Shanklin Pier Ltd v Detel Products Ltd [1951]

Court: High Court of Justice, King’s Bench

Facts: Shanklin Pier Ltd instructed contractors to use Detel’s paint based on Detel’s assurance that it would last seven years. The paint failed after three months, and Shanklin Pier sought compensation from Detel.

Issue: Can a collateral contract exist between two parties not directly involved in the main contract?

Held: The court found that a collateral contract existed based on the assurance, making Detel liable for the defective paint.

Key Judicial Statement: McNair J stated that a warranty can arise even in the absence of direct contractual privity if a party relies on another's assurances when entering into a related contract.

💡 Leveluplaw: Collateral contracts can create liability for third parties when assurances given by one party lead another to enter a related contract.