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There are a number of situations where a business or individual will need to assign contractual rights or benefits to a third party. This may be through buying or selling a business, or transferring ownership of intellectual property.
Read on to find out exactly what a Deed of Assignment is, when to use one and how to find legal advice and templates online.
What's in this guide?
- What is a Deed of Assignment?
- When should I use a Deed of Assignment?
- Find customisable legal templates and services online
- Deed of Assignment vs Deed of Novation
- What does a Deed of Assignment include and not include?
- How effective is a Deed of Assignment?
- Do I need a lawyer for a Deed of Assignment?
- How do I write a Deed of Assignment?
- Where can I get free Deed of Assignment templates?
What is a Deed of Assignment?
Put simply, a Deed of Assignment is an assignment of rights. It is a legal document that transfers select legal rights in a contract to a third party (known as the assignee). With this arrangement, the assignor keeps performing their duties under the contract and cannot offload certain obligations or liabilities onto the assignee.
Deeds of Assignment are often confused with Deeds of Novation. We will discuss this further below so you know which document is most suited to your situation.
When should I use a Deed of Assignment?
You'll want to use a Deed of Assignment any time when you need to transfer specific legal rights or benefits of a contract to another party.
This document is used in a variety of contexts including:
- Real estate – leases and sales
- Giving others rights and access to intellectual property and copyrighted material
- Debt collection
- Payment to subsidiary companies owned by a parent company.
Find customisable legal templates and services online
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Deed of Assignment vs Deed of Novation
As mentioned above, Deeds of Assignment and Deeds of Novation are sometimes used interchangeably, but legally there are some key differences between the two.
A Deed of Assignment allows you to transfer select rights, property or benefits to a third party (assignee) while you retain your rights and obligations under the same contract. The assignee does not incur any legal obligation or liability through this arrangement but can exercise their power over the rights or property assigned to them.
A Deed of Novation allows you to release one party from a contract and replace them with a new one. This is a full transfer of a contract, including all rights, benefits, legal obligations and liability. Put simply, this ends the current contract and creates a new one with the new parties involved.
For example, let's say you're a bakery owner who has just sold your business. You would likely have an existing contract with a flour supplier. You would sign a Deed of Novation to transfer that contract to the new owner so they can keep running the business. This transfers all legal rights and responsibilities to them and severs your legal ties to the flour supply contract.
Deeds of Novation are tpyically used when businesses are bought, sold or merged.
What does a Deed of Assignment include and not include?
As previously mentioned, a Deed of Assignment allows one party to transfer rights, benefits and property to another party.
They typically include:
- Benefits, rights or property that is assigned to a third party
- Guidelines for how and when the assignee may use the assigned rights.
They typically don't include:
- Compulsory consent from all parties concerned. An assignor can grant an assignee legal rights and benefits without the need for permission.
- The transferring of legal obligations and liability
- Replacing a party on a contract.
How effective is a Deed of Assignment?
A Deed of Assignment can be a handy and very effective document that allows parties to assign contractual rights to third parties efficiently without the need to draw up a separate contract. These documents give flexibility to businesses and individuals as they expand their horizons and work with new people.
Do I need a lawyer for a Deed of Assignment?
That's up to you to decide. But given how Deeds of Assignment and Deeds of Novation are so similar, the wrong wording or clauses penned by an inexperienced person could wind up with you signing over the rights to the entirety of a contract. A good lawyer can draft a bulletproof document that ensures you are protected and will advise on what rights and benefits to include in the deed.
How do I write a Deed of Assignment?
Writing a Deed of Assignment depends entirely on the rights, benefits or property you are giving access to. As there are multiple clauses in this agreement, starting with a template is a solid way to begin drafting this document.
Make sure your document includes:
- Key information: Names and contact details of all parties involved.
- Identification: Setting out the rights, benefits, permission or property being assigned.
- Warranties: A clause that guarantees all parties are able to perform their outlined duties.
- Confidentiality: A clause that mandates all rights, benefits and information shared with the assignee will remain confidential.
You may feel it's a good idea to have a contracts lawyer go over the finalised document before signing.
Where can I get free Deed of Assignment templates?
- SprintLaw. Fixed-price Deed of Assignment packages starts at $875. This includes a custom Deed of Assignment drafted to meet your requirements, phone consultations with a lawyer and a complimentary amendment to the final draft.
- LawDepot. LawDepot has a Deed of Assignment template you can download and fill in yourself for $10.
- Net Lawman. Buy a template or get the template along with a review from one of their in-house legal experts.
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