Question 1

Hilda enters into a contract with Indemnity Insurance Company that designates Hilda's daughter Jackie as the beneficiary. Jackie's rights under the contract will vest

Accepted Answer

A)  automatically. 
B)  never. 
C)  if Hilda attempts to change the beneficiary. 
D)  on the occurrence of the event for which the insurance was procured. 
A)  automatically. 
B)  never. 
C)  if Hilda attempts to change the beneficiary. 
D)  on the occurrence of the event for which the insurance was procured.

Question 2

Retail Outlets LLC contracts with Smooth Paving Inc. to grade and pave a parking lot. The contract provides that it cannot be assigned without Retail's consent. Later, Smooth assigns the contract to Tough Road Company without obtaining Retail's consent. Retail could most successfully argue that the contract cannot be assigned because

Accepted Answer

A)  the assignment is prohibited by statute. 
B)  the contract is personal. 
C)  the assignment will materially change a risk. 
D)  the contract prohibits assignment. 
A)  the assignment is prohibited by statute. 
B)  the contract is personal. 
C)  the assignment will materially change a risk. 
D)  the contract prohibits assignment.

Question 3

In an assignment, the obligee is the person who is obligated to perform the duty.

Accepted Answer

A) True 
 B)False

Question 4

Kent enters into a contract with Life Insurance Company for a policy that designates Mia as the beneficiary. Kent reserves the right to change the designated beneficiary. Mia's rights under the policy are

Accepted Answer

A)  not affected by the reservation. 
B)  subject to any change that Kent makes. 
C)  subject to the first-in-time rule. 
D)  terminated by the reservation. 
A)  not affected by the reservation. 
B)  subject to any change that Kent makes. 
C)  subject to the first-in-time rule. 
D)  terminated by the reservation.

Question 5

Neither intended nor incidental beneficiaries acquire legal rights in a contract.

Accepted Answer

A) True 
 B)False

Question 6

Apps LLC enters into a contract with Bart, the chief executive officer of Corporate Sales Inc., to create an app for the firm. To fulfill the contract, Apps hires Dave as a student intern. With respect to the contract, Dave is

Accepted Answer

A)  an intended beneficiary. 
B)  an incidental beneficiary. 
C)  a delegatee. 
D)  an assignee. 
A)  an intended beneficiary. 
B)  an incidental beneficiary. 
C)  a delegatee. 
D)  an assignee.

Question 7

Once the obligor receives proper notice, only performance to the assignee can discharge the obligor's obligation.

Accepted Answer

A) True 
 B)False

Question 8

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. The delegator is

Accepted Answer

A)  Uri. 
B)  Victor. 
C)  Wren. 
D)  none of the choices. 
A)  Uri. 
B)  Victor. 
C)  Wren. 
D)  none of the choices.

Question 9

In an assignment, the obligor is the person who to whom a duty, or obligation, is owed.

Accepted Answer

A) True 
 B)False

Question 10

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

Accepted Answer

A)  no longer liable under the contract . 
B)  liable to Joy for breach of contract. 
C)  liable to Joy if Lena does not perform. 
D)  liable to Lena for inducing a prohibited contract. 
A)  no longer liable under the contract . 
B)  liable to Joy for breach of contract. 
C)  liable to Joy if Lena does not perform. 
D)  liable to Lena for inducing a prohibited contract.

Question 11

Expressly designating a third party as a beneficiary in a contract indicates whether the beneficiary is intended or incidental.

Accepted Answer

A) True 
 B)False

Question 12

The assignment of the same contract right to two different parties requires parallel and equal rights and obligations.

Accepted Answer

A) True 
 B)False

Question 13

Rhea takes out a life insurance policy with Secure Insurance Corporation that names her spouse Tim as the beneficiary. This is

Accepted Answer

A)  a delegation. 
B)  an assignment. 
C)  a third party incidental beneficiary contract. 
D)  a third party intended beneficiary contract. 
A)  a delegation. 
B)  an assignment. 
C)  a third party incidental beneficiary contract. 
D)  a third party intended beneficiary contract.

Question 14

Fact Pattern 15-1 Restore Construction Company enters into a contract with Sam to remodel Tess's Home Store, using products from United Building Supplies.
Refer to Fact Pattern 15-1. United will realize a profit from the sale of products to Restore to remodel Tess's store. United is

Accepted Answer

A)  a delegatee. 
B)  an assignee. 
C)  an incidental beneficiary. 
D)  an intended beneficiary. 
A)  a delegatee. 
B)  an assignee. 
C)  an incidental beneficiary. 
D)  an intended beneficiary.

Question 15

As a general rule, all rights can be assigned.

Accepted Answer

A) True 
 B)False

Question 16

Ira owes Jessie $1,000. Kerry owes Ira $1,000. Ira unconditionally assigns his rights to Jessie. Ira's right to the $1,000 is then

Accepted Answer

A)  unchanged . 
B)  extinguished. 
C)  incidental. 
D)  in abeyance. 
A)  unchanged . 
B)  extinguished. 
C)  incidental. 
D)  in abeyance.

Question 17

As a general rule, any duty can be delegated.

Accepted Answer

A) True 
 B)False

Question 18

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

Accepted Answer

A)  at any time. 
B)  at no time. 
C)  after Molly's rights have vested. 
D)  before Molly's rights have vested. 
A)  at any time. 
B)  at no time. 
C)  after Molly's rights have vested. 
D)  before Molly's rights have vested.

Question 19

Ilene and Jerry enter into a contract under which Ilene agrees to provide groundskeeping services for Jerry's Family Fun Center. Under an anti-delegation clause, the contract can prohibit and prevent the transfer of

Accepted Answer

A)  only duties that are personal in nature. 
B)  only duties that are impersonal in nature. 
C)  no duties under the contract. 
D)  all duties under the contract. 
A)  only duties that are personal in nature. 
B)  only duties that are impersonal in nature. 
C)  no duties under the contract. 
D)  all duties under the contract.

Question 20

Carol takes out an insurance policy on her truck, a Dodge pick-up. Carol can assign her policy to Elmer, who owns a Ford F-150,

Accepted Answer

A)  under any circumstances . 
B)  under no circumstances . 
C)  as long as she does so in writing. 
D)  if Elmer agrees to the assignment. 
A)  under any circumstances . 
B)  under no circumstances . 
C)  as long as she does so in writing. 
D)  if Elmer agrees to the assignment.

Exam 15: Third Party Rights

Hilda enters into a contract with Indemnity Insurance Company that designates Hilda's daughter Jackie as the beneficiary. Jackie's rights under the contract will vest

In an assignment, the obligee is the person who is obligated to perform the duty.

Kent enters into a contract with Life Insurance Company for a policy that designates Mia as the beneficiary. Kent reserves the right to change the designated beneficiary. Mia's rights under the policy are

Neither intended nor incidental beneficiaries acquire legal rights in a contract.

Apps LLC enters into a contract with Bart, the chief executive officer of Corporate Sales Inc., to create an app for the firm. To fulfill the contract, Apps hires Dave as a student intern. With respect to the contract, Dave is

Once the obligor receives proper notice, only performance to the assignee can discharge the obligor's obligation.

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. The delegator is

In an assignment, the obligor is the person who to whom a duty, or obligation, is owed.

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

Expressly designating a third party as a beneficiary in a contract indicates whether the beneficiary is intended or incidental.

The assignment of the same contract right to two different parties requires parallel and equal rights and obligations.

Rhea takes out a life insurance policy with Secure Insurance Corporation that names her spouse Tim as the beneficiary. This is

Fact Pattern 15-1 Restore Construction Company enters into a contract with Sam to remodel Tess's Home Store, using products from United Building Supplies. Refer to Fact Pattern 15-1. United will realize a profit from the sale of products to Restore to remodel Tess's store. United is

As a general rule, all rights can be assigned.

Ira owes Jessie $1,000. Kerry owes Ira $1,000. Ira unconditionally assigns his rights to Jessie. Ira's right to the $1,000 is then

As a general rule, any duty can be delegated.

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

Ilene and Jerry enter into a contract under which Ilene agrees to provide groundskeeping services for Jerry's Family Fun Center. Under an anti-delegation clause, the contract can prohibit and prevent the transfer of

Carol takes out an insurance policy on her truck, a Dodge pick-up. Carol can assign her policy to Elmer, who owns a Ford F-150,

Introduction to the Law

Ethics in Business

The Courts and Our Legal System

Constitutional Law

Business Torts

Intellectual Property

Business Crimes

Introduction to Contracts

Offer and Acceptance

Consideration

Capacity

The Legality of Agreements

Voluntary Consent

Written Contracts

Termination and Remedies

Introduction to Sales and Lease Contracts

Title and Risk of Loss

Performance and Breach

Warranties and Product Liability

Consumer Protection

The Essentials of Negotiability

Negotiable Instruments: Transfer and Liability

Banking in the Digital Age

Agency Relationships

Employment, Immigration, and Labor Law

Employment Discrimination

Types of Business Organizations

Formation and Ownership of a Corporation

Management of a Corporation

Combining and Dissolving a Corporation

Credit and Security

Mortgages

Bankruptcy

Insurance

Personal Property

Bailments

Real Property

Landlord and Tenant Law

Wills and Trusts

Administrative Law

Antitrust Law

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