Chapter 16- Third Parties

Question 0

Two types of third-party beneficiaries

Answer 0

Donee Beneficiaries: Named as a gift, cannot sue the gift giver, only the party that fails to preform.
Creditor Beneficiaries: The promisee intends the performance of the promise to satisfy a legal duty owed to the beneficiary, who is a creditor of the promisee. Can sue either party or both.

Question 1

Third Party Beneficiaries:

Answer 1

The contract itself when it is made, promises that performance will be rendered to a third-party. Only intended beneficiaries get rights under a contract: incidental beneficiary do not!

Question 2

Rights:

Answer 2

things that are to be received

Question 3

Duties

Answer 3

Things that must be done

Question 4

Assignment

Answer 4

transfer of right to receive something

Question 5

delegation

Answer 5

transfer of a duty to do something

Question 6

Assignments…

Answer 6

a transfer of a right to receive something under a contract

• not always money
• Assignor is transferring the right to receive to the asignee
• obligor no longer has to preform for the asignor, but the asignee.
• result of a valid assignment assignee takes place of assignor.

Question 7

What is Assignable?

Answer 7

All rights EXCEPT:

1) Transfer that increases the burden of performance to obligor.
2) Transfer of Personal Rights
3) Transfer Prohibited by Law.

Question 8

Delegations

Answer 8

A transfer of duties to do something under a contract.

RULE OF LAW: and a delegation, the delegator and the delagatee are liable for performance unless there is a novation

Question 9

Novation

Answer 9

An agreement to substitute performance, not mere notice, making only delagatee liable for performance.

Question 10

Delegable Duties Exceptions

Answer 10

1) the nature of the duties is personal in that the obligee has a substantial interest in having the delegator perform the contract
2) the performance is expressly made nondelegable
3) the delegation is prohibited by statue.