Who is a donee beneficiary? Does he or she have the right to enforce a contract?
What will be an ideal response?
A third person is a donee beneficiary if the promisee's primary purpose in contracting was to make a gift of the contracted performance to the third party. Either the promisee or the donee beneficiary can sue the promisor for not performing the promise. The beneficiary can recover the value of the promised performance, whereas the promisee can recover damages resulting from nonperformance (usually only nominal damages).
Life insurance contracts are a common form of donee beneficiary contract. The insurance company (the promisor), in return for payment of a premium, contracts with the owner of the policy (the promisee) to pay benefits to a beneficiary on the death of the insured (who may or may not be the promisee). If the insured dies and the company does not pay, the beneficiary can sue for the policy amount.
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