Andthird-partyrights

ng 1: I n gn on

Thefollowing text deals with a specificaspect of the lawof contracts,explainingbasic

concepts associated with assignment and third-party rights.

1 Read through the text quickly and decide whether these statements are true or

false.

1 Athird-party beneficiary contract is one which intends for someone who is

not a party to that contract to benefit from the contract.

2 The term privity of contract refers to the relationship which exists between

the immediate parties to a contract.

3 The transfer of rights under a contract is known as delegation.

4 Novation is the renewal of a contract by the contracting parties.

1 (US) delegatee

s:

2 Distinguishing assignment from novation Complete the text below using the

words in the box.

assignment (x3) benefits novation (x4) parties third party

1) is a means by which one party to a contract totally removes

himself from the contract bytransferring not onlyall of the 2)......................

conferred by that contract, but also all of the obligations. The 3)...............

replaces the original party as a party to the contract. Following4),

the other contracting party is left in the same position as he was in before it was

carried out, except that there is a new obligor. A5)requires the

agreement of all three parties. In contrast, an 6)refers to transfer of

a right (and sometimes, in general speak, obligations) of one person to another.

7)differs from novation in that the 8)to the contract do

not change. Most rights and obligations are capable of 9), but not all

are capable of 10)...........

3 CollocationsComplete these verb-noun collocations as they appear in

Reading 1. Then express the meaning of each phrase in your own words.

1 confer fiE.h.t.S (paragraph 1)

Th~s mWvY\sto g~ve rLghts to someone m cA.contro..c.t.

2 impose d (paragraph 1)

3 enforce c p ............. . (paragraph 1)

4 render p . (paragraph 2)

5 delegate d. (paragraph 4)

6 assign r . (paragraph 4)

Unit 7 Contracts: assignment and third-party rights

~

9 e 1: 0 en ng in

Words ending in -or and -ee (such as promisor/promisee)

found in legal texts of all kinds, but particularly in contracts. In these words,

the -or ending indicates the person initiating the action, and

the one receiving Thus promisor refers to

the promisee is the recipient of the promise,

something has been promised. Note that words

everyday English (for example employer, sor

employee, someone receiving employment).

4 Complete these pairs of -or/-ee words from Reading1. Can you think of any

others?

1 pr.()rn.~s..()r.... pr()ff1.~s.~......

2 d.................... d.........................

3 0..........................

4 a...............

0..........................

a..........................

9 1: ning 9

Paragraphs 1 and 3 of Reading 1

third-party beneficiary contracts,

arise differs between jurisdictions. Some jurisdictions

rights take effect immediately at the time the contract is

find that these rights do

the rights and agrees to accept the benefits.

that the third-party beneficiary must change his

contract in order for his rights to This means that

the third-party beneficiary must take some type of action

necessarily have taken or refrain from taking some type I

would not necessarily have refrained from taking, unless

receive some benefit under the

5 How is this question handled in your jurisdiction? Tick the sentence that

applies to your jurisdiction and discuss with a partner.

0 Third-party rights arise immediately at the time the contract is made.

0 Third-party rights do not arise until the third party acquires knowledge of the

rights and agrees to accept the benefits.

0 Third-party rights do not arise until the third-party beneficiary has changed

his position in reliance upon the contract.

0 Third-party rights as described above are not recognised.

How are the different parties' rights affected, depending on when the thirdparty

rights arise in each situation? If you are uncertain of the law in your

jurisdiction, discuss what you think the law should be and support your

position.

,

ng 2: n ng c

Reading1introducedassignmentclauses,whichgovernthe contractingparties' rightsto

assign rights and delegate duties to others. The passage below looks at a right of first

refusal clause.

6 Read the first paragraph of this example of a specific type of 'right of first

refusal' clause, which is seen most often in shareholder agreements. What is

the 'right of first refusal'?

Date: 2015-12-11; view: 1262