What is a novation of a contract?

A novation of a contract is a substitution of a new contractual obligation that replaces the existing contract. This type of contract happens when two or more parties agree to transfer the rights and obligations of one party to another to create a new contract. No particular form of words is required in order for the transfer to be completed, as long as all parties involved are in agreement. The novation of a contract is commonly seen in business, where the responsibility for one particular party is transferred to another party. In Mississippi, novation of a contract is recognized as a legal method for altering an existing contract. The parties may agree to a novation in writing, but it is not necessary. In Mississippi, a novation of a contract is considered valid if both parties involved agree to the terms and enter into a new contract. It is important to note that Mississippi courts will rarely recognize a novation of a contract if the novation involves a third party. A third party must have provided consideration or be a part of the consideration exchange in order for the novation to be recognized and enforced. Furthermore, the parties must have intended for the novation to substitute the rights and obligations of the existing contract. Overall, a novation of a contract is a legal transfer of the rights and obligations of one obligation to a new one. In Mississippi, novation of a contract is allowed, as long as all parties involved agree and the novation involves a consideration exchange.

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