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when people think of contracts they assume that there are only two parties involved contract law is not always that simple though there can be other parties that stand to benefit from a contracts performance and can be hurt by its bdocHub the outside party is known as a third party beneficiary as early as 1806 American courts started recognizing that third party beneficiaries have legal rights in the seminal case of Lawrence V Fox Holly loaned $300 to Fox and Fox agreed to pay the $300 to Lawrence to satisfy a debt that Holly owed Lawrence the New York Court of Appeals found that Lawrence was an intended third party beneficiary of the contract who had rights and could enforce the contract between Holly and Fox in order to recover the $300 a third party beneficiary is either a donee or a creditor a donee beneficiary benefits from a contract gratuitously that is not in exchange for a service he has provided for example assume that John enters into a contract with Robert a landscaper prov
