Assignment Contract Law

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For example, if Karrie’s business is tree trimming, not lawn mowing, the contract can’t be assigned to her.The assignor may assign any right unless (1) doing so would materially change the obligation of the obligor, materially burden him, increase his risk, or otherwise diminish the value to him of the original contract; (2) statute or public policy forbids the assignment; or (3) the contract itself precludes assignment.The common law of contracts and Articles 2 and 9 of the Uniform Commercial Code (UCC) govern assignments.The Company will have the right at all times to assign any of its rights or obligations …to a direct or indirect wholly owned Subsidiary of the Company, provided that, in the event of any such assignment, the Company will remain liable for all such obligations.For the assignment to become effective, the assignee must manifest his acceptance under most circumstances.This is done automatically when, as is usually the case, the assignee has given consideration for the assignment (i.e., there is a contract between the assignor and the assignee in which the assignment is the assignor’s consideration), and then the assignment is not revocable without the assignee’s consent.The assignor’s intention must be that the assignment is effective without need of any further action or any further manifestation of intention to make the assignment.In other words, the assignor must intend and understand himself to be making the assignment then and there; he is not promising to make the assignment sometime in the future.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.Rights and obligations of specific people can’t be assigned because special skills and abilities can’t be transferred. For example, Billy Joel can’t transfer (assign) a contract to perform at Madison Square Garden to anyone else.


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