K: Assignments; Third Party Beneficiaries

Question 1

Vesting rule for 3rd party beneficiaries: (3 actions)

creditor AND donee

Answer 1

(i) Manifests assent to the promise in a manner invited or requested by the parties;
(ii) Brings suit to enforce the promise; or
(iii) Materially changes position in justifiable reliance on the promise.

Question 2

UCC: Four situations where the bona fide purchaser for value cuts off the rights of the true owner:

Answer 2

(i) The seller was deceived as to the identity of the buyer;
(ii) The delivery was in exchange for a check later dishonored;
(iii) The sale was a “cash sale”; or
(iv) The fraudulent conduct of the buyer is punishable as larceny.

Question 3

n every assignment for value, the assignor impliedly warrants 3 things:

Answer 3

(i) He has the right to make the assignment; i.e., the assignor has made no prior assignment of the right;
(ii) The right exists and is not subject to limitations or defenses other than those stated or apparent at the time of the assignment; and
(iii) He will do nothing to defeat or impair the assigned right; e.g., he will not attempt a subsequent assignment.

Question 4

4 situations where an assignment must be in writing:

Answer 4

a) Wage assignments;
b) Assignments of an interest in land;
c) Assignments of choses in action worth more than $5,000; and
d) Assignments intended as security interests under Article 9 of the U.C.C.

Question 5

For an effective assignment generally a writing is:

Answer 5

not required.

see 4 exceptions

Question 6

Obligee

Answer 6

The obligee must accept performance from the delegate of all duties that may be delegated.

Question 7

Delegator

Answer 7

will remain liable on his contract, even if the delegate expressly assumes the duties. However, as between the delegator and the delegate, the delegation places the primary responsibility to perform on the delegate. The delegator becomes secondarily liable, as a surety, for performance of the duty. Note that if an obligee expressly consents to the transfer of duties, it could be construed as an offer of novation (see below) rather than a delegation.

Question 8

Assumption:

Answer 8

occurs when the delegate promises that she will perform the duty delegated and the promise is supported by consideration or its equivalent.

Question 9

An assignment is for value if it is:

Answer 9

(i) done for consideration or

(ii) taken as security for or a payment of a preexisting debt.

Question 10

As a general rule, if a promisor fails to perform under a contract, a donee third-party beneficiary whose rights have vested can sue:

Answer 10

the promisor to enforce the contract.