Business - Chapter 14 Quiz

A(n) _____ is the transfer of contractual rights by an obligee to another party.

• delegation
• annulment
• exoneration
• assignment
• stipulation

Which of the following is an INCORRECT statement regarding the assignment of contract​ rights?

• The right to sue another party for a violation of personal rights cannot usually be assigned.
• ​Generally, no formalities are required for a valid assignment of rights.
• Contracts for the provision of personal services are generally assignable.
• ​Usually, a person cannot assign a currently nonexistent right that he or she expects to have in the future.
• A contract cannot be assigned if the assignment would materially alter the risk or duties of the obligor.

​Raul, a real estate​ agent, signs an option contract to purchase a dilapidated house on First Street from Amir. Prior to​ closing, Raul assigns the purchase contract to his brother Julio. When Julio shows up to the closing with the check to​ purchase, Amir refuses to sell Julio the house. Is Amir within his​ rights?

• ​No, because Julio was an incidental beneficiary of the contract
• ​No, because Julio was an intended beneficiary of the contract
• ​Yes, unless he was provided with notice of the assignment
• ​No, because Raul assigned his contract to Raul
• ​No, because Raul delegated his rights under the contract

Which of the following types of contract can be​ assigned?

• An agreement to star in a movie
• A right to receive an inheritance
• A right to receive payment from another
• A​ driver's auto insurance policy
• An injured​ person's right to sue the person who injured them.

Big​ Toys, LLC enters into a lease to rent space from Outdoor​ Mall, Inc. The lease provides that Outdoor​ Mall, Inc. will clean the windows once per month. Outdoor​ Mall, Inc. hires Mary to clean the windows. Is Outdoor​ Mall, Inc. in violation of the lease​ agreement?

• ​Yes, unless Big Toys approves of the delegation
• ​Yes, unless Big Toys approves of the assignment
• ​No, because Mary is the intended beneficiary of the lease
• ​No, unless prohibited in the​ agreement, duties can be delegated to other parties
• ​Yes, this duty cannot be delegated

If a client retains a firm of accountants to do work for him or​ her, the firm can​ _________ the duties under the contract to any qualified member of the firm.

• assign
• delegate
• discharge
• covenant
• condition

If a famous singer is hired to give a concert on a college​ campus, she can appoint another singer to appear in her place under which​ theory?

• assignment
• no theory
• condition precedent
• discharge
• delegation

​A(n) _____​ third-party beneficiary is a third party who is not in privity of contract but who has rights under the contract and can enforce the contract against the promisor.

• unqualified
• incidental
• conditional
• intended
• consequential

Intended​ third-party beneficiaries may be classified as either​ ________ beneficiaries.

• donee or creditor
• reserved or unreserved
• primary or secondary
• incidental or consequential
• qualified or unqualified

What is a​ third-party beneficiary?

• obligee
• a person who was not an active party to a contract but who claims rights under a contract
• assignee
• obligor
• assignor