X third party beneficiaries three parties in a third

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circumstances surrounding the making of the contract. X. Third-Party Beneficiaries Three parties in a third-party beneficiary problem: promisor (party that made the original promise that benefited third-party), promisee (original party to which the contract was made), and third-party beneficiary (stranger to original contract, that would benefit from its performance). Know which party has which label promisee Third-party promisor beneficiary §302 Intended and Incidental Beneficiaries (pg. 953): is intended beneficiary if recognition of right to performance shows intention of parties by (1) satisfying promise obligation to pay beneficiary; (2) circumstances indicate promisee intends to give beneficiary benefit of performance. Incidental beneficiary: beneficiary who is not an intended beneficiary §309 (1) no duty if contract is voidable/unenforceable at time of formation; (2) contract ceases to be binding due to unsatisfied condition (TPB has no right to collect from Po); (3) TPB has no rights greater than Pe (derivative right); and (4) if Pe pulls TPB into dispute between Po and Pe, TPB is subject to the claim. TPB is actually subject to promisor’s defenses against the promisee. If the purpose of promisee is to benefit third party beneficiary, TPB has a valid claim because Pe has made the consideration with Promisor. XI. Assignment, Delegation, and Other Transfers Rights assigned and duties delegated In assigned rights cases (aka assigning the contract cases): Assignor-person that makes assignment in original contract
Assignee-person to whom the assignment of rights is made – not party of original Obligor-original contracting party to which obligation is assigned In delegation of duties cases: Delegator-person that makes delegations in original contract Delegatee-person to whom the delegation of duties is made –not party of original Obligee-original contracting party to which duty is delegated Novation: happens when one party leaves the relationship and is replaced with another who then inherits the original party’s rights and duties. Novation agreements don’t have to comply with traditional rules of assignment and delegations. BUT unlike other agreements, consent to a novation is never presumed. Must have all party’s intention for second agreement to be a novation and replace the original contract. For an assignment to be valid and enforceable against the assignor's creditor (the obligor), the assignor must make clear his intent to relinquish the right to the assignee and must not retain any control over the right assigned or any power of revocation. The assignment takes effect through the actions of the assignor and assignee and the obligor need not accept the assignment to render it valid. In novation, must make sure there’s no imbalance in duties being performed. §317 Restatement – assignment of a right. assignment will succeed unless assignment would significantly change things with obligor.

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