MBE Rules · Contracts
Assignment of rights
Restatement §317; UCC §2-210
The rule
An obligee may assign contract rights to a third party (assignee), who then stands in the assignor's shoes and may enforce the right directly against the obligor. Assignment is invalid if it would materially change the obligor's duty, materially increase risk or burden, or materially impair the obligor's chance of return performance. Contract clauses prohibiting assignment generally bar only the delegation of duties or give the obligor a damages claim — they do not void the assignment of the right to receive payment.
In plain English
An assignment transfers an existing contract right (typically the right to be paid) to someone else. The assignee can sue the obligor directly. Between successive assignees for value, the first in time generally prevails, though gratuitous assignments are revocable.
Memory hook
Assign RIGHTS, delegate DUTIES.
The trap
Anti-assignment clauses look ironclad but are strictly construed — courts often read them as barring delegation only, especially for the right to receive money (which is freely assignable under UCC §2-210(2) and §9-406).
How examiners test it
Obligee assigns right to payment; obligor refuses to pay assignee, citing an anti-assignment clause. Analyze whether the clause bars assignment of the right or only delegation of duty.
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