F. TP Contracts

Question 1

What is required for enforcing a contract as TP beneficiary?*

Answer 1

1) Valid contract between Parties (NOT TP)
2) Contract was intended for its benefit

3) Benefit was direct
- NOT incidental

Question 2

When is a party an ‘intended’ Beneficiary?

Answer 2

1) Recognition of Beneficiary’s right to performance must be appropriate to effectuate parties’ intention

2) Either;
- Promisee’s promised performance will satisfy Promisee’s obligation to pay Beneficiary
- Promisee intends to give benefit of promised performance to Beneficiary

Question 3

When is TP an intended beneficiary?*

Answer 3

Benefit must be;

1) Sufficiently immediate (NOT incidental)
2) To indicate assumption by contracting parties of duty to compensate TP (if benefit is lost)

(Intention to benefit must be derived from the contract ‘as a whole’)
- If performance is rendered directly to TP => TP presumed to be intended beneficiary