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Assignment by way of security: Difference between revisions
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There’s quite a bit more over at [[set-off]] and even more than that at [[netting]], ''and'' some stuff at [[equitable set-off]], too. Unless that’s just a redirect to [[set-off]]. | There’s quite a bit more over at [[set-off]] and even more than that at [[netting]], ''and'' some stuff at [[equitable set-off]], too. Unless that’s just a redirect to [[set-off]]. | ||
An [[assignment by way of security]] is | An [[assignment by way of security]], usually,<ref>An [[assignment by way of security]] ''could'' be a legal assignment, if it meets the formal criteria, but one of those is that the assignment is absolute and not by way of security only, so — yeah. And there is authority about this, by the way: {{cite|Mailbox (Birmingham) Limited|Galliford Try Construction Limited|2017|EWHC|67}}. </ref> does not meet all the formal requirements for a [[legal assignment]] set out in the [[Law of Property Act 1925|Law of Property Act]]. So it’s not as good. Being, therefore, an [[equitable assignment|''equitable'' assignment]] and not a [[legal assignment|''legal'' assignment]], there differences relating to how an assignee enforces its claim against contracting party: a legal assignee can sue in its own name; and equitable assignee only by joining the assignor to the action (I know: shoot me, right?). | ||
===Do I need an [[assignment by way of security]] if I have a [[charge]]?=== | ===Do I need an [[assignment by way of security]] if I have a [[charge]]?=== | ||
Not unless you’re the sort of person who wears two pairs of underpants in case the first fails.<ref>“That old man, despite all the hardships, still manages to put on a clean pair of underpants every day. And, you know? By the end of the week, he can’t get his trousers on.”—From ''There’s no land like Po-land'' by the redoubtable ''Not The Nine O’Clock News'' team.</ref> Both are [[Equitable security|equitable interests]], but a fixed charge is more formal. | Not unless you’re the sort of person who wears two pairs of underpants in case the first fails.<ref>“That old man, despite all the hardships, still manages to put on a clean pair of underpants every day. And, you know? By the end of the week, he can’t get his trousers on.”—From ''There’s no land like Po-land'' by the redoubtable ''Not The Nine O’Clock News'' team.</ref> Both are [[Equitable security|equitable interests]], but a fixed charge is more formal. The problem with a [[fixed charge]] is that it requires control over the asset (an actual thing) being charged: that is easy enough if you can take possession of it (prime brokers: hooray!), but if you can’t - if it is some vague right the debtor has to be paid money at a later date - then your [[fixed charge]] might wind up looking a bit like a [[Floating charge|floating]] charge, which means you may wind up behind other people in the queue. | ||
{{assignment and set off}} | {{assignment and set off}} | ||