Question 1

Fact Pattern 17-B1 (Questions B15-B18 apply)
Able Contractors,Inc.,enters into a contract with Beau to repair,rebuild,and remodel Coastal Marina & Boardwalk,using products from Delta Lumber & Marine.Eatwell Café is next to Coastal Marina.
-Refer to Fact Pattern 17-B1.The value of Eatwell Café's property will increase after Coastal Marina store is refurbished.Eatwell Café is
A)a delegatee.
B)an assignee.
C)an incidental beneficiary.
D)an intended beneficiary.

Accepted Answer

Eatwell Café is an incidental beneficiary because the increase in property value is a secondary effect of the contract between Able Contractors and Beau, not a direct benefit intended by the parties involved in the contract.

Question 2

Animal Feed Corporation and Beneficial Trucking,Inc.,enter into a contract for Beneficial to transport a truckload of hay for which Animal Feed agrees to pay.Due to schedule conflicts,Beneficial contacts Crop Transport Company,to which Beneficial "assigns all rights under the contract." This transfer is
A)an assignment and a delegation.
B)an alienation and a negotiation.
C)an obligation and a cancelation.
D)prohibited.

Accepted Answer

The transfer from Beneficial to Crop Transport Company is an assignment of its rights under the contract with Animal Feed, as Beneficial is not transferring its obligations. It is also a delegation of its obligation to transport the hay to Crop Transport Company. Therefore, it is both an assignment and a delegation.

Question 3

Laramie contracts to provide cattle-herding services to Miles for $1,400 per month.Laramie cannot transfer this duty
A)under any circumstances.
B)without continuing to be potentially liable.
C)without Miles's consent.
D)without paying Miles at least one monthly fee.

Accepted Answer

The answer of Laramie contracts to provide cattle-herding services to...

Question 4

Qiana has the right under a contract with Runway Retail,Inc.,to buy the retailer's clothing overstock.Qiana's sale of this right to Sade's Style House is
A)a delegation.
B)an assignment.
C)prohibited.
D)a third-party beneficiary contract.

Accepted Answer

Qiana is transferring her right to buy the clothing overstock to Sade's Style House, which is an assignment. Delegation would involve Qiana transferring her obligation to buy the clothing overstock to another party instead of her right to do so. Prohibition or third-party beneficiary contract are not applicable in this scenario.

Question 5

Mai is a third party beneficiary under a contract between Novia and Otis.Novia and Otis can modify or rescind their contract without Mai's consent
A)at any time.
B)at no time.
C)after Mai's rights have vested.
D)before Mai's rights have vested.

Accepted Answer

As a third-party beneficiary, Mai's rights do not vest until she has knowledge of the contract and the intent to create her as a beneficiary. Therefore, Novia and Otis can modify or rescind their contract before Mai's rights have vested without her consent.

Question 6

Bobbie enters into a contract with Claire,who agrees to paint Bobbie's studio apartment for $500.Claire is the
A)obligor.
B)obligee.
C)assignee.
D)assignor.

Accepted Answer

The answer of Bobbie enters into a contract with Claire,who...

Question 7

Leon contracts to install automatic watering troughs in Kendall's dairy barn.Leon 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
A)no one.
B)Jake only.
C)Leon only.
D)Jake or Leon.

Accepted Answer

Kendall can sue both Jake and Leon. Leon had originally agreed to install the troughs but became unable to do so due to his illness. However, it is still his responsibility to ensure that the work is completed, either by himself or by hiring a reliable subcontractor like Jake. Since Jake never showed up to do the work, he has breached his contract with Leon, who in turn has breached his contract with Kendall. Thus, Kendall can sue both Jake and Leon for breach of contract.

Question 8

Richly Merchandise,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 contract cannot be assigned because
A)Richly did not consent to the assignment.
B)Richly did not receive adequate consideration for the assignment.
C)an assignment will significantly increase the risk of nonperformance.
D)Town Builders was not an original party to the deal.

Accepted Answer

Richly could most successfully argue that the contract cannot be assigned because allowing Town Builders, who has a poor record of completing projects, to take over the contract would significantly increase the risk of nonperformance. This is a valid reason for asserting that the contract cannot be assigned without Richly's consent.

Question 9

App Developers,Inc.(ADI),enters into a contract with Carmen,the chief executive officer of SalesCorp,to create an app for the firm.To fulfill the contract,ADI hires Max and ten other student interns.With respect to the contract,Max is
A)an intended beneficiary.
B)an incidental beneficiary.
C)a delegatee.
D)an assignee.

Accepted Answer

The answer of App Developers,Inc.(ADI),enters into a contract with Carmen,the...

Question 10

Fact Pattern 17-B1 (Questions B15-B18 apply)
Able Contractors,Inc.,enters into a contract with Beau to repair,rebuild,and remodel Coastal Marina & Boardwalk,using products from Delta Lumber & Marine.Eatwell Café is next to Coastal Marina.
-Refer to Fact Pattern 17-B1.Coastal Marina is
A)a delegatee.
B)an assignee.
C)an incidental beneficiary.
D)an intended beneficiary.

Accepted Answer

Coastal Marina is an intended beneficiary because it was clearly intended to benefit from Able Contractors' contract with Beau, as it involves repairing, rebuilding, and remodeling the marina.

Question 11

Jean promises to paint Katy's house in exchange for Lila's promise to plant trees on Jean's property.This is
A)a delegation.
B)an assignment.
C)a third party beneficiary contract.
D)none of the choices.

Accepted Answer

A third party beneficiary contract is a contract in which a third party, who is not a party to the contract, can enforce the contract. In this case, Lila is the third party beneficiary because she is not a party to the contract between Jean and Katy, but she can enforce the contract to require Jean to paint her house.

Question 12

Orchid and Peony enter into a contract for the sale of Orchid's textbook at the end of the fall semester for which Peony agrees to pay Orchid $75.Peony wants to transfer her right to payment for the book to Queenie.This transfer
A)is prohibited.
B)may be oral or written.
C)must be implied.
D)must be in writing.

Accepted Answer

The transfer of rights, also known as an assignment, can generally be made orally or in writing unless a specific law requires it to be in writing.

Question 13

Uri and Victor enter into a contract by which Uri promises to deliver business cards,advertising banners,and other marketing materials to Victor.Uri later transfers his duty under the contract to Wren.Uri is
A)a delegator and an obligor.
B)a delegate and an obligee.
C)an assignor and an assignee.
D)none of the choices.

Accepted Answer

Uri is a delegator because he transfers his duty to another party, Wren. He is also an obligor because he has an obligation to deliver the materials to Victor.

Question 14

Fact Pattern 17-B1 (Questions B15-B18 apply)
Able Contractors,Inc.,enters into a contract with Beau to repair,rebuild,and remodel Coastal Marina & Boardwalk,using products from Delta Lumber & Marine.Eatwell Café is next to Coastal Marina.
-Refer to Fact Pattern 17-B1.Halfway through the project,Able Contractors refuses to finish the job.The contract can be enforced against Able Contractors by
A)Beau only.
B)Beau or Coastal Marina only.
C)Beau,Coastal Marina,or Delta Lumber only.
D)Beau,Coastal Marina,Delta Lumber,or Eatwell Café.

Accepted Answer

Only Beau and Coastal Marina have privity of contract with Able Contractors, therefore only they can enforce the contract. Delta Lumber and Eatwell Café are not parties to the contract and do not have standing to enforce it.

Question 15

Illya owes Jenny $1,000.In a separate deal,Kasey owes Illya $1,000.Illya unconditionally assigns his rights in the deal with Kasey to Jenny.Illya's right to the $1,000 is then
A)unchanged.
B)extinguished.
C)incidental.
D)assigned to a court.

Accepted Answer

When Illya assigns his rights in the deal with Kasey to Jenny, Jenny now has the right to collect the debt that Kasey owes Illya. This means that Illya no longer has the right to collect the $1,000 from Kasey, and therefore his own debt to Jenny remains unchanged, but his right to collect from Kasey is extinguished.

Question 16

A contract between Laser Maintenance,Inc.,and Medical Vision Operation Corporation contains a clause stating that any assignment is "void." This ordinarily prohibits
A)any assignment.
B)no assignment.
C)only an assignment of contract rights to personal services.
D)only an assignment that would change the obligor's risk.

Accepted Answer

The clause stating that any assignment is "void" prohibits any assignment, meaning no transfer of rights or obligations can occur under the contract.

Question 17

Julia,a world-famous chef,signs a contract to give lessons in French cooking to Kyle.Julia wants to transfer her duties under the contract to Leila,a short-order cook at Mom's Café.The transfer is
A)valid because the performance required is of a nonpersonal nature.
B)valid if Leila is a highly regarded short-order cook.
C)not valid because performance depends on Julia's personal skills.
D)not valid if Kyle does not hold Leila in high regard.

Accepted Answer

The contract involves personal services that rely on Julia's unique skills and reputation, making it non-transferable to another individual like Leila.

Question 18

Fact Pattern 17-B1 (Questions B15-B18 apply)
Able Contractors,Inc.,enters into a contract with Beau to repair,rebuild,and remodel Coastal Marina & Boardwalk,using products from Delta Lumber & Marine.Eatwell Café is next to Coastal Marina.
-Refer to Fact Pattern 17-B1.Delta Lumber will realize a profit from the sale of products to Bayside to remodel Coastal Marina.Delta Lumber is
A)a delegatee.
B)an assignee.
C)an incidental beneficiary.
D)an intended beneficiary.

Accepted Answer

Delta Lumber is an incidental beneficiary because they benefit from the contract between Able Contractors and Beau indirectly, without being the intended recipient of the contract's benefits.

Question 19

Devon and Edmond enter into a contract for the closing of a sale of Devon's recording studio.When Edmond's schedule conflicts,he asks Ferdie to perform his duties at the closing.This transfer of duties is
A)a delegation.
B)an assignment.
C)prohibited.
D)a negotiation.

Accepted Answer

A delegation occurs when a party transfers their duties or obligations under a contract to another party. In this case, Edmond is transferring his duties to Ferdie for the closing of the sale, which is considered a delegation. An assignment, on the other hand, involves transferring a party's rights under a contract to another party, which is not the case here. Prohibition and negotiation are not relevant options in this scenario.

Question 20

Merry Music Inc.and Nayda enter into a contract for Nayda to write six songs for which Merry Music agrees to pay her.Nayda transfers her right to payment under the contract to Omni Artists Agency.In the transfer of rights,Nayda is
A)a delegator.
B)an assignor.
C)an obligor.
D)an alien.

Accepted Answer

Nayda is transferring her right to payment to Omni Artists Agency, which makes her an assignor. A delegator is someone who delegates their duties under a contract to another party, while an obligor is the party who is obligated to perform under the contract. An alien does not have any relevance to the transfer of rights in a contract.

Quiz 17: Third Party Rights

Laramie contracts to provide cattle-herding services to Miles for $1,400 per month.Laramie cannot transfer this duty

Qiana has the right under a contract with Runway Retail,Inc.,to buy the retailer's clothing overstock.Qiana's sale of this right to Sade's Style House is

Mai is a third party beneficiary under a contract between Novia and Otis.Novia and Otis can modify or rescind their contract without Mai's consent

Bobbie enters into a contract with Claire,who agrees to paint Bobbie's studio apartment for $500.Claire is the

Leon contracts to install automatic watering troughs in Kendall's dairy barn.Leon 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

Richly Merchandise,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 contract cannot be assigned because

App Developers,Inc.(ADI) ,enters into a contract with Carmen,the chief executive officer of SalesCorp,to create an app for the firm.To fulfill the contract,ADI hires Max and ten other student interns.With respect to the contract,Max is

Fact Pattern 17-B1 (Questions B15-B18 apply) Able Contractors,Inc.,enters into a contract with Beau to repair,rebuild,and remodel Coastal Marina & Boardwalk,using products from Delta Lumber & Marine.Eatwell Café is next to Coastal Marina. -Refer to Fact Pattern 17-B1.Coastal Marina is

Jean promises to paint Katy's house in exchange for Lila's promise to plant trees on Jean's property.This is

Orchid and Peony enter into a contract for the sale of Orchid's textbook at the end of the fall semester for which Peony agrees to pay Orchid $75.Peony wants to transfer her right to payment for the book to Queenie.This transfer

Uri and Victor enter into a contract by which Uri promises to deliver business cards,advertising banners,and other marketing materials to Victor.Uri later transfers his duty under the contract to Wren.Uri is

Illya owes Jenny $1,000.In a separate deal,Kasey owes Illya $1,000.Illya unconditionally assigns his rights in the deal with Kasey to Jenny.Illya's right to the $1,000 is then

A contract between Laser Maintenance,Inc.,and Medical Vision Operation Corporation contains a clause stating that any assignment is "void." This ordinarily prohibits

Julia,a world-famous chef,signs a contract to give lessons in French cooking to Kyle.Julia wants to transfer her duties under the contract to Leila,a short-order cook at Mom's Café.The transfer is

Devon and Edmond enter into a contract for the closing of a sale of Devon's recording studio.When Edmond's schedule conflicts,he asks Ferdie to perform his duties at the closing.This transfer of duties is

Merry Music Inc.and Nayda enter into a contract for Nayda to write six songs for which Merry Music agrees to pay her.Nayda transfers her right to payment under the contract to Omni Artists Agency.In the transfer of rights,Nayda is