Adam bought a boat from Charlie for $900 payable on November 6.On November 6,when Charlie came for the money,Adam didn't have it.Adam was,however,employed by Ms.Bey to do some market research.He was to be paid $1000 for his report,due on November 12.Charlie wanted an assignment of $900 of the amount Adam expected to receive November 12.Adam wrote out an assignment with all of the essential information and signed it.Charlie gave written notice of the assignment with all pertinent information to Ms.Bey the next day,November 7.On November 12,Adam had not finished his report.The contract provided that he would lose $100 for every week he was late.Adam was two weeks late in submitting his report.Which of the following is true?
A)Ms.Bey must honour the notice of assignment by paying out the $900 on the day the notice was received.
B)The assignment fails to be an assignment at all because Adam failed to get the consent of Ms.Bey.
C)Charlie,the assignee,would receive $800 from Ms.Bey and have to look to Adam for the other $100 owed.
D)Charlie would get nothing because Ms.Bey owed less than the amount assigned.
E)This assignment is a statutory assignment.

Question

Quizplus · Accepted Answer

Charlie, the assignee, would receive $800 from Ms. Bey ($1000 - $200 late penalty) and Adam would be responsible for the remaining $100 owed. This is because an assignment is a transfer of rights to the assignee, but it does not change the underlying contract between the assignor (Adam) and the obligor (Ms. Bey). The contract between Adam and Ms. Bey provided for a penalty for late submission, which Adam was responsible for paying. Therefore, Charlie would only receive the amount that Ms. Bey owed after the late penalty was deducted.

Adam Bought a Boat from Charlie for $900 Payable on November