Exam 11: Privity of Contract and the Assignment of Contractual Rights

When it comes to a manufacturer who negligently manufactures goods

Dunlop sold a number of their tires to Dew & Co.on the terms that Dew & Co.would not resell them below certain listed prices and that,in the event of a sale to trade customers,Dew & Co.would get a similar undertaking not to sell below the listed prices.Dew & Co.sold the tires to Selfridge,who agreed to observe the restrictions and to pay Dunlop the sum of $5.00 for each tire sold in breach of this agreement.Selfridge in fact supplied tires to two of their own customers below the listed price.Dunlop now sues Selfridge to recover the two sums of $5.00 as liquidated damages and asks for an injunction to restrain further breaches of the agreement.In this situation

Peter was a coal merchant.In March 1962,he contracted to sell the business to his nephew John in consideration (1)that for the rest of Peter's life John should pay him $20.00 a week and (2)that if Peter's wife survived him,John should pay her an annual annuity of $15.00 a week.John took over the business and paid Peter the agreed sum until Peter died in November 1963.He then paid Peter's widow $15.00 for one week and refused to pay any more.The widow in both her personal capacity and as administratrix of Peter's estate brought an action against John in which she claimed all arrears under the annuity not paid her and asked for specific performance of the contract regarding the annuity.In this case

Landlord and Tenant entered into a five-year lease.One year later,Landlord sold the premises to Purchaser.Purchaser is bound by the lease.

When can intermediate carriers successfully claim the protection of an exemption clause?

Landlord and tenant entered into a five-year lease.One year after the lease began,tenant assigned its rights under the lease to assignee.Two years after taking possession of the premises,assignee stopped paying rent to landlord.In order to recover rent due,landlord has a right to sue

A third party can perform contractual obligations on behalf of the promisor (who of course remains responsible for proper performance)EXCEPT in circumstances where

How has the privity of contract rule been modified with respect to insurance?

A debtor/promisor ignores a notice of an assignment at her own risk.

Ordinarily,a debtor/promisor must consent to an assignment.

Ted provides lawn care services to a number of customers.He cannot personally perform all of his obligations under each contract,so he arranges for third parties to do some of the work.In these circumstances,Ted cannot

A Co.is a carrier of goods.A Co.uses a standard form contract that contains a provision which states that the risk of loss is to be borne by the owner of the goods and that A Co.will not be held liable for its negligence or the negligence of its employees.In the course of carrying B's goods,one of A Co.'s employees is negligent and the goods are damaged.In this situation

What is the defence of set off and why is it important in the context of an assignment of contractual rights?

A policy of life insurance provided that the insurers would pay to the insured or his assignees the sum of $1000.00 if he died before July 31,1926.The insured assigned the benefit of the policy to his wife and gave written notice of the assignment to the insurers.The policy was later extended,on the payment of an additional premium,for a further three months,but the benefit of the extension was not assigned to the wife.The insured died within the three-month extension period and the matter went to court on the issue of whether or not the wife benefited from the extension of the policy so as to be entitled to the insurance money.In this case

Which of the following best demonstrates the concept of vicarious liability?

Generally,a contract does not confer any benefit or impose any obligations on a stranger to the contract.

A person who,although not the legal owner,may compel the trustee to provide benefits of a trust to him is called the

An assignee of a contract takes the contract subject to equities.Explain the meaning of this phrase with the use of examples.

The right to tangible property that can be possessed is known as

A enters into a contract with B whereby in consideration of the intended marriage of A's daughter to B's son,each of A and B will pay B's son a sum of money.A fails to pay the money and now B's son sues A.In this situation