Assignment of Contractual Rights: The Apparent Reformulation of the Personal Rights Rule

Abstract:     
It is a fundamental rule of assignment that personal contractual rights cannot be assigned. It is also well settled that whether or not a right is personal is an issue of construction. However, there is a view that greater assignability should be fostered by doing away with the personal rights rule and allowing a right to be assigned if there is no good objective reasoning for disallowing the assignment. Under this model, assignment is allowed if there is a benefit to the assignor and no real harm to the obligor. This approach blurs the line between the personal rights rule and the separate rule that an obligor is to be no worse off by reason of an assignment. There have been statements in recent Australian cases that appear to adopt this approach. This article looks at those cases and assesses the impact of such a move.

Keywords: Contract, assignment, operation of the personal rights rule

JEL Classifications: K12, K10, K40

Accepted Paper Series