Third Party In Agreement
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FAQ
Third party means any person (including companies, partnerships, legal entities, churches, governmental authorities and agencies) who is not a party to the agreement.
What Is a Third Party? A third party is an individual or entity that is involved in a transaction but is not one of the principals and, thus, has a lesser interest in the transaction.
A contract is drawn up and the parties to the contract want a third-party to be able to sue if the contract promise isn't fulfilled. This person is considered a third-party beneficiary.
Example: Grandma enters into a contract with Oldfield to purchase a Jaguar automobile to be given to grandchild as a graduation present. If Oldfield takes a down payment and then refuses to go through with the sale, grandchild may sue Oldfield for specific performance of the contract as a third-party beneficiary.
To rescind or to alter the term of a contract the parties must have the consent of third party. The parties only can insert the clause in to contract to rescind or alter a term if they so choose at the time of entering in to contract.
