However, in the case of assignment, the consent of the non-assigning party may be required by a contractual provision.The assignment does not necessarily have to be in writing; however, the assignment agreement must show an intent to transfer rights.A promise to assign in the future has no legal effect.
The effect of a valid assignment is to extinguish privity (in other words, contractual relationship, including right to sue) between the assignor and the third-party obligor and create privity between the obligor and the assignee.
Unless the contractual agreement states otherwise, the assignee typically does not receive more rights than the assignor, and the assignor may remain liable to the original counterparty for the performance of the contract.
However, it is possible to assign the lease, but the new party (assignee) will be subject to the lessor’s credit evaluation process and approval.
Even if the assignee is approved, the existing lessee’s (assignor’s) personal guarantee(s), if any, might not be released unless the assignee’s credit stature is extremely strong.
The assignor often delegates duties in addition to rights to the assignee, but the assignor may remain ultimately responsible.
However, in the United States, there are various laws that limit the liability of the assignee, often to facilitate credit, as assignees are typically lenders.
Two other techniques to prevent the assignment of contracts are rescission clauses or clauses creating a condition subsequent.
The former would give the other party to the contract the power to rescind the contract if an assignment is made; the latter would rescind the contract automatically in such circumstances.
is a legal term used in the context of the law of contract and of property.
In both instances, assignment is the process whereby a person, the assignor, transfers rights or benefits to another, the assignee.