Also known as: privity limitations · privity · limitation of privity
Written by attorneys · grounded in primary & secondary sources — see below
A doctrinal restriction that bars recovery or enforcement of obligations by or against parties lacking a direct contractual or estate-based relationship. The limitation historically confined tort and contract claims to immediate parties and prevented remote successors from assuming or enforcing burdens unless privity of contract or estate was preserved or an exception applied.
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Global Structures leased a storage yard to Harbor Builders under a lease requiring Global to maintain structural supports. Global sold the property to Coastal Development without obtaining any release from Harbor. Harbor later sued Global for failing to perform the maintenance. Because Global's obligation rested on privity of contract that was never released, Global remained liable after the transfer.
Prime Logistics purchased a newly built warehouse from Prosperity Investments. Two years later Prime sold the building to Precision Tools. Precision discovered construction defects and sued Prosperity. Because Precision lacked privity with the original builder-vendor, the implied warranty of habitability did not extend to it under the authority limiting such claims to parties in direct privity.
Parker Phillips used a gravel path across Patricia Patel's land for access starting in 2005. In 2015 Parker sold his adjacent parcel to Paul Peterson and assigned all interests in the path. Paul continued the identical weekly use. Because privity existed between the successive adverse users through the assignment, their periods of use could be added to satisfy the prescriptive period.
Peak Performance recorded an agreement granting an online retailer permanent space for parcel lockers on the exterior wall of its shopping center. The retailer held no ownership or lease interest in any parcel. Because no privity relationship between the parties is required to create a servitude, the recorded permanent grant established an enforceable servitude rather than a revocable license.
Pilar Pena leased a warehouse from Prime Logistics under a lease requiring resurfacing of a shared access road. Pilar assigned the lease to Prosperity Investments, which took possession. Because the assignment brought Prosperity into privity of estate with Prime Logistics and the burden touched and concerned the leased premises, Prosperity became obligated to perform the resurfacing promise.
Paige Porter bought a used child safety seat from her uncle, who had relied on the manufacturer's public advertisement that the seat prevented side-impact injuries. In a collision Paige suffered injuries when the seat failed. Because the manufacturer owed a duty of due care to any foreseeable user, the absence of contractual privity with Paige did not bar her negligence claim.
A landlord remains liable after transfer if the obligation rests on privity of contract and no release is obtained from the tenant. The transfer ends privity of estate but does not automatically discharge contractual duties.
Courts are split. Some jurisdictions require privity with the original builder-vendor and therefore bar claims by remote purchasers. Others extend the warranty to subsequent buyers despite the lack of privity.
…warranty provisions and the disclaimer of liability contained in the purchase order do not bind them because (1) there was no privity of contract between them and the defendants, (2) the warranty provisions are not binding upon them because they were not read by or explained to Mr. Henningsen before he signed the purchase…
…L. Rev. 938, 947 (1969); Note, Civil Liability Under Section 10B and Rule 10B-5: A Suggestion for Replacing the Doctrine of Privity, 74 Yale L. J. 658, 682-689 (1965), with, e. g. , 3 L. Loss, Securities Regulation 1766 (2d ed. 1961); 6 id. , at 3883-3885 (1969). [^maj-18]: The Commission would not permit recovery…
…Ballantine explains: Where the same claim of title has been consistently asserted for the statutory period by persons in privity with each other, there is the same reason to quiet and establish the title as where one person has held. The same flag has been kept flying for the whole period. It is the same ouster and…
…products and an impersonal marketplace. Its primary weakness was, of course, its rigid requirement of a relationship of privity
…related to the contract that until 1962 Virginia would generally allow design defect suits only by the purchaser and those in privity
Periods of successive adverse users may be added if privity exists between them, such as through an assignment of the interest in the disputed land.
No privity relationship between the parties is necessary to create a servitude.
The transferee assumes the burden when the promise touches and concerns the leased interest, the parties intended the burden to run, and the transfer places the transferee in privity of estate with the person entitled to enforce the promise.
No. A manufacturer owes a duty of due care to any foreseeable plaintiff, including users and bystanders, so lack of contractual privity is not a defense in negligence.