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QUESTION ( 2 9 ) Breckon Limited ( Breckon ) are contractors for ABC Development Company ( ABC ) in a multimillion pounds contract. The

QUESTION (29) Breckon Limited (Breckon) are contractors for ABC Development Company (ABC) in a multimillion pounds contract. The contract between the parties is not a standard form contract but one drafted by ABC's legal team. The contract is silent on assignment. ABC has made a habit of being late on interim payments. Having now successfully completed the contract and agreed to the final account, Breckon has without informing ABC, assigned its rights to payment on the final payment certificate to Hassler Limited (Hassler). Hassler is a new company that is specialised in collecting construction debt. Hassler has unconventional methods that often are embarrassing to the company it is collecting from. Hassler has paid Breckon a percentage of the agreed final certificate. Hassler has also written to ABC to tell them it has now taken over the debt they owe Breckon in the final certificate. It has made it clear that failure to pay on the contractual date will attract various actions including suing ABC, using Breckon's name. The management of ABC are worried and feel the action of Breckon is wrong and illegal especially because they had not been informed of the assignment by Breckon. They have approached you for your recommendation. The correct position of the law is: a. Breckon seems successfully to have put into effect an assignment, the action is legal and correct, the contract having been silent on assignment. b. Breckon could have been right if it had informed ABC, in the circumstance Breckon's assignment is invalid. c. The action of Breckon is illegal, it does not comply with the Law of Property Act 1925 Section 136 d. ABC, Breckon, and Hassler should meet and agree to a novation, otherwise, the arrangement cannot work.

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