BUL 4421 Lecture Notes - Lecture 5: Condition Subsequent, Fiduciary, Structured Settlement
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Void contract- if someone wants you to do something that is illegal, and when an ind. Has been
declared as incompetent.
Enforcable contracts must take on proper form.
Privity of contract- only the parties to a contract (the offeror and the offeree) have “privity” and
thus owe any duties and enjoy and rights arising from the contracts.
Orig parties to the contract have privity, third parties cannot stand in the shoes of the litigant.
Exceptions to this include:
Assignment of rights, delegation of duties, assignment of all rights, third party beneficiaries.
Assignment = transfer of contractual rights.
Delegation= transfer of contractual duties.
Structured settlement- when you get monthly payments for a settlement for injury or something
To whom should obligtor tender performance if assignor assigns same rights to two or more
Two general rules:
1. English rule- first assignee to give notice of assignment to obligor party has contract
2. Majority rule- first in time takes priority over subsequent assignment.
As a general rule, all contract duties may be delegated except in four circumstances, where:
1. Performance depends on
2. The delegator owes the obligee a fiduciary duty (ie. duty arising from a special trust)
3. Performance by the delegatee would differ from the orig. party
If the delegatee fails to perform adequately, the delegator remains liable for the delegatee’s
Unintended third party beneficiaries are possible
Donee beneficiary- third party for whose benefit a contract was made
Allan vs nervosa- 2 ppl living in a condo
Rules come from condo documents