ch15

West's Business Law with Online Research Guide, 9th Edition

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PRIVITY OF CONTRACT As a general rule, only the parties to a contract – the promisor and the promisee – owe any duties and enjoy any rights arising from the contract. Common law recognizes three exceptions: Assignment (of Rights): A transaction whereby an obligee (the assignor ) transfers her rights to some third party (the assignee ). As a consequence, the assignor’s contract rights are extinguished , and the assignee may demand any performance due to the assignor. Delegation (of Duties): A transaction whereby an obligor (the delegator ) frees himself from his duties by having some third party (the delegatee ) perform those duties. Despite his delegation, the delegator remains liable for his contract duties if the delegatee fails to perform. An “ assignment of all rights ” implies both an assignment and a delegation. Third-Party Beneficiary Contract: A third party, X, is intended, by the terms of the contract between Y Ch. 15: Contracts: Third Party Rights - No. 1 West’s Business Law (9th ed.)
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and Z, to benefit from Y’s and Z’s performance of the contract. Ch. 15: Contracts: Third Party Rights - No. 2 West’s Business Law (9th ed.)
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SCOPE OF ASSIGNMENT As a general rule, all contract rights may be assigned , except where: (1) the assignment is prohibited by statute ; (2) the contract to be assigned is for personal services , unless all that remains under the contract is a money payment for services previously rendered; (3) the assignment would
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ch15 - PRIVITY OF CONTRACT As a general rule, only the...

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