Who has privity to the contract governed under SGA? • Can the party claiming protection do so under SGA if they are not a party to the contract? No a. Horizontal privity à A sells to B to benefit C - C is not party to the contract between A-B and cannot sue to enforce contractual obligations even though the contract was for C’s benefit b. Lyons v Consumers Glass: A 3rd party who suffers harm due to the seller’s breach of an implied condition under SGA has no recourse against the seller because he was not party to the contract i. Facts: Glass bottle bought by mom, exploded and hurt kid, mother cannot sue on behalf of child c. Vertical privity à A sells to B who then sells to C – generally, C has no recourse against A and is limited to enforcing B’s obligations to C d. Chabot v Ford Motor: A 3rd party cannot claim the benefit of an exclusion clause in a contract they are not privy to i. An exclusion clause will be construed contra proferentem (very strictly) against the party seeking to rely on it ii. Facts: truck caught fire weeks after sale, contract had exclusion clauses for manufacturer and dealer – P technically in breach of contract with dealer, but manufacturer cannot use it as a defence for a claim (privity) e. Other jurisdictions: i. Quebec: successor by particular title is not a 3rd party – eg can receive quality guarantees (GM v Kravitz) a. Bruce: can argue this at common law, but would need broad interpretation of assignment of rights ii. US: PP demands an implied warranty on manufacturer that goods are wholesome and fit for use for all a. If a 3rd party would reasonably be expected to become a user, can make claim (Henningsen) f. Fraser River Pile & Dredge v Can-Dive: example of Canadian CL creating specific exceptions to privity of contract i. A 3rd party can rely on an exclusion clause as a defence if: a. (i) exclusion clause was intended benefit this type of third party; b. (ii) parties to the contract must have known that the 3rd party was the type of party to benefit; and c. (iii) the 3rd party was engaged in the very activities contemplated by the scope of the contract d. Bruce: this creates an absolute defence, could easily have used estoppel argument