Assignment by a funder in construction projects


Produced in partnership with Maxwell Winward
Practice notes

Assignment by a funder in construction projects


Produced in partnership with Maxwell Winward

Practice notes
imgtext

Banks and other funders frequently take an assignment of the benefit of the suite of construction documents in respect of a development as an additional part of a security package for their loan to finance the development. See Practice Notes: Assignment in construction contracts and Legal and equitable assignment in construction contracts. This Practice Note looks at the different methods used for such an assignment and some of the risks. In this note, for brevity, all funders are referred to as ‘banks’.

Why does a bank wish to take an assignment?

It is worth noting that an assignment of construction documents is only one of a number of security measures that a bank will have. It will also probably register a charge against the employer itself and will also benefit from a suite of collateral warranties from the construction parties (contractor, professional consultants and key sub-contractors). These warranties will be likely to contain step-in rights so that the bank can assume the position of the employer in the event of the employer defaulting on its financial

Powered by Lexis+®
Jurisdiction(s):
United Kingdom
Related legal acts:
Key definition:
Equitable assignment definition
What does Equitable assignment mean?

assignments can occur in equity when any of the requirements of legal assignment are not satisfied.

Read more

Popular documents

Novation in construction projects

Novation in construction projectsWhat is novation?Novation is the transfer of one party’s rights and obligations under a contract to a third party. Novation effectively substitutes a contracting party (the 'outgoing party') with a new party (the 'incoming party') and, in legal terms, it amounts to

Scotland—the process for applying for sequestration

Scotland—the process for applying for sequestrationSequestration in Scotland is the legal process by which an insolvent debtor’s estate is gathered in, realised and then distributed among their creditors by a trustee appointed for that purpose. The process requires that a formal award of

If planning permission imposes restrictions on a licensed premises opening hours, once operational can

If planning permission imposes restrictions on a licensed premises opening hours, once operational can the personal licence holder apply for a Temporary Events Notice (TEN) to open for longer hours than those permitted in the planning permission?To use any property for a licensable activity both

Micklefield clauses

Micklefield clausesWhat is a Micklefield clause?It is common for employee share plans to provide that, on termination of employment (or when an employee is given or receives notice of termination of employment), subsisting share awards will be forfeited and subsisting share options will lapse.It is