Novation letter agreement
A short novation agreement to transfer all of one party’s rights and obligations under an existing contract to a third party. It is designed for use when the outgoing party wishes to present the novation as a relatively informal letter agreement. The drafting notes explain what novation is, when a novation agreement might be used to transfer a contract, the key legal requirements for consent and consideration, and the implications of novation for pre-existing liabilities. The agreement provides for the outgoing party to surrender its rights and be released from its obligations under the original agreement in return for the incoming party assuming rights and obligations that duplicate those of the outgoing party. It also provides drafting to deal with pre-novation liabilities, with an option to include indemnities (commonly but not automatically included in novation agreements).
Already a Practical Law customer? Sign in
Get access to this document with Practical Law
Why Practical Law?
Gain a built-in attorney network
Practical Law’s resources are written and maintained by over 650 dedicated, full-time attorney-editors globally. They’re highly qualified, having practiced at the world’s leading law firms, corporate law departments, and government agencies, so they understand the challenges you face. They dedicate themselves to creating resources to help you navigate the new legal realities, legislative changes, and practice areas impacting your clients or organisation.
See how to leverage the expertise of Practical Law’s attorney-editors to help you practice more efficiently.
Learn more about Practical Law
Expert guidance
650+ full-time, experienced attorney-editors keep you up to date globally
Total resources
118,000+ total resources across 17 practice areas ensure comprehensive coverage
Timely updates
150,000+ hours spent in 2025 maintaining and updating resources