R2d § 304

Creation of Duty to Beneficiary

R2d § 304 Creation of Duty to Beneficiary
A promise in a contract creates a duty in the promisor to any intended beneficiary to perform the promise, and the intended beneficiary may enforce the duty.

Professor's notes

Element: a promise in a contract creates a duty in the promisor to any intended beneficiary to perform the promise, and the intended beneficiary may enforce the duty.

This is the source of the intended beneficiary's standing. Once classified as intended under § 302, the beneficiary has direct enforcement rights against the promisor.

Common misunderstanding: students think the beneficiary must show consideration. The beneficiary need not provide any consideration: the consideration is between the promisee and promisor; the beneficiary is the third-party recipient of the duty. § 304 simply opens the courthouse door to the beneficiary.

Text

R2d § 304. Creation of Duty to Beneficiary.

A promise in a contract creates a duty in the promisor to any intended beneficiary to perform the promise, and the intended beneficiary may enforce the duty.

[VERIFICATION REQUIRED: subsection text drafted from memory; cite-check against ALI Restatement (Second) of Contracts official text before publication]