BLAW final

Question 1

What is privity of contract?

Answer 1

Pretty much says that only the parties on the contract can do the obligations and benefits and third parties have no right to the contract

Question 2

what is an assignment? what effect does it have?

Answer 2

the transfer of contract RIGHTS to a 3rd party. the the assignee (3rd party) has the right to to demand performance from the performing party

Question 3

Bank A sends loan money to the student. Bank A then assigns the right to get the loans to Bank B. Student pays Bank B. Who is the assignee? Who is the assignor?

Answer 3

Bank A is the assignor, Bank B is the assignee.

Question 4

What 4 rights cannot be assigned?

Answer 4

1. statute expressly prohibits assignment
2. contract is for personal services
3. assignment will change risks or duties of performing party
4. the contract itself prohibits assignments

Question 5

what is a delegation?

Answer 5

a party transfering duties to a third party

Question 6

does the assignee need to give notice to the assignor?

Answer 6

no

Question 7

does delegator still owe duty the originial party?

Answer 7

yes

Question 8

Customer pays Airline A to fly. Airline A gives airline B the duty to fly. Who is delegator? Who is delegatee?

Answer 8

delegator is Airline A, delegatee is Airline B

Question 9

What are 4 duties that cannot be delegated?

Answer 9

1. when performance depends on personal skills of the delegator
2. when special trust has been placed in the obligor
3. when 3rd party performance will vary
4. when the contract prohibits delegation

Question 10

What is an intended beneficiary? can they sue?

Answer 10

a 3rd party whose performance is rendered directly, has right to control details of performance, or a designated beneficary. They can sue to enforce the contract

Question 11

what is an incidental beneficiary? can they sue?

Answer 11

a third party who benefits from the contract but has no rights in the contract. They cannot sue

Question 12

what is a promisor?

Answer 12

the person in charge of satisfying the third party in a bilateral contract

Question 13

when do third party beneficiary rights take into effect for intended ones? what about incidental ones?

Answer 13

1. third parties express content
2. third party alters their position
3. when conditions are satisified
   they can sue

for incidental, they have no rights and can’t sue

Question 14

how to determine if someone is intended or incidental beneficiary:

also, what 1 of 3 things are needed to be intended:

Answer 14

reasonable person test: would a reasonable person think that the promisee intended the third party the right to enforce the contract?

1. performance is rendered directly
2. third party has rights to control details
3. third party is expressly designated

Question 15

what is contractual performance?

Answer 15

when performance occurs and the contract is fulfilled

Question 16

what are 5 ways a contract ends?

Answer 16

1. full performance
2. a condition occurring or not occurring
3. breach
4. operation of law
5. agreement of the parties

Question 17

what are conditions of performance?

Answer 17

a condition is a possible future event that triggers
1. the performance of the contract
2. terminates an obligation under the contract

Question 18

what happens if the conditions of a performance are not satisifed?

Answer 18

the contract is discharged

Question 19

what are 3 types of conditions?

Answer 19

1. condition precedent - a condition that must occur or not occur before performance
2. conditions subsequent - a condition that must occur or not occur after performance
3. conditions concurrent - each party must render performance simultaneously

Question 20

what is discharge by performance?

Answer 20

when a contract ends because it was performed

Question 21

what are 3 types of performance?

Answer 21

1. complete
2. substantial (minor breach)
3. performance of satisfaction to one party

Question 22

what remedy do a non-breaching party have to substantial performance?

Answer 22

damages compensation

Question 23

what is required for substantial performance?

Answer 23

good faith

Question 24

what is performance to the satisfaction of another?

Answer 24

contract is discharged when one or third party is satisfied

Question 25

what is inferior performance?

Answer 25

material breach when contract does inferior performance

Question 26

what does non-breaching party have remedies to for a inferior perofrmance?

Answer 26

sue for damages

Question 27

what is an anticapatory breach of contract?

Answer 27

occurs when a party tells another party they will not perform duties

Question 28

how is non anticipatory breach of contract handled?

Answer 28

party can sue for damages

Question 29

what is discharge by agreement?

Answer 29

a contract ends by way contract says or the creation of a new contract that ends the old one.

Question 30

what are 3 types of discharge by agreement?

Answer 30

1. discharge by recission - cancellation of og contract
2. discharge by novation - substition of one of the og parties
3. discharge by accord and satisfaction - accept that performance will be different than og performance

Question 31

what are 6 types of discharge by operation of law?

Answer 31

1. material contract alteration - innocent party discharged when guilty party wrote in part of contract without consent
2. statute of limitations - no lawsuit for contract breach after limitation period has passed
3. bankruptcy - creditor gets assets
4. performance is impossible
5. commercial impractibility - performance becomes more difficult or expensive
6. frustration of purpose - impossible to obtain purpose both parties had in mind

Question 32

what are contract damages?

Answer 32

relief provided to the non-breaching party for losses caused by breaching party

Question 33

what is the most common remedy for breach of contract?

Answer 33

monetary damages

Question 34

what are 4 types of money damages?

Answer 34

1. compensatory (to cover direct costs and losses)
2. consequential (to cover indirect and foreseeable losses)
3. punitive (to punish wrongdoings)
4. nominal (to recognize wrongdoing when no monetary loss is shown)

Question 35

what is the standard measurement for compensatory damages?

Answer 35

difference between promised value and value of performance

Question 36

if non-breaching contract has no losses, are they entitled to compensatory damages?

Answer 36

no

Question 37

what is buyer’s standard of measurement?

Answer 37

difference between contract price and market price when good was delivered

Question 38

what is seller’s standard measurement?

Answer 38

seller’s loss profit on sale of goods, is applicable only when buyer breaches before seller produces goods

Question 39

what are compensatory damages for construction contracts if owner breaches
1. before contract began
2. during contract
3. after contract

Answer 39

1. profits that would have been made
2. profits + costs incurred
3. entire contract + interest

Question 40

what are compensatory damages for construction contracts if contractor breaches
1. before construction began
2. before completion of instruction

Answer 40

1. cost in excess + price to complete work
2. all of owner’s cost to complete project

Question 41

what are consequential damages?

Answer 41

indirect and foreseeable losses caused by special circumstances beyond the contract