East Mississippi Community College

ECON 2123

Chapter 18-THIRD PERSONS AND CONTRACTS

TRUE/FALSE

1)Generally, only the parties to a contract may sue on it.

 

                                

 

2. Persons who are not a party to a contract can never bring a suit based on that contract.

 

                                

 

3. Whenever a contract is intended to benefit a third person, this person is referred to as a delegator.

 

                                

 

4. An incidental beneficiary is the same thing as a third-party beneficiary.

 

                                

 

5. It is necessary that a third-party beneficiary be identified by name.

 

                                

 

6. A third person does not have the status of an intended third-party beneficiary unless it is clear at the time the contract was formed that the parties intended to impose a direct obligation with respect to the third person.

 

 

                                

 

7. The rights of a third-party beneficiary always can be destroyed without that beneficiary's consent.

 

                                

 

8. The beneficiary of a life insurance policy is not subject to any policy restrictions that had been agreed to between the insured and the insurance company.

 

                                

 

9. When a municipality contracts with a contractor to pave a street, homeowners on that block are third- party beneficiaries of the contract.

 

                                

 

10. An assignment is a transfer of rights, and a delegation is a transfer of duties.

 

                                

 

11. An assignee of a contract can bring suit on the contract only in the name of the assignor.

 

                                

 

12. Generally, an assignment may be in any form.

 

                                

 

13. Only written words that show an intention to transfer or assign will be given the effect of an assignment.

 

                                

 

14. An obligee’s authorization to an obligor to pay a third person is an assignment to such a third person.

 

                                

 

15. An assignment, if otherwise valid, takes effect the moment it is made.

 

                                

 

16. If the obligor is notified in any manner that there has been an assignment and that any money due must be paid to the assignee, the obligor’s obligation can be discharged only by making payment to the assignee.

 

                                

 

17. A person entitled to receive money may generally assign that right to another person.

 

                                

 

18. When work is guaranteed by one who repairs a building, the owner, on selling the building, may assign the guarantee to the buyer.

 

                                

 

19. In general, one may assign rights if that does not cause the obligor's duties to increase or change materially.

 

                                

 

20. An employer can assign to another employer the right to have an employee work.

 

                                

 

21. A person who has a right to buy on credit can transfer that right to a close relative.

 

                                

 

22. An assignee's rights are the same as those that had been possessed by the assignor.