Assignement & Novation - CONTRACT LAW

- Assignment and novation are two important concepts in contract law that involve the transfer of rights and obligations under a contract.

- While both assignment and novation involve the transfer of contractual rights, they differ in significant ways that have legal implications for the parties involved.

**Assignment**

- Assignment is the transfer of a party's rights under a contract to a third party, known as the assignee.

- The original party, known as the assignor, remains liable to perform their obligations under the contract unless the parties agree otherwise.

- Assignments can be either legal or equitable, depending on whether they meet certain requirements set out in the Law of Property Act 1925.

*Example*: Alice enters into a contract to sell her car to Bob. Alice then assigns her right to receive payment for the car to Carol. Carol is now entitled to receive payment from Bob under the contract, but Alice remains liable to deliver the car to Bob.

**Novation**

- Novation is the substitution of one party to a contract with a new party, who assumes both the rights and obligations under the contract.

- Novation requires the consent of all parties involved, including the original contracting parties and the new party.

- Novation effectively ends the original contract and creates a new contract between the parties.

*Example*: Alice enters into a contract to provide catering services at a wedding for Bob. Bob then asks Carol to take over the contract and perform the catering services instead. If Alice, Bob, and Carol all agree to novate the contract, Carol will become the new party to the contract, assuming all rights and obligations.

**Key Differences**

- Assignment...