Question 1

Merry Music Inc. and Nayda enter into a contract for Nayda to write six songs for which Merry Music agrees to pay her. Nayda transfers her right to payment under the contract to Omni Artists Agency. In the transfer of rights, Nayda is

Accepted Answer

A)   a delegator.
B)   an assignor.
C)   an obligor.
D)   an alien. B

Question 2

Qiana has the right under a contract with Runway Retail, Inc., to buy the retailer's clothing overstock. Qiana's sale of this right to Sade's Style House is

Accepted Answer

A)   a delegation.
B)   an assignment.
C)   prohibited.
D)   a third-party beneficiary contract. B

Question 3

Julia, a world-famous chef, signs a contract to give lessons in French cooking to Kyle. Julia wants to transfer her duties under the con?tract to Leila, a short-order cook at Mom's Café. The transfer is

Accepted Answer

A)   valid because the performance required is of a nonpersonal nature.
B)   valid if Leila is a highly regarded short-order cook.
C)   not valid because performance depends on Julia's personal skills.
D)   not valid if Kyle does not hold Leila in high regard. C

Question 4

The assignment of the same contract right to two different parties automatically cancels both assignments.

Accepted Answer

A) True 
 B)False

Question 5

Fact Pattern 17-B1 (Questions B15-B18 apply)
Able Contractors, Inc., enters into a contract with Beau to repair, rebuild, and remodel Coastal Marina & Boardwalk, using products from Delta Lumber & Marine. Eatwell Café is next to Coastal Marina.
-Refer to Fact Pattern 17-B1. The value of Eatwell Café's property will increase after Coastal Marina store is refurbished. Eatwell Café is

Accepted Answer

A)   a delegatee.
B)   an assignee.
C)   an incidental beneficiary.
D)   an intended beneficiary.

Question 6

In an assignment, the party receiving the rights is the assignee.

Accepted Answer

A) True 
 B)False

Question 7

Devon and Edmond enter into a contract for the closing of a sale of Devon's recording studio. When Edmond's schedule conflicts, he asks Ferdie to perform his duties at the closing. This transfer of duties is

Accepted Answer

A)   a delegation.
B)   an assignment.
C)   prohibited.
D)   a negotiation.

Question 8

As long as a contract is personal in nature, all rights under the contract can be assigned.

Accepted Answer

A) True 
 B)False

Question 9

Fact Pattern 17-B1 (Questions B15-B18 apply)
Able Contractors, Inc., enters into a contract with Beau to repair, rebuild, and remodel Coastal Marina & Boardwalk, using products from Delta Lumber & Marine. Eatwell Café is next to Coastal Marina.
-Refer to Fact Pattern 17-B1. Delta Lumber will realize a profit from the sale of prod?ucts to Bayside to remodel Coastal Marina. Delta Lumber is

Accepted Answer

A)   a delegatee.
B)   an assignee.
C)   an incidental beneficiary.
D)   an intended beneficiary.

Question 10

Vested is the condition in which rights have taken effect and cannot be taken away.

Accepted Answer

A) True 
 B)False

Question 11

A valid delegation of duties relieves the delegator of obligations under the contract.

Accepted Answer

A) True 
 B)False

Question 12

A contract between Laser Maintenance, Inc., and Medical Vision Operation Corporation contains a clause stating that any assignment is "void." This ordinarily prohibits

Accepted Answer

A)   any assignment.
B)   no assignment.
C)   only an assignment of contract rights to personal services.
D)   only an assignment that would change the obligor's risk.

Question 13

A right can be assigned even if the assignment will significantly alter the risks or duties of the obligor.

Accepted Answer

A) True 
 B)False

Question 14

The rights of a third party bene?ficiary under a contract vest if the third party brings a lawsuit on the promise.

Accepted Answer

A) True 
 B)False

Question 15

Fact Pattern 17-B1 (Questions B15-B18 apply)
Able Contractors, Inc., enters into a contract with Beau to repair, rebuild, and remodel Coastal Marina & Boardwalk, using products from Delta Lumber & Marine. Eatwell Café is next to Coastal Marina.
-Refer to Fact Pattern 17-B1. Coastal Marina is

Accepted Answer

A)   a delegatee.
B)   an assignee.
C)   an incidental beneficiary.
D)   an intended beneficiary.

Question 16

The rights of a third party bene?ficiary under a contract vest if the third party materially changes his or her position in justifiable reliance on the promise.

Accepted Answer

A) True 
 B)False

Question 17

Laramie contracts to provide cattle-herding services to Miles for $1,400 per month. Laramie can?not transfer this duty

Accepted Answer

A)   under any circumstances.
B)   without continuing to be potentially liable.
C)   without Miles's consent.
D)   without paying Miles at least one monthly fee.

Question 18

Richly Merchandise, Inc., contracts with Stand-Rite Contractors to build a store. Stand-Rite assigns the contract to Town Builders, which has a poor record of completing projects. Richly could most successfully argue that the con?tract cannot be assigned because

Accepted Answer

A)   Richly did not consent to the assignment.
B)   Richly did not receive adequate consideration for the assignment.
C)   an assignment will significantly increase the risk of nonperformance.
D)   Town Builders was not an original party to the deal.

Question 19

Orchid and Peony enter into a contract for the sale of Orchid's textbook at the end of the fall semester for which Peony agrees to pay Orchid $75. Peony wants to transfer her right to payment for the book to Queenie. This transfer

Accepted Answer

A)   is prohibited.
B)   may be oral or written.
C)   must be implied.
D)   must be in writing.

Question 20

Motors Repair Company contracts to sell a car to Nikki for $3,500. Nikki gives Motors Repair a worth?less check for the price. Nikki assigns her right to the car to Opie. If Motors Repair refuses to deliver the car to Opie and Opie sues, can Motors Repair raise Nikki's fraud as a defense against deliv?ery of the car to Opie? Explain.

Accepted Answer

The answer of Motors Repair Company contracts to sell a...

Exam 17: Third Party Rights

Merry Music Inc. and Nayda enter into a contract for Nayda to write six songs for which Merry Music agrees to pay her. Nayda transfers her right to payment under the contract to Omni Artists Agency. In the transfer of rights, Nayda is

Qiana has the right under a contract with Runway Retail, Inc., to buy the retailer's clothing overstock. Qiana's sale of this right to Sade's Style House is

Julia, a world-famous chef, signs a contract to give lessons in French cooking to Kyle. Julia wants to transfer her duties under the con?tract to Leila, a short-order cook at Mom's Café. The transfer is

The assignment of the same contract right to two different parties automatically cancels both assignments.

In an assignment, the party receiving the rights is the assignee.

Devon and Edmond enter into a contract for the closing of a sale of Devon's recording studio. When Edmond's schedule conflicts, he asks Ferdie to perform his duties at the closing. This transfer of duties is

As long as a contract is personal in nature, all rights under the contract can be assigned.

Vested is the condition in which rights have taken effect and cannot be taken away.

A valid delegation of duties relieves the delegator of obligations under the contract.

A contract between Laser Maintenance, Inc., and Medical Vision Operation Corporation contains a clause stating that any assignment is "void." This ordinarily prohibits

A right can be assigned even if the assignment will significantly alter the risks or duties of the obligor.

The rights of a third party bene?ficiary under a contract vest if the third party brings a lawsuit on the promise.

Fact Pattern 17-B1 (Questions B15-B18 apply) Able Contractors, Inc., enters into a contract with Beau to repair, rebuild, and remodel Coastal Marina & Boardwalk, using products from Delta Lumber & Marine. Eatwell Café is next to Coastal Marina. -Refer to Fact Pattern 17-B1. Coastal Marina is

The rights of a third party bene?ficiary under a contract vest if the third party materially changes his or her position in justifiable reliance on the promise.

Laramie contracts to provide cattle-herding services to Miles for $1,400 per month. Laramie can?not transfer this duty

Richly Merchandise, Inc., contracts with Stand-Rite Contractors to build a store. Stand-Rite assigns the contract to Town Builders, which has a poor record of completing projects. Richly could most successfully argue that the con?tract cannot be assigned because

Orchid and Peony enter into a contract for the sale of Orchid's textbook at the end of the fall semester for which Peony agrees to pay Orchid $75. Peony wants to transfer her right to payment for the book to Queenie. This transfer