Certified Professional Contract Manager (CPCM) 2025 – 400 Free Practice Questions to Pass the Exam

Privity of contract refers to the direct relationship and legal binding agreement between the parties involved in a contract. This principle allows the parties to seek enforcement and remedies directly from one another. When two parties enter into a contract, privity ensures that they are the only ones who have the rights and obligations outlined within the contract, making it possible for them to hold each other accountable and seek recourse if there is a breach.

The other options do not accurately represent the concept of privity of contract. The obligation for parties to communicate through a lawyer pertains to legal representation but does not define the relationship established by the contract itself. Similarly, the requirement to make agreements in writing relates to contract formation and enforceability rather than privity. Lastly, the notion concerning the inability to assign contracts to third parties touches on assignment rights, which is a separate legal consideration that may or may not relate to the privity between the contracting parties. Thus, option A correctly captures the essence of privity of contract, emphasizing the direct connection and accountability that allows parties to pursue legal remedies against each other.