The contract of assignment of the right of claim is called cession. This agreement has a special place among other transactions. Further we consider in detail such concepts as the assignor and the assignee: who they are, what legal capabilities and obligations they have.
General information
Usually, the assignment of claims involves the payment of a certain compensation by the receiving party. In fact, three entities are involved in the transaction:
- A person who has certain obligations by virtue of the original contract. This member is called the debtor.
- Subject to which obligations arose. He is a creditor.
- A person who, in fact, is ceded the right to claim.
Assignor and assignee: who is it?
Entities that have certain obligations are called debtors. This term has a somewhat narrow meaning. Nevertheless, it, in accordance with existing practice, can mean not only monetary obligations, but also debts of a different kind. For example, it may be an obligation to perform work / provide a service, transfer ownership, and so on. An entity acting as a creditor is referred to in the assignment as an assignor. This person transfers to a third party the opportunity to demand payment of arrears. The latter is referred to in the transaction as the assignee. He gets the opportunity to demand payment of debt in his favor.
Assignee
An individual, as a result of a transaction on the transfer of a legal opportunity to demand repayment of a debt, assumes all the powers that the original creditor had. The latter leaves the contract. The assignee is a party to the transaction who, in accordance with the agreement concluded with the original creditor, gets the opportunity not only to demand repayment of the debt, but also to apply sanctions to the person evading it.
The specifics of the transfer of authority
The conclusion of the contract does not imply the obligatory consent of the borrower. However, the law stipulates the need to notify the debtor of such a transaction. The notice is needed so that the assignee begins to receive payments. This will avoid potential problems for both parties to the contract. If the debtor does not know about the change of the lender, he can continue to repay the obligations in favor of the original lender. As a result, he is in arrears.
Credentials of a new creditor
The rights of the assignee at the conclusion of the transaction have the same scope and the same limits as the original lender. For example, the contract provided for the ability to repay obligations by transferring property. The lender, therefore, can turn it in his favor. The assignee has the same opportunity. This will not depend on whether a notice of transaction has been sent to the debtor. Payment (repayment of an obligation) can be made in any form (cash / in kind). But in all cases it is necessary to determine the powers that a new creditor has.
Debt repayment
In practice, payments are rarely made in cash. Usually, obligations are paid off by crediting to an account that the assignee has. This can also be done by issuing promissory notes, checks, other negotiable documents. In accordance with the principle of autonomy of the will of the participant, the parties to the assignment agreement may decide in different ways the issue regarding the rights of the assignee to the sums of money and property received in pursuance of the original agreement.
Important point
As mentioned above, the right of the assignee is retained regardless of whether the debtor has been notified of the conclusion of the contract of assignment. This approach is considered universally recognized and operates in almost all legal systems. Its application is determined by the need to ensure withholding from payment, if it was made before the notification of the debtor. If the money arrived to the assignor after the borrower was informed, the assignee receives the right to these payments, since the debt under the new agreement has not been repaid.
