Third Parties Flashcards
the person to whom a promise is addressed
promisee
a person other than the promisee who will be benefitted by performance of the promise.
beneficiary
The terms “intended” beneficiary and “incidental” beneficiary are used to distinguish beneficiaries who have _______ from those who do not.
rights
Unless otherwise agreed between promisor and promisee, a beneficiary of a promise is an intended beneficiary if recognition of a right to performance in the beneficiary is appropriate to effectuate the intention of the parties and either:
the performance of the promise will satisfy an obligation of the promisee to pay money to the beneficiary; or
the circumstances indicate that the promisee intends to give the beneficiary the benefit of the promised performance.
An ________________________ is a beneficiary who is not an intended beneficiary.
incidental beneficiary
a beneficiary of a promise
where recognition of right to performance in the beneficiary is appropriate to effectuate the intent of the parties and
Either the performance of the promise will satisfy an obligation of the promisee to pay money to the beneficiary
Or the circumstances indicate that the promisee intends to give the beneficiary the benefit of the promised performance.
Intended Beneficiary
third party has an enforceable right by reason of a contract made by two others if
the promised performance will be of pecuniary benefit to the third party and
the contract is so expressed as to give a promisor reason to know that such benefit is contemplated by the promisee as one of the motivating causes of his making the contract.
Three judicial interpretations of intent requirement for 3rd Party Beneficiary.
Promisor and promisee must intend to give 3rd party rights under K
Intention of the promisee controls
Promisor must know/have reason to know of promisee’s intent to benefit 3rd part
An ___________ is an act or manifestation by the owner of a right (the assignor) indicating his intent to transfer that right to another person (the assignee)
assignment
For the assignment to be ___________________ against the assignor’s debtor (the obligor), the assignor must make clear his intent to relinquish the right to the assignee and must not retain any control over the right assigned or any power of revocation.
valid and enforceable
The assignment takes effect through the actions of the assignor and assignee and the obligor _________________ the assignment to render it valid.
need not accept
Once the obligor has notice of the assignment, the fund is from that time forward impressed with _______; it is impounded in the obligor’s hands and must be held by him not for the original creditor, the assignor, but for the substituted creditor, the assignee.
a trust
After receiving notice of the assignment, the obligor ________ ______ pay the amount assigned either to the assignor or to his other creditors.
cannot lawfully
Right
Manifestation of assignor intent to transfer right
Assignor’s right to performance is extinguished
Assignee acquires right of performance
Elements of Assignment
Can’t assign right if
Materially adverse effect on other party
Forbidden by Statute
Precluded by contract
