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Editing Contracts/Assignment
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==Liabilities and duties== | ==Liabilities and duties== | ||
Unless the contractual agreement states otherwise, the assignee typically does not receive | Unless the contractual agreement states otherwise, the assignee typically does not receive greater rights than the assignor, and the assignor may remain liable to the original counterparty for the performance of the contract. The assignor often delegates duties in addition to rights to the assignee, but the assignor may remain ultimately responsible. | ||
However, in the United States | However, in the United States there are various laws which limit the liability of the assignee, often in order to facilitate credit, since assignees are typically lenders.<ref name=AssigneeLiability>[http://arnstein.com/attorneypublications/Ropiquet/Assignee.Liability.-.Through.the.Minefield.pdf Assignee Liability: Through the Minefield]. Arnstein & Lehr LLP.</ref> Notable examples include a provision in the [[Truth in Lending Act]]<ref>See 15 U.S.C. 1641(a).</ref> and provisions in the [[Consumer Leasing Act]] and the [[Home Ownership Equity Protection Act]].<ref name=AssigneeLiability/> | ||
In other cases, the contract may be a [[negotiable instrument]] in which the person receiving the instrument may become a [[holder in due course]], which is similar to an assignee except that issues | In other cases, the contract may be a [[negotiable instrument]] in which the person receiving the instrument may become a [[holder in due course]], which is similar to an assignee except that issues such as lack of performance by the assignor may not be a valid defense for the obligor.<ref name=PSTCC_HDC>[http://www.pstcc.edu/departments/lat/classes/2300/notes/chap23.htm Commercial Paper: Holder in Due Course & Defenses] {{webarchive|url=https://web.archive.org/web/20121128024402/http://www.pstcc.edu/departments/lat/classes/2300/notes/chap23.htm |date=2012-11-28 }}.</ref> As a response to this, the United States [[Federal Trade Commission]] promulgated Rule 433, formally known as the "Trade Regulation Rule Concerning Preservation of Consumers' Claims and Defenses", which "effectively abolished the [holder in due course] doctrine in consumer credit transactions".<ref name=PSTCC_HDC/> In 2012, the FTC reaffirmed the regulation.<ref>[http://ftc.gov/opa/2012/05/holderrule.shtm FTC Opinion Letter Affirms Consumers' Rights under the Holder Rule]. FTC.</ref> | ||
==Assignment of contract rights== | ==Assignment of contract rights== |