Novation Deed (Asset Sales)

This Novation Deed (Asset Sales) is used where a contract needs to be transferred as part of an asset sale and the parties want a clear tripartite document to effect that transfer.

Under English law, the benefit of a contract may be assigned, but the burden (the obligations) cannot be transferred without the other contracting party’s consent. While asset sale agreements often provide that the parties will use reasonable endeavours to obtain third party consent, a novation deed is used to provide certainty by recording the consent and the agreed transfer in a single deed.

What does Novation Deed (Asset Sales) do?

It novates the relevant contract so that the buyer steps into the seller’s shoes as contracting party. The buyer will usually assume liability for the seller’s obligations from the point of novation.

What does Novation Deed (Asset Sales) cover?

• A tripartite arrangement between the seller, the buyer and the other contracting party.
• Transfer of the contract (or an agreement affecting third party assets) so the buyer becomes the contracting party in place of the seller.
• Assumption by the buyer of the seller’s obligations from the point of novation, where applicable.
• Execution as a deed by each party.

When should you use Novation Deed (Asset Sales)?

Use this deed where a contract (or an agreement affecting third party assets) is being transferred as part of an asset sale and third party consent is required to transfer obligations as well as rights.

Novation Deed (Asset Sales) is part of Corporate. Just £38.50 + VAT provides unlimited downloads from Corporate for 1 year.