Question 1

Kellie owes a duty to Grant and Kellie delegates the duty to Hank.Hank:

Accepted Answer

A) is not obligated to either Kellie or Grant to perform the duty unless Hank agrees to do so. 
B) becomes liable for nonperformance to both Kellie and Grant only if Hank promises both Kellie and Grant that he will perform Kellie's duty. 
C) cannot create contractual rights in Grant. 
D) All of the above. 
A) is not obligated to either Kellie or Grant to perform the duty unless Hank agrees to do so. 
B) becomes liable for nonperformance to both Kellie and Grant only if Hank promises both Kellie and Grant that he will perform Kellie's duty. 
C) cannot create contractual rights in Grant. 
D) All of the above. A

Question 2

Sandra purchases a life insurance policy naming her husband as beneficiary.His rights as a donee beneficiary vest at the time she purchases the policy,even though the policy permits her to cancel the policy or change beneficiaries.

Accepted Answer

A) True 
 B)False  False

Question 3

The student government of State University has a contract with a famous rock band to perform at the university on homecoming weekend.The band cannot assign its rights and delegate its duties under this contract.

Accepted Answer

A) True 
 B)False  True

Question 4

Carl,a contractor,and Lyle,a landowner,have a contract whereby Carl is to perform routine construction services according to the blueprints that Lyle has provided.Carl assigns the contract to David,a developer.As a result of this assignment:

Accepted Answer

A) Lyle can bring suit based upon detrimental reliance. 
B) Carl has no more rights or responsibilities with regard to the contract. 
C) Carl no longer has any rights under the contract, but he remains responsible for the duties he agreed to perform. 
D) Carl has all of his rights under the contract, but he has no responsibility for the performance of the duties. 
A) Lyle can bring suit based upon detrimental reliance. 
B) Carl has no more rights or responsibilities with regard to the contract. 
C) Carl no longer has any rights under the contract, but he remains responsible for the duties he agreed to perform. 
D) Carl has all of his rights under the contract, but he has no responsibility for the performance of the duties.

Question 5

Theresa has a contract to teach eighth grade at Washington Middle School.She decided she could make more money writing a book,so she wants to assign her teaching contract to her friend,Stephanie,who is also a licensed teacher.

Accepted Answer

A) If effective, this would be both an assignment and a delegation. 
B) The duties which Theresa wants to delegate are personal in nature. 
C) If the school district agrees to accept Stephanie's services, a novation would occur, which would relieve Theresa of her obligation to the school district. 
D) All of the above are correct. 
A) If effective, this would be both an assignment and a delegation. 
B) The duties which Theresa wants to delegate are personal in nature. 
C) If the school district agrees to accept Stephanie's services, a novation would occur, which would relieve Theresa of her obligation to the school district. 
D) All of the above are correct.

Question 6

A contract in which a party (the promisor)promises to render a certain performance not to the other party (the promisee)but to a third person (the beneficiary)is called a third-party beneficiary contract.

Accepted Answer

A) True 
 B)False

Question 7

Harold hired Blake Painters to paint his house.Blake decides he has too many jobs and delegates the duties to the Andrews Company.If Andrews does a poor job,and drips paint on Harold's flowers and windows,Harold:

Accepted Answer

A) can sue both Blake and Andrews. 
B) can sue Blake, but he cannot sue Andrews. 
C) can sue Andrews, but he cannot sue Blake. 
D) cannot sue, because he has accepted the benefits of the assignment. 
A) can sue both Blake and Andrews. 
B) can sue Blake, but he cannot sue Andrews. 
C) can sue Andrews, but he cannot sue Blake. 
D) cannot sue, because he has accepted the benefits of the assignment.

Question 8

Mary goes to her stockbroker,purchases 30 shares of P & G stock,and instructs the broker to register the stock in her husband Warren's name.If this stock is intended as a Valentine's gift,Warren becomes:

Accepted Answer

A) a donee beneficiary. 
B) a transferee. 
C) a delegatee. 
D) an assignee. 
A) a donee beneficiary. 
B) a transferee. 
C) a delegatee. 
D) an assignee.

Question 9

When the assignee gives consideration in exchange for an assignment,there is a contract between the assignor and the assignee that prevents the assignor from revoking the assignment without the assent of the assignee.

Accepted Answer

A) True 
 B)False

Question 10

Consideration must be received for an assignment to be effective.

Accepted Answer

A) True 
 B)False

Question 11

Assignment of rights is the voluntary transfer to a third party of the rights arising from a contract.

Accepted Answer

A) True 
 B)False

Question 12

A gratuitous assignment is revocable even after the assignor has made an effective delivery of the assignment to the assignee.

Accepted Answer

A) True 
 B)False

Question 13

Which one of the following assignments would probably be prohibited by a court?

Accepted Answer

A) Mary is in debt. A credit card company calls and threatens to sue. Mary orally assigns her next bimonthly paycheck to her creditor. 
B) John is a house painter. He is scheduled to paint Molly's home on Monday. John wakes up Monday morning with a stiff neck. He calls Ed, who is also a painter, to begin the job at Molly's. 
C) Ron has a contract with Bonett Bank to service their coffee machines. He assigns the remainder of his contract with Bonett to Michelle, who also owns a coffee service. 
D) All of the above. 
A) Mary is in debt. A credit card company calls and threatens to sue. Mary orally assigns her next bimonthly paycheck to her creditor. 
B) John is a house painter. He is scheduled to paint Molly's home on Monday. John wakes up Monday morning with a stiff neck. He calls Ed, who is also a painter, to begin the job at Molly's. 
C) Ron has a contract with Bonett Bank to service their coffee machines. He assigns the remainder of his contract with Bonett to Michelle, who also owns a coffee service. 
D) All of the above.

Question 14

Darrell owns a parcel of land that is encumbered by a mortgage held by the First National Bank.Darrell agrees to sell the land to Paul for $50,000.Darrell and Paul together go to the First National Bank to discuss the sale and purchase with the banker.Darrell,Paul,and the banker sign an agreement stating that Paul will assume the mortgage and that Darrell will be discharged from all further liability on the mortgage.In this case:

Accepted Answer

A) the bank is a third party donee beneficiary. 
B) the bank can collect from Darrell if Paul defaults. 
C) Darrell is a third party beneficiary of the agreement between Paul and the bank. 
D) the agreement among the three is a novation. 
A) the bank is a third party donee beneficiary. 
B) the bank can collect from Darrell if Paul defaults. 
C) Darrell is a third party beneficiary of the agreement between Paul and the bank. 
D) the agreement among the three is a novation.

Question 15

A(n)__________ is a third party who obtains possible benefits but no rights under a contract.

Accepted Answer

A) incidental beneficiary 
B) intended beneficiary 
C) assignor 
D) donee beneficiary 
A) incidental beneficiary 
B) intended beneficiary 
C) assignor 
D) donee beneficiary

Question 16

The privilege to play tennis and socialize at the Capital City Country Club (CCCC)is obtained through application,references,resumes,and fees.Steven and Chanel want to assign the remaining 4 years of their 5-year membership to Charles and Prissy so that Steven and Chanel may join the posh Silver Hawk Tennis and Polo Club.CCCC sues to enjoin Steven and Chanel from assigning their membership.CCCC will most probably:

Accepted Answer

A) not prevail because all contract rights are assignable. 
B) prevail because the parties intended the contract to be personal and non-assignable. 
C) prevail because assigning the membership contract would violate public policy. 
D) None of the above. 
A) not prevail because all contract rights are assignable. 
B) prevail because the parties intended the contract to be personal and non-assignable. 
C) prevail because assigning the membership contract would violate public policy. 
D) None of the above.

Question 17

The State Opera Company has a contract with a famous tenor to perform in its production of La Boheme.If the tenor chooses,he may delegate his duties under the contract to an equally well-known tenor.

Accepted Answer

A) True 
 B)False

Question 18

The court in Public Service Commission of Maryland v.Panda-Brandywine,L.P.:

Accepted Answer

A) held that there is no legal distinction between the transfer of contractual rights and duties. 
B) found the issue was whether an assignment or delegation could be made in this case. 
C) found that the provisions in the Asset Purchase and Sale Agreement did not constitute an assignment or transfer within the meaning of the parties' agreement. 
D) held that there was an assignment of rights and delegation of duties in contravention of the parties' agreement and the transfer was therefore invalid and unenforceable. 
A) held that there is no legal distinction between the transfer of contractual rights and duties. 
B) found the issue was whether an assignment or delegation could be made in this case. 
C) found that the provisions in the Asset Purchase and Sale Agreement did not constitute an assignment or transfer within the meaning of the parties' agreement. 
D) held that there was an assignment of rights and delegation of duties in contravention of the parties' agreement and the transfer was therefore invalid and unenforceable.

Question 19

List the implied warranties imposed by law on an assignor who has received value for the assignment.

Accepted Answer

The following are the implied warranties

Question 20

Stark enters into a contract with a contractor to build a large shopping mall in River City.Donner will greatly benefit from this contract since his convenience store is adjacent to the mall.Donner in this instance is:

Accepted Answer

A) an implied beneficiary. 
B) a partial beneficiary. 
C) a donee beneficiary. 
D) an incidental beneficiary. 
A) an implied beneficiary. 
B) a partial beneficiary. 
C) a donee beneficiary. 
D) an incidental beneficiary.

Exam 16: Third Parties to Contracts

Kellie owes a duty to Grant and Kellie delegates the duty to Hank.Hank:

Sandra purchases a life insurance policy naming her husband as beneficiary.His rights as a donee beneficiary vest at the time she purchases the policy,even though the policy permits her to cancel the policy or change beneficiaries.

The student government of State University has a contract with a famous rock band to perform at the university on homecoming weekend.The band cannot assign its rights and delegate its duties under this contract.

Carl,a contractor,and Lyle,a landowner,have a contract whereby Carl is to perform routine construction services according to the blueprints that Lyle has provided.Carl assigns the contract to David,a developer.As a result of this assignment:

Theresa has a contract to teach eighth grade at Washington Middle School.She decided she could make more money writing a book,so she wants to assign her teaching contract to her friend,Stephanie,who is also a licensed teacher.

A contract in which a party (the promisor)promises to render a certain performance not to the other party (the promisee)but to a third person (the beneficiary)is called a third-party beneficiary contract.

Harold hired Blake Painters to paint his house.Blake decides he has too many jobs and delegates the duties to the Andrews Company.If Andrews does a poor job,and drips paint on Harold's flowers and windows,Harold:

Mary goes to her stockbroker,purchases 30 shares of P & G stock,and instructs the broker to register the stock in her husband Warren's name.If this stock is intended as a Valentine's gift,Warren becomes:

When the assignee gives consideration in exchange for an assignment,there is a contract between the assignor and the assignee that prevents the assignor from revoking the assignment without the assent of the assignee.

Consideration must be received for an assignment to be effective.

Assignment of rights is the voluntary transfer to a third party of the rights arising from a contract.

A gratuitous assignment is revocable even after the assignor has made an effective delivery of the assignment to the assignee.

Which one of the following assignments would probably be prohibited by a court?

A(n)__________ is a third party who obtains possible benefits but no rights under a contract.

The State Opera Company has a contract with a famous tenor to perform in its production of La Boheme.If the tenor chooses,he may delegate his duties under the contract to an equally well-known tenor.

The court in Public Service Commission of Maryland v.Panda-Brandywine,L.P.:

List the implied warranties imposed by law on an assignor who has received value for the assignment.

Stark enters into a contract with a contractor to build a large shopping mall in River City.Donner will greatly benefit from this contract since his convenience store is adjacent to the mall.Donner in this instance is:

Introduction to Law

Business Ethics

Civil Dispute Resolution

Constitutional Law

Administrative Law

Criminal Law

Intentional Torts

Negligence and Strict Liability

Introduction to Contracts

Mutual Assent

Conduct Invalidating Assent

Consideration

Illegal Bargains

Contractual Capacity

Contracts in Writing

Performance, Breach, and Discharge

Contract Remedies

Introduction to Sales and Leases

Performance

Transfer of Title and Risk of Loss

Product Liability: Warranties and Strict Liability

Sales Remedies

Form and Content

Transfer and Holder in Due Course

Liability of Parties

Bank Deposits, Collections, and Funds Transfers

Relationship of Principal and Agent

Relationship With Third Parties

Formation and Internal Relations of General Partnerships

Operation and Dissolution of General Partnerships

Limited Partnerships and Limited Liability Companies

Nature and Formation of Corporations

Financial Structure of Corporations

Management Structure of Corporations

Fundamental Changes of Corporations

Secured Transactions and Suretyship

Bankruptcy

Securities Regulation

Intellectual Property

Employment Law

Antitrust

Accountants Legal Liability

Consumer Protection

Environmental Law

International Business Law

Introduction to Property, property Insurance, Bailments, and Documents of Title

Interests in Real Property

Transfer and Control of Real Property

Trusts and Wills

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