Deck 16: B: Third Party Rights

Question 1

The rights of a third party bene?ficiary under a contract vest if the third party brings a suit on the promise.

Answer 1

True

Question 2

Both intended and incidental beneficiaries acquire legal rights in a contract.

Answer 2

False

Question 3

A transfer of contract rights to a third party is a delegation.

Answer 3

False

Question 4

An assignee can compel the obligor to perform.

Question 5

An incidental third party beneficiary cannot sue to enforce the contract because the benefit is unintentional.

Question 6

The assignment of the same contract right to two different parties automatically cancels both assignments.

Question 7

A delegation relieves the party making it of the obligation to per?form.

Question 8

Privity of contract refers to the fact that traditionally contracting parties alone have rights and liabilities under their contract.

Question 9

To make an effective delegation,the delegator must use the word delegate.

Question 10

A life insurance contract is a third party benefi?ciary contract involving a donee beneficiary.

Question 11

A creditor beneficiary can sue the promisor directly for breach.

Question 12

Designating a third party as a beneficiary in a contract does not indicate whether the beneficiary is intended or incidental.

Question 13

If a statute prohibits the assignment of certain rights,those rights cannot be assigned.

Question 14

An assignment of a negotiable instrument is generally prohibited.

Question 15

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

Question 16

To be enforceable,any assignment covered by the Statute of Frauds must be in writing.

Question 17

An assignment is effective immediately,whether or not notice is given.

Question 18

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

Question 19

An assignee's rights are subject to the defenses that the obligor has against the assignor.

Question 20

A "donee" beneficiary is a type of an "incidental" beneficiary.

Question 21

Parsley,a world-famous chef,signs a contract to give lessons in French cooking to Curry.Parsley wants to transfer his duties under the con?tract 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 22

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)neither a delegator nor an obligor.

Question 23

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 24

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)after Jen's rights have vested.
D)before Jen's rights have vested.

Question 25

Commercial Shipping,Inc. ,and Dock Services Corporation enter into a contract for Dock to load Commercial's barges for which Commercial agrees to pay Dock.Dock transfers its duty to load the barges to Riverside Freight Company.Dock is

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

Question 26

Fact Pattern 16-B1
Bayside Construction Company enters into a contract with Clio to remodel Dewey's Home Store,using products from Eagle Building Supplies.Fresh Food Café is next to Dewey's Home Store.
Refer to Fact Pattern 16-B1.Halfway through the project,Bayside refuses to finish the job.The contract can be enforced against Bayside by

A)Clio only.
B)Clio or Dewey only.
C)Clio,Dewey,or Eagle only.
D)Clio,Dewey,Eagle,or Fresh Food.

Question 27

Jocasta contracts to provide lawn-mowing services to Kevin for $140 per month.Jocasta can?not 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 28

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 29

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 30

Fact Pattern 16-B1
Bayside Construction Company enters into a contract with Clio to remodel Dewey's Home Store,using products from Eagle Building Supplies.Fresh Food Café is next to Dewey's Home Store.
Refer to Fact Pattern 16-B1.Dewey is

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

Question 31

Betty assigns her right to payment of a loan to Cody.Cody is

A)a creditor beneficiary.
B)a debtor beneficiary.
C)a donee beneficiary.
D)a donor beneficiary.

Question 32

Fact Pattern 16-B1
Bayside Construction Company enters into a contract with Clio to remodel Dewey's Home Store,using products from Eagle Building Supplies.Fresh Food Café is next to Dewey's Home Store.
Refer to Fact Pattern 16-B1.The value of Fresh Food's property will increase after Dewey's store is remodeled.Fresh Food is

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

Question 33

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 34

Fact Pattern 16-B1
Bayside Construction Company enters into a contract with Clio to remodel Dewey's Home Store,using products from Eagle Building Supplies.Fresh Food Café is next to Dewey's Home Store.
Refer to Fact Pattern 16-B1.Eagle will realize a profit from the sale of prod?ucts to Bayside to remodel Dewey's store.Eagle is

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

Question 35

Heather and Genice agree that Genice can satisfy her debt to Heather by pay?ing the money directly to Fava (to whom Heather owes a debt).The designation of this con?tract as a third party benefi?ciary contract is determined by the intent to benefit

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

Question 36

Bret and Cory enter into a contract for the sale of Bret's textbook at the end of the fall semester for which Cory agrees to pay Bret $60.Cory wants to transfer her 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 37

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 38

Ron makes a contract with Stu that indirectly benefits Tim,although nei?ther Ron nor Stu intended that result.Tim is

A)a delegatee.
B)an assignee.
C)an incidental beneficiary.
D)none of the choices.

Question 39

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 40

Basil and Rosemary enter into a contract for the sale of Basil's condominium to Rosemary.She transfers her right to be recorded as the owner of the property to her son Sage.This transfer is

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

Question 41

Shade Tree Landscaping Company enters into a contract with Jill to landscape Jack's yard,using Fertile Nursery to supply trees and bushes.Maria owns the lot next to Jack's property.The landscaping is a gift from Jill to Jack,who is Jill's friend,but they are not related.What type of beneficiary is Jack? What type of beneficiary is Maria? What type of bene?ficiary is Fertile Nursery? If Shade Tree refuses to do the job,who can en?force the contract against it?

Question 42

Fix-It Auto Company contracts to sell a car to Garth for $3,500.Garth gives Fix-It a worth?less check for the price.Garth assigns his right to the car to Herb.If Fix-It refuses to deliver the car to Herb and Herb sues,can Fix-It raise Garth's fraud as a defense against deliv?ery of the car to Herb? Explain.