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Contracts/Novation
From wikilawschool.net. Wiki Law School does not provide legal advice. For educational purposes only.
- This article is on the legal term; for the company, see Novation Electronic Music Systems.
Novation is a term used in contract law and business law to describe the act of either replacing an obligation to perform with a new obligation, or replacing a party to an agreement with a new party. A novation must be agreed upon by all original parties to the original agreement.
In business, novation is typically the process by which a newly formed corporation assumes the pre-incorporation liabilities incurred by its founders.
