COMMON LAW 235
The Section does not say :
(i) By whom is notice to be given—by the assignor or assignee.
(ii) At what time notice is to be given so that it may be given, by the assignee after the death of the assignor.
Effect of Want of Notice
- Absence of notice does not disentitle an assignee of suing on the assignment. It only imposes certain disabilities and results in certain disadvantages.
(i) The assignee cannot sue the debtor in his own name without making the original creditor a party to the action.
(ii) The assignee will be subject to equities arising between the debtor and his original creditor before the date of the assignment and will lose his right against the debtor altogether if the debtor pays the original creditor. On the other hand, if the debtor pays the original creditor after receiving notice of assignment, the assignee could still recover the debt from him.
(iii) The assignee, who fails to give notice to the debtor of his assignment, will be postponed to a subsequent assignee for value who has no notice of the previous assignment, and gives notice of his assignment to the debtor.
Requisites of an Equitable assignment of a Legal Chose in action
An Assignment which does not comply with the statutory requirements is not necessarily ineffectual, for it may operate as an Equitable Assignment.
Two things are necessary :
(1) There must be value given by the assignor.
(2) A charge created by agreement between the debtor and the creditor upon specific funds or by an order given to the creditor upon a person holding money belonging to the debtor, will amount to an assignment.
- Burn vs. Carvallo
4 Hylve & Craig’s Reports. 690
Facts
F was in the habit of sending consignments of goods to R, who was trading in a different town and used to draw Bills of Exchange upon R. It was arranged by F with B & Co. that they should endorse and negotiate his Bills drawn upon R against