What are timeshare claims and assignments?

What are timeshare claims and assignments?

A cause of action is often referred to as a “bare right to litigate” it may not be assigned, as such an assignment would offend the rules on maintenance and champerty.

The appellant court has held an assignment of a “bare cause of action” in tort for personal injury was void. The reason expressed was it was contrary to public policy as the assignee had no legitimate interest in the claim. The case I refer to is:-

(Simpson v Norfolk & Norwich University Hospital NHS Trust [2011] EWCA Civ 1149).

That said exceptions do exist and therefore, the authority may be capable of being overridden.

1. By statute as in the case of liquidation (see Insolvency exception).
2. An assignment of a cause of action may be effected as part of a transfer of property to which the cause of action relates, for example a debt (which is effectively both property and a cause action itself) or the transfer of a lease which may carry with it the right to existing arrears of rent.
3. It may be possible to assign the proceeds of a cause of action. This would take effect as an agreement to assign future property (Re Oasis Merchandising Services Ltd [1995] 2 BCLC 493 at page 498).

In addition, there are particular categories of cause of action that may not be capable of assignment, as follows:

For reasons of statutory interpretation and policy, claims that exist in an insolvency process and may only be pursued by the insolvency practitioner appointed in respect of the company or individual. These claims include preference claims and wrongful trading under the Insolvency Act 1986 (IA 1986).

For more detail, see Assignment of claims in the context of insolvency.

Claims arising under an agreement containing a contractual restriction (see Effect of contractual prohibition on assignment).

A claim that does not yet exist (such as a future claim). However, an attempt to assign a future cause in action may take effect in equity as a contract to assign (Re Clarke, Coombe v Carter (1887) 36 Ch D 348).

A claim that no longer exists, for example, a claim against one defendant where the liability is a joint liability and has been extinguished by payment by a co-defendant (Crooks v Newdigate Properties Ltd and others [2009] EWCA Civ 283). Effect of contractual prohibition on assignment.

For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk