Collateral warranties

Many clients require collateral warranties even though in most cases the Contracts (Rights of Third Parties) Act 1999 could offer them a similar level of protection.

Negotiating separate collateral warranties does offer a chance for the parties to negotiate different terms. These could be additional benefits but often the opportunity is also used by the party giving the collateral warranty to try and limit the scope of the duties owed.

It should be noted that the addition of a collateral warranty does not remove the right of third parties to enforce the terms of the original contract unless expressly provided otherwise.

This section is maintained by Richard Mills of Mills & Co. Solicitors.

isurv contract administrator tool

RICS journal article: How to enforce collateral warranties