Question 1

Equity Company and Faye enter into a contract for Faye to cater a meeting of Equity's shareholders.When Faye's schedule conflicts,she asks Gudren to serve Faye's coffee and pastries at the meeting.This transfer of duties is

Accepted Answer

Delegation occurs when a party to a contract transfers their duties to a third party. In this case, Faye is transferring her duty to provide catering to Gudren, while still remaining responsible for the obligation under the contract with Equity. Therefore, this situation is considered a delegation. Assignment involves the transfer of rights under a contract, not duties. A third-party beneficiary contract involves a contract where a third party benefits from the performance of the contract, which is not applicable in this scenario. There is no indication that this transfer of duties is prohibited by law.

Question 2

Wilma owes Jill $5,000.Jill assigns the claim to Andrew.Jill

Accepted Answer

The answer of Wilma owes Jill $5,000.Jill assigns the claim...

Question 3

Marco and Fred enter into a contract for the sale of Marco's apartment for which Fred agrees to pay him $100,000.Marco cannot prohibit Fred from transferring his right to the ownership of the apartment because such a prohibition is

Accepted Answer

Prohibiting the transfer of ownership rights is against public policy, as it discourages the free flow of property and hinders economic growth. Contracts that violate public policy are generally unenforceable.

Question 4

Vicky contracts with Warren for the delivery of hospice services to benefit Xavier.This is

Accepted Answer

This is a third party beneficiary contract, as Xavier is the intended beneficiary of the services provided under the contract between Vicky and Warren.

Question 5

Commercial Shipping,Inc.,and Dock Services Corporation enter into a contract for Dock to load Commercial's trucks for which Commercial agrees to pay Dock.Dock transfers its duty to load the trucks to East Harbor Transport Company.Dock is

Accepted Answer

Dock Services Corporation is delegating its duty to load the trucks to East Harbor Transport Company. Therefore, Dock is a delegator.

Question 6

Leonard contracts to install automatic watering troughs in Kendall's dairy barn.Leonard then becomes seriously ill and contracts with Jake to install the troughs.Jake is unreliable and never shows up to install the troughs.Kendall can sue

Accepted Answer

Kendall can sue Leonard because Leonard was the original party to the contract and is responsible for fulfilling the contract terms. Kendall can also sue Jake because Jake was contracted by Leonard to perform the work, making him liable for not completing the task.

Question 7

Will owes Jenny $1,000.Brad owes Will $1,000.Will unconditionally assigns his rights to Jenny.Will's right to the $1,000 is then

Accepted Answer

When Will assigns his rights to Jenny, it means he is transferring his right to collect the $1,000 to her. This means that Will no longer has any claim on the $1,000 and his right to it is extinguished. Therefore, the correct answer is B.

Question 8

Carol takes out an insurance policy on her car.Carol can assign her policy to a third party

Accepted Answer

The answer of Carol takes out an insurance policy on...

Question 9

Phillip assigns his rights under a contract with Maria to his college roommate,John.Neither Phillip nor John notifies Maria of the assignment.The assignment

Accepted Answer

The assignment is immediately effective even if neither Phillip nor John notifies Maria. However, if Maria is to perform any obligations under the contract, she still needs to perform them to Phillip as she was unaware of the assignment. The failure to notify Maria may result in legal consequences for Phillip and John, but it does not invalidate the assignment itself.

Question 10

Dwayne and Ewell enter into a contract for the design of an addition to Dwayne's house for which he agrees to pay Ewell.Ewell transfers his right to payment under the contract to Flex Construction Company.Flex is

Accepted Answer

Flex Construction Company is an assignee because it has received the right to payment under the contract from Ewell. A delegatee would be someone appointed by a party to perform duties under the contract, and an obligee would be the person owed the duty under the contract. Flex is not a third party beneficiary because it is not receiving a benefit from the contract that was intended for it.

Question 11

Rural Development Corporation (RDC) and Sid enter into a contract for the clear-cutting of RDC's fifty-acre tract for which RDC agrees to pay Sid.Sid transfers his duty to log the tract under the contract to Timber Logging Company.Timber is

Accepted Answer

Timber Logging Company is a delegatee because Sid transferred his duty to perform the contract (clear-cutting the tract) to Timber, which is a delegation of duty.

Question 12

Jack contracts to provide lawn-mowing services to Lee.Jack can?not dele?gate this duty

Accepted Answer

The answer of Jack contracts to provide lawn-mowing services to...

Question 13

A contract between Lee and Mary may not be assigned if it

Accepted Answer

Contracts for personal services are generally not assignable. The other options, although they may have other implications, do not necessarily preclude assignment.

Question 14

Pat,a world famous musician and composer,agrees to give ten piano les?sons to Quinn in exchange for $1,000.Pat's attempt to delegate his con?tract to Ruth,an in?experienced pianist,will probably be

Accepted Answer

The answer of Pat,a world famous musician and composer,agrees to...

Question 15

Joy and Kris enter into a contract for Kris to lay sod in Joy's yard for which she agrees to pay Kris.When Kris's schedule conflicts,she contacts Leza,to whom Kris "assigns all rights under the contract." Kris is

Accepted Answer

When Kris assigns all rights under the contract to Leza, Kris remains liable to Joy if Leza does not perform. Kris cannot escape her obligation to Joy simply by assigning the contract to someone else. Therefore, option C is the best choice.

Question 16

Musica Production Company and Nora enter into a contract for Nora to write six songs for which Musica agrees to pay her.Nora transfers her right to payment under the contract to Omni Entertainment Agency.Nora is

Accepted Answer

Nora is transferring her right to payment to another party, which makes her an assignor.

Question 17

Eli owes Martin $10,000.Martin assigns the claim to Jack.Jack does not notify Eli of the assignment.A week later,Martin assigns the same claim to Allen.Allen immediately notifies Eli of the assignment.Allen

Accepted Answer

Under the English rule, the first assignee to give notice to the debtor (Eli) has priority over subsequent assignees. In this scenario, Jack did not notify Eli of the assignment, so Allen, the second assignee, has priority as long as he notified Eli before Eli paid Martin. This answer assumes that the question is referring to the traditional common-law rule followed in some states, and not the modern Uniform Commercial Code rule followed in others.

Question 18

Richly Retail Outlets,Inc.,contracts with Stand-Rite Contractors to build a store.Stand-Rite assigns the contract to Town Builders,which has a poor record of completing projects.Richly could most successfully argue that the con?tract cannot be assigned because

Accepted Answer

Richly can argue that the contract cannot be assigned because the assignment will materially increase the risk of nonperformance due to Town Builders' poor record of completing projects. This is known as the doctrine of material alteration, which allows a party to object to an assignment if it materially alters the duties or obligations of the contract. The other options (A, B, and D) do not apply in this scenario as Richly did not need to consent to the assignment, consideration is presumed to be adequate in a contract, and an assignment can be made to a third party if it is allowed under the contract.

Question 19

Ben and Ivy enter into a contract under which Ben agrees to cater Ivy's wedding in exchange for a cash down payment.The contract expressly prohibits any transfer of rights.A contract right may be transferred,however,if the transfer involves

Accepted Answer

A right to receive payment can typically be transferred, even if the contract prohibits the transfer of rights. In this case, the transfer would involve the right to receive the down payment. B is not the best choice because it involves the transfer of Ben's services, which may not be transferable depending on the terms of the contract. C is not relevant to the transfer of contract rights. D is not a correct choice because the question states that the transfer is prohibited, so there would be no express prohibition by statute.

Question 20

Phil and Mike enter into a contract that expressly prohibits delegation.Phil is the obligor and Mike is the obligee.Mike delegates his duties to Alex.Phil

Accepted Answer

Even if a contract expressly prohibits delegation, the obligor (Phil) can consent to the delegation by accepting the performance from the delegatee (Alex), thereby waiving the prohibition.

Quiz 15: Third Party Rights