Novation Agreement
/ˌnoʊ.veɪʃən əˈɡriːmənt/
Definitions
- (n.) A contract through which an original party transfers its rights and obligations under an existing contract to a new party, replacing the former party's position.
The company signed a novation agreement to transfer its contractual duties to a subsidiary.
Forms
- novation agreements
Related terms
See also
Commentary
Novation agreements differ from assignments by requiring the consent of all original and new parties, effectively replacing one party in the contract rather than merely transferring benefits or duties.
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