Question 1

Joan owes Richard money.Richard assigns his rights of collection to Steve.In this situation,which of the following is true?

Accepted Answer

A)  Joan is the obligee. 
B)  Richard is the obligor. 
C)  Richard is the assignor. 
D)  A,B,and C are true. 
E)  A and B only are true. 
A)  Joan is the obligee. 
B)  Richard is the obligor. 
C)  Richard is the assignor. 
D)  A,B,and C are true. 
E)  A and B only are true.

Question 2

A contract cannot be based on the satisfaction of a third party,such as an engineer or architect.

Accepted Answer

A) True 
 B)False

Question 3

Third parties never acquire rights under other people's contracts.

Accepted Answer

A) True 
 B)False

Question 4

If a third-party beneficiary tries to enforce a contract,the promisor may use any defense against the third party that could have been used against the original promisee.

Accepted Answer

A) True 
 B)False

Question 5

A clause that prohibits the assignment of rights under a contract is called a pro-assignment clause.

Accepted Answer

A) True 
 B)False

Question 6

In an ordinary contract assignment,the assignee:

Accepted Answer

A)  acquires the rights of the assignor,but nothing more 
B)  is released from liability 
C)  assumes the assignor's duty by operation of law 
D)  assumes no liability pursuant to the UCC 
A)  acquires the rights of the assignor,but nothing more 
B)  is released from liability 
C)  assumes the assignor's duty by operation of law 
D)  assumes no liability pursuant to the UCC

Question 7

A covenant is an unconditional promise to perform.

Accepted Answer

A) True 
 B)False

Question 8

In general,an incidental beneficiary has no enforceable contract rights because she was not intended to have such rights.

Accepted Answer

A) True 
 B)False

Question 9

The reasonable person test is a subjective test that is used to judge contracts involving the mechanical fitness and most commercial contract.

Accepted Answer

A) True 
 B)False

Question 10

The English rule regarding successive assignment of rights states that the first assignment in time prevails,regardless of notice.

Accepted Answer

A) True 
 B)False

Question 11

Is the doctrine of commercial impracticability a good doctrine? Or,should the parties to a contract spell out in advance the exact circumstances when performance is excused? Isn't everyone who enters into a contract taking certain chances?

Accepted Answer

It is impossible to identify i

Question 12

Barney's assignment of his rights to be insured may not be assigned to Betty,as the assignment would materially alter the risk and duties of the insurance company.

Accepted Answer

A) True 
 B)False

Question 13

Duties under a contract:

Accepted Answer

A)  are freely assignable under all circumstances 
B)  can be delegated,but only if there is a signed writing 
C)  may be delegated without assigning rights 
D)  may be delegated only if there is a corresponding assignment of rights 
A)  are freely assignable under all circumstances 
B)  can be delegated,but only if there is a signed writing 
C)  may be delegated without assigning rights 
D)  may be delegated only if there is a corresponding assignment of rights

Question 14

Rebecca owes Ian $5,000.Ian needs money in a hurry so he assigns his right to collect from Rebecca to Janet for $4,500.Several days later,Ian assigns his right to collect from Rebecca to Kristin for another $4,500.Ian then leaves town.Kristin is the first to notify Rebecca of the assignment.In the majority of states,which of the following best describes this situation?

Accepted Answer

A)  Rebecca need pay only Janet,since Janet was the first to receive the assignment. 
B)  Rebecca need pay only Kristin,since Kristin was the first to give notice to Rebecca. 
C)  Rebecca must pay both Janet and Kristin,since a valid assignment was made to each. 
D)  Rebecca need pay only Ian,since debts are not assignable. 
A)  Rebecca need pay only Janet,since Janet was the first to receive the assignment. 
B)  Rebecca need pay only Kristin,since Kristin was the first to give notice to Rebecca. 
C)  Rebecca must pay both Janet and Kristin,since a valid assignment was made to each. 
D)  Rebecca need pay only Ian,since debts are not assignable.

Question 15

If a person assigns the same contract rights to more than one assignee,the majority of courts would decide that which of the following is true?

Accepted Answer

A)  The first assignee to give notice would prevail. 
B)  The first assignee to be assigned the rights would prevail. 
C)  The first assignee to file a lawsuit would prevail. 
D)  The first assignee to collect would prevail. 
E)  The assignee who paid the most would prevail. 
A)  The first assignee to give notice would prevail. 
B)  The first assignee to be assigned the rights would prevail. 
C)  The first assignee to file a lawsuit would prevail. 
D)  The first assignee to collect would prevail. 
E)  The assignee who paid the most would prevail.

Question 16

Conditions can be only:

Accepted Answer

A)  precedent 
B)  subsequent 
C)  precedent or subsequent 
D)  precedent,subsequent,or concurrent 
E)  precedent,subsequent,concurrent,or nominal 
A)  precedent 
B)  subsequent 
C)  precedent or subsequent 
D)  precedent,subsequent,or concurrent 
E)  precedent,subsequent,concurrent,or nominal

Question 17

Which of the following events would probably excuse performance of a contract because of commercial impracticability?

Accepted Answer

A)  The price of the commodity increases slightly so that the contract will not be as profitable. 
B)  There is an unforeseeable trade embargo causing commodity prices to triple. 
C)  The promisor of a personal service contract dies. 
D)  The subject matter of the contract is destroyed by fire. 
E)  The contract contains a time-is-of-the-essence clause. 
A)  The price of the commodity increases slightly so that the contract will not be as profitable. 
B)  There is an unforeseeable trade embargo causing commodity prices to triple. 
C)  The promisor of a personal service contract dies. 
D)  The subject matter of the contract is destroyed by fire. 
E)  The contract contains a time-is-of-the-essence clause.

Question 18

Assume that the players on the Colorado Rockies baseball team breach their contract by refusing to play the remainder of their games in the season.A restaurant located near Coors Field,where the games would have been played,sues the players.As a result,which of the following is true?

Accepted Answer

A)  The restaurant loses due to public policy. 
B)  The restaurant loses because it is not an intended beneficiary of the players' contract. 
C)  The restaurant wins as a third-party beneficiary. 
D)  The restaurant wins under promissory estoppel. 
A)  The restaurant loses due to public policy. 
B)  The restaurant loses because it is not an intended beneficiary of the players' contract. 
C)  The restaurant wins as a third-party beneficiary. 
D)  The restaurant wins under promissory estoppel.

Question 19

A car owner enters into a contract to buy 50 gallons of gasoline each month in 2002 from Greedy Oil Co.for $1.70 per gallon.By June,the wholesale price of gasoline is $1.80 and the retail price is $1.90.Greedy wants out of the contract.Which of the following is most likely true?

Accepted Answer

A)  Greedy can get out on the doctrine of impossibility. 
B)  Greedy can get out on the doctrine of commercial impracticability. 
C)  Greedy cannot get out of the contract,but the car owner must pay the market price. 
D)  Greedy must sell the gasoline at a loss under the terms of the contract. 
A)  Greedy can get out on the doctrine of impossibility. 
B)  Greedy can get out on the doctrine of commercial impracticability. 
C)  Greedy cannot get out of the contract,but the car owner must pay the market price. 
D)  Greedy must sell the gasoline at a loss under the terms of the contract.

Question 20

For a condition to be enforceable,it must be an express condition.

Accepted Answer

A) True 
 B)False

Exam 15: Third-Party Rights and Discharge

Joan owes Richard money.Richard assigns his rights of collection to Steve.In this situation,which of the following is true?

A contract cannot be based on the satisfaction of a third party,such as an engineer or architect.

Third parties never acquire rights under other people's contracts.

If a third-party beneficiary tries to enforce a contract,the promisor may use any defense against the third party that could have been used against the original promisee.

A clause that prohibits the assignment of rights under a contract is called a pro-assignment clause.

In an ordinary contract assignment,the assignee:

A covenant is an unconditional promise to perform.

In general,an incidental beneficiary has no enforceable contract rights because she was not intended to have such rights.

The reasonable person test is a subjective test that is used to judge contracts involving the mechanical fitness and most commercial contract.

The English rule regarding successive assignment of rights states that the first assignment in time prevails,regardless of notice.

Is the doctrine of commercial impracticability a good doctrine? Or,should the parties to a contract spell out in advance the exact circumstances when performance is excused? Isn't everyone who enters into a contract taking certain chances?

Barney's assignment of his rights to be insured may not be assigned to Betty,as the assignment would materially alter the risk and duties of the insurance company.

Duties under a contract:

If a person assigns the same contract rights to more than one assignee,the majority of courts would decide that which of the following is true?

Conditions can be only:

Which of the following events would probably excuse performance of a contract because of commercial impracticability?

Assume that the players on the Colorado Rockies baseball team breach their contract by refusing to play the remainder of their games in the season.A restaurant located near Coors Field,where the games would have been played,sues the players.As a result,which of the following is true?

A car owner enters into a contract to buy 50 gallons of gasoline each month in 2002 from Greedy Oil Co.for $1.70 per gallon.By June,the wholesale price of gasoline is $1.80 and the retail price is $1.90.Greedy wants out of the contract.Which of the following is most likely true?

For a condition to be enforceable,it must be an express condition.

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