Faught files suit against the restaurant and discovers that there is no insurance policy in effect. Faught then files suit against Jackson, arguing that he is an intended third party beneficiary of the lease provi- sion requiring insurance and thus can sue Jackson for failing to enforce the lease (which requires the restaurant to carry insurance Ask your students to answer the following questions, using the informa- tion presented in the chapter. 1. Can Jackson delegate her duty to maintain the buildings to Dunn? Why or why not? Jackson can delegate the duty to Dunn because she cannot perform all tasks related to her property, but that does not necessarily relieve her of liability. 2. Who can be held liable for Dunn’s failure to fix the ceiling, Jackson or Dunn? Jackson had an obligation to McCall, and thereby his customers, to maintain the building. Her delegation to Dunn will not relieve her of possible liability. If Dunn is in the business of providing such maintenance, by contract, for Jack- son, then Dunn could be liable; if Dunn is just an employee of Jackson, then Jackson retains primary li- ability. 3. Was Faught an intended third party beneficiary of the lease between Jackson and McCall? Why or why not? The purpose of the contract was to have business premises that would be frequented by clients such as Faught. Hence, he is a third party beneficiary of the relationship and is due protection from such haz- ards.. 4. Suppose that Jackson tells Dan Stryker, a local builder to whom she owes $50,000, that he can collect the rents from the buildings’ tenants until the debt is satisfied. Is this a valid assignment? Why or why not? The assignment of in- come that is owed from other parties to help satisfy a debt is a normal assignment. However, it could not interfere with the rights in the relationship between Jackson and her tenants.
- Fall '09
- Business Law, ........., Business Law