ASSIGNMENT AND DISCHARGE OF CONTRACTS 1. Definition of assignment.—Persons other than a creditor may become entitled by representation or assignment to stand in the creditor's place, to exercise his rights under the contract; in other words, the creditor may transfer his rights against his debtor to some third person. An assignment, says another au thority, is a transfer by one party to another of some right, title or interest in personal or real property. The instrument by which the transfer is made is also frequently called an assignment. The assignment must not increase the debtor's burden or diminish his remedies.
2. Competent parties to an who have capacity to contract may make an assign ment. Where a partnership has a claim against some debtor, ordinarily one partner can assign this claim to some other person. A may assign his claim against B thru the ministry of his agent C. A tenant, where he is not forbidden by his contract or by law, may assign his interest in a lease. The person to whom the rights are assigned, under a contract may bring action in his own name; generally, notice in writing must be given to the debtor of the assignment, as he is entitled to know to whom he can pay his debt. Thus if a debtor, before receiving notice of the assignment, were to pay his original creditor, he would be discharged. If the assignee sues him, he will be able to raise against the assignee any defence he might have raised against the original creditor. On the other hand, the debtor may consent to the assignment, in which case no notice will be necessary.
When there are several competing assignees, their claims will rank as between themselves, not according to the order in date of the assignment, but according to the dates at which they have respectively given no tice to the debtor.' The debtor, on paying the first who gives notice to him, is discharged. In the case of negotiable instruments, these difficulties are overcome in that the absolute benefit of the contract is attached to the ownership of the document, which according to ordinary rules would be the only evidence of the con tract. The instrument itself when it is transferable by indorsement is an authentic record of the succes sive transfers, and the bona fide possessor of the in strument is presumed to be the true owner thereof.
3. Assignment of the assigning of liabilities the converse of the rule we have been con sidering is followed. Ordinarily speaking, a debtor may not assign his liability to be performed by some third person. It is a matter of public policy that the creditor should know to whom he may look for satisfaction after considering the character, credit and substance of the person with whom he contracted. Of course, if the creditor consents to accept another debtor a new contract is formed, and the old debtor will be released to the extent of the new contract.
Where a person has undertaken an obligation which is not purely personal and does not require the exer cise of his own peculiar skill, he may have the contract performed by some other person, but he will remain li able for its due performance according to his contract. Again, there may be certain servitudes attaching to a piece of land, as, for example, the servitude by which low lying land must receive surplus water from higher land; if the owner of the lower land assigns or sells it, the person to whom he assigns or sells must respect the servitude. If a party to a contract dies, his rights and liabilities pass to his heirs or representatives, and while they may take advantage of the rights, they must also carry the liabilities under the contract made by the deceased.
4. Other examples of and mortgages are generally assignable, as also the bene fits under judgments, insurance policies and contracts of suretyship. Chattel mortgages may also be as signed, in which case the transfer may cover the legal title to the property mortgaged and all the rights of the mortgagor under the mortgage, or only the equity or equitable interest of the assignor. But if a person has a right of action for breach of promise to marry, it is contrary to public policy that this right of action should be assigned to a third person. If A con tracts with a famous artist to paint his portrait, and the artist assigns the contract to another artist equally famous and able, A is not bound to accept the picture by the second artist, or to recognize him in any way.