“In California, as in other jurisdictions, it is well established that under some circumstances a third party may bring an action for breach of contract based upon an alleged breach of a contract entered into by other parties.” Goonewardene v. ADP, LLC (2019) 6 Cal.5th 817, 826–27.

“Civil Code section 1559, enacted as one of the provisions of the original 1872 Civil Code, declares: ‘A contract, made expressly for the benefit of a third person, may be enforced by him at any time before the parties thereto rescind.’” Id. at p. 827; 1 Witkin, Summary of Cal. Law (9th Ed.1988) Contracts, section 656; see also Lucas v. Hamm (1961) 56 Cal.2d 583, 591; Sofias v. Bank of America (1985) 172 Cal.App.3d 583, 587; Harper v. Wausau Ins. Co. (1997) 56 Cal.App.4th 1079, 1086; Outdoor Services, Inc. v. Pabagold, Inc. (1986) 185 Cal.App.3d 676, 681. “The word ‘expressly,’ by judicial interpretation, has now come to mean merely the negative of ‘incidentally.’” Gilbert Financial Corp. v. Steelform Contracting Co. (1978) 82 Cal.App.3d 65, 70, 145 Cal.Rptr. 448.

The promise in such a situation is treated as having been made directly to the third party. If the plaintiff is a third party beneficiary of the contract, the plaintiff has a right to sue for its breach. Spinks v. Equity Residential Briarwood Apartments (2009) 171 Cal. App. 4th 1004, 1031.

However, the contract need not be exclusively for the benefit of the third party. He does not need to be the sole or the primary beneficiary. Johnson v. Super. Ct. (2000) 80 Cal.App.4th 1050, 1064.

To assert a claim as a third-party beneficiary, a plaintiff must show not only:

1. whether the third party would in fact benefit from the contract, but also
2. whether a motivating purpose of the contracting parties was to provide a benefit to the third party, and
3. whether permitting a third party to bring its own breach of contract action against a contracting party is consistent with the objectives of the contract and the reasonable expectations of the contracting parties.

Goonewardene v. ADP, LLC (2019) 6 Cal.5th 817, 830. “All three elements must be satisfied to permit the third party action to go forward.” Id.

(Another court says the factors to consider are:

1. the extent to which the transaction was intended to benefit the third party;
2. the foreseeability of harm to the third party;
3. the degree of certainty that the third party suffered injury;
4. the closeness of the connection between the defendant’s conduct and the injury
5. the moral blame attached to the defendant’s conduct, and the policy of preventing future harm.

Biakanja v. Irving (1958) 49 Cal.2d 647.)

“‘Whether the third party is an intended beneficiary or merely an incidental beneficiary involves construction of the intention of the parties, gathered from reading the contract as a whole in light of the circumstances under which it was entered.’” Cione v. Foresters Equity Services, Inc. (1997) 58 Cal.App.4th 625, 636 (citations omitted); Johnson v. Super. Ct. (2000) 80 Cal.App.4th 1050, 1064. Generally, it is a question of fact whether a particular third person is an intended beneficiary of a contract. Bancomer, S.A. v. Super. Ct. (1996) 44 Cal.App.4th 1450, 1458. “However, where... the issue can be answered by interpreting the contract as a whole and doing so in light of the uncontradicted evidence of the circumstances and negotiations of the parties in making the contract, the issue becomes one of law that we resolve independently.” Prouty v. Gores Tech. Group (2004) 121 Cal.App.4th 1225, 1232-1233.

A party may have rights as a third-party beneficiary due to a “special relationship,” such as where the intended recipients of testamentary gifts can be third party beneficiaries of a contract between a testator and his or her attorney and as a result have a viable cause of action against the attorney. Lucas v. Hamm (1961) 56 Cal.2d 583, 591; see also Biakanja v. Irving (1958) 49 Cal.2d 647 (involving unlicensed person acting as an attorney, but with similar circumstances, principles, and result); Heyer v. Flaig (1969) 70 Cal.2d 223, 227 (the plaintiff must prove that he or she was intended to benefit from the established attorney-client relationship).