UNIVERSITY VITEZTRAVNIK

FACULTY OF LAW

ASSIGNMENT OF CLAIM (CESSION)

ESSAY

Subject: English Language

Professor: Vesna Biljaka

Student: Ismet Rei

CONTENT

Changing of Entities in Obligations 3

Term of Cession 4

Subject of Cession ..... 5

Special Cases of Cession ... 6

Conclusion 7

References . 8
INTRODUCTION

CHANGE OF ENTITIES IN OBLIGATIONS

Old Roman law did not recognize the transfer of liabilities by individual ways, but only with
universal succession. Ius civilians did not allow a change of subjects in obligations, because
of strictly personal character of obligation. However, legal remedies were found and change
subjects in obligation.

Parties, who wanted to make transfer of claims or debts, used the novation and the possibility
of representation in the dispute, in order to come to the special institute which carried out the
changes of person, creditor (cessio) or debtor (expromissio).

Change of creditors was first performed by novation, in the way that the new contract with the
same content had been concluded between the new creditor and debtor, while the old
obligations would cease. For this transfer of claims consent of debtor is required. Next step
towards the introduction of cession was representation in disputes.

But even in this case it is not to the transfer of claims, but the transfer of the lawsuit. Only in
the classical law contract can determine the new creditor; however the assignee must notify
the debtor about the change.

After this notice (denuntiatio), debtor (debtor cessus) could no longer validly pay the debt,
and he cannot be sued. Post classical law adopted various regulations that sought to prevent
speculative operations with cessions.

The transfer of receivables from the (humiliores) to (potentiores), as well as the transfer of
disputed debts (res litigiosae) were prohibited, also lex Anastasian provides that the assignee
cannot charge from the debtor more than he is, as a compensation for ceded claims, paid by
the assigner.
TERM OF CESSION

Assignment of claims is a contract between the old and the new creditor where old creditor
transmits cession to new creditor. Contract that cedes the claims is called cession. Previous
creditor is assignor and the new creditor assignee (receiver). The debtor is (cesus). There are
three types of cessions: legislative, judicial and contract cession. Legal cession occurs by
performance of certain legally prescribed facts.

Judicial cession occurs in the proceedings, when the court seizure claims that the debtor has to
the third parties and that claim is transferred to the creditor. To create contractual cession it is
necessary to fulfill certain assumptions. It is necessary to conclude the contract between the
assignor and the assignee.

If assignor fulfills an obligation to the assignee based on their previous contractual

relationship, then we have (solvendi causa), but if the transferor gives assignee his claims,
than it is (Donand causi). Exception of rules that the cession is valid and without the consent
of the debtor is in the case when the debtor and assignor previously agreed that the claim
cannot be transferred without the debtor consent.

Contract on cession is consensual legal job. Claims become the property of the assignee by
very act of signing the contract.
SUBJECT OF CESSION

The subject of cession is a particular claim and not the entire contractual relationship, from
which the claim is created. Ceding the complete position is not cession, however it is ceding
of contract. In principle it is possible to assign any claim. Exceptions are provided by ZOO.
Subject of cession may be: due and outstanding, conditional, or even future receivables,
except that we cannot expect payment of future claims by debtor before they arrive. Cession
may be identified or identifiable.

1. Assignment of future claims - the future claims can be waived if they are not
exempted from the assignment, or if they are not prohibited. General rules are applied
for them. Judicial practice is of the view that the prospective debtor at the time of
cession does not have to be known.
2. Partial transfer partial transfer is allowed if the claim is divisible, and if the parties
did not exclude that from the transfer. Partly transfer leading to more creditor. The
sum of their claims is the original obligation, and their rights are not dependent from
each other. Ako se duniku za ispunjenje obrati vie povjerioca prioritet ima onaj koji
se prvi obratio.
3. Claims from double-compulsory contract for two-sided mandatory contract, where
the creditor is (cesus), and for not fulfilling the obligations to creditor, assignor is
responsible, not the assignee, because the assignor is counterparty with which creditor
concluded the job.
4. Format of the contract contract of cession is informal. Consent of the parties is
sufficient. The exception is the case when the legal transaction requires a certain form.
SPECIAL CASES OF CESSION

1 Ceding instead of fulfillment - assignor instead of fulfilling its obligations to the creditor
can assign its claims for the third party. Assignor settled its debt with another debt, where it
appears as a creditor to a third party. The purpose of the assignment instead of fulfillment is to
release the assignor of its obligations to the assignee. This form is called datio in solutum.

2 Ceding for billing - Assignment for billing is a special case of cession, where the assignor
gives its creditor some of its claims in order that the assignee reimbursed that from debtors.
The very act of assigning assignor existing obligations to the assignee does not change. This
obligation is extinguished only when the assignee reimbursed claims.

3 Ceding due to security serves as insurance of claims that the assignee has to the assigner
on the legal grounds. An assigned claim serves to assignee only to secure his claims against
the ceding insurer. If the assignor fulfils his obligation, his assignee shall back cede claims,
and it became the case of private cession.
CONCLUSION

Moreover, from the above text, we can conclude that the cession is transfer of claims from the
existing creditors on new creditors, usually done by contract, but basically it can be law or
judicial coercion. Cession does not change the right or claim which is assigned, but only
creditor. The subject of cession may be all the claims. Cession is concept in the field of
banking, which represents ceding.
REFERENCES:

1. Roman Private Law, mandatory part

2. Contract Law