FYLSX FYLSX - Baby Bar Third Party Contract Rights

Question 1

A third-party beneficiary who has 'vested' rights under a contract may enforce the contract against the promisor. When do a donee beneficiary's rights vest under the majority rule?

Accepted Answer

When the beneficiary learns of the contract and assents to it

Answer

At the moment the contract between the promisor and promisee is formed

Answer

Only after the promisor begins performance

Answer

When the promisee notifies the promisor of the beneficiary's identity

Question 2

Paula contracts with Dave for Dave to mow her elderly mother's lawn all summer. Dave fails to perform. Who has standing to sue Dave?

Accepted Answer

Both Paula and Paula's mother

Answer

Only Paula, as she is the promisee

Answer

Only Paula's mother, as she is the intended beneficiary

Answer

Neither, because the contract lacks consideration

Question 3

Which type of third-party beneficiary acquires NO enforceable rights under a contract?

Accepted Answer

Incidental beneficiary

Answer

Creditor beneficiary

Answer

Donee beneficiary

Answer

Intended beneficiary

Question 4

A city contracts with a construction company to repair a road. A nearby shop owner benefits from the improved road traffic. The shop owner is best classified as:

Accepted Answer

An incidental beneficiary

Answer

A creditor beneficiary with vested rights

Answer

An intended donee beneficiary

Answer

A third-party promisee

Question 5

After a third-party beneficiary's rights vest, can the original promisor and promisee modify the contract to eliminate the benefit?

Accepted Answer

No, once rights vest the beneficiary's consent is required for modification that impairs those rights

Answer

Yes, always, because they are the contracting parties

Answer

Yes, but only if they give the beneficiary written notice

Answer

No modification is ever permitted after formation

Question 6

A creditor beneficiary differs from a donee beneficiary primarily in that a creditor beneficiary:

Accepted Answer

Is owed a pre-existing obligation by the promisee that the contract is meant to satisfy

Answer

Has no rights against the promisor

Answer

Must provide consideration to the promisor

Answer

Is always an incidental beneficiary