Jugal Kishore v Raw Cotton Co

Facts

• Creditor assigned a debt to a third party by written instrument
• No notice was given to the debtor
• Question: is the assignment valid without notice?

Issue

1. Whether an assignment of an actionable claim without notice to the debtor is valid between the parties.

Held

• The assignment is valid between assignor and assignee upon execution. Notice is not a condition of validity. But notice is essential to: (a) bind the debtor (redirect payment), and (b) obtain priority over subsequent assignees.

Ratio Decidendi

S.130 requires a written instrument for validity. Notice (S.131) serves a different function: it protects the assignee against the debtor paying the original creditor and against competing assignees. Without notice, the assignment exists but is vulnerable.