What Is Another Name For A Third Party Agreement

The term “third party” is often used in a variety of legal documents without being defined – one dictionary definition of “third party” is “a person or group next to both who is primarily involved in a situation, especially a dispute”, but often the parties assume that it is someone who is not related; an arm`s length person. This can lead to problems if a group company appears in the photo of one of the parties – a unit with its own legal personality, but which is related to the other in a parent-subsidiary relationship or by co-ownership. Can this Group company be described as a “third party”? “In my view, the term `third party` has a simple and ordinary meaning, especially when used in a bilateral treaty. Words refer to a party other than both parties. If these words had not received their usual meaning, there would be no reason why they should not qualify to exclude companies from the Orwell group if this had been intended. Thus, in my view, there is no ambiguity in the use of the terms “third party” and the simple and ordinary meaning of clause 10 of the prosecutor`s employment contract is that the payment of the prosecutor`s premium is triggered, inter alia, by the transfer of a substantial part of the assets of Fishing Services Ltd to a party who is not a party to the contract. A third party is any person (including corporations, partnerships, legal entities, churches, government agencies and agencies) that is not a party to the Agreement. You might define the term “person” somehow, as American-style treaties sometimes do, but in most (if not all) cases it seems exaggerated and most likely it doesn`t contribute to the general understanding that if: So, at least as far as Scottish law is concerned, the term “third party” is likely to refer to anyone who is not a party to the relevant treaty – especially if the term is used in a bilateral treaty. trag. But would the decision be different if the matter were brought before an English court? It appears that there is no general rule in previous case-law that the “third party” clause implicitly includes or excludes a party`s group company, and therefore in all circumstances the issue would be one of the correct interpretations of the terms used in the contract. In case of ambiguity, the court may decide on the economically reasonable construction. One of the leading English cases in the field of construction is the 2011 Supreme Court decision in the sky SA & Ors v Kookmin Bank case.

In this judgment, the following basic principles were expressed: best practice rule. Do not replace third parties with “third parties” or develop them. If you have a third party in mind, include their name in the agreement (and don`t forget to include their affiliates) or mention them in a cover letter with your draft contract. Of course, the best course of action is to ensure that the wording is as clear as possible (and especially terms that have commercial meaning are explicitly defined), but if a dispute arises and the case is brought before a court, it will analyze the words used applying the legal principles established in the design of contracts. In this article, we look at an example where the parties had opposing views on what was meant by a term commonly used in legal documents (but often not specifically defined), and one of the leading English judgments on contract construction – Rainy Sky. It goes without saying that when creating legal documents, special attention should be paid to the words used. But sometimes the parties use a word or phrase without defining exactly what it means – because they both assume it has an accepted and natural meaning. .

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