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New Zealand Shipping Co. Ltd. v. A. M. Satterthwaite & Co. Ltd. [1974] UKPC 1


P stevedor. D consignee of bill of lading. Drill damaged because of P. Bill of lading said the carrier had limited liability and clause would extend to servants, agents, or independent contractors


Can P, as a 3rd party, take the benefit of the time limitation provision, when they have provided no consideration under the contract?


The bill of lading was treated as an offer and for P to accept they just had to unload the product – independent contractors will be covered.

Typically an agreement to do something that a third party is already obligated to do is not valid consideration unless the promisee obtains some benefit from an enforceable agreement


A contract between 2 parties cannot be sued on by a 3rd person even though the contract is expressed to be for his benefit. – because no consideration provided.

Prerequisite of validity of contract – criteria for 3rd party to take benefit of exemption clause:
**Has to be exemption clause
**Intention to create an agency
**Authority to act as agent
**Show consideration

Can you use consideration twice? - YES. To give P the benefit of the exemptions and limitations, is to give effect to the clear intentions of a commercial document


P is protected by limitation and exemption clause

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