Pronunciation: del - uh - gay - schun
Definition: the transfer of contract duties by one party – the delegator – to another party – the delegatee
So, how exactly does a delegation work? In short, a delegation is when one person transfers contractual duties (as opposed to rights) to another person. Let’s go over an example to clarify.
Here, Al agrees to pay Bob $100 for a TV and they put the agreement in a written contract. But assume they will wait 2 weeks until the TV is ready to be delivered to Al before either exchanges anything. In the meantime, Al delegates his right to pay $100 for the TV to Ron. In other words, Al is going to make Ron pay for the TV because Ron already owes Al $100 for money that he previously borrowed.
In this situation, Al is called the delegator and Ron is called the delegatee. Al is the delegator because he is delegating the duty to pay Bob $100 to Ron. Ron is the delegatee because he is receiving the duty to pay Bob. In other words, think of the delegatee as the person who receives a duty – as Ron receives the duty to pay $100 to Bob.
Delegations happen all the time in contracts. But keep some things in mind. First, the delegator (e.g. Al) remains liable on the contract unless there is an agreement to the contrary. In other words, if Bob never receives the $100 for the TV, Bob can sue Al for it. Second, delegations are permitted for most types of contracts. This means the delegator does not need to consult the other party to the contract to make the delegation. For example, Al does not have to consult Bob about making Ron pay Bob. However, certain exceptions apply where contractual duties cannot be delegated. For example, there may be an express prohibition against delegation in the contract or the delegation may be against public policy (e.g. Al tries to delegate a duty to someone where only Al can safely do the job).
Finally, a very similar concept to a delegation is an assignment. Please read assignment
for further details.