When a person enters into a contract with the intent to confer a gift to an intended third party,the contract is called a ________ contract.
A) substituted
B) delegated
C) donee beneficiary
D) novation

Question

Quizplus · Accepted Answer

A donee beneficiary contract is a legal agreement where the original parties intend to confer a benefit on a third party. In this type of contract, the third party (donee beneficiary) has the legal right to enforce the terms of the contract and sue for damages if the contract is breached. This is commonly seen in life insurance policies, where the policyholder pays premiums to the insurance company and names a beneficiary who will receive a lump sum payment upon the policyholder's death. The beneficiary is the donee beneficiary in this case.

When a Person Enters into a Contract with the Intent