Term
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Definition
Non-parties to a contract may have rights or duties under contract.
Example: A contracts with B that B will render a service for C |
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Term
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Definition
Has contractual rights (Incidental beneficiaries do not)
1. Identified in contract
2. Receives performance directly
3. Has some relationship with the promisee |
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Term
| Creditor vs. Donee Beneficiary |
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Definition
Creditor: a person to whom a debt is owed by the promisee
Donee: a person whom the proimsee intends to benefit gratuitously. |
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Term
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Definition
1. Manifests assent to promise
2. Brings suit to enforce promise
3. Materially changes position in reliance
Before vesting, contracting parties are free to modify contract |
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Term
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Definition
Third party beneficiary can sue promisor. Promisor can raise any defense promisor has against promisee.
Only a creditor beneficiary can sue a promisee.
A donee has no right to sue unless detrimental reliance.
A promisee may sue the promisor. |
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Term
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Definition
Contractual rights.
Exceptions:
1. An assignment that would substantially change the obligor's duty of risk
2. an assignment of future rights from future contracts
3. an assignment prohibited by law |
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Term
| Express Contractual Provision Against Assignment |
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Definition
A clause prohibiting assignment of the contract will be CONSTRUED as barring only delegation of the assignor's duties.
However, if contract provides that attempts to assign will be void, parties can bar assignments. |
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Term
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Definition
| Effect of assignment is to establish privity of contract between the obligor and the assignee wile extinguishing privity between the obligor and the assignor. |
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Term
| Essentials for Assignment |
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Definition
No writing required
No consideration required |
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Term
| Gratuitous assignment: revocation |
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Definition
A gratuitous assignment is generally revokable.
Exceptions: (1) obligor already performed; (2) a token chose is delivered; (3) an assignment of a chose; or (4) revokable. |
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Term
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Definition
Assignee can sue the obligor
Assignee is the real party in interest |
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Term
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Definition
Assignment = warranty that:
1. assignor has not made a prior assignment
2. right exists and is not subject to any undisclosed defenses
3. he will do nothing to interfere with right |
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Term
| Issue of Successive Assignments |
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Definition
Revocable, THEN subsequent assignment revokes it
Irrevocable, first assignment will prevail
Exception if: second assignee paid value and gets judgment, first payment, delivery of chose, estoppel, etc. |
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Term
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Definition
Generally, all duties may be delegated.
Exceptions:
1. duties involving personal judgment or skill
2. delegation would change the obligee's expectancy
3. a special trust
4. Contractual restriction |
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Term
| Delegation: Rights and Liabilities |
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Definition
Obligee must accept performance from the delgate of all duties.
Delegator remains liable on the contract and obligee can sue delegator for nonperformance
Delegate is obligated to perform ONLY IF assumed duties (promise + consideration)
This creates a third party beneficiary |
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