Abolition of certain rules of law
Section 17 – Abolition of certain rules of law
100.Subsection (1) abolishes four common law rules insofar as they apply to assignations to which Part 1 applies:
The first is any rule that a mandate (personal instruction) to deal with a claim may operate as an assignation of the claim. The existing law on this matter is unclear.
The second is any rule under which an assignation is made ineffective by an instruction given to the debtor by the assignee to continue to perform to the assignor. There is some authority suggestive of such a rule existing, which is inconvenient in commercial practice.
The third rule is the one permitting the assignee to sue in the name of the assignor. The effect is that the assignee must raise proceedings in their own name.
The fourth rule is any rule in relation to the warrandice to be implied in an assignation, or a contract relating to an assignation. Section 9 now deals with this matter.
101.Subsection (2) provides that the abolition of the third rule described above does not affect any rule as regards subrogation. Subrogation is the legal principle whereby someone stands in the place of another person and acquires that person’s rights and responsibilities, which may be regarded as a form of assignation. The effect is to preserve the well-established practice that insurers sue in the name of the insured in personal injury and other insurance cases.
