Legal Definitions - Obligee

An Obligee is a person or entity to whom a legal duty or benefit is owed by another party. This term is frequently used in situations where one party has a legal obligation to perform an action, provide a service, or deliver something of value to another. The obligee is the recipient of that promised performance or fulfillment of the duty.

• Example 1: Service Contract

  Imagine a homeowner hires a landscaping company to design and install a new garden. The landscaping company has a contractual obligation to complete the work as agreed. In this scenario, the homeowner is the obligee because the landscaping company owes them the performance of the garden installation service.

• Example 2: Insurance Policy

  Consider a person who purchases a car insurance policy. If that person is involved in an accident and their car is damaged, the insurance company has a contractual obligation to cover the repair costs, subject to the policy terms. The car owner, in this instance, becomes the obligee because the insurance company owes them the benefit of financial compensation for the damage.

• Example 3: Loan Agreement

  When a student takes out a student loan from a financial institution, the student has a legal obligation to repay the borrowed money, plus interest, over time. The financial institution (the bank or lender) is the obligee because the student owes them the repayment of the loan according to the agreed-upon terms.