Question 1

When the rights under a contract are highly personal, they are not assignable.

Accepted Answer

When the rights under a contract are highly personal, such as those based on the unique skills, qualifications, or characteristics of a party, they are generally not assignable because the performance expected is specific to the individual involved.

Question 2

A partial assignment is a transfer of a portion of the contractual rights to one or more assignees.

Accepted Answer

A partial assignment is a transfer of a portion of the contractual rights to one or more assignees.

Question 3

When the assignee gives consideration in exchange for an assignment, there is a contract between the assignor and the assignee that prevents the assignor from revoking the assignment without the assent of the assignee.

Accepted Answer

When consideration is given for an assignment, a contract is created between the assignor and the assignee, and the assignor cannot revoke the assignment without the agreement of the assignee.

Question 4

The UCC prohibits assignments of $5,000 or more.

Accepted Answer

The UCC does not prohibit assignments of $5,000 or more.

Question 5

When a partial assignment is made, the obligor may require all the parties entitled to the promised performance to litigate in one action any issues concerning the contract performance.

Accepted Answer

When a partial assignment is made, the obligor can indeed require all parties entitled to the promised performance to litigate in one action any issues concerning the contract performance, to avoid multiple lawsuits over the same contractual obligations. This is to ensure efficiency and consistency in the resolution of disputes related to the contract.

Question 6

Assignment of rights is the voluntary transfer to a third party of the rights arising from a contract.

Accepted Answer

Assignment of rights is indeed the voluntary transfer to a third party of the rights arising from a contract.

Question 7

If a contract explicitly provides that it may be assigned, then rights under it are assignable even if the assignment would change the duty, risk, or burden of performance on the obligor.

Accepted Answer

An assignment of rights under a contract is generally permissible even if it would change the duty, risk, or burden of performance on the obligor, provided that the contract explicitly allows for assignment.

Question 8

The Coastal Opera Company has a contract with a famous tenor to perform in its production of La Boheme . If the tenor chooses, he may delegate his duties under the contract to an equally well-known tenor.

Accepted Answer

Under contract law, personal service contracts, especially those involving unique skills or talents like those of a performer, generally cannot be delegated to another party without the consent of the party who contracted for the services.

Question 9

In England and in a minority of states, the first of two or more assignees to give notice to the obligor is entitled to the assigned performance.

Accepted Answer

This is known as the "first in time, first in right" rule, which means that the first assignee to give notice to the obligor has priority over subsequent assignees. However, this rule is not followed in all states and jurisdictions.

Question 10

Article 9 of the UCC makes waiver-of-defense clauses effective against assignees in consumer transactions.

Accepted Answer

Article 9 of the Uniform Commercial Code (UCC) generally governs secured transactions but does not make waiver-of-defense clauses effective against assignees in consumer transactions. Consumer protection laws often limit or prohibit such waivers to protect consumers.

Question 11

A party delegating his duty to a third party is known as a delegator.

Accepted Answer

In contract law, the party who delegates his duty to a third party is referred to as the delegator, while the third party taking on the duty is called the delegatee.

Question 12

Under Article 2 of the UCC, a right to damages for breach of the whole contract can be assigned despite a contractual provision to the contrary.

Accepted Answer

Under the Uniform Commercial Code (UCC) Article 2, which governs the sale of goods, the right to damages for breach of the whole contract or any unperformed balance can indeed be assigned despite a contractual provision that attempts to restrict assignment. This is because the UCC aims to facilitate the free flow of commerce, including the rights to remedies for breach of contract.

Question 13

In a third-party beneficiary contract, the third party's rights arise at the time the contract is formed.

Accepted Answer

In a third-party beneficiary contract, the third party's rights arise at the time the contract is formed, as the contract is intended to benefit them either directly or indirectly, granting them enforceable rights upon its execution.

Question 14

A duty may not be delegated if there is an express provision in a contract against delegation.

Accepted Answer

Contracts often include clauses that prohibit the delegation of duties to third parties without prior consent, making any attempt to delegate in violation of such a provision ineffective.

Question 15

Assignments that materially increase the risk, duty, or burden on the obligor will nonetheless remain effective and enforceable.

Accepted Answer

Assignments that materially increase the risk, duty, or burden on the obligor are generally not enforceable because they alter the terms of the original contract without the obligor's consent.

Question 16

An obligor may assert rights of setoff arising out of entirely separate matters that he might have against the assignor, as long as the matters arose before he had notice of the assignment.

Accepted Answer

An obligor can assert rights of setoff for matters that arose before the notice of assignment because, until notified, the obligor's rights and obligations remain unchanged and can include defenses or claims against the assignor that are unrelated to the assigned obligation.

Question 17

The student government of State University has a contract with a famous rock band to perform at the university on homecoming weekend. The band cannot assign its rights and delegate its duties under this contract.

Accepted Answer

This is a common provision in contracts known as an anti-assignment clause. It prohibits one party from transferring their rights or obligations under the contract to a third party without the other party's consent.

Question 18

In some states, the vesting of a third party's rights occurs only when the third party learns of the contract and assents to it.

Accepted Answer

This is known as the doctrine of "vesting by knowledge and acceptance" or "vesting by manifestation of assent." In these states, a third party's rights are not vested until they become aware of the contract and give their consent or assent to be bound by its terms.

Question 19

A person who owes a duty under a contract is an obligee.

Accepted Answer

A person who owes a duty under a contract is known as the obligor, while the obligee is the party to whom the duty, or obligation, is owed.

Question 20

After an assignment, only the assignee has a right to the obligor's performance.

Accepted Answer

Once an assignment is made, the assignee becomes the new owner of the rights to the obligor's performance and therefore only the assignee has the right to demand performance from the obligor.

Quiz 16: Third Parties to Contracts

When the rights under a contract are highly personal, they are not assignable.

A partial assignment is a transfer of a portion of the contractual rights to one or more assignees.

When the assignee gives consideration in exchange for an assignment, there is a contract between the assignor and the assignee that prevents the assignor from revoking the assignment without the assent of the assignee.

The UCC prohibits assignments of $5,000 or more.

When a partial assignment is made, the obligor may require all the parties entitled to the promised performance to litigate in one action any issues concerning the contract performance.

Assignment of rights is the voluntary transfer to a third party of the rights arising from a contract.

If a contract explicitly provides that it may be assigned, then rights under it are assignable even if the assignment would change the duty, risk, or burden of performance on the obligor.

The Coastal Opera Company has a contract with a famous tenor to perform in its production of La Boheme . If the tenor chooses, he may delegate his duties under the contract to an equally well-known tenor.

In England and in a minority of states, the first of two or more assignees to give notice to the obligor is entitled to the assigned performance.

Article 9 of the UCC makes waiver-of-defense clauses effective against assignees in consumer transactions.

A party delegating his duty to a third party is known as a delegator.

Under Article 2 of the UCC, a right to damages for breach of the whole contract can be assigned despite a contractual provision to the contrary.

In a third-party beneficiary contract, the third party's rights arise at the time the contract is formed.

A duty may not be delegated if there is an express provision in a contract against delegation.

Assignments that materially increase the risk, duty, or burden on the obligor will nonetheless remain effective and enforceable.

An obligor may assert rights of setoff arising out of entirely separate matters that he might have against the assignor, as long as the matters arose before he had notice of the assignment.

The student government of State University has a contract with a famous rock band to perform at the university on homecoming weekend. The band cannot assign its rights and delegate its duties under this contract.

In some states, the vesting of a third party's rights occurs only when the third party learns of the contract and assents to it.

A person who owes a duty under a contract is an obligee.

After an assignment, only the assignee has a right to the obligor's performance.