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Contracts • Third Parties
K#190
Legal Definition
There are several implied warranties of an assignor in an assignment for consideration: (1) the right assigned actually exists; (2) the right assigned is not subject to any then-existing defenses by the obligor; and (3) the assignor will do nothing after assignment to impair the value of the assignment.
However, there is no warranty as to the obligor's actions after the assignment.
However, there is no warranty as to the obligor's actions after the assignment.
Plain English Explanation
When an assignor gives rights to an assignee, it includes default warranties that (1) the rights are real and not just made up (which would be fraud), (2) the rights aren't already undermined by some existing defense (which would need to be disclosed), and (3) that the assignor won't later come back and cause drama, which would affect the value of the rights.
Visual Aids
Related Concepts
In a third-party beneficiary situation, who is the third-party beneificiary, who is the promisor, and who is the promisee?
What defenses may a promisor assert against a third-party beneficiary?
What duties are not delegable?
What is a delegatee?
What is a delegator, delegatee, and obligee?
What is an assignee?
What is an assignment?
What is an assignor?
What is an obligee?
What is an obligor?
What is a promisee?
What is a promisor?
What is the difference between an assignment and a delegation?
What is the difference between an incidental and intended beneficiary?
What is the effect of a clause prohibiting assignment?
What is the effect of a contract containing no language about assignment rights?
What is the effect of consideration on assignment rights?
What is the effect of invalidation language on assignment?
What two types of intended beneficiaries are there?
When are modification agreements between the obligor and assignor effective?
When can an assignee sue an obligor for payments to the assignor?
When do a third party's rights to enforce the contract vest?
When does delegation of duties occur?
Who can sue whom in a suit involving beneficiaries, promisees, and promisors?
Who can sue whom in a suit involving the assignment of rights?
Who can sue whom in a suit involving the delegation of duties?
Who prevails when the same rights have been assigned to multiple parties?
