Week 8 Flashcards

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1
Q

Privity of contract

A

Only contracting parties are bound, never duties for 3rd party

Exemption: 3rd party rights.

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2
Q

Third Party Rights

A

A clause in a contract confers rights to a third party. (Grandma wants her money to be given to her kids after her death). Identifiable benefiaciary

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3
Q

Assignment principle

A

Assignment of rights - no consent
Transfer of obligations - consent
Assignment of contracts - consent

  • Transfer of negotiable instruments
  • Transfer of rights linked to the transfer of a business
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4
Q

Transfer of obligations

A

To transfer the obligation you need the consent of creditor

The debtor can be replaced, but who pays is important

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5
Q

Novation

A

Original contract no longer exists, fresh start

Intention to create new relationship.

If its a new contract you lose security rights

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