It is unlikely but still possible that during the course of the Contract a need could arise for the Authority to transfer or assign its interest in the Contract to another party. The most likely cause would be a Local Government reorganisation that involved the dissolution of the Authority and the transfer of its duties, assets etc to a new authority. Such an event would result in the Contractor having to establish a new working relationship with an entirely new body.
The concept of assignment is a major concern for Contractor and funders which would have undertaken their due diligence on the original procuring Authority. The Contract will therefore place some very strong limitations on the ability of the Authority to assign, transfer or novate its interest in the Contract.
The WIDP Contract (Clause 81) prevents any assignment by the Authority unless it relates to the whole Contract and is to a public body having the appropriate legal powers i.e.:
• a Minister of the Crown;
• another Local Authority (including a Joint Waste Disposal Authority) of sufficient financial standing; or
• another public body guaranteed by the Authority or a Minister of the Crown.
As any form of other assignment would trigger Authority Default it is important that the Contract Management Manual flags up the relevant contractual provisions. It should also contain an outline plan for dealing with the management issues that would arise if an assignment or transfer were to occur.