Novation (Noun)
Meaning
(law) the replacement of one obligation by another by mutual agreement of both parties; usually the replacement of one of the original parties to a contract with the consent of the remaining party.
Classification
Nouns denoting acts or actions.
Examples
- The novation agreement was signed by all parties, effectively substituting the new contractor for the original one.
- The company's lawyer advised them to seek a novation to transfer the liability to the new owner.
- The novation clause in the contract allowed for the substitution of one party with another without affecting the overall terms.
- The court ruled that the novation was valid, as both parties had given their consent to the change.
- The novation process was complex, requiring the agreement of all parties involved in the original contract.