Question 1

If Velma,as a birthday present,assigns to Jim her contractual right to collect $50 from Wood Co.,this would be a gratuitous assignment.

Accepted Answer

A) True 
 B)False  True

Question 2

Alice owes money to Bob.Bob enters into a contract with Alice asking her to pay the money she owes him to his sister Trish,to whom he owes money.Trish is:

Accepted Answer

A) a third party creditor beneficiary. 
B) the assignee. 
C) a third party incidental beneficiary. 
D) a third party donee beneficiary. 
A) a third party creditor beneficiary. 
B) the assignee. 
C) a third party incidental beneficiary. 
D) a third party donee beneficiary. D

Question 3

Which of the following duties can probably be delegated?

Accepted Answer

A) An agreement to perform an operation. 
B) A contract to paint a picture. 
C) An agreement by an attorney to draft a contract. 
D) An agreement to paint a house. 
A) An agreement to perform an operation. 
B) A contract to paint a picture. 
C) An agreement by an attorney to draft a contract. 
D) An agreement to paint a house. D

Question 4

Generally,duties may not be delegated.

Accepted Answer

A) True 
 B)False

Question 5

If Casey assigns her rights to receive income from rental property to Errol,then Errol will legally acquire any rights held by Casey to the income.

Accepted Answer

A) True 
 B)False

Question 6

Andrew Durham was injured in a job-related accident that resulted in a workers' compensation settlement agreement with the employer's insurance carrier,Traveler's Indemnity Company.The settlement agreement required Traveler's to pay Durham $2500 per month for the rest of his life.To finance its obligation,Traveler's purchased an annuity in its name.The settlement agreement required Traveler's approval or consent prior to an assignment of the annuity payments.Durham later decided to open a business and went to a credit union for a $214,000 loan.The credit union loaned the money,taking a security interest in Durham's monthly annuity payments.Traveler's consent was never secured.Was this a valid assignment?

Accepted Answer

Assignments can be made unless: (a)the a

Question 7

In the Schauer v.Mandarin Gems of California,Inc.case,the court held:

Accepted Answer

A) the plaintiff was entitled to proceed with her contract claim against the jeweler because the jeweler must have understood that she was an intended beneficiary of the sales contract. 
B) both of the contracting parties must intend to benefit the third party to create a right to sue in the third party. 
C) a specific manifestation by the promisor of an intent to benefit the third person is required to create a third party beneficiary contract. 
D) the plaintiff was a donee beneficiary and, as such, she had no right to sue. 
A) the plaintiff was entitled to proceed with her contract claim against the jeweler because the jeweler must have understood that she was an intended beneficiary of the sales contract. 
B) both of the contracting parties must intend to benefit the third party to create a right to sue in the third party. 
C) a specific manifestation by the promisor of an intent to benefit the third person is required to create a third party beneficiary contract. 
D) the plaintiff was a donee beneficiary and, as such, she had no right to sue.

Question 8

An assignment is effective from the moment it is made,provided the assignor notifies the obligor.

Accepted Answer

A) True 
 B)False

Question 9

Claims for personal injury are generally assignable.

Accepted Answer

A) True 
 B)False

Question 10

A rock group assigns its payment under a performance contract to the Costume Shop,a business that has supplied the group with outrageous stage outfits,and to which the group owes a great sum of money.This is:

Accepted Answer

A) a valid assignment because of the rule of freedom to contract. 
B) a valid assignment because this is a simple transfer of the right to receive money. 
C) an invalid assignment because it increases the burden of the payor. 
D) an invalid assignment because this is a personal service contract. 
A) a valid assignment because of the rule of freedom to contract. 
B) a valid assignment because this is a simple transfer of the right to receive money. 
C) an invalid assignment because it increases the burden of the payor. 
D) an invalid assignment because this is a personal service contract.

Question 11

Tyron purchased a vacant lot and entered into a contract with BZ Inc.to construct a shopping center on the site.Douglas heard about this contract and built a restaurant on an adjoining piece of property because of the planned shopping center.Tyron was unable to raise the necessary capital and was unable to perform the contract with BZ,Inc.Douglas sued Tyron for breach of contract as a third party beneficiary.Douglas will probably:

Accepted Answer

A) win as a third party creditor beneficiary. 
B) win as a third party donee beneficiary. 
C) lose as a third party incidental beneficiary. 
D) lose as a third party creditor beneficiary. 
A) win as a third party creditor beneficiary. 
B) win as a third party donee beneficiary. 
C) lose as a third party incidental beneficiary. 
D) lose as a third party creditor beneficiary.

Question 12

The McDougal Foundation contracted with Shiny Cleaning Services to clean their offices every weeknight.In the contract,The McDougal Foundation included a clause prohibiting Shiny from delegating its duties.Courts will ordinarily enforce such a clause.

Accepted Answer

A) True 
 B)False

Question 13

The case Tenet Healthsystem Surgical,L.L.C.v.Jefferson Parish Hospital Service District No.1 provides an example of::

Accepted Answer

A) an illegal delegation. 
B) a valid waiver clause. 
C) a contract in which a party prohibits the other party from assigning her rights to a third party. 
D) a novation. 
A) an illegal delegation. 
B) a valid waiver clause. 
C) a contract in which a party prohibits the other party from assigning her rights to a third party. 
D) a novation.

Question 14

If Valley Bridge contracts with Rainbow Painters to paint a bridge and the contract requires that only Sherwin Williams paint be used,then Sherwin Williams will be able to enforce the contract against either Valley Bridge or Rainbow Painters.

Accepted Answer

A) True 
 B)False

Question 15

In the case Rosenberg v.Son,Inc.,the Supreme Court of North Dakota held that Pratt was still liable to Rosenberg as she did not obtain a novation by assigning her rights to Son,Inc.

Accepted Answer

A) True 
 B)False

Question 16

Which statement about a donee beneficiary is true?

Accepted Answer

A) The donee beneficiary is not entitled to enforce a contract against either party. 
B) The donee beneficiary usually does not give consideration in return for the gift. 
C) The donee beneficiary is a third party to a contract whereby the promisee is fulfilling some duty. 
D) All of the above. 
A) The donee beneficiary is not entitled to enforce a contract against either party. 
B) The donee beneficiary usually does not give consideration in return for the gift. 
C) The donee beneficiary is a third party to a contract whereby the promisee is fulfilling some duty. 
D) All of the above.

Question 17

Norm and Frank have a legal contract that is silent with regard to an assignment of the contract.In order for Norm to assign all or part of his rights under a contract,Frank must grant permission to Norm to make the assignment legally effective.

Accepted Answer

A) True 
 B)False

Question 18

Linda assigns to Ben a right to receive rent payments.The law implies the following warranty on Linda's part:

Accepted Answer

A) the tenant is solvent. 
B) Linda actually has a right to the rental payments. 
C) the tenant will actually pay. 
D) No warranties are implied by law in an assignment. 
A) the tenant is solvent. 
B) Linda actually has a right to the rental payments. 
C) the tenant will actually pay. 
D) No warranties are implied by law in an assignment.

Question 19

Discuss the potential liability differences between a delegation and a novation.

Accepted Answer

When an obligor delegates duties under a

Question 20

The party receiving an assignment is:

Accepted Answer

A) the obligor. 
B) the beneficiary. 
C) the assignee. 
D) the assignor. 
A) the obligor. 
B) the beneficiary. 
C) the assignee. 
D) the assignor.

Exam 15: Third Parties

If Velma,as a birthday present,assigns to Jim her contractual right to collect $50 from Wood Co.,this would be a gratuitous assignment.

Alice owes money to Bob.Bob enters into a contract with Alice asking her to pay the money she owes him to his sister Trish,to whom he owes money.Trish is:

Which of the following duties can probably be delegated?

Generally,duties may not be delegated.

If Casey assigns her rights to receive income from rental property to Errol,then Errol will legally acquire any rights held by Casey to the income.

In the Schauer v.Mandarin Gems of California,Inc.case,the court held:

An assignment is effective from the moment it is made,provided the assignor notifies the obligor.

Claims for personal injury are generally assignable.

A rock group assigns its payment under a performance contract to the Costume Shop,a business that has supplied the group with outrageous stage outfits,and to which the group owes a great sum of money.This is:

The McDougal Foundation contracted with Shiny Cleaning Services to clean their offices every weeknight.In the contract,The McDougal Foundation included a clause prohibiting Shiny from delegating its duties.Courts will ordinarily enforce such a clause.

The case Tenet Healthsystem Surgical,L.L.C.v.Jefferson Parish Hospital Service District No.1 provides an example of::

If Valley Bridge contracts with Rainbow Painters to paint a bridge and the contract requires that only Sherwin Williams paint be used,then Sherwin Williams will be able to enforce the contract against either Valley Bridge or Rainbow Painters.

In the case Rosenberg v.Son,Inc.,the Supreme Court of North Dakota held that Pratt was still liable to Rosenberg as she did not obtain a novation by assigning her rights to Son,Inc.

Which statement about a donee beneficiary is true?

Norm and Frank have a legal contract that is silent with regard to an assignment of the contract.In order for Norm to assign all or part of his rights under a contract,Frank must grant permission to Norm to make the assignment legally effective.

Linda assigns to Ben a right to receive rent payments.The law implies the following warranty on Linda's part:

Discuss the potential liability differences between a delegation and a novation.

The party receiving an assignment is:

Introduction to Law

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Common Law, statutory Law, and Administrative Law

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Torts

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Capacity and Consent

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Introduction to Sales

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Creating a Negotiable Instrument

Liability for Negotiable Instruments

Liability for Negotiable Instruments: Banks and Their Customers

Secured Transactions

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