Can you assign part of the benefit of a collateral warranty?

Can you assign part of the benefit of a collateral warranty?
slice of pieThe problem:
In some cases, a construction project intended to be sold as a single unit is ultimately divided into one or more parts. Upon the sale of such a part, how does one deal with collateral warranties originally granted in respect of the entire site?

 

The question:

Can a purchaser take a legal assignment of only part of a collateral warranty?

The likely answer...

This will depend upon the terms of the warranty in question.

If the underlying building contract or consultant appointment (and any associated warranties) are based on industry standard forms and/or reflect the market norm, it would be unusual for assignment of part of the warranty to be permitted.

Possible solutions?

Ask for a new collateral warranty...

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About the author:

Becky Johnson is a solicitor specialising in non-contentious construction law. Becky also has experience in advising in connection with construction disputes, including adjudication. Becky joined Lexis®PSL in 2014. She qualified as a solicitor at Olswang LLP in 2009 and subsequently joined Wedlake Bell LLP in 2011. Becky is experienced in advising clients across the construction industry including developers, funders, contractors, consultants and specialist sub-contractors in relation to all matters relating to construction projects.