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For contract assignments, does the assignor remain liable for breaches by the assignee? Ex: O and D have a contract. D assigns all the rights and duties of the K to E. Is D still liable if E breaches? Is it that the assignee is primarily liable and the assignee is secondarily liable (so they could both be sued by O for E's breach? (Not wondering about the delegatee issues, just the assignor/assignee analysis). Thanks.

Impishee wrote:For contract assignments, does the assignor remain liable for breaches by the assignee? Ex: O and D have a contract. D assigns all the rights and duties of the K to E. Is D still liable if E breaches? Is it that the assignee is primarily liable and the assignee is secondarily liable (so they could both be sued by O for E's breach? (Not wondering about the delegatee issues, just the assignor/assignee analysis). Thanks.

Yes D is still liable unless there is a release (novation, O and E must agree). Usually O and E are both jointly and severally liable unless otherwise agreed.

Primary liable/secondary liable analysis are often used in the mortgages settings. D would be primary liable if the E is only subject to the mortgages and second liable if E is subject to and assumes the mortgages.

I AM SO SORRY IF I'M WRONG.

I think this is right, thanks!

Impishee wrote:I think this is right, thanks!

I hope you really saw this before the exam. There were 3 questions on this. or maybe 2.

A good rule of thumb is that you're not off the hook unless (as stated above) there has been a novation. You'll still be stuck as the assignor if the assignee doesn't perform the obligation that you as the assignor promised to perform.

Sean (Silverman Bar Prep)
http://www.mbetutorial.blogspot.com