novation — meaning in English

English meaning

• novation noun The replacement of a contract, or of one of the parties to it, by a new agreement that all parties consent to, so that the original obligations are extinguished.

Senses

novation is used for these senses in English:

• novation (legal) A new contract between the original contracting parties whereby the first obligation is extinguished and a new obligation is substituted.

novation — full definition

1. noun The replacement of a contract, or of one of the parties to it, by a new agreement that all parties consent to, so that the original obligations are extinguished.
2. noun In finance, the process by which a clearing house steps in between the two original parties to a trade and becomes the counterparty to each of them.