Question 1

Ralph and Sven enter into a contract under which Sven agrees to guide Ralph's expedition through Tibet for which Ralph agrees to pay Sven.This contract may not be assigned if
A)the assignment will significantly change the risk of nonperformance.
B)the assignment is expressly prohibited by the terms of the contract.
C)the contract is uniquely personal in nature.
D)any of the choices.

Accepted Answer

The contract may not be assigned if any of the choices apply: A) if the assignment significantly changes the risk of nonperformance, B) if the contract expressly prohibits assignment, or C) if the contract is uniquely personal in nature.

Question 2

Peri,a world famous musician and composer,agrees to give ten piano les?sons to Quinn in exchange for $1,000.Peri's attempt to transfer her contract duties to Roth,an in?experienced pianist,will probably be
A)permitted because contracts may be freely delegated.
B)permitted because the contract is concerned with music lessons.
C)prohibited because contracts may not be freely delegated.
D)prohibited because Peri and Roth have very different skill levels.

Accepted Answer

The delegation of duties in a contract is generally allowed unless the duties involve personal skills or expertise. Since Peri is a world-famous musician and Roth is inexperienced, the skill levels are significantly different, making the delegation inappropriate.

Question 3

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.

Accepted Answer

Kris is still liable to Joy if Leza does not perform because an assignment transfers rights, but not obligations under the contract. Therefore, Kris remains responsible for the performance of the contract even after the assignment.

Question 4

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.

Accepted Answer

The transfer of ownership of the lake cottage to Sheldon is considered an alienation, which is the act of transferring ownership rights in property from one party to another.

Question 5

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)an alien.

Accepted Answer

Flex Construction Company is an assignee because it has received the right to payment from Ewell under the contract with Dwayne. A delegatee, on the other hand, is someone who is authorized to perform a duty under a contract on behalf of the obligor, while an obligee is the party who is owed a duty or obligation under a contract. An alien has no relevance in this context.

Question 6

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.

Accepted Answer

An incidental beneficiary is a person who benefits from a contract but is not a party to the contract and does not have any legal rights under the contract. In this case, Natural Roofing Supplies is an incidental beneficiary because it benefits from the contract between Linus and Marlena by selling materials to Linus.

Question 7

Consumers Credit Company is a creditor beneficiary in a deal that involves Devon and Elena.Consumers Credit,like most creditor beneficiaries,is
A)a donee beneficiary.
B)an incidental beneficiary.
C)an intended beneficiary.
D)one of the original contracting parties.

Accepted Answer

Consumers Credit Company is considered an intended beneficiary because they are specifically named in the contract and stand to gain certain rights or benefits from the performance of the contract between Devon and Elena.

Question 8

Trudy and Uri enter into a contract for the sale of Trudy's house for which Uri agrees to pay her $200,000.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.

Accepted Answer

The transfer of ownership rights in real property must be in writing to be enforceable under the statute of frauds. Therefore, Uri must transfer his right to the ownership of the house to Val in writing.

Question 9

Equity Company and Faye enter into a contract for Faye to cater a meeting of Equity's shareholders.When Faye's schedule conflicts,she asks Gudren to serve Faye's coffee and pastries at the meeting.This transfer of duties is
A)a delegation.
B)an assignment.
C)an alienation.
D)prohibited.

Accepted Answer

A delegation is the transfer of duties from one party to another with the consent of the other party. In this case, Faye has delegated her duty to serve coffee and pastries to Gudren with the consent of Equity. Therefore, the correct choice is A) a delegation.

Question 10

Floyd and Gert enter into a contract by which Floyd promises to deliver fer?tilizer to Gert.Floyd subsequently transfers this duty to Hazel.Floyd is
A)a delegatee.
B)an obligee.
C)an obligor.
D)an assignee.

Accepted Answer

Floyd is the obligor because he is the party who made the promise to deliver the fertilizer to Gert. Since he transferred this duty to Hazel, she becomes the delegatee. Assignees refer to the transfer of rights, rather than duties.

Question 11

Dale signs a contract with Everbest Insurance Company that intentionally confers a benefit on Flo as the designated beneficiary.Flo's rights under the contract will vest
A)automatically.
B)if she demonstrates her consent to the promise at Dale's request.
C)if Everbest attempts to modify the terms of the contract.
D)never.

Accepted Answer

The answer of Dale signs a contract with Everbest Insurance...

Question 12

Vicky contracts with Rashad for the delivery of hospice services to benefit Sigmund.This is
A)a delegation.
B)an assignment.
C)a third party beneficiary contract.
D)an alienation.

Accepted Answer

This is a third party beneficiary contract because Sigmund will benefit from the hospice services provided by Rashad, even though he is not a party to the contract between Vicky and Rashad.

Question 13

Jordan and Isabel enter into a contract under which Jordan agrees to cater Isabel's wedding in exchange for $5,000.The contract can expressly prohibit and prevent the transfer of
A)Jordan's right to receive funds.
B)Isabel's right to receive personal services.
C)no rights under the contract.
D)all rights under the contract.

Accepted Answer

The contract can prohibit and prevent the transfer of Isabel's right to receive personal services, as catering is a personal service that cannot be performed by someone else. However, Jordan's right to receive funds can generally be transferred unless expressly prohibited in the contract. Therefore, option A is not the best choice. Option C is incorrect because a contract creates enforceable rights and obligations, so there must be some rights provided under the contract. Option D is also incorrect because prohibiting all rights under the contract would render it unenforceable.

Question 14

Lois takes out a life insurance policy with Mega Insurance Corporation that names her son,Nero,as the bene?ficiary.This is
A)a delegation.
B)an assignment.
C)a third party incidental beneficiary contract.
D)a third party intended beneficiary contract.

Accepted Answer

Lois's life insurance policy with Mega Insurance Corporation clearly identifies Nero as the beneficiary, indicating that she has intended for him to receive the benefits provided by the policy. Therefore, this is a third party intended beneficiary contract. Option A and B are incorrect as they do not appropriately reflect the parties involved. Option C is incorrect as the policy explicitly identifies Nero as the beneficiary, meaning that he is not merely an incidental beneficiary.

Question 15

Joaquin wants to transfer his right to the payment of his wages under an employment contract with Free-Flo Plumbing Company to Inez.In most states,this transfer
A)is prohibited.
B)may be oral or written.
C)must be implied.
D)must be in writing.

Accepted Answer

The answer of Joaquin wants to transfer his right to...

Question 16

Nick contracts for the sale of this year's strawberry crop to Phoenix,with payment to go to Rural Cooperative Association.The contract reserves to Nick 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 Nick and Phoenix make.
C)limited only if Rural Cooperative agrees to any changes.
D)terminated by the reservation.

Accepted Answer

Rural Cooperative Association's right to payment is subject to any change that Nick and Phoenix make because the contract explicitly reserves the right to modify its terms to the original parties involved, Nick and Phoenix.

Question 17

Esther and Faisal agree that Esther will fix Faisal's car in exchange for his paying a debt owed by Esther to Gladys.Gladys is
A)a delegatee.
B)an intended beneficiary.
C)an incidental beneficiary.
D)an alien to the contract.

Accepted Answer

Gladys is an intended beneficiary because she is receiving a benefit from the contract (the payment of the debt owed by Esther to her) even though she is not a party to the contract between Esther and Faisal.

Question 18

Jean Paul and Hermosa enter into a contract under which Jean Paul agrees to provide greensward services for Hermosa's Golf Links.Under an antidelegation clause,their contract can prohibit and prevent the transfer of
A)duties that are personal in nature.
B)duties that are impersonal in nature.
C)no duties under the contract.
D)all duties under the contract.

Accepted Answer

An anti-delegation clause allows a party of a contract to prevent the transfer of certain duties. These duties are typically those that are "personal in nature," meaning they require the specific skills, expertise, or judgment of the original party. In this case, providing greensward services may require specific knowledge and abilities that are unique to Jean Paul, so it would be reasonable to include an anti-delegation clause to prevent the transfer of these personal duties. Therefore, the best choice is A.

Question 19

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 under this contract to Timber Logging Company.Timber is
A)a delegatee.
B)an assignee.
C)an obligee.
D)an alien.

Accepted Answer

Timber Logging Company is a delegatee because Sid has transferred his duty to perform under the contract to Timber, which is a delegation of duty.

Question 20

Loren and Kendra enter into a contract for the distribution of Loren's produce to local restaurants for which he agrees to pay Kendra.Kendra transfers her right to payment under the contract to County Bank.This transfer is
A)a delegation.
B)an assignment.
C)an alienation.
D)prohibited.

Accepted Answer

The transfer of Kendra's right to payment under the contract to County Bank is an assignment. An assignment is a transfer of a contractual right from one party to another. It is allowed unless the contract prohibits it, or if the rights are personal in nature and cannot be delegated.

Quiz 16: Third Party Rights

Ralph and Sven enter into a contract under which Sven agrees to guide Ralph's expedition through Tibet for which Ralph agrees to pay Sven.This contract may not be assigned if

Peri,a world famous musician and composer,agrees to give ten piano les?sons to Quinn in exchange for $1,000.Peri's attempt to transfer her contract duties to Roth,an in?experienced pianist,will probably be

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

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

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

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

Consumers Credit Company is a creditor beneficiary in a deal that involves Devon and Elena.Consumers Credit,like most creditor beneficiaries,is

Trudy and Uri enter into a contract for the sale of Trudy's house for which Uri agrees to pay her $200,000.Uri wants to transfer his right to the ownership of the house to Val,his niece.This transfer

Equity Company and Faye enter into a contract for Faye to cater a meeting of Equity's shareholders.When Faye's schedule conflicts,she asks Gudren to serve Faye's coffee and pastries at the meeting.This transfer of duties is

Floyd and Gert enter into a contract by which Floyd promises to deliver fer?tilizer to Gert.Floyd subsequently transfers this duty to Hazel.Floyd is

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

Vicky contracts with Rashad for the delivery of hospice services to benefit Sigmund.This is

Jordan and Isabel enter into a contract under which Jordan agrees to cater Isabel's wedding in exchange for $5,000.The contract can expressly prohibit and prevent the transfer of

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

Joaquin wants to transfer his right to the payment of his wages under an employment contract with Free-Flo Plumbing Company to Inez.In most states,this transfer

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

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

Jean Paul and Hermosa enter into a contract under which Jean Paul agrees to provide greensward services for Hermosa's Golf Links.Under an antidelegation clause,their contract can prohibit and prevent the transfer of

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 under this contract to Timber Logging Company.Timber is

Loren and Kendra enter into a contract for the distribution of Loren's produce to local restaurants for which he agrees to pay Kendra.Kendra transfers her right to payment under the contract to County Bank.This transfer is