Prohibition on Assignment Clauses in Contractual Rights: A Comparative Analysis of Enforceability and Implications in Iranian and English Law

This article employs an analytical-comparative approach to examine the legal nature and enforceability of prohibition on assignment clauses in contractual relationships, focusing on the Iranian and English legal systems. These clauses, which restrict the transferability of contractual rights, are commonly used in commercial transactions to limit legal exposure and maintain control over contractual relationships. While English law distinguishes between statutory and equitable assignments under the Law of Property Act ۱۹۲۵ and benefits from a well-developed body of case law, Iranian law lacks explicit statutory regulation in this area and instead relies on general principles and specific provisions of the Civil Code. The core inquiry driving this research-how the structural differences in prohibition on assignment clauses influence their legal enforceability and practical implications in Iranian and English law-is addressed through the critical evaluation of two opposing doctrinal views. The property view treats the clause as negating the assignability of the right itself, rendering any assignment void, and is supported by English case law such as Linden Gardens Trust Ltd v Lenesta Sludge Disposals Ltd (۱۹۹۳). In contrast, the contractual view regards the clause as merely imposing an obligation on the assignor not to assign, without affecting the legal validity of the assignment, as reflected in cases like Sacks v Neptune Meter Co. (۱۹۳۲). The article further analyzes how the interpretation and drafting of these clauses impact their legal effect-ranging from absolute voidness to relative unenforceability-depending on jurisdictional context and judicial approach. By synthesizing comparative jurisprudence and doctrinal analysis, the study finds that the property view better aligns with commercial expectations and provides greater legal certainty, whereas the contractual view, though flexible, risks undermining the intended limitations imposed by the clause.

Keywords:

Prohibition on Assignment , Contractual Rights Transferability , Property , Contracts