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New Bermuda Legislation: Contracts (Rights of Third Parties) Act, 2016

The Contracts (Rights of Third Parties) Act, 2016 (the “Act”) was recently enacted by the Bermuda Legislature and is now fully operative. The Act is significant in that, subject to its terms, it permits parties to vary the common law doctrine of “privity of contract” which provides that only parties to a contract may enjoy the benefits and enforce the provisions of that contract.

Under the Act, persons not specifically party to a contract may now be entitled to benefit from and enforce the terms of the contract, subject to certain restrictions. The Act will be of significant interest to investment managers, investment funds, third party service providers and delegates who traditionally may not be parties to an agreement but may be impacted by its specific terms and provisions. In particular, the Act should assist in the area of indemnification and exculpation provisions of agreements intended to benefit a wider class of beneficiaries beyond just the contracting parties.

 

To continue reading full articles in PDF format:
New Bermuda Legislation: Contracts (Rights of Third Parties) Act, 2016

 


Elizabeth Denman
Director

BERMUDA   +1 441 278 7842


David J. Doyle
Director

BERMUDA   +1 441 299 4902


David W.P. Cooke
Director

BERMUDA   +1 441 299 4933


Chris Garrod
Director, Head of Bermuda Blockchain & ICOs Practice

Bermuda   +1 441 299 4923


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Alerts

New Bermuda Legislation: Contracts (Rights of Third Parties) Act, 2016

The Contracts (Rights of Third Parties) Act, 2016 (the “Act”) was recently enacted by the Bermuda Legislature and is now fully operative. The Act is significant in that, subject to its terms, it permits parties to vary the common law doctrine of “privity of contract” which provides that only parties to a contract may enjoy the benefits and enforce the provisions of that contract.

Under the Act, persons not specifically party to a contract may now be entitled to benefit from and enforce the terms of the contract, subject to certain restrictions. The Act will be of significant interest to investment managers, investment funds, third party service providers and delegates who traditionally may not be parties to an agreement but may be impacted by its specific terms and provisions. In particular, the Act should assist in the area of indemnification and exculpation provisions of agreements intended to benefit a wider class of beneficiaries beyond just the contracting parties.

 

To continue reading full articles in PDF format:
New Bermuda Legislation: Contracts (Rights of Third Parties) Act, 2016

 


Elizabeth Denman
Director

BERMUDA   +1 441 278 7842


David J. Doyle
Director

BERMUDA   +1 441 299 4902


David W.P. Cooke
Director

BERMUDA   +1 441 299 4933


Chris Garrod
Director, Head of Bermuda Blockchain & ICOs Practice

Bermuda   +1 441 299 4923


 

JURISDICTION(S)

Bermuda


International Office(s)

Bermuda