13. If the chef allows the friend to perform and approves his design plan, but the friend fails without legal excuse to complete the decorating as agreed, against whom does the chef have an enforceable claim for breach of contract?

«Delegation» refers to duties under a contract, not rights. A party who wishes to have another person perform his duties under a contract delegates them. However, when performance of a duty is delegated, the delegator remains liable for the duty. But the other party, the obligee, may expressly agree to accept the delegate's performance as a substitute for the delegator's. This is a «novation» and it does release the delegator from liability entirely. A novation requires explicit acceptance of the delegate's performance in place of the delegator and release of the delegator (rather than mere consent to delegation).

For a third party to be an intended beneficiary who can enforce his interest in a contract, as a threshold matter, allowing them to sue must have the effect of carrying out the intentions of the parties. Then, the third party must fall within one of two categories: (i) if the promise is performed, it will satisfy some obligation of money owed to the third party; (ii) circumstantial facts indicate that one of the parties intends to give the third party the benefit of a promised performance.

Whether a beneficiary is «intended» is determined by examining several factors, including whether: (i) the beneficiary could have reasonably relied on the fact that a purpose of the contract was to confer a right to him; (ii) performance is supposed to run directly from a contracting party to the third party, rather than from the promisor to the promissee and only indirectly benefitting the third party; (iii) again, if part of the overall objective of the parties to the contract was to benefit the third party.

D is correct. A properly-delegated duty under a contract does not absolve the delegator of liability for performance of the duty absent a novation or express agreement by the obligee to use the delegate AND release the delegator. Here, unless the chef/obligee otherwise agrees (e.g., by executing a novation substituting the new obligor and releasing the original obligor of its duty) to the delegation of the duty to design the chef's restaurant to the friend AND to release the obligor/decorator from liability, the decorator will remain liable. When the friend who had been delegated to breached the contractual duty, the decorator will be liable to the chef under the contract.

The chef, as a third-party beneficiary, can also enforce the contract against the delegate/friend. The chef was explicitly an intended beneficiary of the contract between the decorator and the friend because the decorator assigned the chef-decorator contract to the friend, and the friend agreed to complete it. This contract clearly intended to directly confer a benefit on the chef.

A is incorrect. This answer is only partially correct. The chef is an intended beneficiary of the decorator-friend agreement and may, therefore, sue the friend too. In other words, allowing the chef standing to enforce the contract would be appropriate to effectuate the parties' understanding, since the friend must have understood that the decorator's intent was to confer a benefit on the chef.

B is incorrect. This answer is also only partially correct and misunderstands the law. Delegation to the friend did not discharge the decorator's original duty to the chef. The obligor's original duty will not be discharged unless the parties execute a novation. A novation substitutes a new party for an original party to the contract and requires the assent of all parties. A novation must be explicit, however, and one was not executed here.

C is incorrect. This answer implies that a novation was executed based on the chef's permission for the friend to do the work and approval of the designs. However, a novation must expressly consent to the delegation AND release the obligor (here, the decorator) from liability, which did not occur here.