BLW 201 CHAPTER 16 T/F SELF QUIZ

Indicate whether the sentence or statement is true or false.

An assignee of a right to receive money acquires any rights to the money held by the assignor.

An obligor with notice of an assignment can be compelled by the assignee to perform.

A party to a contract may transfer the rights arising from the contract to another.

Privity of contract refers to the fact that only the actual parties to a contract should have rights and liabilities under the contract.

A third party beneficiary contract is formed when the parties to a contract intend to confer a benefit on a third party.

An unconditional assignment of rights in a contract will extinguish the rights of the assignor.

Banks may assign their loan contracts to other firms.

Businesses can assign their rights to receive payments to financing companies in exchange for cash to finance future purchases of inventory.

A right to receive income can be assigned.

Assignments of negotiable instruments are not generally permitted.

In most cases, the fact that a contract contains a clause prohibiting its assignment will prevent it from being assigned.

A contract that contains language stating that any assignment is "void" may still be assigned.

An assignment of rights in real estate can always be prohibited.

An assignment of an insurance policy cannot be prohibited.

The rights under a contract for personal service normally cannot be assigned.

The fact that a contract contains a clause prohibiting its assignment ordinarily will prevent it from being assigned.

Most states follow the rule that a prior assignment will usually prevail against subsequent assignments.

An assignment is effective only after notice has been given to the obligor.

With some exceptions, a party may delegate freely his or her duties under a contract.

A delegation relieves the party making it of the obligation to perform even if the party to whom the duty is delegated fails to perform.

The inclusion of a phrase in a contract permitting "the assignment of all rights" will not, by itself, be presumed by most courts to include a delegation of all duties.

Third parties have no rights to contracts to which they are not a party, even if the contracting parties made the contract with the intent to benefit a third party.

A creditor beneficiary is entitled to sue the promisor directly to enforce his or her promise.

The terms "creditor beneficiary" and "donee beneficiary" are synonymous with the terms "intended beneficiary" and "incidental beneficiary," respectively.

A donee beneficiary is never entitled to enforce the promise of a promisor.

A creditor beneficiary has the power to sue the promisee if the contract is breached.

An intended beneficiary is entitled to sue the promisor directly to enforce his or her promise.

A life insurance contract is one of the most common examples of a third party beneficiary contract involving a donee beneficiary.

The vesting of contractual rights in a third party will not prevent the original parties to the contract from modifying the contract as long as the contract expressly reserves their right to do so.

If a contract expressly reserves to the contracting parties the right to cancel, rescind, or modify the contract, then the rights of the third party beneficiary are subject to any changes made by the contracting parties.

The fact that a contract does not require performance rendered directly to a third party will make it very likely the third party will be considered an intended beneficiary.

If a contract benefits a third party beneficiary incidentally, then the third party will have the power to enforce the contract.

If a contract does not require that performance be rendered directly to a third party, then the third party will be considered an intended beneficiary.

An incidental beneficiary is never entitled to enforce the promise of a promisor.

An incidental beneficiary can sue the promisee if the contract is breached.

True/False Indicate whether the sentence or statement is true or false.
	1.	An assignee of a right to receive money acquires any rights to the money held by the assignor.
	2.	An obligor with notice of an assignment can be compelled by the assignee to perform.
	3.	A party to a contract may transfer the rights arising from the contract to another.
	4.	Privity of contract refers to the fact that only the actual parties to a contract should have rights and liabilities under the contract.
	5.	A third party beneficiary contract is formed when the parties to a contract intend to confer a benefit on a third party.
	6.	An unconditional assignment of rights in a contract will extinguish the rights of the assignor.
	7.	Banks may assign their loan contracts to other firms.
	8.	Businesses can assign their rights to receive payments to financing companies in exchange for cash to finance future purchases of inventory.
	9.	A right to receive income can be assigned.
	10.	Assignments of negotiable instruments are not generally permitted.
	11.	In most cases, the fact that a contract contains a clause prohibiting its assignment will prevent it from being assigned.
	12.	A contract that contains language stating that any assignment is "void" may still be assigned.
	13.	An assignment of rights in real estate can always be prohibited.
	14.	An assignment of an insurance policy cannot be prohibited.
	15.	The rights under a contract for personal service normally cannot be assigned.
	16.	The fact that a contract contains a clause prohibiting its assignment ordinarily will prevent it from being assigned.
	17.	Most states follow the rule that a prior assignment will usually prevail against subsequent assignments.
	18.	An assignment is effective only after notice has been given to the obligor.
	19.	With some exceptions, a party may delegate freely his or her duties under a contract.
	20.	A delegation relieves the party making it of the obligation to perform even if the party to whom the duty is delegated fails to perform.
	21.	The inclusion of a phrase in a contract permitting "the assignment of all rights" will not, by itself, be presumed by most courts to include a delegation of all duties.
	22.	Third parties have no rights to contracts to which they are not a party, even if the contracting parties made the contract with the intent to benefit a third party.
	23.	A creditor beneficiary is entitled to sue the promisor directly to enforce his or her promise.
	24.	The terms "creditor beneficiary" and "donee beneficiary" are synonymous with the terms "intended beneficiary" and "incidental beneficiary," respectively.
	25.	A donee beneficiary is never entitled to enforce the promise of a promisor.
	26.	A creditor beneficiary has the power to sue the promisee if the contract is breached.
	27.	An intended beneficiary is entitled to sue the promisor directly to enforce his or her promise.
	28.	A life insurance contract is one of the most common examples of a third party beneficiary contract involving a donee beneficiary.
	29.	The vesting of contractual rights in a third party will not prevent the original parties to the contract from modifying the contract as long as the contract expressly reserves their right to do so.
	30.	If a contract expressly reserves to the contracting parties the right to cancel, rescind, or modify the contract, then the rights of the third party beneficiary are subject to any changes made by the contracting parties.
	31.	The fact that a contract does not require performance rendered directly to a third party will make it very likely the third party will be considered an intended beneficiary.
	32.	If a contract benefits a third party beneficiary incidentally, then the third party will have the power to enforce the contract.
	33.	If a contract does not require that performance be rendered directly to a third party, then the third party will be considered an intended beneficiary.
	34.	An incidental beneficiary is never entitled to enforce the promise of a promisor.
	35.	An incidental beneficiary can sue the promisee if the contract is breached.