Deck 17: Third Party Rights

Question 1

Oral assignments are prohibited.

Answer 1

False

Question 2

Notice is not legally required to establish the validity of an assignment.

Answer 2

True

Question 3

An assignment is effective only after notice is given to the obligor.

Answer 3

False

Question 4

Alienation is a transfer of contract rights between citizens of different nations.

Question 5

Privity of contract refers to the privacy that contracting parties should maintain with respect to their contract.

Question 6

An unconditional assignment of rights in a contract will extinguish the rights of the assignor.

Question 7

A right to receive damages on a breach of a contract for a sale of goods may be assigned.

Question 8

An assignment of an insurance policy cannot be prohibited.

Question 9

Privity of contract is the principle under which contracting parties alone traditionally had rights and liabilities under their contract.

Question 10

A contract can prevent the assignment of the right to receive funds.

Question 11

A transfer of contract rights to a third party is a negotiated instrument.

Question 12

A delegator is a party who transfers his or her obligation under a contract to another party.

Question 13

The person to whom rights in a contract are assigned is the delegatee.

Question 14

A transfer of contract rights to a third party is an assignment.

Question 15

All rights can be assigned.

Question 16

An assignee can compel the obligor to perform.

Question 17

The rights under a contract for personal service normally can be assigned.

Question 18

To be enforceable,any assignment must be in writing.

Question 19

An obligor is a person to whom a duty is owed.

Question 20

The assignment of the same contract right to two different parties results in their "splitting the difference."

Question 21

Tanya attempts to free herself from the duties of her contract with Drew by telling Drew to find someone else to perform them.This is

A)a delegation.
B)an assignment.
C)a third party beneficiary contract.
D)none of the choices.

Question 22

Bret and Cory enter into a contract under which Bret agrees to sell his textbook to Cory for $60 at the end of the fall semester.Bret wants to transfer his right to payment for the book to Del.This transfer

A)is prohibited.
B)may be oral or written.
C)must be implied.
D)must be in writing.

Question 23

An "assignment of all rights" absolves the assignor of all liability under the contract that created the rights.

Question 24

If a contract does not require that performance be rendered directly to a third party,the third party will be considered an intended beneficiary.

Question 25

An incidental beneficiary can sue directly to enforce a promisee's promise.

Question 26

A third party beneficiary contract is formed when a contract confers a benefit on any third party.

Question 27

Any third party beneficiary to a contract who is not an intended beneficiary is incidental.

Question 28

The vesting of contractual rights in a third party will always prevent the original parties to the contract from modifying it.

Question 29

McCall and Teresa enter into a contract for the distribution of McCall's produce to local restaurants for which Teresa agrees to pay.McCall transfers his right to payment under the contract to Midtown Bank.This transfer is

A)a delegation.
B)an assignment.
C)a novation.
D)prohibited.

Question 30

The rights of a third party beneficiary under a contract with two other parties vest when the conditions for vesting are satisfied.

Question 31

If a contract does not require that performance be rendered directly to a third party,the third party may be considered an incidental beneficiary.

Question 32

An incidental beneficiary can sue directly to enforce a promisor's promise.

Question 33

No special form is required to create a delegation of duties.

Question 34

A third party's right to control the details of performance of a contract indicates that the third party is an intended beneficiary.

Question 35

Fitch and Gert enter into a contract for the distribution of Fitch''s produce to local restaurants and wineries for which Fitch agrees to pay Gert.Gert transfers his right to payment under the contract to Honor Bank.This transfer is

A)a delegation.
B)an assignment.
C)an obligato.
D)prohibited.

Question 36

An intended beneficiary can sue directly to enforce a promisor's promise.

Question 37

A third party beneficiary contract is formed only when the parties to a contract intend to confer a benefit on a third party.

Question 38

Dwayne and Ewell enter into a contract for the design of an addition to Dwayne's house for which he agrees to pay Ewell.Ewell transfers his right to payment under the contract to Flex Construction Company.Flex is

A)a delegatee.
B)an assignee.
C)an obligee.
D)a prohibitee.

Question 39

The rights of a third party beneficiary under a contract are subject to any express reservation of rights in the contract to the original parties.

Question 40

A delegation relieves the party making it of the obligation to perform.

Question 41

A contract between Drill-Bit Sharpeners,Inc.,and East Oil Mining Corporation contains a clause stating that any assignment is "void." This ordinarily prohibits

A)any assignment.
B)no assignment.
C)only an assignment of contract rights to personal services.
D)only an assignment that would change the obligor's risk.

Question 42

Joy and Kris enter into a contract for Kris to lay sod in Joy's yard for which she agrees to pay Kris.When Kris's schedule conflicts,she contacts Leza,to whom Kris "assigns all rights under the contract." Kris is

A)absolved of any liability under the contract.
B)in breach of the contract with Joy.
C)liable to Joy if Leza does not perform.
D)liable to Leza for inducing a prohibited contract.

Question 43

Commercial Shipping,Inc.,and Dock Services Corporation enter into a contract under which Commercial agrees to pay Dock to load Commercial's trucks.Dock transfers its duty to load the trucks to East Harbor Transport Company.Dock is

A)a delegator.
B)an assignor.
C)a payor.
D)a righter.

Question 44

Jocasta contracts to provide lawn-mowing services to Kevin for $140 per month.Jocasta cannot transfer this duty

A)under any circumstances.
B)without continuing to be potentially liable.
C)without Kevin's consent.
D)without paying Kevin at least one monthly fee.

Question 45

Parsley,a world-famous chef,signs a contract to give lessons in French cooking to Curry.Parsley wants to transfer his duties under the contract to Relish,the operator of a hot dog concession.The transfer is

A)valid because the performance required is of a nonpersonal nature.
B)valid if Relish is a highly regarded vendor.
C)not valid because performance depends on Parsley's personal skills.
D)not valid if Curry does not hold Relish in high regard.

Question 46

Nashville Harmonies Inc.and Taylor enter into a contract for Taylor to write six songs for which Nashville agrees to pay her.Taylor transfers her right to payment under the contract to Omni Entertainment Agency.In the transfer of rights,Taylor is

A)a delegator.
B)an assignor.
C)an obligor.
D)an alien.

Question 47

Trudy and Uri enter into a contract for the sale of Trudy's house for which Uri agrees to pay her $250,000.Uri wants to transfer his right to the ownership of the house to Val,his niece.This transfer

A)is prohibited.
B)may be oral or written.
C)must be implied.
D)must be in writing.

Question 48

Vernon contracts with Whitney to provide concierge services to Yerba Buena Hotel.This is

A)a delegation.
B)an assignment.
C)a third party beneficiary contract.
D)a novation.

Question 49

Lois takes out a life insurance policy with Mega Insurance Corporation that names her son,Nero,as the beneficiary.This is

A)a delegation.
B)an assignment.
C)a third party incidental beneficiary contract.
D)a third party intended beneficiary contract.

Question 50

Floyd and Grady enter into a contract by which Floyd promises to deliver fertilizer to Grady.Floyd subsequently transfers this duty to Hiram.Floyd is

A)a delegatee and an obligee.
B)a delegatee but not an obligee.
C)a delegator and an obligor.
D)a delegator but not an obligor.

Question 51

Miley and Rico enter into a contract for the closing of a sale of Miley's recording studio.When Rico's schedule conflicts,he asks Oliver to perform his duties at the closing.This transfer of duties is

A)a delegation.
B)an assignment.
C)prohibited.
D)a negotiation.

Question 52

Esther and Faisal agree that Esther will fix Faisal's car in exchange for his paying a preexisting debt owed by Esther to Gladys.Gladys is

A)an assignee.
B)an intended beneficiary.
C)an incidental beneficiary.
D)a delegatee.

Question 53

Fiorella and Midwest Agri-Ship,Inc.,enter into a contract for Midwest to transport a silo of corn for which Fiorella agrees to pay Midwest.Due to schedule conflicts,Midwest contacts Hybrid Crop Transport Company,to which Midwest "assigns all rights under the contract." This transfer is

A)an assignment and a delegation.
B)an alienation and a negotiation.
C)an obligation and a cancelation.
D)prohibited.

Question 54

Trudy and Uri enter into a contract for the sale of Trudy's house for which Uri agrees to pay her $250,000.Uri wants to transfer his right to the ownership of the house to Val,his niece.This transfer generally

A)cannot be prohibited.
B)cannot be allowed.
C)can be prevented.
D)can be circumvented.

Question 55

Jen is a third party beneficiary under a contract between Kyla and Leo.Kyla and Leo can modify or rescind their contract without Jen's consent

A)at any time.
B)at no time.
C)only after Jen's rights have vested.
D)only before Jen's rights have vested.

Question 56

Ben and Ivy enter into a contract under which Ben agrees to cater Ivy's wedding in exchange for a cash down payment.The contract expressly prohibits any transfer of rights.A contract right may be transferred,however,if the transfer involves

A)a right to receive payment.
B)a right to Ben's services.
C)rights under Ivy's insurance policy against Ben's failing to perform.
D)a right whose transfer is otherwise expressly prohibited by statute.

Question 57

Manny wants to transfer his right to buy $400 of pistachio nuts under a contract with Nila to Opie.To ensure that the transfer of the right is valid,Manny must

A)designate Opie as a "delegate."
B)file a notice of assignment in the public records.
C)tell Nila that he has no right and no liability under the contract.
D)none of the choices.

Question 58

Phaedra and Raul contract with Sheldon to transfer the ownership of their lake cottage to him.This is

A)a delegation.
B)an assignment.
C)a third party beneficiary contract.
D)an alienation.

Question 59

Reba and Sly enter into a contract by which Reba promises to deliver newly printed marketing brochures to Sly.Reba later transfers her duty under the contract to Troy.Reba is

A)a delegator and an obligor.
B)a delegator only.
C)an obligor only.
D)none of the choices.

Question 60

Rural Development Corporation (RDC)and Sid enter into a contract for the clear-cutting of RDC's fifty-acre tract for which RDC agrees to pay Sid.Sid transfers his duty to log the tract under the contract to Timber Logging Company.Timber is

A)a delegatee.
B)an assignee.
C)an obligee.
D)a prohibitee.

Question 61

Pam borrows $5,000 from Quality Auto Sales to buy a car.When Pam does not pay the loan or return the car,Quality wants to transfers the right to the payment to Rapid Collection Agency.Rapid agrees to pay Quality for this right,but for a price that is less than the amount owed.Can Quality transfer this right to Rapid without Pam's consent If so,and Quality committed fraud in the deal with Pam,could Pam legitimately refuse to pay Rapid Explain.

Question 62

Heather and Genice agree that Genice can satisfy her debt to Heather by paying the money directly to Fava (to whom Heather owes a debt).The designation of this contract as a third party beneficiary contract is determined by the intent to benefit

A)all of the parties.
B)Heather only.
C)Genice only.
D)Fava only.

Question 63

Xtra Finance Company is a creditor beneficiary in a deal that involves Yvon and Zack.Xtra,like most creditor beneficiaries,is

A)a donee beneficiary.
B)an incidental beneficiary.
C)an intended beneficiary.
D)none of the choices.

Question 64

Linus and Marlena agree that Linus will fix Marlena's roof in exchange for $8,000.Linus spends half of the amount due under the contract to acquire the materials for the job from Natural Roofing Supplies.Natural Roofing is

A)a delegatee.
B)an intended beneficiary.
C)an incidental beneficiary.
D)an alien to the contract.

Question 65

George promises to repair Ford's boat dock in exchange for Efrem's promise to plant trees on George's property.This is

A)a delegation.
B)an assignment.
C)a third party beneficiary contract.
D)an alienation.

Question 66

Evergreen Landscapers,Inc.,owes Friendly Finance Company $5,000.Evergreen enters into a contract with Suburban Office Park under which Evergreen promises to maintain the landscaping on Suburban's property.Under the contract,Suburban promises to pay Friendly Finance the amount that will be due Evergreen until Evergreen's debt to Friendly Finance is paid.Evergreen performs as promised,but Suburban does not pay Friendly Finance.Can Friendly Finance succeed in a suit against Suburban Why or why not

Question 67

Dale signs a contract with Everbest Insurance Company that intentionally confers a benefit on Flo.Flo's rights under the contract will vest

A)automatically.
B)if she manifests assent to the contract or materially al?ters her po?si?tion in justifiable reliance on it.
C)only if she manifests assent.
D)only if she materially alters her position in justifiable reliance.

Question 68

Olivia contracts for the sale of this year's strawberry crop to Phoenix,with payment to go to Rural Cooperative Association.The contract reserves to Olivia and Phoenix the right to modify its terms.Rural Cooperative's right to payment is

A)not affected by the reservation.
B)subject to any change that Olivia and Phoenix make.
C)limited only if Rural Cooperative agrees to any changes.
D)terminated by the reservation.