Law And Business I
Law And Business I BUL 3320
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This 3 page Class Notes was uploaded by Kenyon Herzog on Wednesday September 23, 2015. The Class Notes belongs to BUL 3320 at University of South Florida taught by Robert Welker in Fall. Since its upload, it has received 22 views. For similar materials see /class/212624/bul-3320-university-of-south-florida in Business Law at University of South Florida.
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Date Created: 09/23/15
Business Law Spring 2004 Chapter 16 Third Parties to Contracts Obligor a person who owes a duty under a contract Obligee a person to whom a contractual duty is owed I EX Ann promises to sell to Bart a car for which Bart promises to pay 10000 by monthly installments over the next 3 years Ann s right under the contract is to receive money from Bart whereas Ann s duty is to deliver the car Bart s right is to receive the car his duty is to pay for it Assignment of lights the voluntary transfer to a third party of the rights arising from the contract I EX if Ann were to transfer her right under the contract the installment payments due from Bart to Clark for 8500 in cash this would constitute a valid assignment of rights Ann would be the assignor Clark would be the assignee and Bart would be the obligor Pg 299 I An effective assignment terminates the assignor s right to receive performance by the obligor Delegation of Duties a transfer to a third party of a contractual obligation I EX if Ann and Doris agree that Doris should deliver the car to Bart this would constitute a delegation not an assignment of duties between Ann and Doris I Ann would be the delegator I Doris would be the delegatee I Bart would be the oblige Requirements of an Assignment I must include intent but not consideration I assignment may be oral I UCC imposes a writing requirement on all assignments over 5000 Revocability of an Assignment when the assignee gives consideration the assignor may not revoke the assignment without the assignee s consent Partial Assignment transfer of a portion of contractual rights to one or more assignees I EX Jack owes Richard 2500 Richard assigns 1000 to Mildred Neither Richard nor Mildred can maintain an action against Jack if Jack objects unless the other is joined in the proceeding against Jack Contract Rights not Assignable o Materially increase the duty risk or burden upon the obligor Personal rights EXpressly forbidden by the contract Prohibited by law 000 Page 1 of3 Setoff a counterclaim arising out of entirely separate matters that the obligor may have against the assignor as long as they arose before he had notice of the assignment Pg 303 Implied warranties obligation imposed by law upon the assignor of a contract right Express warranty explicitly made contractual promise regarding contract rights transferred Delegation of Duties a transfer of a contractual obligation to a third party I Contractual duties are not assignable but their performance generally may be delegated to a third person I Ex A promises to sell B a new car for which B promises to pay 10000 by monthly installments over the next 3 years If A and D agree that D should deliver the car to B this would not constitute an assignment but would be a delegation of duties between A and D A would be the delegator D would be the delegatee and B would be the obligee I The contractual are not delegable if 1 The nature of the duties are personal in that the oblige has a substantial interest in having the delegator perform the contract ex teachers artist 2 The performance is expressly made nondelegable 3 The delegation is prohibited by statute or public policy Novation if the delegator desires to be discharged of the duty she may enter into an agreement by which she obtains the consent of the obligee to substitute a third person the delegatee in her place The delegator is discharged and the third party becomes directly bound on his promise to obligee Third Palty Bene ciary Contracts a contract in which a party the promisor promises to render a certain performance not to the other party the promise but to a third person the beneficiary 2 types 1 Intended bene ciary contracts is intended by the two parties to the contract the promisor and promise to receive a benefit from the performance of their agreement Court enforces the rights to contract I Ex Abbot promises Baldwin to deliver a car to Carson if Baldwin promises to pay 10000 Carson is the intended beneficiary 2 types of intended beneficiaries o Donee bene ciary a third party intended to receive a benefit from the contract as a gift 0 Ex life insurance policy 0 May enforce the contract against the promisor Creditor bene ciary a third person intended to receive a benefit from the contract to satisfy a legal duty owed to him 0 Page 2 of3 0 Usually debt of the deceased is paid to creditors 0 May enforce the contract against either or both the promisor and the promisee 2 Incidental bene ciary contracts the third party is not intended to receive bene t under the contract Courts do not enforce the third party s right to the bene ts of the contract I EX Abbot promise to purchase and deliver to Baldwin a car for 10000 In all probability Abbot would acquire the car from DaVis DaVis would be an incidental bene ciary Third person does not have any rights under the contract because their bene t is incidental Page 3 of3
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