Question 1

A party to a contract who transfers his or her duty to perform to a third party who is not part of the original contract is called a[n] _____.

Accepted Answer

A)   Delegatee
B)   Delegator
C)   Assignor
D)   Assignee
E)   TransferorF) B) and C)
G) C) and E)

Question 2

What is the term for the third party who receives an assignment of contract rights?

Accepted Answer

A)   Transferor
B)   Transferee
C)   Relator
D)   Assignor
E)   AssigneeF) A) and E)
G) C) and D)

Question 3

A[n] ______ is created when two parties enter into a contract with the intended end purpose of benefiting a third party.

Accepted Answer

A)   Third-party beneficiary
B)   Second-party beneficiary
C)   First-party beneficiary
D)   Assignment
E)   Creditor BeneficiaryF) A) and B)
G) A) and D)

Question 4

Which of the following is an exception to the general rule that rights to a contract cannot be assigned when a contract is personal in nature?

Accepted Answer

A)   When the only part of a contract left to be fulfilled is the payment.
B)   When nothing has been done on the contract at all.
C)   When no more than half the contractual duties have been performed.
D)   When no more than three-fourths of the contractual duties have been performed.
E)   There is no exception because rights to a contract that is personal in nature may generally be assigned.F) B) and D)
G) A) and B)

Question 5

What would be the likely result of a lawsuit brought by Richard against Jan to recover the $800?

Accepted Answer

A)   Richard will win because Jan accepted the risk that the contract would be assigned.
B)   Richard will win only so long as Billy has not been declared bankrupt because Jan will be able to recover the amounts at issue from Billy.
C)   Richard will win only so long as the assignment was for an amount under $1,000.
D)   Jan will win because she had no notice that the contract had been assigned and could, therefore, legally pay Billy.
E)   Jan will win only so long as the assignment was for an amount over $500.F) B) and C)
G) A) and D)

Question 6

What would be the most likely result if Fred sues Michelle for the $10,000 payment?

Accepted Answer

A)   Fred will win only if Fred did a good job on the portraits.
B)   Fred will lose because Michelle's only obligation is to pay Belinda.
C)   Fred will win unless Michelle can prove that Fred knew that she did not want him to do the portraits.
D)   Fred will lose unless Fred can prove that he was unaware that Michelle did not want him to do the portraits.
E)   Michelle will win because the portrait was personal in nature and could not be assigned.F) A) and B)
G) B) and E)

Question 7

Which of the following is the likely result if Sam sues Betty for the $40 that Trudy owes him for the book?

Accepted Answer

A)   Sam will lose because the attempted delegation was against public policy.
B)   Sam will lose because his only right of action is against Trudy.
C)   Sam will lose because he was not aware of the assignment before the duties were completed.
D)   Sam will win only if he can prove that Trudy has insufficient funds with which to pay him.
E)   Sam will win.F) C) and E)
G) D) and E)

Question 8

What type of third-party beneficiary is Sally?

Accepted Answer

A)   Intended and donee
B)   Creditor and incidental
C)   Intended and creditor
D)   Donee and incidental
E)   Creditor and doneeF) B) and E)
G) B) and D)

Question 9

A[n] ______ beneficiary is a third party who benefits from a contract in which the promisor agrees to give a gift to the third party.

Accepted Answer

A)   Creditor
B)   Donee
C)   Incidental
D)   Promised
E)   AvowedF) A) and B)
G) A) and C)

Question 10

A third party,who is not part of an original contract,but to whom duty to perform contained in the original contract is transferred is called a[n] _____.

Accepted Answer

A)   Delegatee
B)   Delegator
C)   Assignor
D)   Assignee
E)   TransferorF) D) and E)
G) C) and D)

Question 11

A donee beneficiary is a third party that benefits from a contract in which the promisor agrees to pay the promisee's debt in return for compensation plus interest.

Accepted Answer

A) True 
 B)False

Question 12

A[n] ______ beneficiary is a third party who benefits from a contract in which the promisor agrees to pay the promisee's debt.

Accepted Answer

A)   Creditor
B)   Donee
C)   Incidental
D)   Promised
E)   AvowedF) A) and B)
G) A) and C)

Question 13

Which of the following references the maturing of rights such that a party can legally act on the rights?

Accepted Answer

A)   Absoluting
B)   Gelling
C)   Forming
D)   Vesting
E)   FinishingF) A) and B)
G) D) and E)

Question 14

What type of third-party beneficiary is Sam?

Accepted Answer

A)   Intended and donee
B)   Creditor and incidental
C)   Intended and creditor
D)   Donee and incidental
E)   Creditor and doneeF) A) and B)
G) C) and D)

Question 15

What was the ruling of the court in the Case Opener involving a lawsuit by fans seeking a refund based upon the Tyson and Holyfield fight being stopped in the third round because Tyson bit off a piece of Holyfield's ear?

Accepted Answer

A)   The fans were not allowed to recover because they were incidental beneficiaries.
B)   The fans were not allowed to recover because they were donee beneficiaries.
C)   The fans were not allowed to recover because they were assigned donees.
D)   The fans were allowed to recover because they were creditor beneficiaries.
E)   The fans were allowed to recover because they were intended third-party beneficiaries.F) A) and D)
G) A) and E)

Question 16

Which of the following was the result on appeal in Forest Commodity Corp.("FCC") v.Lone Star Industries Inc.,the case in the text in which the Forest Commodity Corp.denied that it violated a contractual nonassignability clause and claimed that it was entitled to recover on a breach of contract claim because the defendant did not fully perform?

Accepted Answer

A)   The court ruled that FCC did not violate a nonassignability clause and that it was entitled to recover.
B)   The court ruled that even though FCC violated the nonassignability clause, the nonassignability clause was against public policy; and FCC was allowed to recover.
C)   The court ruled that even though FCC violated the nonassignability clause, the other party also violated a nonassignability clause resulting in FCC being able to recover its full claim.
D)   The court ruled that FCC violated a nonassignability clause and was therefore unable to recover on its claim.
E)   The court ruled that FCC violated a nonassignability clause but that because the other party also violated a nonassignability clause, FCC's recovery would be reduced by 50%, not completely barred.F) A) and B)
G) C) and D)

Question 17

Creditor beneficiaries can enforce their rights under a contract whenever the contract is valid.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following is true regarding oral assignments?

Accepted Answer

A)   In some cases, assignments may be made orally.
B)   Assignments, regardless of the terms, are not covered by the statute of frauds.
C)   The UCC requires that assignments be in writing when the amount being assigned is greater than $1,000.
D)   The UCC requires that assignments be in writing when the amount being assigned in greater than $1,500.
E)   The UCC requires that assignments be in writing when the amount being assigned is greater than $2,000.F) None of the above
G) B) and E)

Question 19

A[n] ______ beneficiary is a third party to a contract who is intended to be benefited directly from the contract made by the contracting parties.

Accepted Answer

A)   Intended
B)   Incidental
C)   Preferred
D)   Collateral
E)   AncillaryF) A) and E)
G) A) and B)

Question 20

Which of the following is a contractual party who agrees to receive something from the other party?

Accepted Answer

A)   Obligor
B)   Obligee
C)   Assignor
D)   Assignee
E)   BoundeeF) A) and E)
G) A) and C)

Exam 19: Third Party Rights to Contracts

What would be the likely result of a lawsuit brought by Richard against Jan to recover the $800?

Correct Answer
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Creditor beneficiaries can enforce their rights under a contract whenever the contract is valid.

Correct Answer
verified

What was the ruling of the court in the Case Opener involving a lawsuit by fans seeking a refund based upon the Tyson and Holyfield fight being stopped in the third round because Tyson bit off a piece of Holyfield's ear?

Correct Answer
verified

A[n] ______ beneficiary is a third party to a contract who is intended to be benefited directly from the contract made by the contracting parties.

Correct Answer
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Which of the following is a contractual party who agrees to receive something from the other party?

Correct Answer
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What is the term for the third party who receives an assignment of contract rights?

Correct Answer
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A[n] ______ beneficiary is a third party who benefits from a contract in which the promisor agrees to give a gift to the third party.

Correct Answer
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Which of the following is true regarding oral assignments?

Correct Answer
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A party to a contract who transfers his or her duty to perform to a third party who is not part of the original contract is called a[n] _____.

Correct Answer
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What type of third-party beneficiary is Sam?

Correct Answer
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Correct Answer
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A[n] ______ beneficiary is a third party who benefits from a contract in which the promisor agrees to pay the promisee's debt.

Correct Answer
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Which of the following references the maturing of rights such that a party can legally act on the rights?

Correct Answer
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Which of the following is the likely result if Sam sues Betty for the $40 that Trudy owes him for the book?

Correct Answer
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A third party,who is not part of an original contract,but to whom duty to perform contained in the original contract is transferred is called a[n] _____.

Correct Answer
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A donee beneficiary is a third party that benefits from a contract in which the promisor agrees to pay the promisee's debt in return for compensation plus interest.

Correct Answer
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What type of third-party beneficiary is Sally?

Correct Answer
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A[n] ______ is created when two parties enter into a contract with the intended end purpose of benefiting a third party.

Correct Answer
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Which of the following is an exception to the general rule that rights to a contract cannot be assigned when a contract is personal in nature?

Correct Answer
verified

What would be the most likely result if Fred sues Michelle for the $10,000 payment?

Correct Answer
verified

Exam 19: Third Party Rights to Contracts

What would be the likely result of a lawsuit brought by Richard against Jan to recover the $800?

Correct AnswerverifiedShow Answer

Creditor beneficiaries can enforce their rights under a contract whenever the contract is valid.

Correct AnswerverifiedShow Answer

What was the ruling of the court in the Case Opener involving a lawsuit by fans seeking a refund based upon the Tyson and Holyfield fight being stopped in the third round because Tyson bit off a piece of Holyfield's ear?

Correct AnswerverifiedShow Answer

A[n] ______ beneficiary is a third party to a contract who is intended to be benefited directly from the contract made by the contracting parties.

Correct AnswerverifiedShow Answer

Which of the following is a contractual party who agrees to receive something from the other party?

Correct AnswerverifiedShow Answer

What is the term for the third party who receives an assignment of contract rights?

Correct AnswerverifiedShow Answer

A[n] ______ beneficiary is a third party who benefits from a contract in which the promisor agrees to give a gift to the third party.

Correct AnswerverifiedShow Answer

Which of the following is true regarding oral assignments?

Correct AnswerverifiedShow Answer

A party to a contract who transfers his or her duty to perform to a third party who is not part of the original contract is called a[n] _____.

Correct AnswerverifiedShow Answer

What type of third-party beneficiary is Sam?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A[n] ______ beneficiary is a third party who benefits from a contract in which the promisor agrees to pay the promisee's debt.

Correct AnswerverifiedShow Answer

Which of the following references the maturing of rights such that a party can legally act on the rights?

Correct AnswerverifiedShow Answer

Which of the following is the likely result if Sam sues Betty for the $40 that Trudy owes him for the book?

Correct AnswerverifiedShow Answer

A third party,who is not part of an original contract,but to whom duty to perform contained in the original contract is transferred is called a[n] _____.

Correct AnswerverifiedShow Answer

A donee beneficiary is a third party that benefits from a contract in which the promisor agrees to pay the promisee's debt in return for compensation plus interest.

Correct AnswerverifiedShow Answer

What type of third-party beneficiary is Sally?

Correct AnswerverifiedShow Answer

A[n] ______ is created when two parties enter into a contract with the intended end purpose of benefiting a third party.

Correct AnswerverifiedShow Answer

Which of the following is an exception to the general rule that rights to a contract cannot be assigned when a contract is personal in nature?

Correct AnswerverifiedShow Answer

What would be the most likely result if Fred sues Michelle for the $10,000 payment?

Correct AnswerverifiedShow Answer

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