Novation
Definition, Meaning & Examples
Pronunciation /noʊˈveɪʃən/ · Part of speech noun
Quick meaning: Novation is a noun meaning (law) A new contract between the original contracting parties whereby the first obligation is extinguished and a new obligation is substituted.
Meaning
(law) A new contract between the original contracting parties whereby the first obligation is extinguished and a new obligation is substituted.
More Meanings
- (law) Replacement of a contract with one or more new contracts, in particular in financial markets the replacement of a contract between a particular buyer and seller with contracts between the clearing house and each party.
Example Sentences
An example of a novation is where an original debt which was payable in two instalments is novated to become payable in five installments.
A similar novation of infrastructure ownership was seen as a logical development for the operation of Merseyrail services. But this has remained with Network Rail, […].
Word Forms
- novations
Related Words
Related dictionary entries include innovation, notation, reexchange, changeout, supplanting, refinancing.
Related Dictionary Tools
Sources & Attribution
FreeDictionaryAPI.com / Wiktionary · Original source · CC BY-SA 4.0
Dictionary data is provided by FreeDictionaryAPI.com and sourced from Wiktionary under its stated license.