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ANSWER One is a third party beneficiary ("intended beneficiary") where (1) permitting her to enforce the promisor's promise would effectuate the parties' (the promisor and promisee) intentions, and (2) performance by the promisor will satisfy the promisee's obligation to pay money to the third party beneficiary, or (3) the circumstances indicate that the promisee intended the beneficiary to receive the promised performance. Rest. 2d., Section 133. EXAMPLE X (a famous person) and Y agree that (1) X will speak at Y's annual convention, at which approximately 15,000 people will be present, and (2) Y will pay for X's stay at the ABC Hotel (reputed to be the best inn in that city). ABC Hotel learns of this agreement, and immediately notifies X and Y that it would be pleased to have X stay there. However, Y subsequently advises X that it would be more convenient if X stays at the DEF Hotel (which is nearer to the convention hall). X agrees to do so. If ABC Hotel sues Y for failing to rent one of its rooms for X, it would probably not be successful. Although the X-Y agreement alluded to the ABC Hotel, it was probably neither party's intention to bestow a benefit on that establishment. Rather, the ABC Hotel was selected simply for X's comfort. The ABC Hotel is merely an incidental beneficiary and would have no rights under the X-Y contract. •EXAMINATION TIP: When analyzing whether a third party can recover under a contract, always apply the "intend to benefit" test. Was the third party intended to benefit from the agreement between the promisor and promisee? Your answer to this question must be 'yes".