nounDownload🔗ShareReplacement of a contract with one or more new contracts, in particular in financial markets the replacement of a contract between a particular buyer and seller with contracts between the clearing house and each party.Examples:"Due to the company's financial troubles, a novation occurred, and the clearing house became the new counterparty for all outstanding trade agreements. "businessfinancelaweconomyChat with AIVocabulary GamePractice Reading
nounDownload🔗ShareA new contract between the original contracting parties whereby the first obligation is extinguished and a new obligation is substituted.Examples:"Through novation, Maria transferred her apartment lease to her friend Sarah, releasing Maria from her original rental agreement. "lawbusinessfinancecommerceChat with AIVocabulary GamePractice Reading