Chapter 14 Third-Party Rights

Learning Objectives

After reading this chapter, you should understand the following:

  1. How an assignment of contract rights is made and how it operates
  2. What a delegation of duties is and how it operates
  3. Under what circumstances a person not a party to a contract can enforce it

To this point, we have focused on the rights and duties of the two parties to the contract. In this chapter, we turn our attention to contracts in which outsiders acquire rights or duties or both. Three types of outsiders merit examination:

  1. Assignees (outsiders who acquire rights after the contract is made)
  2. Delegatees (outsiders who acquire duties after the contract is made)
  3. Third-party beneficiaries (outsiders who acquire rights when the original contract is made)