ContractsContract_assignment_and_novationEASY
What is the key difference between assignment and novation?
Correct Answer
C) Assignment transfers rights while the original party may remain liable; novation substitutes a new party and releases the original
Assignment transfers rights without necessarily releasing the original party. Novation substitutes a new party with all parties' consent, releasing the original obligor.
Answer Options
A
Assignment requires court approval; novation does notB
There is no difference; the terms are interchangeableC
Assignment transfers rights while the original party may remain liable; novation substitutes a new party and releases the originalD
Novation applies only to leases; assignment applies only to salesWhy This Is the Correct Answer
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Background Knowledge for Contracts
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Real World Application in Contracts
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Key Terms:
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