Assignment of Rights

In one sentence

The transfer of a contractual right from one party to another, making the new party the beneficiary.

Plain English

An assignment of rights is when one party to a contract transfers their right to receive something to a different person. For example, if you are owed $1,000 under a contract, you can assign (transfer) that right to someone else, who then has the right to collect the $1,000. Not all rights can be assigned—some are too personal or the contract forbids it—but most payment rights can be.

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Example

A contractor finishes work and is owed $50,000 by the property owner. The contractor assigns that right to a bank as collateral for a loan. The bank can now collect the $50,000 directly from the property owner.

Used in a sentence

“The company assigned its rights to future royalties to an investment firm in exchange for immediate cash.”

Related terms

Discharge of Contract

The release of both parties from their contractual obligations.

Condition

An event that must happen (or not happen) for a contract obligation to take effect.

Condition Subsequent

An event that, if it occurs, ends or excuses performance under a contract.

Condition Concurrent

Mutual promises in a contract that must be performed at the same time by both parties.

Legal Value

Something of worth in the eyes of the law that can support a binding contract.

Written Contract

An agreement between parties that is documented in writing and signed by the parties involved.

Offer

A proposal to enter into a binding agreement on specific terms.

Acceptance

Agreeing to the exact terms of an offer, creating a binding contract.

This page is a plain-English reference and is not legal advice. Laws vary by jurisdiction and change over time. For specific situations consult a licensed attorney.