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Novation should be distinguished from assignment.
Novation occurs when A and B are party to an agreement and B 'transfers' both their obligations and rights under the agreement to C, such that C can be said to 'step into the shoes' of party B. The result of a novation is a new contractual relationship between A and C, and the contract between A and B being extinguished.
An assignment is 'an immediate transfer of an existing proprietary right, vested or contingent from one party to another'. ‘Assigning a contract' is concerned with transferring a party's rights under the contract only, and not the transfer any of their obligations, a third party. In a contract between A and B, B can choose to assign their rights under the contract to C. The result of an assignment is that the original contract between A and B remains in place, no new contract between A and C is established, but C receives a benefit of the original contract which was originally the benefit of B.
For further information, see Practice Notes: What constitutes a valid assignment of a contract? and Novation—why and how to novate a contract.
The legal position as to novating part of a contract is not straightforward.
The traditional, accepted understanding of novation is that one original contract is extinguished and replaced by a
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