Rights of Third Party Beneficiaries Flashcards
1
Q
Classification of Third-Party Beneficiaries and Enforcement Rights
A
Include:
- Intended Beneficiaries (Creditor and Donee)
- Incidental Beneficiaries
2
Q
Creditor Beneficiary
A
Promisee seeks a performance from promisor to satisfy an obligation owed to a third party.
3
Q
Donee Beneficiary
A
Promisee seeks performance from promisor to make a gift of that performance to a third party.
4
Q
Who Can Intending Beneficiaries Sue?
A
Intended beneficiaries can sue the promisors who directly promised to provide the benefit, but can’t sue the promisees under the K (but they can still sue on any prior obligation (if any)
5
Q
Who Can Incidental Beneficiaries Sue?
A
No one.
6
Q
Modifying a Third-Party Beneficiary Provision
A
Is allowed unless a third-party’s rights have vested.
7
Q
Vesting of Intended Beneficiaries Rights
A
- When beneficiary brings suit
- When beneficiary changes position in justifiable reliance on the K (e.g. deciding not to continue legal proceedings)
- Beneficiary manifests assent to the K at the request of promisor or promisee
- Rights of beneficiary have vested under express K terms (when condition is satisfied)
