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AIC 301 STUDY GUIDE EXAM| PERFECTLY
REVISED ASSESSMENT WITH COMPLETE
QUESTIONS AND ANSWERS 2026
if a contract can have legal and illegal purposes, courts will assume it had a/an
_____________ purpose - correct-answer -legal
courts attempt to apply _____________ and _______________ interpretation -
correct-answer -fair; impartial
courts consider _____________ & ________________ meanings of terms and
common meanings of terms within an industry - correct-answer -local; cultural
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parties' ______________ course of dealings can take precedence over
_____________ meaning if the parties' intent isn't clear - correct-answer -prior;
trade
2 situations where third-parties have enforceable rights under contracts others
have made - correct-answer -1) assignment of a contract
2) third-party beneficiary contracts
transfer of contractual performance rights to other people - correct-answer -
contract assignments
ex. creditors assigning the right to receive money from debtors to third parties -
correct-answer -contract assignments
5 unassignable contract rights - correct-answer -1) law restricts prior assignments
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2) parties specify in contract that rights are unassignable
3) personal rights
4) if an assignment materially alters or varies the obligor's performance
5) when a judgment is pending in a personal injury case
3 types of beneficiaries from third-party contracts - correct-answer -1) creditor
beneficiaries
2) donee beneficiaries
3) incidental beneficiaries
_________________ beneficiaries have no enforceable rights - correct-answer -
incidental
a third-party beneficiary owed a debt that is to be satisfied by performance of a
contract - correct-answer -creditor beneficiary
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a third-party beneficiary who receives the benefit of a contract's performance as
a gift from the promise, with the intent of the contracting parties - correct-
answer -donee beneficiary
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 - correct-
answer -incidental beneficiary
the act of ending a contract, agreement, or obligation - correct-answer -discharge
6 ways a contract can be discharged - correct-answer -1) performance
2) agreement of parties
3) substitution
4) impossibility
5) fraudulent alteration
AIC 301 STUDY GUIDE EXAM| PERFECTLY
REVISED ASSESSMENT WITH COMPLETE
QUESTIONS AND ANSWERS 2026
if a contract can have legal and illegal purposes, courts will assume it had a/an
_____________ purpose - correct-answer -legal
courts attempt to apply _____________ and _______________ interpretation -
correct-answer -fair; impartial
courts consider _____________ & ________________ meanings of terms and
common meanings of terms within an industry - correct-answer -local; cultural
,2|Page
parties' ______________ course of dealings can take precedence over
_____________ meaning if the parties' intent isn't clear - correct-answer -prior;
trade
2 situations where third-parties have enforceable rights under contracts others
have made - correct-answer -1) assignment of a contract
2) third-party beneficiary contracts
transfer of contractual performance rights to other people - correct-answer -
contract assignments
ex. creditors assigning the right to receive money from debtors to third parties -
correct-answer -contract assignments
5 unassignable contract rights - correct-answer -1) law restricts prior assignments
,3|Page
2) parties specify in contract that rights are unassignable
3) personal rights
4) if an assignment materially alters or varies the obligor's performance
5) when a judgment is pending in a personal injury case
3 types of beneficiaries from third-party contracts - correct-answer -1) creditor
beneficiaries
2) donee beneficiaries
3) incidental beneficiaries
_________________ beneficiaries have no enforceable rights - correct-answer -
incidental
a third-party beneficiary owed a debt that is to be satisfied by performance of a
contract - correct-answer -creditor beneficiary
, 4|Page
a third-party beneficiary who receives the benefit of a contract's performance as
a gift from the promise, with the intent of the contracting parties - correct-
answer -donee beneficiary
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 - correct-
answer -incidental beneficiary
the act of ending a contract, agreement, or obligation - correct-answer -discharge
6 ways a contract can be discharged - correct-answer -1) performance
2) agreement of parties
3) substitution
4) impossibility
5) fraudulent alteration
