Successors And Assigns Clause

That agreement said: “THIS INDENTURE Shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, administrators, successors and assigns.” The agreement was never registered against the title to the land.The City said that the agreement was never assigned or otherwise transferred to the plaintiffs or the other owners of the land after the original farmer who entered into the agreement.

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Rather, …given the intention of the contracting parties stipulated in the Agreement under the enurement clause, I conclude that ‘relaxing’ the doctrine of privity in this case does not frustrate the reasonable expectations of the parties at the time the Agreement was formed.The City asserted that the Browns were third parties to the original agreement and did not fall within any of the accepted category of persons who could enforce the agreement.Court of Appeal Decision The Court of Appeal held that, on its face, the contract created a category of persons who could enforce the contract as parties to the contract, namely, successors of the owner who entered into the agreement.If necessary, the court said that it would apply the exceptions to the rule prohibiting third party enforcement of a contract and allow the Browns to enforce the drainage agreement when they so clearly fell within the category of persons who were intended to have its benefit.The Court of Appeal considered one further objection of Belleville, namely, that the Browns were using the 1953 agreement as a sword – to bring an action and positively enforce rights – rather than as a shield – or as a defence.The court stated it this way: “…the broad and unqualified language of the enurement clause constitutes an express stipulation by the contracting parties that they intended the benefit of the Agreement to be shared by future owners of Mr.Sills’s lands, as his successors or assigns or by way of inheritance.Six years later, the municipality stopped maintaining and repairing the drainage system.Over the next 50 years, the original municipality and successor municipality clearly and repeatedly repudiated the agreement.If the main contract between the owner and the contractor states that it is binding on the “successors” of the contractor, does that word include a subcontractor?What if the owner has given a covenant in the main contract that affects the electrical work and the contractor subcontracts the entire electrical work to an electrical subcontractor?


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