3rd party

Question 1

3rd party beneficiary: definition

Answer 1

1) not a party to the contract

2) able to enforce the contract others made for her benefit

Question 2

Promisor: definition

Answer 2

person making the promise that benefits the third party

Question 3

Promisee: definition

Answer 3

person who obtains the promise that benefits the third party

Question 4

Intended v. Incidental beneficiary

Answer 4

only an intended beneficiary has contract rights

Question 5

When a 3rd party’s rights vest

Answer 5

1) knows of and has relied on the contract

2) has assented as requested

Question 6

Beneficiary v. promisor

Answer 6

may sue directly once rights have vested

Question 7

Promisee v. promisor

Answer 7

may sue directly

Question 8

Donee beneficiary v. promisee

Answer 8

cannot sue

Question 9

Creditor beneficiary v. promisee

Answer 9

can sue on preexisting debt

Question 10

Assignment: definition

Answer 10

transfer of rights under a contract in 2 steps

1) contract between only 2 parties
2) one of the parties later transfers rights under that contract to a 3rd party

Question 11

assignor: definition

Answer 11

party to the contract who later transfers rights to another

Question 12

assignee: definition

Answer 12

not a party to the contract but able to enforce the contract because of the assignment

Question 13

obligor: definition

Answer 13

other party to the contract whose rights were not assigned

Question 14

Prohibition of assignment in K

Answer 14

1) means the assignor breached

2) but assignee can still enforce if didn’t know of the prohibition

Question 15

Invalidation of assignment in K

Answer 15

1) takes away the right and power to assign
2) breach by the assignor
3) no rights in the assignee

Question 16

CL rights to assign

Answer 16

may not assign if substantially changes the duties of the obligor

Question 17

Assignee v. obligor

Answer 17

1) assignee can sue obligor

2) BUT if obligor paid assignor b/c didn’t know of the assignment duties fulfilled until knows of assignment

Question 18

Multiple assignments: gratuitous

Answer 18

last assignee wins

Question 19

Multiple assignments: for consideration

Answer 19

1) first assignee for consideration wins UNLESS
2) subsequent assignee does not know of the earlier assignment and is the first to obtain payment, novation, judgment, or indicia of ownership

Question 20

Multiple assignments: for consideration and as breach of warranty

Answer 20

assignor makes a warranty to assignee when consideration is paid that the rights assigned are assignable and enforceable

Question 21

Delegation: definition

Answer 21

party to a contract transferring work under the contract to a 3rd party

Question 22

Delegation Permitted unless

Answer 22

1) contract prohibits delegations or prohibits assignments
2) contract calls for VERY SPECIAL skills
3) person to perform contract has a VERY SPECIAL reputation

Question 23

Liability for delegating party

Answer 23

always remains liable

Question 24

Liability for delegatee

Answer 24

liable only if receives consideration from delegating party