Sub-sales and assignments


Published by a ³ÉÈËÓ°Òô Property expert
Practice notes

Sub-sales and assignments


Published by a ³ÉÈËÓ°Òô Property expert

Practice notes
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What is the difference between a sub-sale and an assignment?

Sub-sale

A sub-sale arises where A contracts to sell a property to B but, before completing the purchase from A, B then enters into a separate contract with C to sell the property to C. There are, therefore, two sale contracts in relation to the one property (A-B and B-C). Completion can be effected either by:

  1. •

    a single transfer (A to C, at B’s direction), or

  2. •

    two transfers (A to B and then B to C)

Assignment

An assignment arises where A contracts to sell a property to B and B then assigns the benefit (but not the burden) of that contract to C. Completion is then effected by a single transfer from A to C.

Assignment must be distinguished from a novation. Novation arises where A contracts with B who then ‘transfers’ (or novates) its rights and obligations under the contract to C. The novation requires A’s consent. The result of the novation is that C can be said to 'step into the shoes' of B, with

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Completion definition
What does Completion mean?

means completion of this agreement in accordance with clause[s] [insert number of the clause(s) dealing with completion of the agreement];

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