Pooja posted an Question
August 18, 2021 • 20:25 pm 30 points
  • UGC NET
  • Commerce

What is novation of contract ?

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  • Rucha rajesh shingvekar best-answer

    A novation is an agreement made between two contracting parties to allow for the substitution of a new party for an existing one. Both original contracting parties must agree to the novation. For example, a person as a seller agrees with the buyer to pay the price to a third party, as new creditor of its debt. In this case, the debtor will be freed by the initial creditor, being bound to the new one, as effect of novation.

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