Does a contract have to define "third party" or does it have a standard meaning of "any entity not a party to this agreement"?

If third party is not explicitly defined in an agreement between Party A and Party B, is Party B free to regard its agent, or any company it contracts with to perform services (even a company that is a competitor of Party A) to be not a third party?

Does the answer to these questions vary by jurisdiction?

I have seen the following explicit definition in a company's Privacy statement:

Third Party: any entity that is not Acme Widgets, an Acme Widgets employee, contractor, or agent.

  • FWIW, it would be rare to define the term "third-party" contractually. In the abstract its meaning is usually clear. But there are always "edge cases", e.g., whether a receiver of a party's property count as third-parties or not, in the context of a particular contract term. Defining such terms without having a foreseeable fact pattern in mind is usually foolish.
    – ohwilleke
    May 18, 2021 at 20:33

3 Answers 3


Third-party has a general meaning but one that can be changed by the contract

Third-party means someone who is not a party to the contract nor an agent of one of the parties (such as an employee of one of them). The term came about because most contracts only have two parties and they were historically identified as the first party and the second party although that usage is now uncommon: that makes everyone else a third party, even where the contract has more than 2 parties.

The definition you cite expands the definition to include contractors of one of the parties: independent contractors are third parties unless their contract amounts to an agency agreement.

  • 2
    Thanks. I will have to do some reading about "agency". The actual context I am concerned about is an intellectual property non-disclosure clause forbidding Party B from disclosing the IP "to any third party". The agreement does not define the term "third party".
    – Tim
    May 19, 2021 at 11:49

Is there a commonly agreed definition of "third party"..?

In it is defined by statute under s.1(1) of the Contracts (Rights of Third Parties) Act 1999 as:

...a person who is not a party to a contract (a “third party”)...

  • 1
    And that definition would be understood strictly and exclude agents and contractors of either of the parties?
    – Tim
    Sep 12, 2022 at 14:15
  • @Tim Hmm - is an agent (properly authorised by a party to a contract) deemed to be a party to that contract also? I've no idea, but it's definitely worth posting as a new question to see what answers others may offer.
    – user35069
    Sep 12, 2022 at 21:39

Generally Third Party means "a party that is not party to the contract" It is not the exact number of parties as there could be any number of 2 or more contracting parties. A "third party" usually means that the injured party cannot claim damages stipulated in the contract if the defending party was acting with respect to the non-signatory's actions.

In cases, where the party would have acted but for unforeseen actions that no party could have controlled, the event would fall under a blanket term usually called an "Act of God". Usually a weather delay or closure or other natural disaster is termed this and it usually comes up in transit.

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