Which term describes a third-party beneficiary who has no contractual rights but benefits from a contract even though that is not the intent of the parties to the contract?

Which term describes a third-party beneficiary who has no contractual rights but benefits from a contract even though that is not the intent of the parties to the contract?

• A. Incidental beneficiary
• B. Tender
• C. Condition concurrent
• D. Repudiation

Answer: (A)

When a contract benefits someone who isn’t the intended beneficiary of the promise, that person is called an incidental beneficiary. An incidental beneficiary receives a benefit from the contract but has no rights to enforce it or sue to compel performance because the parties didn’t intend them to benefit. The essence here is that the benefit happens by chance, not by design. In contrast, an intended beneficiary is someone the parties aimed to benefit, and that person typically has the right to sue if the contract isn’t fulfilled. The other terms don’t fit this scenario: a tender is an offer to perform or pay, a condition concurrent refers to promises that must occur at the same time, and repudiation is a refusal to perform. So the term that best matches the description is incidental beneficiary.

When a contract benefits someone who isn’t the intended beneficiary of the promise, that person is called an incidental beneficiary. An incidental beneficiary receives a benefit from the contract but has no rights to enforce it or sue to compel performance because the parties didn’t intend them to benefit. The essence here is that the benefit happens by chance, not by design.

In contrast, an intended beneficiary is someone the parties aimed to benefit, and that person typically has the right to sue if the contract isn’t fulfilled. The other terms don’t fit this scenario: a tender is an offer to perform or pay, a condition concurrent refers to promises that must occur at the same time, and repudiation is a refusal to perform. So the term that best matches the description is incidental beneficiary.