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Glite Dictionary
novation

novation

9.9
Everyone involved replaces an old agreement or a party in it with a new one
  • noun
  • /noʊˈveɪʃən/
  • Formal
translation icon : novación
  • We use a novation agreement when there's institutional financing, when they won't let us double close.

We use a novation agreement when there's institutional financing, when they won't let us double close.

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Examples

  • A party to a CDS contract may exit the contract through termination or novation.

    Academic text (2016)

  • The new always contains aspects of the old: novation springs from the existent.

    Fiction book (1999)

  • And so I just saw those who actually do novations, they're killing it.

  • A novation is executed by identifying a market participant willing to assume the obligation of one of the original counterparties at prevailing market prices.

    Academic text (2016)

  • The article concerns contractual assignment, which may be better understood as a novation, where a third party (the assignee) takes the place of the creditor pursuant to a contract.

    Academic text (2018)

  • The alternative, if no opportunity for a dignified novation is offered, is that they brazen it out, Michael Mann style, and stick two fingers up at the lot of us and laugh with glee as the less temperate burn up in their own indignation.

    Blog text (23)

  • Novation is also created by context and label: free verse was written before the modernists popularized the term, yet twentieth-century unrhymed poetries of variable meter sound like none other.

    Fiction book (1999)

  • The company agreed to a novation to transfer its obligations to a new partner.

  • In order to finalize the project, we needed to complete a novation of the existing contract.

  • The lawyers prepared a novation document to officially substitute the parties involved in the agreement.

Synonyms

supplantation
vsnovation
  • Formal
9.6

An action that replaces a person or thing, often by force

is a legal substitution made with agreement of all relevant parties

Surface Forms

novation singular
novations plural

Morphology

novation = novate (opaque) = novate + ion

The noun is a specialized legal term derived from the rare verb 'novate'; its contractual sense is technical and not predictably inferable by an average B1 learner.

Etymology

The word novation comes from the Latin root nov- meaning 'new', the same root you see in novel and innovate. In law, a novation is when an old contract, person, or company in an agreement is replaced by a new one with everyone's agreement, so the deal is literally made 'new'.