Chpater 16 Flashcards Preview

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Flashcards in Chpater 16 Deck (10):

What is a "third party beneficiary"?

someone who was not a party to the contract but stands to benefit from it


Distinguish an "intended beneficiary" from an "incidental beneficiary".

intended= someone who may enforce a contract made between two other parties
incidental= someone who might have benefited from a contract between two others but has no right to enforce that agreement


Which type type can enforce a contract which benefits them even if they are not a party to the contract?

Intended beneficiary


What is a party allowed to assign under a contract?

a delegation of duties. a party may make an assignment and delegation simultaneously, transferring both rights and duties to a third party.
Any contractual agreement may be assigned unless assignment:
a) would substantially change the obligor's rights or duties under the contract
b) is forbidden by law or public policy
c) is validly precluded by the contract itself


What may a party seek to delegate under a contract?

Most duties are delegable. But delegation does not by itself relieve the delegator of his own liability to perform the contract
As long as the delegation of duties are not:
- violating public policy
- the contract prohibits delegation
- the obligee has a substantial interest in personal performance by the obligor


Does delegation relieve the delegating party of his.her liability/obligations under the original contract? Why?

No, -- unless the obligee agrees otherwise, delegation does not discharge the delegator's duty to perform


May a non- delegating party successfully object to delegation of a specific duty? When?

repudiated= he has formally notified the other side he will not perform his side of the contract


What is an assignment?

the transfer of the assignor's contract rights to the assignee


What is a delegation?

transfers the delegator's duties to the delegatee


What is a novation?

a three-way agreement in which the obligor transfers all rights and duties to a third party. The obligee agrees to look only to that third party for performance.