The House of Lords, overruling the decision of Lord Denning in the Court of Appeal, ruled that a person who was not party to a contract had no independent standing to sue to enforce it, even if the contract was clearly intended for their benefit.

Today the judicial precedent has been codified by statute in the United Kingdom, and Lord Denning's decision has largely been given effect by the Contracts (Rights of Third Parties) Act 1999.

Since the latter term was for the benefit of someone not party to the contract, the nephew did not believe it was enforceable and so did not perform it, making only one payment of the agreed weekly amount of 5 pounds.

Lord Denning held that Mrs Beswick was entitled to claim in her capacity as a third party intended to benefit from the contract.

For clarity I think it best to begin by considering a simple case where, in consideration of a sale by A to B, B agrees to pay the price of £1,000 to a third party X.

In the present case I think it clear that the parties to the agreement intended that the respondent should receive the weekly sums of £5 in her own behoof and should not be accountable to her deceased husband's estate for them.

Reverting to my simple example the next question appears to me to be: Where the intention was that X should keep the £1,000 as his own, what is the nature of B's obligation and who is entitled to enforce it?

But the view more commonly held in recent times has been that such a contract confers no right on X and that X could not sue for the £1,000.

It is true that a strong Law Revision Committee recommended so long ago as 1937 (Cmd.

5449): "That where a contract by its express terms purports to confer a benefit directly on a third party it shall be enforceable by the third party in his own name ..." (p. 31).And, if one had to contemplate a further long period of Parliamentary procrastination, this House might find it necessary to deal with this matter.

The argument for the appellant is that A's only remedy is to sue B for damages for B's breach of contract in failing to pay the £1,000 to X.

If that were so, I shall assume that he is right in maintaining that the administratrix could then only recover nominal damages because his breach of contract has caused no loss to the estate of her deceased husband.

It would mean that the appellant keeps the business which he bought and for which he has only paid a small part of the price which he agreed to pay.

The respondent's first answer is that the common law has been radically altered by section 56 (1) of the Law of Property Act 1925, and that that section entitles her to sue in her personal capacity and recover the benefit provided for her in the agreement although she was not a party to it.

For purely practical reasons we do not permit debates in either House to be cited: it would add greatly to the time and expense involved in preparing cases involving the construction of a statute if counsel were expected to read all the debates in Hansard, and it would often be impracticable for counsel to get access to at least the older reports of debates in Select Committees of the House of Commons, moreover, in a very large proportion of cases such a search, even if practicable, would throw no light on the question before the court.

That section provided: "That, under an indenture, executed after October 1, 1845, an immediate estate or interest, in any tenements or hereditaments, and the benefit of a condition or covenant, respecting any tenements or hereditaments, may be taken, although the taker thereof be not named a party to the same indenture.

But more difficulty is introduced by the definition section of the Act of 1925 (section 205 ) which provides: "(1) In this Act unless the context otherwise requires, the following expressions have the meanings hereby assigned to them respectively, that is to say:- ... (xx) 'Property' includes any thing in action, and any interest in real or personal property.

"Before further considering the meaning of section 56 (1) I must set out briefly the views which have been expressed about it in earlier cases.

I had thought from what Lord Simonds said in White's case[10] that section 5 of the Act of 1845 did enable certain persons to take benefits which they could not have taken without it.

In Smith and Snipes Hall Farm Ltd v River Douglas Catchment Board[11] Denning L.J., after stating his view that a third person can sue on a contract to which he is not a party, referred to section 56 as a clear statutory recognition of this principle, with the consequence that Miller's case[12] was wrongly decided.

But it appears from what Lord Simonds said in White's case[10] and from what Vaisey J. said in Chelsea and Walham Green Building Society v. Armstrong[14] that being in fact a party to an agreement might not be enough; the person claiming a benefit had to be named a party in the indenture.

I would not venture to criticise it, but I do not think it necessary for me to consider it if it leads to the conclusion that section 56 taken by itself would not assist the present respondent.

The respondent's second argument is that she is entitled in her capacity of administratrix of her deceased husband's estate to enforce the provision of the agreement for the benefit of herself in her personal capacity, and that a proper way of enforcing that provision is to order specific performance.

For the reasons given by your Lordships I would reject the arguments submitted for the appellant that specific performance is not a possible remedy in this case.

I am therefore of opinion that the Court of Appeal reached a correct decision and that this appeal should be dismissed.In Smith and Snipes Hall Farm Ltd v River Douglas Catchment Board [1949] 2 KB 500, 514, Denning LJ had already tried to dispose of the English doctrine of privity.

He had said, A man who makes a deliberate promise which is intended to be binding, that is to say, under seal, or for good consideration, must keep his promise; and the court will hold him to it, not only at the suit of the party who gave the consideration but also at the suit of one who was not a party to the contract, provided that it was made for his benefit and that he has a sufficient interest to entitle him to enforce it, subject always, of course, to any defences that may be open on the merits.In Australia, Coulls v. Bagot's Executor and Trustee Co Ltd (1967) 119 CLR 460 shows the approach has been similar.

Many people, including judges had called for statutory reform and in England this came in the form of the Contracts (Rights of Third Parties) Act 1999, which gives a general right to enforce the benefit of a contract when one was either expressly identified as being able to enforce it, or one was intended to benefit.