Exam 16: Third Party Rights

The assignment of the same contract right to two different parties results in their "splitting the difference."

Basil, a world-famous chef, signs a contract to give lessons in French cooking to Marge. Basil wants to transfer his duties under the con?tract to Harv, the operator of a hot dog concession. The transfer is

A and B enter into a contract for the distribution of A''s produce to local restaurants and wineries for which A agrees to pay B. B transfers his right to payment under the contract to C Bank. This transfer is

A life insurance contract is a third party benefi?ciary contract involving a donee beneficiary.

An intended beneficiary is entitled to enforce the promise of a promisor.

The rights under a contract for personal service normally can be assigned.

Floyd and Gert enter into a contract by which Floyd promises to deliver fer?tilizer to Gert. Floyd subsequently transfers this duty to Hiram. Floyd is

Dwayne and Ewell enter into a contract for the design of an addition to Dwayne's house for which he agrees to pay Ewell. Ewell transfers his right to payment under the contract to Flex Construction Company. Flex is

Vicky contracts with Warren for the delivery of hospice services to benefit Xavier. This is

An assignment of a negotiable instrument is generally prohibited.

Alienation is a transfer of contract rights between citizens of different nations.

A transfer of contract rights to a third party is an assignment.

Frank and Green Agri-Ship, Inc., enter into a contract for Green to transport a silo of soybeans for which Frank agrees to pay Green. When Green's schedule conflicts, Green contacts Hybrid Crop Transport Company, to which Green "assigns all rights under the contract." This transfer is

Fix-It Auto Company contracts to sell a car to Garth for $3,500. Garth gives Fix-It a worth?less check for the price. Garth assigns his right to the car to Herb. If Fix-It refuses to deliver the car to Herb and Herb sues, can Fix-It raise Garth's fraud as a defense against deliv?ery of the car to Herb? Explain.

An unconditional assignment of rights in a contract will extinguish the rights of the as?signor.

Pam borrows $5,000 from Quality Auto Sales to buy a car. When Pam does not pay the loan or return the car, Quality wants to transfers the right to the payment to Rapid Collection Agency. Rapid agrees to pay Quality for this right, but for a price that is less than the amount owed. Can Quality transfer this right to Rapid without Pam's consent? If so, and Quality committed fraud in the deal with Pam, could Pam legiti?mately refuse to pay Rapid? Explain.

Ron makes a contract with Stu that indirectly benefits Tim, although nei?ther Ron nor Stu intended that result. Tim is

If a contract benefits a third party incidentally, the third party has the power to enforce the contract.

Owen and Paula enter into a contract under which Owen agrees to cater Paula's wedding in exchange for a cash down payment, a postdated check, and a possible interest in an apartment. The contract expressly prohibits any transfer of rights. The rights may be transferred if the transfer involves

Jen is a third party beneficiary under a contract between Kyla and Leo. Kyla and Leo can modify or rescind their contract without Jen's consent