The Principle of Benefit and Burden

Abstract

OVER the years there seem to have been a number of cases based ultimately on a general principle that a person who takes the benefit of an arrangement will be bound by any associated burden contained in it despite the fact that he was not a party to the original arrangement. Potentially the most extreme application of this principle, and the most controversial, has been in Halsall v. Brizell and cases which followed it. The idea introduced in Halsall v. Brizell and later developed by Megarry V.-C. in Tito v. Waddell (No. 2) is that a person may, in appropriate circumstances, be bound by an obligation which is imposed by the same transaction that grants a benefit of which he wishes to take advantage but is not a condition of that benefit. Megarry V.-C. referred to this as an application of a pure principle of benefit and burden to contrast the situation with the application of a principle of benefit and burden in the case of a conditional or qualified right. In this article the term “pure principle” will be used to refer to the application of a principle of benefit and burden in Halsall v. Brizell and the cases which have followed it. Since the decision in Halsall v. Brizell, there has been controversy as to this most recent application of a principle of benefit and burden, the perceived problems being the lack of clarity and certainty as to the necessary requirements for its application and its potentially far-reaching effects. Such problems clearly influenced the House of Lords when deciding the case of Rhone v. Stephens and, since that decision, there has been some doubt as to whether the principle of benefit and burden can have the effect that has been suggested. A principle whereby a person can be forced to comply with obligations that would not otherwise bind him has undoubted attractions but will be unacceptable if it directly contradicts clearly established rules which prevent obligations binding non-contracting parties.