The assignment of a contract occurs when one party to the contract (the assignor) transfers its rights and responsibilities under the contract to another person or entity (the assignee)—usually someone who was not a party to the original contract.
Contracts often include a paragraph or clause near the end of the agreement that addresses whether the parties may assign the contract.
In Texas, the assignment of a contract is generally permissible unless the contract itself prohibits it or the assignment would significantly change the obligations of the other party. Texas law recognizes the right to assign contracts as a part of the freedom to contract. However, certain types of contracts, such as personal service contracts or contracts that require a unique skill, are typically not assignable. Additionally, if a contract requires the other party's consent for assignment, then the assignor must obtain that consent before the assignment can be valid. It is also important to note that while rights under a contract can be assigned, the assignor cannot transfer its obligations without the agreement of the other party to the contract. The specific clause addressing assignment in the contract will dictate the permissibility and requirements for a valid assignment. An attorney can provide guidance on the enforceability of an assignment clause and the proper procedure for assigning contractual rights and responsibilities in Texas.
