Which Statement Most Accurately Describes Third Party Beneficiary Rights

question 18

Multiple Choice

Which statement most accurately describes third party beneficiary rights?

• A)A beneficiary may enforce a contract if the parties intended to benefit him and if enforcing the promise will satisfy a duty of the promisee to the beneficiary.
• B)If a promisee intended to make a gift to the beneficiary,the beneficiary may not enforce the contract.
• C)An intended third party beneficiary has no enforceable rights in a contract.
• D)Incidental beneficiaries have enforceable rights against both contracting parties.

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Definitions:

Legal Liability

The legal responsibility to compensate for harm caused to another person or property, arising out of one's actions or failures to act.

Negligent Conduct

Behavior that falls below the standard of care expected to protect others from unreasonable risk of harm.

Illegal Contract

A contract that is not enforceable because it involves activities that are against the law.

Insurance Agreement

A formal contract where one party agrees to indemnify another against loss, damage, or liability in return for payment of a premium.