“A contract, made expressly for the benefit of a third person, may be enforced by him at any time before the parties thereto rescind it.” Cal. Civ. Code § 1559.
- Defendant and a third-party entered a valid contract;
- Plaintiff is not a party to the contract;
- The contracting parties expressly intended to benefit Plaintiff, as evidenced by the terms of the contract, even if Plaintiff is not specifically named;
- Defendant breached the contract; and
- Plaintiff suffered damages as a result of the breach.
A third-party beneficiary must be a creditor or donee beneficiary. Epitech, Inc. v. Kann, 204 Cal. App. 4th 1365, 1372 (2012).
“‘A creditor beneficiary is a party to whom a promisee owes a preexisting duty which the promisee intends to discharge by means of a promisor's performance. . . ”. . . A person cannot be a creditor beneficiary unless the promisor's performance of the contract will discharge some form of legal duty owed to the beneficiary by the promisee.
A person is a donee beneficiary only if the promisee’s contractual intent is either to make a gift to him or to confer on him a right against the promisor.
Martinez v. Socoma Cos., 11 Cal. 3d 394, 400-01 (1974).
CALIFORNIA STATE COURTS
Supreme Court of California: Martinez v. Socoma Cos., 11 Cal. 3d 394, 400-01 (1974).
California 1st Dist.: Lake Almanor Associates L.P. v. Huffman-Broadway Group, Inc.,178 Cal. App. 4th 1194, 1199 (2009).
California 2d Dist.: Epitech, Inc. v. Kann, 204 Cal. App. 4th 1365, 1371-72 (2012).
California 3d Dist.: Unite Here Local 30 v. Dep’t of Parks & Recreation, 194 Cal. App. 4th 1200, 1214-16 (2011); Grossmont Union High School Dist. v. State Dept. of Education, 169 Cal. App. 4th 869, 890-91 (2008).
California 4thDist.: The H.N. & Frances C. Berger Foundation v. Perez, 218 Cal. App. 4th 37, 43-45 (2013).
California 5thDist.: Cargill, Inc. v. Souza, 201 Cal. App. 4th 962, 967 (2011); Souza v. Westlands Water Dist., 135 Cal. App. 4th 879, 893-95 (2006).
California 6th Dist.: Spinks v. Equity Residential Briarwood Apartments, 171 Cal. App. 4th 1004, 1022-23 (2009).
CALIFORNIA FEDERAL COURTS
United States Court of Appeal for the 9th Circuit: Balsam v. Tucows Inc., 627 F.3d 1158, 1161 (9th Cir. 2010); Doe v. Wal-Mart Stores, Inc., 572 F.3d 677, 682 (9th Cir. 2009) (discussing creditor and donee third-party beneficiaries).
Central District: Solid Host, NL v. Namecheap, Inc., 652 F. Supp. 2d 1092, 1117-18 (C.D. Cal. 2009).
Eastern District: Grill v. BAC Home Loans Servicing LP, No. 10-CV-03057-FCD/GGH, 2011 U.S. Dist. LEXIS 3771, at *14-15 (E.D. Cal. Jan. 13, 2011).
Northern District: State Nat’l Ins. Co. v. Khatri, No. C 13-00433 LB, 2013 U.S. Dist. LEXIS 132167, at *33-34 (N.D. Cal. Sept. 13, 2013).
Southern District: Stocco v. Gemological Inst. of Am., Inc., No. 12-CV-1291 WQH (DHB), 2013 U.S. Dist. LEXIS 137942, at *22-23 (S.D. Cal. Sept. 24, 2013).