Allen hired Beth to do a marketing survey. The contract provided that she would start the work on January 15 and finish it by March 15, the date for completion being a condition on the contract. She would be paid $2000. After one month of work, when the work was half completed, Beth assigned the $2000 contract price to Charlie, from whom she had bought computer hardware. Charlie gave written notice of the assignment to Allen on the same day. The second month's work went badly. Information entered into the computer was lost and Beth could not finish on time. She was five days late, and each day cost Allen $100. His total foreseeable loss was $500 because of her breach. On these facts, which of the following is true?
A) Charlie could receive only $1000 from Allen because half of the $2000 project was finished when he gave notice of the assignment to Allen.
B) Charlie could receive $2000 from Allen because that is the amount owed to Charlie and the amount assigned by Beth.
C) Charlie could receive $1500, because when the contract was completed, that was all that was legally owed to Beth.
D) Charlie could receive only $1000 from Allen because only half the work was done when the assignment was made.
E) Charlie gets $0 from Allen because one can assign contractual obligations but not contractual rights.

Question

Quizplus · Accepted Answer

Charlie could receive $1500 from Allen because Beth completed the work, albeit late, and the only deduction from the original contract price would be the $500 loss Allen suffered due to the delay. Since Beth's right to payment was assigned to Charlie, he steps into her shoes regarding the right to receive payment, subject to any defenses Allen might have against Beth, such as the damages for the delay.

Allen Hired Beth to Do a Marketing Survey