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Collateral contract Introduction Statement is a term of a separate contract - a contract collateral to the main contract.

If you will make such and such a contract I will give you one hundred pounds, is in every sense of the word a complete legal contract. It is collateral to the main contract, but each has an independent existence, and they do not differ in respect of their possessing to the full the character and status of a contract. -Heilbut, Symons & Co v Buckleton execution of the lease, i.e. his entering into the main contract- De Lassalle v Guildford !oint %# a collateral contract may be valid even though it conflicts with a term in the main contract. -City of Westminster Properties v udd !oint &# uses of collateral ctt- side-step the parol evidence rule, privity rule and an exclusion clause or to avoid the effects of an illegal contract. S!anklin Pier Ltd v Detel Products Ltd" avoid privity rule by collateral ctt (owever, even after the introduction of remedies in damages for negligent statements, the courts have shown a readiness to find a collateral contract or warranty. $his may be where the statement is in the form of an opinion or promise as to the future which may not give rise to liability in misrepresentation under the )isrepresentation *ct "+,Collateral ctt can be raised even misrep is there# #sso Petroleum Co Ltd v ardon $ involve collateral ctt issue and negligent misrep

!oint "# Consideration to enforce the collateral ctt# $he consideration to enforce this promise as a separate contract was the claimants

'evelopment# Since damages can now be claimed for negligent misrepresentation and negligent misstatement, this particular role of the collateral contract has lost some of its significance.

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