Exam 17: Rights of Third Parties

The assignor impliedly warrants to the assignee that the claim assigned is valid.

Edna is a leading brain surgeon in the United States.She enters into a contract to perform a complicated brain surgery on Ben.However,since Edna is very busy,she wants to assign this contract to a less experienced surgeon,Charles.This would be Charles's first operation of this type.Ben can object to this assignment and prevent it because the contract between Ben and Edna is a(n):

Why is it important for an assignee to immediately notify the obligor of the assignment?

Most states have passed statutes prohibiting or regulating a wage earner's assignment of future wages.

The transfer of a right under a contract is called a(n):

Quick Corp.has $270,000 of outstanding accounts receivable.On March 10,1988,Quick assigned a $30,000 account receivable due from Pine,one of Quick's customers,to Taft Bank for value.On March 30,Pine paid Quick the $30,000.On April 5,Taft notified Pine of the March 10 assignment from Quick to Taft.Who is Taft entitled to collect the $30,000 from?

Under the "American rule" governing successive assignments,the first assignee in time has the superior right.

A delegator can be discharged from his/her obligation to perform his/her duty to the original promisee by a contract of novation.

Denise contracts with Long Life Insurance Co. ,agreeing to pay premiums in return for which the company agrees to pay $500,000 to Denise's husband Barn when Denise dies.Barn is a(n):

Once an assignment occurs,the assignee acquires:

With regard to an assignment,the person to whom the right has been transferred is called the:

Hugo sells his pharmacy,Prescriptions Plus,to Andrew.Their contract of sale contains a covenant whereby Hugo agrees not to operate a competing pharmacy within a 30-mile radius of Prescriptions Plus for five years after the sale.Two years later,Andrew sells Prescriptions Plus to Marvin.Within a month of the sale,Marvin learns that Hugo opened a new pharmacy within 25 miles of Prescriptions Plus.Which of the following statements is true?

Unless specific language indicates otherwise,an assignment of a right will be interpreted to include a delegation of duty under a contract.

Martha purchases a book from Just Books on credit and later sells the book to her friend,Christina.Christina in turn sells the book to David,who agrees to pay the balance to Just Books.Who is the creditor beneficiary in this exchange?

Antiassignment clauses in contracts are not enforceable.

On May 2,Kurtz Co.assigned its entire interest in a $70,000 account receivable due in 60 days from Long to City Bank for $65,000.On May 4,City notified Long of the assignment.On May 7,Long informed City that Kurtz had committed fraud in the transaction out of which the account receivable arose and that payment would not be made to City.If City commences an action against Long,and Long is able to prove that Kurtz acted fraudulently:

On August 1,Neptune Fisheries contracted in writing with West Markets to deliver to West 3,000 pounds of lobsters at $4 a pound.Delivery of the lobsters was due October 1 with payment due November 1.On August 4,Neptune entered into a contract with Deep Sea Lobster Farms which provided as follows: "Neptune Fisheries assigns all the rights under the contract with West Markets dated August 1 to Deep Sea Lobster Farms." The best interpretation of the August 4 contract would be that it was:

A third-party beneficiary is a person who is not a party to a contract but who has the right to enforce it because the parties to the contract made the contract with the intent to benefit him or her.

Union Bank lent $200,000 to Wagner.Union required Wagner to obtain a life insurance policy naming Union as beneficiary.While the loan was outstanding,Wagner stopped paying the premiums on the policy.Union paid the premiums,adding the amounts paid to Wagner's loan.Wagner died and the insurance company refused to pay the policy proceeds to Union.Union may:

Which of the following is true of assignments?