Rights and Duties of Third Parties

Question 1

Third Party Beneficiary

Answer 1

INTENDED TPBs have contractual rights when:

1. identified in the contract
2. receives performance directly from promisor OR
3. has some relationship with the promisee to indicate intent to benefit

CREDITOR VERSUS DONEE BENEFICIARY

1. Creditor: a person to whom a debt is owed by the promisee and
2. Donee: a person whom the promisee intends to benefit gratuitously

Question 2

When do the rights of a TPB vest?

Answer 2

1. Manifest assent to a promise
2. Bring suit to enforce or
3. Materially change position in justifiable reliance on the promise

Question 3

Assignment

Answer 3

In the typical assignment situation, the obligor contracts with the asignor, who assigns his right to the obligor’s performance to the asignee

Question 4

Delegation

Answer 4

Promising to perform on behalf of another