INTERVIEW QUESTIONS MERCANTILE LAW CONSIDERATION DETAILS

Question: A is indebted to B. He sells a trolley to C. C promises to pay all debts of A to B. If C fails to pay, B has no right to sue C because:
(a) C is stranger to consideration
(b) C is stranger to contract
(c) Both
(d) None

Answer: (b) C is stranger to contract
Description: General Rule 'A stranger to a contract cannot sue'.
Though a stranger to consideration can sue because the consideration can be furnished or supplied by any person whether he is the promisee or no, but a stranger to a contract cannot sue because of the absence of privity of contract(i.e. relationship subsisting between the parties to a contract). Hence, in this case A is indebted to B. He sells a trolley to C. C promises to pay all debts of A to B. If C fails to pay, B has no right to sue C because C is stranger to contract.

(b) C is stranger to contract
Description: General Rule 'A stranger to a contract cannot sue'.
Though a stranger to consideration can sue because the consideration can be furnished or supplied by any person whether he is the promisee or no, but a stranger to a contract cannot sue because of the absence of privity of contract(i.e. relationship subsisting between the parties to a contract). Hence, in this case A is indebted to B. He sells a trolley to C. C promises to pay all debts of A to B. If C fails to pay, B has no right to sue C because C is stranger to contract. Source: CoolInterview.com

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