Tabasom Mahjub Tm682 Supervision Essays 2021-22 Louise Gullifer Supervision 1 (answer both parts (i) and (ii)) i. What is the difference between a statutory and an equitable assignment? An assignment is the transfer of a right or benefit from one party to another. This can be categorised as either statutory or equitable assignment. First, we consider statutory assignment and compare the differences with equitable assignment. Then, we evaluate whether the extent of these differences and how significantly they affect the way assignment is carried out. Statutory assignments are governed by statute, namely s.136 of the Law of Property Act 1925. Under this section, the assignment must be in writing and signed by the assignor, only the benefit of an agreement may be assigned, the assignment must be absolute, rights to be assigned must be wholly ascertainable and must not relate to part only of a debt and notice must be received by the other parties for the assignment to occur. This importantly contrasts against equitable assignments whereby an assignment does not have to fulfil the statutory criteria applicable under s. 136. An equitable assignment can be made in two ways. Firstly, the assignor can inform the assignee that he transfers a right or rights to them. Secondly, the assignor can instruct the other party or parties to the agreement to discharge their obligation to the assignee instead of the assignor. Whilst for both statutory and equitable assignment, only the benefit of an agreement may be assigned, for the latter type of assignment there is no requirement for written notice to be given or received (Williams v Dunlop, Phelps v Spon-Smith). Thus, formalities play a role in highlighting the differences between the two variations of assignment. Arguably, the most significant difference between a legal and equitable assignment is a procedural one. An equitable assignee cannot bring an action (where an equitable chose is not absolute) in its own name against the third-party contractor but must join the assignor as party to the action or align with certain rules regulating equitable assignment. However, a legal assignment within the act transfers a legal right in the chose to the assignee. Consequently, the assignee sues the debtor in his own name. This difference is illustrated in General Nutrition v Holland and Barret whereby the beneficiary of an equitable assignment did not have the right to bring proceedings in its own name and had to do so jointly with the assignor which had assigned rights in the underlying contract. Although equitable assignments have limitations, an assignor and assignee may prefer this route because they do not want to form a direct relationship between the obligor and the assignee and to protect the debtor from the possibility of any further claim brought by the assignor
Tabasom Mahjub Tm682 (Kapoor v Westminster Bank). This is because it is more efficient or preferable that the debtor continue to deal with the assignor. For instance, an assignor bank wishes to continue to service its relationship with borrowers who are