Contract Law Question

A contract law question.

Its part of a problem question

A makes a contract with B, (a company) to hire a car. However B sells the car to C, another company.

Its all speculation, but COULD there be a novation agreement between B and C to transfer the contractual obligation of hiring the car to A.

Basically, could C be obligated to hire the car out to A?

Reply 1

jacketpotato

Nope. A novation is an entirely new contract. It needs all parties to consent: A would need to consent.

B could enter into a sub-hire agreement whereby C agrees to provide the car to A as B's agent and/or a risk-sharing agreement whereby C reimburses B for any liability B incurs to A. This would mean that C would effectively take on B's responsibilities and risks from the stand-point of B, but A would still only have a direct contractual relationship with B.