Assignment agreement
An assignment (cession): transfer of a right to claim, what passes to the new creditor, and which terms to check before you sign
An assignment agreement records the transfer of a right to claim: the assignor transfers to the assignee the right to demand performance from the debtor. Without a precise description of the right being assigned and of the grounds on which it arose, the new creditor risks receiving an “empty” title.
In practice, assignment is used when a debt is sold, when obligations are reorganized, and in internal settlements between companies. Separately, check any ban on assignment in the original contract and the procedure for notifying the debtor.
Draft a text or check a finished assignment agreement:
Structure of an assignment agreement
- The parties: assignor and assignee
- Subject matter: which right to claim is assigned
- The ground on which the right arose (a contract, a certificate, a court decision)
- The scope of the assignment: principal, interest, penalty, and security rights
- The price of the assignment and the payment procedure
- Handover of documents and evidence of the claim
- Notice to the debtor: who gives it, and by when
- The assignor’s warranties and liability
What to check in the right being assigned
- Whether the claim exists, and whether it has been partly discharged
- Whether the original contract bans assignment or requires consent
- Whether security rights pass (a pledge, a suretyship)
- Which moment is treated as the moment the right passes
- What the debtor receives: notice and the new creditor’s details
Dangerous wording:
- “All rights under the contract are assigned” with no list and no amount
- “The assignor is not liable for the validity of the claim”
- “Notice to the debtor is not required”
- “Documents are handed over on request” with no deadline and no list of the set
For the assignor and for the assignee
The assignor cares about: the price of the assignment, the moment risk passes, and a limit on later claims. The assignee cares about proof that the claim exists, a complete set of documents, notice to the debtor, and a clear scope of the rights transferred.
If you need intermediation in deals, not an assignment of a debt, see an agency agreement. For regular commercial settlements, a services contract or separate set-off agreements are sometimes closer.
Draft or check
A draft — draft an assignment agreement online. A finished file — check it for risks / with AI. Edits — compare the versions.
Common questions about an assignment agreement
Is the debtor’s consent required for an assignment?
Not always. But if the original contract bans assignment or requires consent, the assignment can be challenged without it.
When must the debtor pay the new creditor?
After proper notice that the assignment has taken place. Until notice, performance to the old creditor is usually treated as proper.
What is included in the scope of the assignment?
What the assignment agreement states expressly: the principal, interest, a penalty, and security rights. “Everything under the contract” with no breakdown is a risk for both parties.
How do you check an assignment agreement online?
Upload the file to the service: the review will highlight a vague subject matter, weak assignor warranties, and gaps in notice to the debtor.
An assignment agreement online
Assemble a draft from a brief, or upload a PDF or Word file for a review of assignment risks.