Q&As

Where A and B enter into a contract, and B’s performance is guaranteed to A by third party C, does the subsequent assignment of the benefit of the contract from B to C in any way affect the validity of the guarantee given by C and does the assignment require the consent of C in its capacity as guarantor?

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Published by a LexisNexis Commercial expert
Published on: 06 November 2017
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In this Q&A, we have focussed on the impact of an assignment on the contractual relationship between the parties and have not considered separate issues which may arise under guarantees.

Effect of an assignment

In this Q&A, A and B enter into an initial contract with each other and exchange promises to perform obligations. B’s performance under the initial contract is guaranteed to A by third party C (we assume under a separate contract, such as a parent company guarantee). It is not immediately obvious why the assignment of rights under the initial contract from B to C would negate the guarantee agreement. We assume in this Q&A that the assignment is a true assignment of rights only.

An assignment is a transfer of

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United Kingdom

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