Assignability

Assignability clause samples

10.3 Assignability .This Agreement may not be assigned by either Party, without the written consent of the other Party, such consent not to be unreasonably withheld.

02/13/2020 (Baudax Bio, Inc.)

SUCCESSION AND ASSIGNABILITY . This Note shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. The Holder may not assign any of his or its rights, interests, or obligations hereunder on his or its own discretion without further approval from the Company.

06/06/2016 (Wrapmail, Inc.)

Section8.13 Non- Assignability . This Agreement and the rights and obligations of the parties under this Agreement may not be assigned or delegated by either party without the prior written consent of the other party, and any purported assignment without such consent shall be void.

02/02/2018 (2017 MANDATORY EXCHANGEABLE TRUST)

4. Non- Assignability . The Restricted Stock Unit shall not be transferable by the Grantee, except as the Plan or this Agreement may otherwise provide.

03/19/2021 (CuriosityStream Inc.)

Assignability . This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to be the benefit of the Holder and its successors and assigns.

03/15/2021 (MMEX Resources Corp)

17. Assignability . During Employee’s employment, this Agreement may not be assigned by either party without the written consent of the other. However, Employer may assign its rights and obligations under this Agreement without Employee’s consent to a successor by sale, merger or liquidation, if such successor carries on the Business substantially in the form in which it is being conducted at the time of the sale, merger or liquidation. This Agreement is binding upon Employee, Employee’s heirs, personal representatives and permitted assigns and on Employer, its successors and assigns.

03/11/2019 (Trillium Therapeutics Inc.)

10.7. Assignability . This Agreement shall be binding upon, and shall be enforceable by and inure solely to the benefit of, the Parties and their respective successors and permitted assigns; provided, however, that neither this Agreement nor any of a Party’s rights or obligations hereunder may be assigned or delegated by such Party without the prior written consent of the other Party, and any attempted assignment or delegation of this Agreement or any of such rights or obligations by such Party without the other Party’s prior written consent shall be void and of no effect.

01/25/2019 (Edge Therapeutics, Inc.)

6.3 Assignability . Note shall be binding upon the Borrower and its successors and assigns, and shall inure to the benefit of the Holder and its successors and assigns. Subject to the prior written consent of the Company, the Holder may assign or transfer this Note to any transferee or have the shares that it converts under this Note sent to any third party. If this Note is to be transferred, the Holder shall surrender this Note to the Company, whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Note registered as the Holder may request and the Company may accept, representing the outstanding Principal being transferred by the Holder and, if less than the entire outstanding Principal is being transferred, a new Note to the Holder representing the outstanding Principal not being transferred. The Holder and any assignee, by acceptance of this Nate, acknowledge and agree that, following conversion or redemption of any portion of this Note, the outstanding Principal represented by this Note may be less than the Principal stated on the face of this Note.

05/26/2016 (NewLead Holdings Ltd.)

5. Assignability . This Amendment shall be binding upon, and shall be enforceable by and inure solely to the benefit of, the Parties and their respective successors and assigns.

12/14/2018 (APRICUS BIOSCIENCES, INC.)

C. Assignability . Neither party to this Agreement may assign all or any part of the party’s rights and obligations under the terms of this Agreement without the prior written consent of the other party. No assignment that is approved by the other party is to relieve the assignor of the assignor’s obligations under the terms of this Agreement if the assignee fails to perform those obligations.

12/12/2017 (Luther Burbank Corp)

6.4 Non- Assignability . This Agreement and the rights and obligations hereunder, shall be fully assignable by the Manager to an affiliate thereof. This Agreement and the rights and obligations hereunder shall not be assignable by any other party hereto without the written consent of all of the other parties hereto. Provided, however, that the foregoing shall not extend to assignments required by any insurance carrier in any matter relating to subrogation and shall not extend to an assignment by any Insured Entity in connection with a sale or financing of a Project or a portion thereof.

05/04/2018 (Spirit MTA REIT)

6. Assignability . This Amendment shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, including any purchasers of the Common Shares or the Warrants.

07/03/2019 (HISTOGENICS CORP)

11. ASSIGNABILITY . This Agreement is not transferable or assignable by the undersigned except as may be provided herein.

09/02/2016 (GEX MANAGEMENT, INC.)

3.4. Assignability . This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to the benefit of the Holder and its successors and assigns, and may not be assigned by the Holder without the prior written consent of the Borrower, which consent may not be unreasonably withheld.

09/02/2016 (Full Spectrum Inc.)

7. Assignability . Assignee shall not assign the Contract or this Assignment or any of its rights, interests, or obligations thereunder or hereunder without the prior written approval of Assignor. Any purported assignment in violation of this paragraph shall be void and ineffectual and shall not operate to transfer or assign any interest or title to the purported assignee.

03/15/2021 (Aspirational Consumer Lifestyle Corp.)

2. Non- Assignability . This Agreement shall not be assignable without the prior written consent of the non-assigning party.

08/10/2016 (Affinity Gaming)

a. Captions and Headings. The Article and Section headings throughout this Agreement are for convenience of reference only and shall in no way be deemed to define, limit or add to any provision of this Agreement. b. Notification of Changes. Subscriber agrees and covenants to notify the Company immediately upon the occurrence of any event prior to the consummation of this Offering that would cause any representation, warranty, covenant or other statement contained in this Agreement to be false or incorrect or of any change in any statement made herein occurring prior to the consummation of this Offering. c. Assignability . This Agreement is not assignable by Subscriber, and may not be modified, waived or terminated except by an instrument in writing signed by the party against whom enforcement of such modification, waiver or termination is sought. d. Binding Effect. Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the parties and their heirs, executors, administrators, successors, legal representatives and assigns, and the agreements, representations, warranties and acknowledgments contained herein shall be deemed to be made by and be binding upon such heirs, executors, administrators, successors, legal representatives and assigns. e. Obligations Irrevocable. The obligations of Subscriber shall be irrevocable, except with the consent of the Company, until the consummation or termination of the Offering. f. Entire Agreement; Amendment. This Agreement states the entire agreement and understanding of the parties relating to the matters contained herein, superseding all prior contracts or agreements, whether oral or written. No amendment of the Agreement shall be made without the express written consent of the parties. g. Severability. The invalidity or unenforceability of any particular provision of this Agreement shall not affect any other provision hereof, which shall be construed in all respects as if such invalid or unenforceable provision were omitted.

01/12/2021 (Masterworks Collection 001, LLC)

whats assignability

Cut contract prep time in half for free

Build document automations that allow you, your staff, and your clients to auto-populate contract templates.

“ I've found it very easy to use. It allows me to work quickly, get something straight from my head and out into the public.”

whats assignability

Partner, Siskind Susser PC

2500 Executive Parkway Suite 300 Lehi, Utah 84043 (866) 638-3627

Level 11, 1 Margaret Street Sydney NSW 2000 Australia +61 2 8310 4319

8th Floor South Reading Bridge House George Street Reading RG1 8LS +44 20 3129 9324

Latin America

Mexico +52 55 5985 3005

Brazil +55 21 4040 4623

  • How to Successfully Switch Your DMS
  • DocuSign + NetDocuments
  • How Ice Miller Adopted the Cloud Completely Remote
  • Case Studies
  • Resource Library
  • Partner Integrations
  • App Directory
  • Locate a Partner
  • Partner Portal
  • Become a Partner

© NetDocuments Software, Inc.

  • Terms of Use
  • Privacy policy
  • Cookie policy
  • Privacy policy for california residents
  • Search Search Please fill out this field.

What Is an Assignable Contract?

Understanding assignable contracts, assignment of a futures contract, factors in the futures market, unwinding futures contracts, real estate assignment, example of an assignable contract.

  • Futures and Commodities Trading
  • Strategy & Education

Assignable Contract: Overview, Factors, Example

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

whats assignability

Katrina Ávila Munichiello is an experienced editor, writer, fact-checker, and proofreader with more than fourteen years of experience working with print and online publications.

whats assignability

An assignable contract is a provision allowing the holder of a contract to transfer or give away the obligations and rights of the contract to another party or person before the contract's expiration date. The assignee would be entitled to take delivery of the underlying asset and receive all of the benefits of that contract before its expiry. However, the assignee must also fulfill any obligations or requirements of the contract.

Assignability may be found in some options and futures contracts. There are also assignable contracts in the real estate market that allow the transfer of property.

Key Takeaways

  • An assignable contract has a provision allowing the holder to give away the obligations and rights of the contract to another party or person before the contract's expiration date.
  • The assignee would be entitled to take delivery of the underlying asset and receive all of the benefits of that contract before its expiry.
  • An assignment agreement can allow a bank or a mortgage company to sell or assign an outstanding mortgage loan.

Assignable contracts provide a way for current contract holders to close out their position, locking in profits or cutting losses, before the expiration date of the contract. Holders may assign their contracts if the current market price for the underlying asset allows them to realize a profit.

As mentioned earlier, not all contracts have an assignment provision, which is contained in the contract's terms. Also, an assignment doesn't always take away the assignor's risk and liability , because the original contract could require a guarantee that—whether assigned or not—the performance of all terms of the contract must be completed as required.

Owners of assignable futures contracts may opt to assign their holdings instead of selling them in the open market via an exchange. A futures contract is an obligation stating a buyer must purchase an asset, or a seller must sell an asset at a preset price and a predetermined date in the future.

Futures are standardized contracts with fixed prices, amounts, and expiration dates. Investors can use futures to speculate on the price of an asset such as crude oil. At expiration, speculators will book an offsetting trade and realize a gain or loss from the difference in the two contract amounts.

If an investor holds a futures contract and the holder finds that the security has appreciated by 1% on or before the closing of the contract, then the contract holder may decide to assign the contract to a third party for the appreciated amount. The initial holder would be paid in cash, realizing the profit from the contract before its expiration date. However, a buyer of an assigned contract can take a loss by paying an above-market price and risk overpaying for the asset.

Most futures contracts do not have an assignment provision. If you are interested in buying or selling a contract, make sure to carefully check its terms and conditions to see if it is assignable or not. Some contracts may prohibit assignment while other contracts may require the other party in the contract to consent to the assignment.

It's important to note that an assignment may be void if the terms of the contract change substantially or violate any laws or public policy.

A futures contract might be assigned if there was an above-market offer from the third party in an illiquid market where bid and ask spreads were wide. The bid-ask spread is the difference between the buy and sell prices. The spreads can be wide meaning there's an additional cost being added to the prices because there's not enough product to satisfy the order at a reasonable price.

Liquidity exists when there are enough buyers and sellers in the market to transact business. If the market is illiquid, a holder might not be able to find a buyer for the contract, or there might be a delay in unwinding the position.

An investor looking to buy the futures contract might offer an amount higher than the current market price in an illiquid environment. As a result, the current contract holder can assign the contract and realize a profit, and both parties benefit. However, unwinding or selling the contract outright is the cleaner solution, and it also guarantees that all liabilities concerning the contract's obligations are discharged.

However, holders of futures contracts don't need to assign the contract to another investor when they can unwind or close the position through a futures exchange. The exchange, or its clearing agent, would handle the clearing and payment functions. In other words, the futures contract can be closed before its expiration. The holder would incur any gains or loss depending on the difference between the purchase and sale prices.

An investor who assigns a futures contract can realize a profit from the contract before its expiry.

An investor might receive an above-market price for assigning a contract in an illiquid market.

Most futures contracts are not assignable.

A buyer of an assigned contract can take a loss by paying an above-market price for the asset.

An assignment agreement can allow a bank or a mortgage company to sell or assign an outstanding mortgage loan. The bank may sell the mortgage loan to a third party. The borrower would receive notice from the new bank or mortgage company servicing the debt with information on payment submission.

The terms of the loan, such as interest rate and duration, will remain the same for the borrower. However, the new bank would receive all of the interest and principal payments. Aside from the name on the check, there should be little difference noticed by the borrower.

Banks will assign loans to remove them as a liability on their balance sheets and allow them to underwrite new or additional loans.

Let's say an investor entered into a futures contract that contains an assignable clause in June to speculate on the price of crude oil, hoping the price will rise by year-end. The investor buys a December crude oil futures contract at $40, and since oil is traded in increments of 1,000 barrels, the investor's position is worth $40,000.

By August, the price of crude oil has risen to $60, and the investor decides to assign the contract to another buyer because the buyer was willing to pay $65 or $5 above market. The contract is assigned to the second buyer for $65, and the original buyer earns a profit of $25,000 (($65-$40) x 1000).

The new holder assumes all responsibilities of the contract and can profit if crude oil is trading above $65 by year-end, but also can lose if the oil trades below $65 by year-end.

whats assignability

  • Terms of Service
  • Editorial Policy
  • Privacy Policy
  • Your Privacy Choices

Assessing Assignability: Transferring Contractual Rights or Obligations | Practical Law

whats assignability

Assessing Assignability: Transferring Contractual Rights or Obligations

Practical law legal update 5-546-6326  (approx. 7 pages).

  • An intended transfer is of the type that is prohibited by law or public policy (see Practice Note, Assignability of Commercial Contracts: Statutory and Public Policy Exceptions ).
  • The parties expressly agree to restrict transferability (see Practice Note, Assignability of Commercial Contracts: Contractual Anti-assignment and Anti-delegation Clauses ).
  • Breaching the contract.
  • Making an ineffective and invalid transfer.

Distinguishing Between Assignment and Delegation

  • The assignment of rights to receive performance.
  • The delegation of duties to perform.

Characteristics of Assignments

  • The right to receive performance from the assignor.
  • Its remedies against the assignor for any failure to perform.

Characteristics of Delegation

The general rule governing assignment and delegation.

  • Most assignments of contractual rights.
  • Many delegations of contractual performance.
  • Assignments and delegations that violate public policy or law.
  • Assignments of rights or delegations of performance that are personal in nature.
  • Contracts with anti-assignment or anti-delegation clauses.

Contracts That Present the Greatest Challenges

  • Personal services contracts (see Personal Services Contracts ).
  • Non-exclusive intellectual property licenses (see Intellectual Property Licenses ).
  • Contracts with anti-assignment and anti-delegation clauses (see Contracts With Anti-assignment and Anti-delegation Contract Clauses ).

Personal Services Contracts

Intellectual property licenses, contracts with anti-assignment and anti-delegation clauses, is a change of control an assignment.

  • Contains an anti-assignment and anti-delegation clause expressly restricting a change of control.
  • States that a change in management or equity ownership of the contracting party is deemed to be an assignment.

When Does an Involuntary Transfer Trigger a Restricted Transfer?

  • A contractual anti-assignment and anti delegation clause applies to a specific type or transfer.
  • The transfer is permissible, with or without a contractual anti-assignment and anti-delegation provision.

Drafting and Negotiating Anti-assignment and Anti-delegation Clauses

  • Directly addressing assignment of rights and delegation of performance.
  • Clarifying the universe of restricted transfers.
  • Designating the non-transferring party's consent rights.
  • Specifying any exceptions to non-transferability.
  • Requiring notification of a permitted transfer.
  • Including a declaration that impermissible transfers are void.
  • Adding a novation to the anti-assignment and anti-delegation provision.

logo

  • assignments basic law

Assignments: The Basic Law

The assignment of a right or obligation is a common contractual event under the law and the right to assign (or prohibition against assignments) is found in the majority of agreements, leases and business structural documents created in the United States.

As with many terms commonly used, people are familiar with the term but often are not aware or fully aware of what the terms entail. The concept of assignment of rights and obligations is one of those simple concepts with wide ranging ramifications in the contractual and business context and the law imposes severe restrictions on the validity and effect of assignment in many instances. Clear contractual provisions concerning assignments and rights should be in every document and structure created and this article will outline why such drafting is essential for the creation of appropriate and effective contracts and structures.

The reader should first read the article on Limited Liability Entities in the United States and Contracts since the information in those articles will be assumed in this article.

Basic Definitions and Concepts:

An assignment is the transfer of rights held by one party called the “assignor” to another party called the “assignee.” The legal nature of the assignment and the contractual terms of the agreement between the parties determines some additional rights and liabilities that accompany the assignment. The assignment of rights under a contract usually completely transfers the rights to the assignee to receive the benefits accruing under the contract. Ordinarily, the term assignment is limited to the transfer of rights that are intangible, like contractual rights and rights connected with property. Merchants Service Co. v. Small Claims Court , 35 Cal. 2d 109, 113-114 (Cal. 1950).

An assignment will generally be permitted under the law unless there is an express prohibition against assignment in the underlying contract or lease. Where assignments are permitted, the assignor need not consult the other party to the contract but may merely assign the rights at that time. However, an assignment cannot have any adverse effect on the duties of the other party to the contract, nor can it diminish the chance of the other party receiving complete performance. The assignor normally remains liable unless there is an agreement to the contrary by the other party to the contract.

The effect of a valid assignment is to remove privity between the assignor and the obligor and create privity between the obligor and the assignee. Privity is usually defined as a direct and immediate contractual relationship. See Merchants case above.

Further, for the assignment to be effective in most jurisdictions, it must occur in the present. One does not normally assign a future right; the assignment vests immediate rights and obligations.

No specific language is required to create an assignment so long as the assignor makes clear his/her intent to assign identified contractual rights to the assignee. Since expensive litigation can erupt from ambiguous or vague language, obtaining the correct verbiage is vital. An agreement must manifest the intent to transfer rights and can either be oral or in writing and the rights assigned must be certain.

Note that an assignment of an interest is the transfer of some identifiable property, claim, or right from the assignor to the assignee. The assignment operates to transfer to the assignee all of the rights, title, or interest of the assignor in the thing assigned. A transfer of all rights, title, and interests conveys everything that the assignor owned in the thing assigned and the assignee stands in the shoes of the assignor. Knott v. McDonald’s Corp ., 985 F. Supp. 1222 (N.D. Cal. 1997)

The parties must intend to effectuate an assignment at the time of the transfer, although no particular language or procedure is necessary. As long ago as the case of National Reserve Co. v. Metropolitan Trust Co ., 17 Cal. 2d 827 (Cal. 1941), the court held that in determining what rights or interests pass under an assignment, the intention of the parties as manifested in the instrument is controlling.

The intent of the parties to an assignment is a question of fact to be derived not only from the instrument executed by the parties but also from the surrounding circumstances. When there is no writing to evidence the intention to transfer some identifiable property, claim, or right, it is necessary to scrutinize the surrounding circumstances and parties’ acts to ascertain their intentions. Strosberg v. Brauvin Realty Servs., 295 Ill. App. 3d 17 (Ill. App. Ct. 1st Dist. 1998)

The general rule applicable to assignments of choses in action is that an assignment, unless there is a contract to the contrary, carries with it all securities held by the assignor as collateral to the claim and all rights incidental thereto and vests in the assignee the equitable title to such collateral securities and incidental rights. An unqualified assignment of a contract or chose in action, however, with no indication of the intent of the parties, vests in the assignee the assigned contract or chose and all rights and remedies incidental thereto.

More examples: In Strosberg v. Brauvin Realty Servs ., 295 Ill. App. 3d 17 (Ill. App. Ct. 1st Dist. 1998), the court held that the assignee of a party to a subordination agreement is entitled to the benefits and is subject to the burdens of the agreement. In Florida E. C. R. Co. v. Eno , 99 Fla. 887 (Fla. 1930), the court held that the mere assignment of all sums due in and of itself creates no different or other liability of the owner to the assignee than that which existed from the owner to the assignor.

And note that even though an assignment vests in the assignee all rights, remedies, and contingent benefits which are incidental to the thing assigned, those which are personal to the assignor and for his sole benefit are not assigned. Rasp v. Hidden Valley Lake, Inc ., 519 N.E.2d 153, 158 (Ind. Ct. App. 1988). Thus, if the underlying agreement provides that a service can only be provided to X, X cannot assign that right to Y.

Novation Compared to Assignment:

Although the difference between a novation and an assignment may appear narrow, it is an essential one. “Novation is a act whereby one party transfers all its obligations and benefits under a contract to a third party.” In a novation, a third party successfully substitutes the original party as a party to the contract. “When a contract is novated, the other contracting party must be left in the same position he was in prior to the novation being made.”

A sublease is the transfer when a tenant retains some right of reentry onto the leased premises. However, if the tenant transfers the entire leasehold estate, retaining no right of reentry or other reversionary interest, then the transfer is an assignment. The assignor is normally also removed from liability to the landlord only if the landlord consents or allowed that right in the lease. In a sublease, the original tenant is not released from the obligations of the original lease.

Equitable Assignments:

An equitable assignment is one in which one has a future interest and is not valid at law but valid in a court of equity. In National Bank of Republic v. United Sec. Life Ins. & Trust Co. , 17 App. D.C. 112 (D.C. Cir. 1900), the court held that to constitute an equitable assignment of a chose in action, the following has to occur generally: anything said written or done, in pursuance of an agreement and for valuable consideration, or in consideration of an antecedent debt, to place a chose in action or fund out of the control of the owner, and appropriate it to or in favor of another person, amounts to an equitable assignment. Thus, an agreement, between a debtor and a creditor, that the debt shall be paid out of a specific fund going to the debtor may operate as an equitable assignment.

In Egyptian Navigation Co. v. Baker Invs. Corp. , 2008 U.S. Dist. LEXIS 30804 (S.D.N.Y. Apr. 14, 2008), the court stated that an equitable assignment occurs under English law when an assignor, with an intent to transfer his/her right to a chose in action, informs the assignee about the right so transferred.

An executory agreement or a declaration of trust are also equitable assignments if unenforceable as assignments by a court of law but enforceable by a court of equity exercising sound discretion according to the circumstances of the case. Since California combines courts of equity and courts of law, the same court would hear arguments as to whether an equitable assignment had occurred. Quite often, such relief is granted to avoid fraud or unjust enrichment.

Note that obtaining an assignment through fraudulent means invalidates the assignment. Fraud destroys the validity of everything into which it enters. It vitiates the most solemn contracts, documents, and even judgments. Walker v. Rich , 79 Cal. App. 139 (Cal. App. 1926). If an assignment is made with the fraudulent intent to delay, hinder, and defraud creditors, then it is void as fraudulent in fact. See our article on Transfers to Defraud Creditors .

But note that the motives that prompted an assignor to make the transfer will be considered as immaterial and will constitute no defense to an action by the assignee, if an assignment is considered as valid in all other respects.

Enforceability of Assignments:

Whether a right under a contract is capable of being transferred is determined by the law of the place where the contract was entered into. The validity and effect of an assignment is determined by the law of the place of assignment. The validity of an assignment of a contractual right is governed by the law of the state with the most significant relationship to the assignment and the parties.

In some jurisdictions, the traditional conflict of laws rules governing assignments has been rejected and the law of the place having the most significant contacts with the assignment applies. In Downs v. American Mut. Liability Ins. Co ., 14 N.Y.2d 266 (N.Y. 1964), a wife and her husband separated and the wife obtained a judgment of separation from the husband in New York. The judgment required the husband to pay a certain yearly sum to the wife. The husband assigned 50 percent of his future salary, wages, and earnings to the wife. The agreement authorized the employer to make such payments to the wife.

After the husband moved from New York, the wife learned that he was employed by an employer in Massachusetts. She sent the proper notice and demanded payment under the agreement. The employer refused and the wife brought an action for enforcement. The court observed that Massachusetts did not prohibit assignment of the husband’s wages. Moreover, Massachusetts law was not controlling because New York had the most significant relationship with the assignment. Therefore, the court ruled in favor of the wife.

Therefore, the validity of an assignment is determined by looking to the law of the forum with the most significant relationship to the assignment itself. To determine the applicable law of assignments, the court must look to the law of the state which is most significantly related to the principal issue before it.

Assignment of Contractual Rights:

Generally, the law allows the assignment of a contractual right unless the substitution of rights would materially change the duty of the obligor, materially increase the burden or risk imposed on the obligor by the contract, materially impair the chance of obtaining return performance, or materially reduce the value of the performance to the obligor. Restat 2d of Contracts, § 317(2)(a). This presumes that the underlying agreement is silent on the right to assign.

If the contract specifically precludes assignment, the contractual right is not assignable. Whether a contract is assignable is a matter of contractual intent and one must look to the language used by the parties to discern that intent.

In the absence of an express provision to the contrary, the rights and duties under a bilateral executory contract that does not involve personal skill, trust, or confidence may be assigned without the consent of the other party. But note that an assignment is invalid if it would materially alter the other party’s duties and responsibilities. Once an assignment is effective, the assignee stands in the shoes of the assignor and assumes all of assignor’s rights. Hence, after a valid assignment, the assignor’s right to performance is extinguished, transferred to assignee, and the assignee possesses the same rights, benefits, and remedies assignor once possessed. Robert Lamb Hart Planners & Architects v. Evergreen, Ltd. , 787 F. Supp. 753 (S.D. Ohio 1992).

On the other hand, an assignee’s right against the obligor is subject to “all of the limitations of the assignor’s right, all defenses thereto, and all set-offs and counterclaims which would have been available against the assignor had there been no assignment, provided that these defenses and set-offs are based on facts existing at the time of the assignment.” See Robert Lamb , case, above.

The power of the contract to restrict assignment is broad. Usually, contractual provisions that restrict assignment of the contract without the consent of the obligor are valid and enforceable, even when there is statutory authorization for the assignment. The restriction of the power to assign is often ineffective unless the restriction is expressly and precisely stated. Anti-assignment clauses are effective only if they contain clear, unambiguous language of prohibition. Anti-assignment clauses protect only the obligor and do not affect the transaction between the assignee and assignor.

Usually, a prohibition against the assignment of a contract does not prevent an assignment of the right to receive payments due, unless circumstances indicate the contrary. Moreover, the contracting parties cannot, by a mere non-assignment provision, prevent the effectual alienation of the right to money which becomes due under the contract.

A contract provision prohibiting or restricting an assignment may be waived, or a party may so act as to be estopped from objecting to the assignment, such as by effectively ratifying the assignment. The power to void an assignment made in violation of an anti-assignment clause may be waived either before or after the assignment. See our article on Contracts.

Noncompete Clauses and Assignments:

Of critical import to most buyers of businesses is the ability to ensure that key employees of the business being purchased cannot start a competing company. Some states strictly limit such clauses, some do allow them. California does restrict noncompete clauses, only allowing them under certain circumstances. A common question in those states that do allow them is whether such rights can be assigned to a new party, such as the buyer of the buyer.

A covenant not to compete, also called a non-competitive clause, is a formal agreement prohibiting one party from performing similar work or business within a designated area for a specified amount of time. This type of clause is generally included in contracts between employer and employee and contracts between buyer and seller of a business.

Many workers sign a covenant not to compete as part of the paperwork required for employment. It may be a separate document similar to a non-disclosure agreement, or buried within a number of other clauses in a contract. A covenant not to compete is generally legal and enforceable, although there are some exceptions and restrictions.

Whenever a company recruits skilled employees, it invests a significant amount of time and training. For example, it often takes years before a research chemist or a design engineer develops a workable knowledge of a company’s product line, including trade secrets and highly sensitive information. Once an employee gains this knowledge and experience, however, all sorts of things can happen. The employee could work for the company until retirement, accept a better offer from a competing company or start up his or her own business.

A covenant not to compete may cover a number of potential issues between employers and former employees. Many companies spend years developing a local base of customers or clients. It is important that this customer base not fall into the hands of local competitors. When an employee signs a covenant not to compete, he or she usually agrees not to use insider knowledge of the company’s customer base to disadvantage the company. The covenant not to compete often defines a broad geographical area considered off-limits to former employees, possibly tens or hundreds of miles.

Another area of concern covered by a covenant not to compete is a potential ‘brain drain’. Some high-level former employees may seek to recruit others from the same company to create new competition. Retention of employees, especially those with unique skills or proprietary knowledge, is vital for most companies, so a covenant not to compete may spell out definite restrictions on the hiring or recruiting of employees.

A covenant not to compete may also define a specific amount of time before a former employee can seek employment in a similar field. Many companies offer a substantial severance package to make sure former employees are financially solvent until the terms of the covenant not to compete have been met.

Because the use of a covenant not to compete can be controversial, a handful of states, including California, have largely banned this type of contractual language. The legal enforcement of these agreements falls on individual states, and many have sided with the employee during arbitration or litigation. A covenant not to compete must be reasonable and specific, with defined time periods and coverage areas. If the agreement gives the company too much power over former employees or is ambiguous, state courts may declare it to be overbroad and therefore unenforceable. In such case, the employee would be free to pursue any employment opportunity, including working for a direct competitor or starting up a new company of his or her own.

It has been held that an employee’s covenant not to compete is assignable where one business is transferred to another, that a merger does not constitute an assignment of a covenant not to compete, and that a covenant not to compete is enforceable by a successor to the employer where the assignment does not create an added burden of employment or other disadvantage to the employee. However, in some states such as Hawaii, it has also been held that a covenant not to compete is not assignable and under various statutes for various reasons that such covenants are not enforceable against an employee by a successor to the employer. Hawaii v. Gannett Pac. Corp. , 99 F. Supp. 2d 1241 (D. Haw. 1999)

It is vital to obtain the relevant law of the applicable state before drafting or attempting to enforce assignment rights in this particular area.

Conclusion:

In the current business world of fast changing structures, agreements, employees and projects, the ability to assign rights and obligations is essential to allow flexibility and adjustment to new situations. Conversely, the ability to hold a contracting party into the deal may be essential for the future of a party. Thus, the law of assignments and the restriction on same is a critical aspect of every agreement and every structure. This basic provision is often glanced at by the contracting parties, or scribbled into the deal at the last minute but can easily become the most vital part of the transaction.

As an example, one client of ours came into the office outraged that his co venturer on a sizable exporting agreement, who had excellent connections in Brazil, had elected to pursue another venture instead and assigned the agreement to a party unknown to our client and without the business contacts our client considered vital. When we examined the handwritten agreement our client had drafted in a restaurant in Sao Paolo, we discovered there was no restriction on assignment whatsoever…our client had not even considered that right when drafting the agreement after a full day of work.

One choses who one does business with carefully…to ensure that one’s choice remains the party on the other side of the contract, one must master the ability to negotiate proper assignment provisions.

Founded in 1939, our law firm combines the ability to represent clients in domestic or international matters with the personal interaction with clients that is traditional to a long established law firm.

Read more about our firm

© 2024, Stimmel, Stimmel & Roeser, All rights reserved  | Terms of Use | Site by Bay Design

  • More from M-W
  • To save this word, you'll need to log in. Log In

Definition of assign

 (Entry 1 of 2)

transitive verb

Definition of assign  (Entry 2 of 2)

  • intrust

ascribe , attribute , assign , impute , credit mean to lay something to the account of a person or thing.

ascribe suggests an inferring or conjecturing of cause, quality, authorship.

attribute suggests less tentativeness than ascribe , less definiteness than assign .

assign implies ascribing with certainty or after deliberation.

impute suggests ascribing something that brings discredit by way of accusation or blame.

credit implies ascribing a thing or especially an action to a person or other thing as its agent, source, or explanation.

Examples of assign in a Sentence

These examples are programmatically compiled from various online sources to illustrate current usage of the word 'assign.' Any opinions expressed in the examples do not represent those of Merriam-Webster or its editors. Send us feedback about these examples.

Word History

Verb and Noun

Middle English, from Anglo-French assigner , from Latin assignare , from ad- + signare to mark, from signum mark, sign

13th century, in the meaning defined at sense 1

15th century, in the meaning defined above

Phrases Containing assign

  • pre - assign

Dictionary Entries Near assign

Cite this entry.

“Assign.” Merriam-Webster.com Dictionary , Merriam-Webster, https://www.merriam-webster.com/dictionary/assign. Accessed 29 Feb. 2024.

Kids Definition

Kids definition of assign, legal definition, legal definition of assign.

Legal Definition of assign  (Entry 2 of 2)

More from Merriam-Webster on assign

Nglish: Translation of assign for Spanish Speakers

Britannica English: Translation of assign for Arabic Speakers

Subscribe to America's largest dictionary and get thousands more definitions and advanced search—ad free!

Play Quordle: Guess all four words in a limited number of tries.  Each of your guesses must be a real 5-letter word.

Can you solve 4 words at once?

Word of the day.

See Definitions and Examples »

Get Word of the Day daily email!

Popular in Grammar & Usage

8 grammar terms you used to know, but forgot, homophones, homographs, and homonyms, commonly misspelled words, a guide to em dashes, en dashes, and hyphens, absent letters that are heard anyway, popular in wordplay, 'blue moon,' 'wolf moon,' and other moons to look for throughout the year, the words of the week - feb. 23, 9 superb owl words, 'gaslighting,' 'woke,' 'democracy,' and other top lookups, 10 words for lesser-known games and sports, games & quizzes.

Play Blossom: Solve today's spelling word game by finding as many words as you can using just 7 letters. Longer words score more points.

  • Search Search Please fill out this field.
  • Building Your Business
  • Operations & Success

What Is an Assignment of Contract?

Assignment of Contract Explained

Hero Images / Getty Images

Assignment of contract allows one person to assign, or transfer, their rights, obligations, or property to another. An assignment of contract clause is often included in contracts to give either party the opportunity to transfer their part of the contract to someone else in the future. Many assignment clauses require that both parties agree to the assignment.

Learn more about assignment of contract and how it works.

What Is Assignment of Contract?

Assignment of contract means the contract and the property, rights, or obligations within it can be assigned to another party. An assignment of contract clause can typically be found in a business contract. This type of clause is common in contracts with suppliers or vendors and in intellectual property (patent, trademark , and copyright) agreements.

How Does Assignment of Contract Work?

An assignment may be made to anyone, but it is typically made to a subsidiary or a successor. A subsidiary is a business owned by another business, while a successor is the business that follows a sale, acquisition, or merger.

Let’s suppose Ken owns a lawn mowing service and he has a contract with a real estate firm to mow at each of their offices every week in the summer. The contract includes an assignment clause, so when Ken goes out of business, he assigns the contract to his sister-in-law Karrie, who also owns a lawn mowing service.

Before you try to assign something in a contract, check the contract to make sure it's allowed, and notify the other party in the contract.

Assignment usually is included in a specific clause in a contract. It typically includes transfer of both accountability and responsibility to another party, but liability usually remains with the assignor (the person doing the assigning) unless there is language to the contrary.

What Does Assignment of Contract Cover?

Generally, just about anything of value in a contract can be assigned, unless there is a specific law or public policy disallowing the assignment.

Rights and obligations of specific people can’t be assigned because special skills and abilities can’t be transferred. This is called specific performance.   For example, Billy Joel wouldn't be able to transfer or assign a contract to perform at Madison Square Garden to someone else—they wouldn't have his special abilities.

Assignments won’t stand up in court if the assignment significantly changes the terms of the contract. For example, if Karrie’s business is tree trimming, not lawn mowing, the contract can’t be assigned to her.

Assigning Intellectual Property

Intellectual property (such as copyrights, patents, and trademarks) has value, and these assets are often assigned. The U.S. Patent and Trademark Office (USPTO) says patents are personal property and that patent rights can be assigned. Trademarks, too, can be assigned. The assignment must be registered with the USPTO's Electronic Trademark Assignment System (ETAS) .  

The U.S. Copyright Office doesn't keep a database of copyright assignments, but they will record the document if you follow their procedure.

Alternatives to Assignment of Contract

There are other types of transfers that may be functional alternatives to assignment.

Licensing is an agreement whereby one party leases the rights to use a piece of property (for example, intellectual property) from another. For instance, a business that owns a patent may license another company to make products using that patent.  

Delegation permits someone else to act on your behalf. For example, Ken’s lawn service might delegate Karrie to do mowing for him without assigning the entire contract to her. Ken would still receive the payment and control the work.

Do I Need an Assignment of Contract?

Assignment of contract can be a useful clause to include in a business agreement. The most common cases of assignment of contract in a business situation are:

  • Assignment of a trademark, copyright, or patent
  • Assignments to a successor company in the case of the sale of the business
  • Assignment in a contract with a supplier or customer
  • Assignment in an employment contract or work for hire agreement

Before you sign a contract, look to see if there is an assignment clause, and get the advice of an attorney if you want to assign something in a contract.

Key Takeaways

  • Assignment of contract is the ability to transfer rights, property, or obligations to another.
  • Assignment of contract is a clause often found in business contracts.
  • A party may assign a contract to another party if the contract permits it and no law forbids it.

Legal Information Institute. " Assignment ." Accessed Jan. 2, 2021.

Legal Information Institute. " Specific Performance ." Accessed Jan. 2, 2021.

U.S. Patent and Trademark Office. " 301 Ownership/Assignability of Patents and Applications [R-10.2019] ." Accessed Jan. 2, 2021.

Licensing International. " What is Licensing ." Accessed Jan. 2, 2021.

Go to the homepage

Definition of 'assignable'

Assignable in american english, synonyms of 'assignable', trends of assignable.

View usage for: All Years Last 10 years Last 50 years Last 100 years Last 300 years

Browse alphabetically assignable

  • assign responsibility
  • assign seating
  • assign staff
  • assignation
  • assigned counsel
  • All ENGLISH words that begin with 'A'

Quick word challenge

Quiz Review

Score: 0 / 5

Image

Wordle Helper

Tile

Scrabble Tools

Image

What Is an Assignment Clause?

An assignment clause spells out which contractual obligations, rights, and duties may be transferred from one of the contractual parties to another party. 3 min read updated on February 01, 2023

Updated October 29, 2020:

An assignment clause spells out which contractual obligations, rights, and duties may be transferred from one of the contractual parties to another party. The assignment may be in whole or in part, and the clause also details the conditions under which a party can assign these duties.

U.S. law dictates that most contractual rights can be freely assigned or delegated, unless an agreement states otherwise.

The assignment clause often overlaps with two other clauses:

  • Parties in Interest
  • Successors and Assigns

These control who assumes contractual rights and obligations.

Legal Background and Freely Assignable Rights

When one party in a contract “assigns” the agreement to someone else, this means the first party — the assignor — transfers its contractual rights and obligations to the second party — the assignee.

In some instances, one party will not want the other contractual party to freely assign its duties. Contracts will then include language that states this.

One exception to the general assignability rule is intellectual property licenses . Legally, a licensor must first give consent before an IP licensee can assign or delegate its rights or obligations, even in the case where the license agreement is silent.

Requirements for Assignment Consent

There are different ways to say the same thing in a contract. Some people prefer lengthier statements, and others like to keep things brief. The following are various ways to make the same points.

  • One contractual party isn't allowed to assign its agreement to another person without prior written consent of the other contractual party, except as provided for in the contract. If an assignment is made without this consent, it won't be considered valid.
  • One party may not assign any interest or right arising out of this contract — in whole or in part — without prior consent.
  • To keep all doubts at bay, no consent is required for an assignment — including collateral, absolute, or other — for a contractual right to payment.

These are the takeaways from these stipulations:

  • This type of requirement for an assignment clause can create obstacles for the non-assigning party in corporate reorganizations or future mergers.
  • The party that's being asked to consent to an assignment clause requirement may want to negotiate its position. For instance, it may find negotiations helpful in a situation when the assignment involves a substantial sale.

A Party May Not Unreasonably Withhold or Delay Consent

It's not permissible to hold up consent to unreasonable delays.

Other ways to state this include:

  • To avoid doubt, a party that suffers damage due to the unreasonable delay or withholding of consent by the other party can treat them as direct damages.
  • To avoid doubt, damages that arise to one party from the unreasonable delay or withholding of consent by the other party aren't excluded from remedies.

Even when these provisions aren't in place, the law may still impose a reasonableness requirement. This requirement may not hold a lot of practical value, whether it's implied by the law or contractual. A reasonableness requirement can't guarantee that the non-assigning party will give consent when the assigning party wants it. By the time a case has worked its way through the court system to a decision, the deal that the assigning party was working on could have fallen through or otherwise be negated or moot.

However, this provision for unreasonable withholding should get the non-assigning party to carefully consider taking too much time due to the prospect of being held liable for damages. This can result in costly consequences.

On the other hand, having an unreasonable delay provision could create conflict with the provision concerning material breach of contract.

When you enter into a contract, it's important that you know what your rights and obligations are, as well as the other party's rights and obligations. If you don't want certain outcomes — assignment of duties, for instance — you must usually make it clear in the agreement. Getting help from a legal professional in the contract law field is a good idea when writing up a contract . That way, you increase the chances of covering everything you want covered, from the finer points to the bigger ones.

If you need help with contracts, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.

Hire the top business lawyers and save up to 60% on legal fees

Content Approved by UpCounsel

  • Legal Assignment
  • Assignment Law
  • Consent to Assignment
  • Assignment of Rights and Obligations Under a Contract
  • Assignment of Rights Example
  • Assignment Contract Law
  • Assignability Of Contracts
  • What Is the Definition of Assigns
  • Assignment Legal Definition
  • Delegation vs Assignment
  • Assignment Clause

Get free proposals from vetted lawyers in our marketplace.

Contract Clauses

  • Acceleration Clause
  • Arbitration Clause
  • Cancellation Clause
  • Choice of Law Clause
  • Confidentiality Clause
  • Consideration Clause
  • Definitions Clause
  • Dispute Resolution Clause
  • Entire Agreement Clause
  • Escalation Clause
  • Exclusivity Clause
  • Exculpatory Clause
  • Force Majeure Clause
  • Governing Law Clause
  • Indemnification Clause
  • Indemnity Clause
  • Insurance Clause
  • Integration Clause
  • Merger Clause
  • Non-Competition Clause
  • Non-Disparagement Clause
  • Non-Exclusivity Clause
  • Non-Solicitation Clause
  • Privacy Clause
  • Release Clause
  • Severability Clause
  • Subordination Clause
  • Subrogation Clause
  • Survival Clause
  • Termination Clause
  • Time of Essence Clause

Jump to Section

Assignment clause defined.

Assignment clauses are legally binding provisions in contracts that give a party the chance to engage in a transfer of ownership or assign their contractual obligations and rights to a different contracting party.

In other words, an assignment clause can reassign contracts to another party. They can commonly be seen in contracts related to business purchases.

Here’s an article about assignment clauses.

Assignment Clause Explained

Assignment contracts are helpful when you need to maintain an ongoing obligation regardless of ownership. Some agreements have limitations or prohibitions on assignments, while other parties can freely enter into them.

Here’s another article about assignment clauses.

Purpose of Assignment Clause

The purpose of assignment clauses is to establish the terms around transferring contractual obligations. The Uniform Commercial Code (UCC) permits the enforceability of assignment clauses.

Assignment Clause Examples

Examples of assignment clauses include:

  • Example 1 . A business closing or a change of control occurs
  • Example 2 . New services providers taking over existing customer contracts
  • Example 3 . Unique real estate obligations transferring to a new property owner as a condition of sale
  • Example 4 . Many mergers and acquisitions transactions, such as insurance companies taking over customer policies during a merger

Here’s an article about the different types of assignment clauses.

Assignment Clause Samples

Sample 1 – sales contract.

Assignment; Survival .  Neither party shall assign all or any portion of the Contract without the other party’s prior written consent, which consent shall not be unreasonably withheld; provided, however, that either party may, without such consent, assign this Agreement, in whole or in part, in connection with the transfer or sale of all or substantially all of the assets or business of such Party relating to the product(s) to which this Agreement relates. The Contract shall bind and inure to the benefit of the successors and permitted assigns of the respective parties. Any assignment or transfer not in accordance with this Contract shall be void. In order that the parties may fully exercise their rights and perform their obligations arising under the Contract, any provisions of the Contract that are required to ensure such exercise or performance (including any obligation accrued as of the termination date) shall survive the termination of the Contract.

Reference :

Security Exchange Commission - Edgar Database,  EX-10.29 3 dex1029.htm SALES CONTRACT , Viewed May 10, 2021, <  https://www.sec.gov/Archives/edgar/data/1492426/000119312510226984/dex1029.htm >.

Sample 2 – Purchase and Sale Agreement

Assignment . Purchaser shall not assign this Agreement or any interest therein to any Person, without the prior written consent of Seller, which consent may be withheld in Seller’s sole discretion. Notwithstanding the foregoing, upon prior written notice to Seller, Purchaser may designate any Affiliate as its nominee to receive title to the Property, or assign all of its right, title and interest in this Agreement to any Affiliate of Purchaser by providing written notice to Seller no later than five (5) Business Days prior to the Closing; provided, however, that (a) such Affiliate remains an Affiliate of Purchaser, (b) Purchaser shall not be released from any of its liabilities and obligations under this Agreement by reason of such designation or assignment, (c) such designation or assignment shall not be effective until Purchaser has provided Seller with a fully executed copy of such designation or assignment and assumption instrument, which shall (i) provide that Purchaser and such designee or assignee shall be jointly and severally liable for all liabilities and obligations of Purchaser under this Agreement, (ii) provide that Purchaser and its designee or assignee agree to pay any additional transfer tax as a result of such designation or assignment, (iii) include a representation and warranty in favor of Seller that all representations and warranties made by Purchaser in this Agreement are true and correct with respect to such designee or assignee as of the date of such designation or assignment, and will be true and correct as of the Closing, and (iv) otherwise be in form and substance satisfactory to Seller and (d) such Assignee is approved by Manager as an assignee of the Management Agreement under Article X of the Management Agreement. For purposes of this Section 16.4, “Affiliate” shall include any direct or indirect member or shareholder of the Person in question, in addition to any Person that would be deemed an Affiliate pursuant to the definition of “Affiliate” under Section 1.1 hereof and not by way of limitation of such definition.

Security Exchange Commission - Edgar Database,  EX-10.8 3 dex108.htm PURCHASE AND SALE AGREEMENT , Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1490985/000119312510160407/dex108.htm >.

Sample 3 – Share Purchase Agreement

Assignment . Neither this Agreement nor any right or obligation hereunder may be assigned by any Party without the prior written consent of the other Parties, and any attempted assignment without the required consents shall be void.

Security Exchange Commission - Edgar Database,  EX-4.12 3 dex412.htm SHARE PURCHASE AGREEMENT , Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1329394/000119312507148404/dex412.htm >.

Sample 4 – Asset Purchase Agreement

Assignment . This Agreement and any of the rights, interests, or obligations incurred hereunder, in part or as a whole, at any time after the Closing, are freely assignable by Buyer. This Agreement and any of the rights, interests, or obligations incurred hereunder, in part or as a whole, are assignable by Seller only upon the prior written consent of Buyer, which consent shall not be unreasonably withheld. This Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors and permitted assigns.

Security Exchange Commission - Edgar Database,  EX-2.1 2 dex21.htm ASSET PURCHASE AGREEMENT , Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1428669/000119312510013625/dex21.htm >.

Sample 5 – Asset Purchase Agreement

Assignment; Binding Effect; Severability

This Agreement may not be assigned by any party hereto without the other party’s written consent; provided, that Buyer may transfer or assign in whole or in part to one or more Buyer Designee its right to purchase all or a portion of the Purchased Assets, but no such transfer or assignment will relieve Buyer of its obligations hereunder. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the successors, legal representatives and permitted assigns of each party hereto. The provisions of this Agreement are severable, and in the event that any one or more provisions are deemed illegal or unenforceable the remaining provisions shall remain in full force and effect unless the deletion of such provision shall cause this Agreement to become materially adverse to either party, in which event the parties shall use reasonable commercial efforts to arrive at an accommodation that best preserves for the parties the benefits and obligations of the offending provision.

Security Exchange Commission - Edgar Database,  EX-2.4 2 dex24.htm ASSET PURCHASE AGREEMENT , Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1002047/000119312511171858/dex24.htm >.

Common Contracts with Assignment Clauses

Common contracts with assignment clauses include:

  • Real estate contracts
  • Sales contract
  • Asset purchase agreement
  • Purchase and sale agreement
  • Bill of sale
  • Assignment and transaction financing agreement

Assignment Clause FAQs

Assignment clauses are powerful when used correctly. Check out the assignment clause FAQs below to learn more:

What is an assignment clause in real estate?

Assignment clauses in real estate transfer legal obligations from one owner to another party. They also allow house flippers to engage in a contract negotiation with a seller and then assign the real estate to the buyer while collecting a fee for their services. Real estate lawyers assist in the drafting of assignment clauses in real estate transactions.

What does no assignment clause mean?

No assignment clauses prohibit the transfer or assignment of contract obligations from one part to another.

What’s the purpose of the transfer and assignment clause in the purchase agreement?

The purpose of the transfer and assignment clause in the purchase agreement is to protect all involved parties’ rights and ensure that assignments are not to be unreasonably withheld. Contract lawyers can help you avoid legal mistakes when drafting your business contracts’ transfer and assignment clauses.

whats assignability

Meet some of our Lawyers

Joon H. on ContractsCounsel

I work with private tech companies on entity formation, corporate governance, and commercial agreements. I was an in-house counsel for a unicorn fintech startup and am currently associated with a startup boutique while operating my solo practice. I received my JD from Berkeley Law, and served in the US Navy for 5 years as a combat linguist. I am fluent in Korean.

Daniel D. on ContractsCounsel

I was born and raised in Wayne, New Jersey and attended Seton Hall University, graduating cum laude. I followed my family down to Florida to attend Ave Maria School of Law where I graduated cum laude. I was admitted to the Florida Bar in 2018. During law school, I participated in the Certified Legal Internship program with the State Attorney's Office of the 20th Judicial Circuit and litigated 5 jury trials, 1 non jury trial and argued various motions before the court under the supervision of an Assistant State Attorney. I was an Assistant States Attorney for Collier County from 2018 to 2020 before moving into private practice in the areas of real estate and first party property from 2020 to 2021. As of November 2021, I started my own law practice that focuses on business planning, real estate and estate planning.

Vicki P. on ContractsCounsel

Vicki graduated from Regent University School of Law in Virginia Beach, Virginia in 1996. She is a licensed attorney. She has been admitted to Wisconsin since 1998 and Pennsylvania since 1999.

John V. on ContractsCounsel

Business, Real Estate, Tax, Estate Planning and Probate attorney with over 20 years experience in private practice in Colorado. Currently owner/operator of John M. Vaughan, Attorney at Law solo practitioner located in Boulder, CO. My practice focuses on transactional matters only.

Mark M. on ContractsCounsel

I have 20-plus years of experience as a corporate general counsel, for public and private corporations, domestic and international. I have acted as corporate secretary for a publicly-held corporation and have substantial experience in corporate finance, M&A, corporate governance, incorporations, corporate maintenance, complex transactions, corporate termination and restructuring, as well as numerous aspects of regulatory and financial due diligence. In my various corporate roles, I have routinely drafted complex corporate contracts and deal-related documents such as stock purchase agreements, option and warrant agreements, MSAs, SOWs, term sheets, joint venture agreements, tender agreements purchase and sale agreements, technology licensing agreements, vendor agreements, service agreements, IP and technology security agreements, NDAs, etc. and have managed from both a legal and business perspective many projects in the financial, technology, energy and venture capital fields.

Daniel K. on ContractsCounsel

My practice focuses on business and commercial litigation. I have worked with companies of all sizes from sole member LLCs to those in the Fortune 500. I've advised clients on mergers, equity issuances, commercial transactions, joint ventures, employment issues, and non-competition. I've also drafted and negotiated the underlying agreements for these transactions and more.

Find the best lawyer for your project

Contract lawyers by city.

  • Atlanta Contract Lawyers
  • Austin Contract Lawyers
  • Boston Contract Lawyers
  • Chicago Contract Lawyers
  • Dallas Contract Lawyers
  • Denver Contract Lawyers
  • Fort Lauderdale Contract Lawyers
  • Houston Contract Lawyers
  • Las Vegas Contract Lawyers
  • Los Angeles Contract Lawyers
  • Memphis Contract Lawyers
  • Miami Contract Lawyers
  • New York Contract Lawyers
  • Oklahoma City Contract Lawyers
  • Orlando Contract Lawyers
  • Philadelphia Contract Lawyers
  • Phoenix Contract Lawyers
  • Richmond Contract Lawyers
  • Salt Lake City Contract Lawyers
  • San Antonio Contract Lawyers
  • San Diego Contract Lawyers
  • San Francisco Contract Lawyers
  • Seattle Contract Lawyers
  • Tampa Contract Lawyers

whats assignability

Quick, user friendly and one of the better ways I've come across to get ahold of lawyers willing to take new clients.

Contracts Counsel was incredibly helpful and easy to use. I submitted a project for a lawyer's help within a day I had received over 6 proposals from qualified lawyers. I submitted a bid that works best for my business and we went forward with the project.

I never knew how difficult it was to obtain representation or a lawyer, and ContractsCounsel was EXACTLY the type of service I was hoping for when I was in a pinch. Working with their service was efficient, effective and made me feel in control. Thank you so much and should I ever need attorney services down the road, I'll certainly be a repeat customer.

I got 5 bids within 24h of posting my project. I choose the person who provided the most detailed and relevant intro letter, highlighting their experience relevant to my project. I am very satisfied with the outcome and quality of the two agreements that were produced, they actually far exceed my expectations.

How It Works

Post Your Project

Get Free Bids to Compare

Hire Your Lawyer

Find lawyers and attorneys by city

  • Daily Crossword
  • Word Puzzle
  • Word Finder
  • Word of the Day
  • Synonym of the Day
  • Word of the Year
  • Language stories
  • All featured
  • Gender and sexuality
  • All pop culture
  • Grammar Coach ™
  • Writing hub
  • Grammar essentials
  • Commonly confused
  • All writing tips
  • Pop culture
  • Writing tips

capable of being specified: The word has no assignable meaning in our language.

capable of being attributed: This work is assignable to a 12th-century poet.

Law . capable of being assigned .

Origin of assignable

Other words from assignable.

  • as·sign·a·bil·i·ty, noun
  • as·sign·a·bly, adverb
  • non·as·sign·a·bil·i·ty, noun
  • non·as·sign·a·ble, adjective
  • non·as·sign·a·bly, adverb
  • un·as·sign·a·ble, adjective
  • un·as·sign·a·bly, adverb

Words Nearby assignable

  • assiduously
  • assignation
  • assigned counsel
  • assigned risk
  • assigned sex

Dictionary.com Unabridged Based on the Random House Unabridged Dictionary, © Random House, Inc. 2024

How to use assignable in a sentence

This is a conquered city, virtually if not nominally in a state of siege, without assignable period.

But, as no assignable sense has been found for valance, I can only suppose that it is an error for falance or fallance.

Moreover, most cases of squint arise without directly assignable causes.

That the number of sub-divisions is definite and assignable , there being a limit beyond which it cannot be carried.

Some children, however, are liable to attacks of nose-bleed coming on without any assignable causes.

  • Skip to primary navigation
  • Skip to main content
  • Skip to footer

Nick, & Cindy Davis

Assignable Contracts

July 9, 2019 by Nick & Cindy Davis

The Florida Realtors/Florida Bar AS IS contract has a provision (Section 7) that permits a contract to be assignable. What you should know if this is filled out – and what does this mean for the transaction?

Assignable Contracts - What you want to understand about them

Assignable Contracts – What you want to understand about them

Here is a scenario.

Seller just received a contract offer from a buyer who used a Florida Realtors/Florida Bar “AS IS” Residential Contract for Sale and Purchase, and they observed that the buyer’s offer included a provision in Section 7, Assignability, that would enable the buyer to assign the contract.

Examples of the ramifications if you accept this assignable contract?

The main thing that changes in an assignable contract will be the person or entity that signed the contract (Buyer 1) most likely is not the same person or entity that will actually close on the property (Buyer 2). An assignment is simply a option for a party to a contract to hand legal rights and obligations off to another individual.

How exactly does an assignment happen? This is generally done by having the assignor and assignee sign a legal document called an assignment. In this situation, the assignor is going to be Buyer 1, whose name is on the contract. The assignee will probably be Buyer 2, who accepts the assignment and steps into the shoes of Buyer 1. As soon as the assignment is fully executed, Buyer 1 gives the contractual rights and obligations to Buyer 2, who receives and assumes those rights and obligations.

Florida Realtors does not provide an assignment-of-sales contract form, so one of the buyers is going to be responsible to draft, or hire a lawyer to draft, the assignment.

Why might a buyer want to negotiate an assignable contract? One reason is just that Buyer 1 intends to form a corporation, LLC or trust to take title at closing. In this scenario, Buyer 1 usually just requires a little time after the property is under contract to get the legal paperwork in order. This particular assignable contract generally on the lower risk side of the spectrum, although it’s always up to seller what terms they’re prepared to accept.

Other buyers might prefer an assignable contract since they want to assign their interest in the contract to another buyer they have not yet identified. This assignment of contractual interest is also known as a flip, and it may be a situation where Buyer 1 hopes to collect money from Buyer 2 to execute the assignment. Unlike the previous scenario, a seller has no idea what the personality and business practices of the unknown Buyer 2 are going to be, so as a seller you should be ready for a new person to enter the transaction.

When the parties opt to make the contract assignable, Section 7 of the contract provides two options:

The first option provides that Buyer 1 “may assign and thereby be released from any further liability under this Contract.” This clause is far more favorable for Buyer 1, because it contains a type of release, which is a means for Buyer 1 to remove some of their liability through the release language.

The second option provides that Buyer 1 “may assign but not be released from liability under this Contract.” This option is more favorable for the seller, and Buyer 1 should be more cautious about vetting Buyer 2 when using this clause.

Understand that this is a very general summary of this topic, therefore if buyers or sellers would like a thorough analysis of risks and benefits associated with making a contract assignable, they should consult a lawyer. The lawyer may suggest additional tools, such as carefully tailored assignment clause that has more protection for a party than is available in the very brief options in the form contract.

Have a questions or concern? Nick, Cindy & Nicholas Davis with RE/MAX Premier Group are here to assist you with all your Real Estate Needs. We are always available at 813-300-7116 to answer your questions or you can simply  click here and we will be in touch with you shortly.

whats assignability

Need to get started with your mortgage process? You can contact Kyle Edwards with Iberia Bank at 813-495-5131, or simply click here to start your online application.

Ways Our Family Can Help Your Family

whats assignability

Serving Tampa Bay

Nick & cindy davis, “ team davis”, 813-300-7116, 813-695-6475, re/max premier group, with 2 locations, 27219 sr 56, wesley chapel, fl 33544 & 6506 n florida ave, tampa, fl 33604.

  • TheFreeDictionary
  • Word / Article
  • Starts with
  • Free toolbar & extensions
  • Word of the Day
  • Free content
  • assignability
  • asseveratingly
  • asseveration
  • asseverative
  • asseverator
  • Asseveratory
  • assibilation
  • Assideanism
  • assiduously
  • assiduousness
  • assignation
  • assigned risk
  • Assignment of dower
  • assimilability
  • assimilable
  • assimilating
  • assimilation
  • assimilationism
  • assimilationist
  • assimilative
  • assimilator
  • assimilatory
  • Assimulation
  • Assign Local Distribution
  • Assign Logical Unit Number
  • Assign Medical Transport
  • Assign Missile Radar
  • Assign Net Rekey
  • assign NNX routing
  • assign NNXX routing
  • assign NYX routing
  • assign on-line diagnostic
  • Assign Online Diagnostics
  • assign preprogrammed conference list
  • assign primary zone routing
  • assign receive bypass lists
  • Assign Remote Connection
  • assign secondary traffic channels
  • Assign Switch Classmarks
  • Assign Switch Initialization
  • assign switch locator
  • assign terminal service
  • assign terminal type
  • assign thresholds
  • assign traffic metering
  • Assign Trunk Group
  • assign trunk group cluster
  • Assign Variable Location
  • assign XXX routing
  • assign zone restriction lists
  • Assign-and-Estimate Scheduling Algorithm
  • assignable cause
  • Assignable Contract
  • Assignable Contracts
  • Assignable Square Foot/Feet
  • assignablely
  • assignation of writs
  • assignational
  • assignations
  • Assignatsii
  • Facebook Share
  • Practical Law

Assessing Assignability: Transferring Contractual Rights or Obligations

Practical law legal update 5-546-6326  (approx. 7 pages).

  • An intended transfer is of the type that is prohibited by law or public policy (see Practice Note, Assignability of Commercial Contracts: Statutory and Public Policy Exceptions ).
  • The parties expressly agree to restrict transferability (see Practice Note, Assignability of Commercial Contracts: Contractual Anti-assignment and Anti-delegation Clauses ).
  • Breaching the contract.
  • Making an ineffective and invalid transfer.

Distinguishing Between Assignment and Delegation

  • The assignment of rights to receive performance.
  • The delegation of duties to perform.

Characteristics of Assignments

  • The right to receive performance from the assignor.
  • Its remedies against the assignor for any failure to perform.

Characteristics of Delegation

The general rule governing assignment and delegation.

  • Most assignments of contractual rights.
  • Many delegations of contractual performance.
  • Assignments and delegations that violate public policy or law.
  • Assignments of rights or delegations of performance that are personal in nature.
  • Contracts with anti-assignment or anti-delegation clauses.

Contracts That Present the Greatest Challenges

  • Personal services contracts (see Personal Services Contracts ).
  • Non-exclusive intellectual property licenses (see Intellectual Property Licenses ).
  • Contracts with anti-assignment and anti-delegation clauses (see Contracts With Anti-assignment and Anti-delegation Contract Clauses ).

Personal Services Contracts

Intellectual property licenses, contracts with anti-assignment and anti-delegation clauses, is a change of control an assignment.

  • Contains an anti-assignment and anti-delegation clause expressly restricting a change of control.
  • States that a change in management or equity ownership of the contracting party is deemed to be an assignment.

When Does an Involuntary Transfer Trigger a Restricted Transfer?

  • A contractual anti-assignment and anti delegation clause applies to a specific type or transfer.
  • The transfer is permissible, with or without a contractual anti-assignment and anti-delegation provision.

Drafting and Negotiating Anti-assignment and Anti-delegation Clauses

  • Directly addressing assignment of rights and delegation of performance.
  • Clarifying the universe of restricted transfers.
  • Designating the non-transferring party's consent rights.
  • Specifying any exceptions to non-transferability.
  • Requiring notification of a permitted transfer.
  • Including a declaration that impermissible transfers are void.
  • Adding a novation to the anti-assignment and anti-delegation provision.
  • General Contract and Boilerplate
  • General Commercial
  • United States
  • TheFreeDictionary
  • Word / Article
  • Starts with
  • Free toolbar & extensions
  • Word of the Day
  • Free content

To transfer to another, as to assign one's right to receive rental income from property to another. To designate for a particular function, as to assign an attorney to defend an indigent in a criminal prosecution. To specify or point out, as to assign errors in a lower court proceeding on a writ of error that is submitted to request a court to reverse the judgment of the lower court.

1) v. to transfer to another person any asset such as real property or a valuable right such as a contract or promissory note. 2) n. the person (assignee) who receives a piece of property by purchase, gift or by will. It often shows up in contracts and wills.

TO ASSIGN, contracts; practice. 1. To make a right over to another; as to assign an estate, an annuity, a bond, &c., over to another. 5 John. Rep: 391. 2. To appoint; as, to appoint a deputy,, &c. Justices are also said to be assigned to keep the peace. 3. To set forth or point out; as, to "assign errors," to show where the error is committed; or to assign false judgment, to show wherein it was unjust. F. N. B. 19.

  • 19 year old daughter in jail for bringing marijuana into the jail
  • Admeasurement of dower
  • Aler sans jour
  • allotment of shares
  • Ambassadors and Consuls
  • Apportionment
  • Arctic, Legal Status of
  • Assessed Valuation
  • assignation
  • assignation of writs
  • Assigned Account
  • Assigned Risk
  • Assigned Risk Plan
  • Augustus, John
  • asportation
  • Assassination
  • Assault and Battery
  • assault by penetration
  • assault penalty
  • assault with a deadly weapon, sexual assault with a weapon
  • Assaulted by bus driver at ATM, any recourse?
  • Assaulting a police officer, counterclaims.
  • Assertory covenant
  • Assessment of damages
  • Assets Recovery Agency
  • Asseveration
  • assignability
  • Assignment for Benefit of Creditors
  • Assignment of dower
  • Assignment of errors
  • Assises of jerusalem
  • Assistance, Writ of
  • Assize of mort d' ancestor
  • Assize, or Assise
  • Associate Justice
  • associated company
  • association
  • Association of Chief Police Officers
  • Association of Chief Police Officers in Scotland
  • Assign Local Distribution
  • Assign Logical Unit Number
  • Assign Medical Transport
  • Assign Missile Radar
  • Assign Net Rekey
  • assign NNX routing
  • assign NNXX routing
  • assign NYX routing
  • assign on-line diagnostic
  • Assign Online Diagnostics
  • assign preprogrammed conference list
  • assign primary zone routing
  • assign receive bypass lists
  • Assign Remote Connection
  • assign secondary traffic channels
  • Assign Switch Classmarks
  • Assign Switch Initialization
  • assign switch locator
  • assign terminal service
  • assign terminal type
  • assign thresholds
  • assign traffic metering
  • Assign Trunk Group
  • assign trunk group cluster
  • Assign Variable Location
  • assign XXX routing
  • assign zone restriction lists
  • Assign-and-Estimate Scheduling Algorithm
  • assignable cause
  • Assignable Contract
  • Assignable Contracts
  • Assignable Square Foot/Feet
  • assignablely
  • assignational
  • assignations
  • Assignatsii
  • Facebook Share

IMAGES

  1. There are many benefits to allowing assignability in many circumstances

    whats assignability

  2. How To Say Assignability

    whats assignability

  3. reactjs

    whats assignability

  4. Mid-Term

    whats assignability

  5. Negotiable instrument CA_IPCC students

    whats assignability

  6. Assignability Tool “Did You Know”

    whats assignability

VIDEO

  1. Be Specific

  2. Improving Argument Selection

  3. Navigating Through Change and Ambiguity

  4. Typescript Syntax, Type, Assignability Errors || Syeda Hafsa

  5. The biggest change in Sidemen history... 😮

  6. Chemistry|senior 2| 2nd term|Chapter 1

COMMENTS

  1. Assignability Of Contracts: Everything You Need to Know

    The assignability of contracts is when one side of a contract agreement transfers the contract to another entity, so that the new entity fulfills the terms of the contract. Being able to assign contracts depends on a variety of factors, mainly the language contained in the contract.

  2. What Is an Assignment of Contract?

    An assignment of contract occurs when one party to an existing contract (the "assignor") hands off the contract's obligations and benefits to another party (the "assignee"). Ideally, the assignor wants the assignee to step into his shoes and assume all of his contractual obligations and rights. In order to do that, the other party to the ...

  3. Examples of assignability clauses in contracts

    17. Assignability. During Employee's employment, this Agreement may not be assigned by either party without the written consent of the other. However, Employer may assign its rights and obligations under this Agreement without Employee's consent to a successor by sale, merger or liquidation, if such successor carries on the Business ...

  4. Assignment of Contract: What Is It? How It Works

    An assignment of contract is simpler than you might think. The process starts with an existing contract party who wishes to transfer their contractual obligations to a new party. When this occurs, the existing contract party must first confirm that an assignment of contract is permissible under the legally binding agreement.

  5. Assignable Contract: Overview, Factors, Example

    Assignable Contract: A futures contract with a provision permitting the contract holder to convey his or her rights of assignment to a third party. This enables the contract holder to assign the ...

  6. Assessing Assignability: Transferring Contractual Rights or ...

    Parties to a commercial contract often desire to transfer their rights or obligations to a non-party. However, even though the general rule permits the unilateral assignment or delegation of contractual rights and obligations, there are certain key exceptions to the general rule. This update provides guidance on selected issues to consider when assessing the assignability of a commercial ...

  7. Assignments: The Basic Law

    Assignments: The Basic Law. The assignment of a right or obligation is a common contractual event under the law and the right to assign (or prohibition against assignments) is found in the majority of agreements, leases and business structural documents created in the United States. As with many terms commonly used, people are familiar with the ...

  8. Unlocking Business Opportunities: The Power of Assignable Assets and

    Assignability can apply to various assets and agreements, including but not limited to: 1. Contracts: A business owner may have a contract with a supplier that includes an assignable clause. This means that if the business is sold or undergoes a change in ownership, the new owner can step into the shoes of the original owner and assume the ...

  9. Assignability Definition & Meaning

    The meaning of ASSIGN is to transfer (property) to another especially in trust or for the benefit of creditors. How to use assign in a sentence. Synonym Discussion of Assign.

  10. What Is an Assignment of Contract?

    Assignment of contract allows one person to assign, or transfer, their rights, obligations, or property to another. An assignment of contract clause is often included in contracts to give either party the opportunity to transfer their part of the contract to someone else in the future. Many assignment clauses require that both parties agree to ...

  11. ASSIGNABLE Definition & Usage Examples

    Assignable definition: capable of being specified. See examples of ASSIGNABLE used in a sentence.

  12. Assignment (law)

    Assignment [1] is a legal term used in the context of the laws 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. [2] An assignment may not transfer a duty, burden or detriment without the express agreement of the assignee.

  13. ASSIGNABLE definition and meaning

    ASSIGNABLE definition: capable of being specified | Meaning, pronunciation, translations and examples

  14. What Is an Assignment Clause?

    One exception to the general assignability rule is intellectual property licenses. Legally, a licensor must first give consent before an IP licensee can assign or delegate its rights or obligations, even in the case where the license agreement is silent. Requirements for Assignment Consent. There are different ways to say the same thing in a ...

  15. A Guide to Assignment of Contract in Real Estate

    A Guide to Assignment of Contract in Real Estate. Assignment of contract involves one party transferring the rights of a real estate purchase agreement to another party. This real estate investing strategy can involve time and financial pressure, but the assignor can potentially make a quick buck. Assignment of contract involves one party ...

  16. What Is An Assignment Of Contract In Real Estate?

    An assignment of contract in real estate is when the original party who has a piece of real estate transfers their contractual obligations to that of a new party. Assigning real estate contracts is a common way to "flip" real estate without having to come out of your pocket with any capital. Utilizing a real estate assignment contract to ...

  17. Assignment Clause: Meaning & Samples (2022)

    Assignment Clause Examples. Examples of assignment clauses include: Example 1. A business closing or a change of control occurs. Example 2. New services providers taking over existing customer contracts. Example 3. Unique real estate obligations transferring to a new property owner as a condition of sale. Example 4.

  18. ASSIGNABLE Definition & Usage Examples

    Assignable definition: capable of being specified. See examples of ASSIGNABLE used in a sentence.

  19. Assignable Contracts

    The main thing that changes in an assignable contract will be the person or entity that signed the contract (Buyer 1) most likely is not the same person or entity that will actually close on the property (Buyer 2). An assignment is simply a option for a party to a contract to hand legal rights and obligations off to another individual.

  20. What is Assignability in TypeScript?

    What is Assignability? Assignability is the ability to assign a value of one type to a variable of another type. In other words, it's the set of rules that TypeScript follows to determine whether a value can be assigned to a variable or not. Assignability is important because it helps maintain the integrity of our code.

  21. Assignability

    Define assignability. assignability synonyms, assignability pronunciation, assignability translation, English dictionary definition of assignability. tr.v. as·signed , as·sign·ing , as·signs 1. To select for a duty or office; appoint: firefighters assigned to the city's industrial park.

  22. Assessing Assignability: Transferring Contractual Rights or Obligations

    Characteristics of Assignments. An assignment involves the transfer by an obligee (assignor) of some or all of its rights to receive performance under the contract to a non-party (assignee). The assignor no longer receives any benefits of the assigned rights, which are all transferred to the assignee. However, even though the assignor divests ...

  23. Assignability legal definition of assignability

    assign: To transfer to another, as to assign one's right to receive rental income from property to another. To designate for a particular function, as to assign an ...