Novation Agreement – Construction (B127)

What is this contract for?

You can use this novation agreement when  a contractor transfers all its rights and obligations under its contract with a client to a new contractor,  who steps in and becomes the contractor dealing directly with the client.  It is a very short agreement.  It can be used, for example, where the employer under the building contract wants to replace an existing contract with a new one.

What are the main issues?

The client or employer is a party to the novation agreement and not only accepts the new contractor in place of the outgoing one, but also releases the retiring contractor from any liability.

The outgoing contractor clearly needs to be sure that it is paid up to date as, once the novation takes place, it will not have any further claim against the employer.  Therefore, our contract specifies the amount paid up to the date of the agreement..

As there is no obvious consideration, a novation agreement should be signed as a deed

What detailed terms does the contract contain?

The main points cover:

• New contractor’s position
• Employer’s acceptance of novation
• Outgoing contractor’s fees

For more information on each of these sections, see our Explanatory Notes  which you will  receive when you download the document from our website.

For information on signing documents see our Contract Signing page

When I download the document, can I change it and/or use it more than once?

Yes, all ContractStore’s templates are in MS Word and you can use the contract on more than one project. For more information, watch the video on this page of our website or see our FAQs

Legal support

ContractStore supplies templates and is not a law firm.  But experienced lawyers write all our templates, so we can arrange legal assistance for customers who need special terms in one of our documents or a bespoke template. . For more information see our Legal Services page.  For more information see our Legal Services page.

Contract Author – Giles Dixon

And if you want to contact us see our Contacts page.