Literal Meaning
An assignee is clothed with rights of his assignor
Explanation
Assignatus utitur jure auctoris states that which is assigned takes with it for its use the rights of the assignor. The maxim explains that any assignee possesses all the rights of the person that they represent. However the right posed by agent is limited to the subject matter on which the representation is made by the agent. No right is vested beyond the subject matter of representation. Moreover these rights need to be given by the assignor himself to its assignee. There should be clear indication as to which rights need to be represented which will remain solely with the principal. The right assigned should be that of the principal. It is a well known rule that no one can transfer to another a right or title greater than he himself possesses. One cannot assign a right that he or she does not have. When the rights are assigned by the principal to the agent, the agent person becomes entitled not only to the rights but also to the actions at law by which that right are to be enforced.
Origin
The legal maxim Assignatus utitur jure auctoris is based on the relationship between principals and agents. This maxim states one of the concepts of agency law. It describes that an assignee is vested with the rights of his or her principal. The agent is considered to be the representative of the principal and thus the agent posses the right that the principal vests on the agent. The agent acts on behalf of the principle and therefore should have equal right as to the person being represented.
Illustration
For example if the owner of a house decides to sell his house and contacts a broker for doing so the owner is the principle and the broker is the agent The agent has the right to sell the house at a profitable price for the owner. He will have all the legal documents related to the property. Thus the owner has assigned the right to sell the house to the broker. He however has the right only to sell the house. The broker cannot put the house lease or do anything that has not been authorised by the principal.
Case Reference
In the case of C.Rameswaran vs N.Sambandam[1] the scope of Transfer of Property Act, 1882, ss. 41, 43 are discussed. It was held that essentially, the principle underlying Sections 41 and 43, is by way of exception to the general rule that a person cannot convey a better title than what he himself has in the property. An assignee makes use of only the rights of the assignor and is clothed only with the rights of the assignor (assignatus utiturjure auctoris) and nothing more. It is a well known rule that no one can transfer to another a right or title greater than he himself possesses, nemo plus juris in alium transferre potest quam ipse haberet. But after effecting the transfer, if the transferor acquires certain rights, that he did not possess at the time of transfer, Section 43 comes into play so as to bind him to the covenant that he made at the time of transfer. Therefore unless the transferor’s rights had enlarged subsequent to the transfer, the question of applying Section 43 would not arise.
In O. L. of Piramal Financial Services Limited v Dena Bank[2] it was observed that “In order to place in a clear light the general bearing of the maxim assignatus utitur jure auctoris, we will briefly notice, first, the quantity, and secondly, the quality or nature, of the interest in property which can be assigned by the owner to another party. And it is a well known general rule, imported into our own from the civil law, that no man can transfer a greater right or interest than he himself possesses; nemo plus juris ad alium transferre potest quam ipse haberet; The owner, for example, of a base or determinable fee can, as a rule, do no more than transfer to another his own estate, or some interest of inferior degree created out of it.
In the case of Taparia Overseas Private Limited and another v Union of India and others[3] the maxim assignatus utitur jure auctoris was discussed and it was observed that this maxim applies generally to all property, real and personal, and refers to assigns by act of parties, as where the assignment is by deed; and to assigns by operation of law, as in the case of an executor. All rights of the assignor in the thing assigned must pass from him to the assignee by virtue of the assignment, forduo non possuntinsolido unam rem possidere. It should be observed, also that the thing assigned takes with it all the liabilities attached to it in the hands of the assignor at the time of the assignment, except in cases for the encouragement of commerce, such as sales in market overt, negotiation of promissory notes, bills of exchange, etc., and, in the case of equities, where the assignee is a bonafide purchaser for value without notice.
Edited by Vigneshwar Ramasubramania
Approved & Published – Sakshi Raje
Reference:
[1] C.Rameswaran vs N.Sambandam, 2009 (2) CTC 119
[2] Piramal Financial Services Limited v Dena Bank, 6 CLC 427
[3] Taparia Overseas Private Limited and another v Union of India and others, 2003 (2) Bom.C.R.7
