deteriorated
after 3 months. The owners could not sue the painters as the promise about the paint was
not made by them and neither did they have a contract with Detel.

Court held: There was a collateral contract between pier owners & Detel as Detel had
promised the paint would last & pier owners request that painters should use Detel paint
was consideration for that promise.

- Such contracts are also often seen in hire purchase contracts as well.
- In Andrews v Hopkinson (1957), the promise by a car dealer was enforced as
collateral contract with the customer when the dealer’s promise had induced
the making of the separate contract of hire purchase between customer &
finance company.
- In Charnock v Liverpool Corporation (1968), collateral contract must be
supported by consideration.
TRUSTS
• It is a legal relationship in which in which a TRUSTEE holds property on
behalf of another, BENEFICIARY.
• Thus the right to the property created under the trust enables the
BENEFICIARY to enforce the trust in his own name even though he was not
a party to the contract.
• Initially, under the HOL decision in Les Affreteurs Reunis v Walford
(1919),the broker although not a party to a contract, nevertheless under the
trust, he can enforce the promise.
• In Re Schebsman (1944),it was decided that in order to establish trust, it
must be proven that there is an intention to create trust of the promise.
• Therefore, it can be clearly seen that the strict requirements to prove the
intention will result in less cases that will circumvent the doctrine of privity.
 Les Affreteurs Reunis v Walford (1919)
A term of charterparty between a shipowner and a charterer stated that the shipowner would pay
a commission to the broker who had negotiated the contract but was not the party to the
contract.

It was held that the broker was the beneficiary of the trust, the subject matter if the trust being
the contractual right of action created by a promise of the shipowner to pay the broker, and that
as a beneficiary , he could enforce the promise

In order to establish a trust, there must be three certainties.

Knight v Knight, per Lord Langdale MR
certainty of intention
certainty of subject matter
certainty of object matter
 ASSIGNMENT
• Rights can be passed via assignment provided it is properly done.
• Example, if A enters into a contract with B in which B has to perform an act , and
A will pay C, C will usually not be able to enforce it under the doctrine of privity.
• However, if B had validly assigned his contractual rights against A to C, C may
sue for the money.
• Rights can be assigned in Equity.
• Rights can also be assigned under Section 136(1) of the Law of Property Act
1925.
Exemptions & limitation of liability
• Initially, the doctrine of privity caused difficulties for third parties to rely on exclusion
 clauses and this was seen in the case of Scruttons Ltd v Midland Silicones Ltd.
• Lord Reid in that case had provided 4 ways in which the stevedores might be able
to claim the protection of an exclusion clause:
1) The bill of lading makes it clear that stevedore is intended to be protected by the
provisions in which limits the liability.
2) The bill of lading makes it clear that the carrier besides contracting on his behalf is
also contracting as agent for the stevedore that these provisions should apply to
the stevedores.
3) Carrier has authority from stevedore to do so or later ratified by the stevedore. 4)
Any difficulties regarding consideration moving from the stevedore were overcome.
• Lord Reid simplified the theory by stating that when a contract is entered, two
contracts are formed : i) Contract between owner & carrier & ii) Contract between
owner & stevedore
• Subsequently, the issue was reconsidered in New Zealand Shipping v
Satterthwaite (1975), (The Eurymedon).
• In this case, unlike Scruttons, the first three of Lord Reid ‘s four condition was
satisfied, the only problem left was with the last condition.
• Although there seem to be no consideration provided by the stevedore to the
consignor’s offer. Nevertheless the Privy Council proceeded by claiming that
there was an Unilateral Contract & the act of unloading the goods by the
stevedores amounted to consideration.
• Therefore, the stevedores were entitled to rely on the clause.
New Zealand Shipping v Satterthwaite (1975), (The Eurymedon)

A drilling machine was to be shipped from Liverpool to Wellington. The bill of lading
stipulated that limited liability of the carrier. It further stated that the clause would extend
to servants, agents, and any independent contractors. The carrier company was a
 subsidiary of the company that also owned the stevedore operation that unloaded the drill.
Due to negligence the stevedores damaged the drill while unloading it.

The stevedores claimed protection of the immunity clause in the contract between the
carrier and Satterthwaite.The council held that the services provided by the shipper in
unloading the drill was consideration for a unilateral contract agreeing to protect those are
doing the unloading. Reversing the New Zealand Court of Appeal and restoring the
judgment of Beattie J, the Privy Council, by a majority held that, applying the unilateral
contract reasoning to bypass the privity objection, the stevedores were so entitled.
• This case was applied & affirmed in :

Jackson Stevedoring v Salmond and Spraggon (1980)

Goods were unloaded from a ship and stored in a near shed which was under the control of the
wharf’s stevedore. Thieves dishonestly claimed that they were the intended recipients of the goods
to an agent of the stevedore. Typically in such circumstances the party claiming ownership would
be expected to produce a bill of ladings as proof of title, however the thieves did not do so and the
agent delivered the goods to the thieves despite this. The rightful intended recipient of the goods
brought an action against the stevedore for professional negligence. The stevedore contended that
he was protected against such an action by a ‘Himalaya clause’ in the bill of ladings between the
recipient and the ship charterer which provided that the various immunities granted to the charterer
could be extended to independent agents contracted by the charterer.
Held
The Court found for the stevedore, viewing that, generally speaking, stevedores were entitled to rely
upon the same protections granted to their principle agents, as per the principle established by the
Privy Court in New Zealand Shipping
• The Eurymedon was subsequently applied in The Mahkutai (1996), in which
Lord Goff did comment that the solutions:

‘ are now perceived to be generally effective for their purpose, their technical
nature is all too apparent; and the time may well come when, in an appropriate
case, it will fall to be considered whether the courts should take what may
legitimately be perceived to be the final, and perhaps inevitable, step in this
development, and recognize in these cases a fully-fledged exception to the
doctrine of privity of contract, thus escaping from all the technicalities with which
courts are now faced in English law’.

- HOL : Homburg Houtimport BV v Agrosin Private Ltd, The Starsin (2003)

AGENCY
- It arises when one party, the agent may act on behalf of another, principal
in the formation of contract with third parties
- When Agent disclosed that he is acting on behalf of the Principal, it is
concluded as a contract entered between the principal & the other party.
Agent can never sue or be sued.
 - When Agent failed to disclose to the third party that he is acting as an
agent for the Principal, the Principal can still sue in limited circumstances.
The other party who has been engaged in the contract can also sue even
though the existence of the Principal was not know when the contract was
entered.
- As for the requirements , the 4 conditions mentioned by Lord Reid in
Scruttons Ltd v Midland Silicones Ltd have to be complied.
.
Watteau v Fenwick (1893)
The defendants were the owners of the business of a beerhouse, appointed a manager of
the business; the licence was taken out in the name of the manager, whose name also
appeared over the door. By the agreement between the defendants and their manager, the
latter was forbidden to purchase certain articles for the purpose of the business, which were
to be supplied by the defendants but the manager, in contravention of his instructions,
 ordered such articles from the plaintiff for use in the business; the plaintiff supplied the
goods and gave credit for them to the manager only. Subsequently, upon discovering that
the defendants were the real owners of the business, the plaintiff sued them for the value of
the goods.
Held, that the plaintiff was entitled to maintain the action, for the defendants, as the real
principals, were liable for all acts of their agent which were within the authority usually
conferred upon an agent of his particular character, although he had never been held out by
the defendants as their agent, and although the authority actually given to him by them had
been exceeded.

Statute
• There are instances where statute had intervened to enable a third party to sue, such as :
• S. 56 Law of Property Act 1925
- A person may take an immediate or other interest in land or other property, or the benefit
of any condition, right of entry, covenant or agreement over or respecting land or other
property, although he may not be named as a party to the conveyance or other instrument
• S.14 Marine Insurance Act 1906
• A mortgagee, consignee, or other person having an interest in the subject-matter insured
may insure on behalf and for the benefit of other persons interested as well as for his own
benefit.
• S.148(4) Road Traffic Act 1972, S.75 Consumer Credit Act 1974 & any other

Rights Conferred on Third Parties

DAMAGES
- When contracts confer benefit to third parties, and there was a breach, promisee
may usually recover for own loss, however there are circumstances in which
promisee is able to recover damages for third party such as :
Multiple Bookings
• This was seen in the case of Jackson v Horizon Holidays Ltd (1975) in which
Lord Denning allowed promisee to recover damages on behalf of third parties.
• However, this was subsequently disapproved in Woodar Investment
Development Ltd v Wimpey Construction(UK) Ltd (1980).
• Lord Wilberforce claimed that Jackson’s decision belonged to a special
category of cases calling for special treatment, in which one party contracts for
the benefit of a groups for reasons for convenience, such as : hiring a taxi in
group, ordering meals in restaurant and more.
• In the HOL’s decision in Linden Garden Trust v Lenesta Sludge Disposals
Ltd (1993), it was held that although the property has been transferred to the
third party, the original property owner may be able to sue the contractor for
damages resulting from defects in the work.
• This principle was also applied in Darlington Borough Council v Wiltshier
Northern Ltd (additional case).
 • However in Alfred MacAlpine Construction Ltd v Panatown Ltd (2001),the
application of the principle was limited. In this case, the general rule is simply
that substantial damages cannot be claimed by a promisee who has suffered
no loss.
• The employer can only claim for substantial damages occupied by a third party
only if the third party suffered damages and is unable to enforce it.
• Presence of collateral warranty will ensure the claim is then nominal.
Alfred MacAlpine Construction Ltd v Panatown Ltd (2001)
Alfred McAlpine Construction (AMC) were builders contracted to complete work on an office block and car park
owned by company that was part of a group of companies which included Panatown. Delays and defects in
AMC’s performance of the contract caused loss to one of the companies. AMC had also entered into a duty of
care deed with the owner of the site which stipulated that where a lack of reasonable skill and care was found
to have been shown by AMC, a remedy was available to the owner at a nominal amount. The deed was
assignable to any successor in title. Panatown was a successor. When defects were found, Panatown sought
damages against AMC for the delay and the defects (having already received a damages under the duty of care
deed). AMC appealed.Whether the employer, who was not initially party to the contract, was entitled to
damages for breach of contract by AMC?
Held:

The appeal by AMC was allowed. It was held that since the employer was not party to the original contract,
they had no grounds to seek damages for delay and defects, especially where the terms of the duty of care
deed had already been exercised. The employer had suffered no financial loss so could not claim more than the
nominal damages that were already determined by the duty of care deed
SPECIFIC PERFORMANCE
- Order of a court to compel promisor to carry out his promise
- It is usually granted when the damages are inadequate
- It involves a breach positive promise
- In Beswick v Beswick, the widow actually sued John for the specific performance
of the contract & the arrears, in which she was entitled to such order but as
administratix.
 INJUNCTIONS
- Court order to restrain the party from doing an act
- It involves a breach negative promise
STAY OF PROCEEDINGS
- If it involves the negative undertaking of not to sue a third party, the correct
procedure is to ask Court to stay proceedings that arose from the breach.
- Initially, in Gore v Van der Lann (1967), a stay of proceedings is only granted
when promisee had sufficient interest in enforcing the promise.
- Subsequently, in Snelling v John G Snelling (1973) – such a requirement was
ignored by the court.
 Snelling v John G Snelling (1973)
The plaintiff and his brothers, the second and third defendants were directors of a family
business and company, the first defendant. The company owed the brothers large amount of
money. The brothers had a falling out and in an effort to make amends, an agreement was
drawn up stating that if any of the brother’s resigned as director, they would forfeit the amount
of money that was owed to them and that money would be used to pay the company mortgage.
Snelling resigned and his director brothers passed a resolution upholding the terms of the
agreement. Snelling issued a writ against the company for the monies owed.
Held : The brother was not permitted to do so.

Liability Imposed upon Third Parties

• Generally, third party cannot be subjected to a burden by a contract which he is
not a party, nevertheless there are instances where parties impose obligations on
third parties.
• A third party must not persuade the other party to break his contract with the other
or preventing the party from performing the contract, as it is a tort for the third
party.
• This is seen in Lumley v Gye (1853), it was deduced that the third party must
know that his act is inducing a breach of contract, it is intended.
• Tulk v Moxhay (1848) – it was argued that third party who acquired property with
the knowledge that it was affected /involved by a contract between parties, is
bound by the terms & may be restrained from acting inconsistently.
• Also read : Lord Strathcona Steamship Co v Dominion Coal Co.Ltd (1926)
.The Pioneer Container (KH Enterprise v Pioneer Container)
Facts
The claimant was a cargo owner who contracted with a carrier to ship the cargo. Per the bills of lading, the
claimant granted the carrier authority to sub-contract their duties ‘on any terms’, in part or in whole.
Subsequently, the carrier sub-contracted a third party, the defendant, using a secondary bills of lading which
stipulated that the legal jurisdiction in the event of dispute would be Taiwan. During the chartered voyage from
Taiwan to Hong Kong, the ship carrying the cargo sank, and the goods were lost. The claimants initially attempted
to bring an action via the Hong Kong judicial system, whilst the ship owners asserted that the case ought be
considered in Taiwan, as per the terms of the exclusive jurisdiction clause of the secondary bills of lading.

Held
The Judicial Committee of the Privy Committee upheld the first instance decision and found that the clause
regarding Taiwanese jurisdiction in the secondary bills of lading operated to bind both the carrier and the
cargo owner as the cargo owner had granted the carrier complete discretion to sub-bail the goods, thus
making it irrelevant that the cargo owner had been unaware of the clause’s existence

Reform of the Doctrine of Privity

 • Law Revision Commission in 1937 called for legislation to enable third party who
is expressly given rights under a contract to enforce those rights directly.
• Lord Scarman commented in Woodar Investment Development Ltd v Wimpey
Construction UK Ltd that if : ‘If the opportunity arises, I hope the House will
reconsider Tweedle v Atkinson & the other cases which stand guard over this
unjust rule.’
• Law Commission issued a report in 1996 ‘Privity of Contract: contracts for the
benefit of third parties.
Application of the Contracts (Rights of Third Parties) Act 1999

• The Act is applicable to all the contracts entered after 11 May 2000
 Contracts under the
1999 Act

Section 6
- Excluded some contracts from the application
- Example : contracts for carriage of goods

If a contract is not exempted under Section 6, a third party

may then enforce the contract under Section 1(1)
• Section 1(1)
• a person who is not a party to a contract
(a “third party”) may in his own right
enforce a term of the contract if—
 subsection (2), the term purports to not apply if on a proper construction
confer a benefit on him. of the contract it appears that the
Section 1(1)(a) -the contract parties did not
expressly provides that he may
OR
► Section 1(1)(b)-subject to Section 1(2)-Subsection (1)(b) does
Section 1(3) -The third party must be expressly the contract is entered into.
identified in the contract by name, as a member intend the term to be enforceable by the
of a class or as answering a particular third party.
description but need not be in existence when
• The interpretation of S1(1)(b) can be seen in several case laws:
 Nisshin Shipping Co Ltd v Cleaves & Co Ltd & Ors [2003]
C had negotiated charters on behalf of N for a number of times. Each charter contract included payment
of commission to C & contained an arbitration clause. When the commission was unpaid, C purported to
refer the commission issue to arbitration & claimed that C will be able to enforce even though C was not
a party to the contract.
Held:
1) The clause purported to confer benefit on C
2) Under S1(2), S(1)(1)(b) is not applicable when the parties did not intend the third party to have a
right of enforcement and neither it is required to be shown that the parties positively intended that
the benefit should be enforceable by the third party.

Since the facts was silent, there was nothing to indicate that parties did not intend C to have a right
for enforcement. S(1)(1)(b) is satisfied.

• See also : Prudential Assurance Co. Ltd v Ayres (2007)

• For s.1(1)(b) of the Act to apply, it must be one of the purposes of the bargain between
the parties to benefit a third party, rather than an incidental effect of contractual
performance
Dolphin & Maritime & Aviation Services Ltd v Sveriges Angfartygs Assurans Forening, The Swedish
Club (2009)
Facts: The Claimant was a cargo recovery agent of the Defendant was a Swedish Club. The Claimant was
engaged by an insurer to recover cargo. The Defendant engaged a ship that collided with an insured vessel.
The vessel was wrecked. The insurer paid out the cargo vessel and gained its rights through subrogation. The
insurer then engaged the Claimant to recover on its behalf. The Claimant issued a letter of undertaking (LOU)
to the Defendant to recover loss on behalf of the insurer. The insurer then settled directly with the Defendant
which meant the Claimant did not receive a commission on recovery. The insurer refused to pay the
commission so the Claimant brought action against the Defendant for a failure to comply with the LOU.

Held: The LOU specified that the payment should be made to the Claimant first or the insurer’s solicitors in
order for the Defendant’s duty to be discharged. However, there was no inference that the Claimant would
benefit from recovering the payment by these means and did not purport to confer a benefit to the Claimant
within the meaning of section 1(1)(b) of the Contracts (Rights of Third Parties) Act 1999. Further, on the
proper construction of contract, it did not appear that there was an intention for the term to be enforceable
by the Claimant.
• Under S1(3) of the 1999 Act, the limitation imposed can be seen in:
Avraamides v Colwill (2006)
Avraamides contracted Bathroom Trading Company (BTC) to complete two bathroom refurbishments. BTC was later
sold to Colwill. Under the contract for sale, there was a term that stipulated that any prior or outstanding bathroom
orders would be completed by BTC & pay in the liabilities incurred by the company. The bathrooms were not
completed to a satisfactory standard, so Avraamides brought action against Colwill (as the transfer had occurred by
this stage).Whether Avraamides could claim a breach of contract by Colwill under s 1(3) of the Contracts (Rights of
Third Parties) Act 1999? Held: The contract did not mention the third party by name or class and that it was a
requirement for a third party to be expressly identified in the contract by name. It was not sufficient to rely on an
inference as the use of the term “express” within the section clearly meant that there must be a name referred to
within the contract. The original agreement between Avraamides and BTC did not identify a third party, even though
there was a clear inference of a third party, given the fact that there was a transfer agreement between BTC and
Colwill. Avraamides claim did not succeed.

The Alexandros T, Starlight Shipping Co v Alliannz Marine and Aviation Versicherungs AG [2014] --settlement agreement
between the insurers (called ‘underwriters’) and owners of a ship included a promise by the shipowners not to sue named
insurers. The shipowner subsequently sued the insurer’s solicitor and loss adjuster.
Held : the reference to ‘underwriters’ included their servants and employees & the solicitors and loss adjusters were
 sufficiently identified to bring an action under the 1999 Act.
• The application of s.1(3) of the Act was also considered in Chudley v Clydesdale Bank
[2019] where a contract between a bank and an investment company specified how
investors’ funds were to be held. In these circumstances, the Court of Appeal held
that the investors were entitled to sue the bank for breach of contract in their own
right under the 1999 Act. The purpose of the contract was to protect investors who,
although not expressly named, were sufficiently identified as a member of a class.
S1(5) :
For the purpose of exercising his right to enforce a term of the contract, there shall be
available to the third party any remedy that would have been available to him in an
action for breach of contract if he had been a party to the contract (and the rules
relating to damages, injunctions, specific performance and other relief shall apply
accordingly)
Generally, the parties to a contract cannot rescind the contract or vary it in such a way
as to either:
• deny the right of the third party, or
• alter the entitlement of the third party once the third party has acquired a right to
enforce a term of the contract.
Variation and rescission of contract.
S2(1):
Subject to the provisions of this section, where a third party has a right under
section 1 to enforce a term of the contract, the parties to the contract may
not, by agreement, rescind the contract, or vary it in such a way as to
extinguish or alter his entitlement under that right, without his consent if—
(a)the third party has communicated his assent to the term to the
promisor, (b)the promisor is aware that the third party has relied on the
term, or
(c)the promisor can reasonably be expected to have foreseen that the third
party would rely on the term and the third party has in fact relied on it
S2(2)
The assent referred to in subsection (1)(a)—
(a)may be by words or conduct, and
(b)if sent to the promisor by post or other means, shall not be regarded as communicated to the
promisor until received by him.

S2(3)
Subsection (1) is subject to any express term of the contract under which—
• (a)the parties to the contract may by agreement rescind or vary the contract without the consent of the
third party, or
• (b)the consent of the third party is required in circumstances specified in the contract instead of those
set out in subsection (1)(a) to (c).
S2(4)
Where the consent of a third party is required under subsection (1) or (3), the court or arbitral tribunal
may, on the application of the parties to the contract, dispense with his consent if satisfied— • (a)that his
consent cannot be obtained because his whereabouts cannot reasonably be ascertained, or • (b)that he is
mentally incapable of giving his consent.
S5 Protection of promisor from double liability.
Where under section 1 a term of a contract is enforceable by a third party, and
the promisee has recovered from the promisor a sum in respect of— (a)the third
party’s loss in respect of the term, or
(b)the expense to the promisee of making good to the third party the default of
the promisor,
then, in any proceedings brought in reliance on that section by the third party,
the court or arbitral tribunal shall reduce any award to the third party to such
extent as it thinks appropriate to take account of the sum recovered by the
promise

S7 Supplementary provisions relating to third party.

(1)Section 1 does not affect any right or remedy of a third party that exists or is
available apart from this Act