Question

The question consists of legal propositions/principles (hereinafter referred to as 'principle') and facts. These principles have to be applied to the given facts to arrive at the most reasonable conclusion. Such principles may or may not be true in the real sense, yet you have to conclusively assume them to be true. In other words, in answering the following question, you must not rely on any principles except the principle that is given herein below for the question. Further, you must not assume any facts other than those stated in the question. The objective of this section is to test your interest in the study of law, research aptitude, and problem-solving ability.

PRINCIPLE A contract cannot be enforced by or against a person who is not a party to it. However, where some benefit is conferred on the third party by the contract itself, their third party can be allowed to enforce that contract to get such benefit.

FACTS Dinesh is liable to pay ₹50000 to Suresh. In order to discharge this liability, Dinesh enters into a contract with Ramesh by which Dinesh sells his car to Ramesh for ₹1 lac. Ramesh takes the delivery of the car and promises/assures to pay its price at the earliest. Dinesh separately informs Suresh about this contract for his satisfaction. Ramesh fails to pay the car's price. Suresh wants to join Dinesh in filing suit against Ramesh for the recovery of the price of the car. Whether Suresh is entitled to do so?

Options

• Suresh is entitled to do so because the contract was made for his benefit

• Suresh is entitled to do so because Dinesh is liable to him and discharge of this liability depends upon the payment of the price of the car by Ramesh

• Suresh is not entitled to do so because the liability of Dinesh does not depend upon any assurance of Ramesh

• Suresh is not entitled to do so because he is not a party to the contract between Dinesh and Ramesh

Answer 1

Suresh is entitled to do so because the contract was made for his benefit

Explanation:

According to the principle given, a contract cannot be enforced by or against a person who is not a party to it but where the benefit is conferred on the third party then that third party, can be allowed to enforce that contract, in this scenario, Suresh is entitled to join Dinesh in filing suit against Ramesh for the recovery of the price of the car, because Dinesh entered into a contract with Ramesh to sell his car, only for the purpose of discharging his liability.