contract-law england-and-wales
What legal grounds exist to dispute the benefits received by the assignee?
<p>Let's suppose A provides some type of services to B in exchange for a monthly payment. A assigns the benefit of all payments it is entitled to receive from B, to C, in exchange for £1.</p>
<p>Under what circumstances could either A or B seek to recover any payments made to C by B? Assume the governing law is that of England and Wales.</p>
<p>My understanding..</p>
<p>Recovery by A: Upon A receiving the consideration of £1 from C, I'm assuming there are no legal grounds for A to recover any payments made by B to C.</p>
<p>Recovery by B: I'm assuming there are no legal grounds for B to recover any payments made by B to C, as C has no obligations to B under the agreement between A and B. I'm ignoring clawbacks in the event of insolvency.</p>
<p>If B was to stop making payments to C that were due and payable, I'm assuming only C has the right to take legal action against B for the late payments?</p>

<p>The question is a little confusing because it’s unclear why any of the payments should be refunded.</p>
<p>If A has not provided the services, and B wants a refund, then B can sue A for breach of contract. A assigned its right to be paid to C, but it cannot assign its obligations to C (this would be a <a href="https://en.wikipedia.org/wiki/Novation" rel="nofollow noreferrer">novation</a> rather than an assignment, which would require both B and C’s consent). If C also agreed with A to perform A’s obligations to B (a subcontract), then A could sue C for any damages A was liable to pay B, but B cannot sue C directly.</p>
<p>If A regrets its decision to assign the contract for £1, and wants to recover larger payments made by B to C in discharge of B’s contractual obligations to A, it can’t. A shouldn’t have assigned the benefit of the contract to C.</p>
<p>If B has not paid, B can be sued under the contract which still exists between A and B. C can file this claim as assignee of the contract. While A could also potentially file the claim, it would be inconsistent with the assignment for A to receive any benefit from it, which would be held on constructive trust for C.</p>
