Sale Of Litigious Rights:Beware Of The Redemption Right

A recent decision of the Superior Court¹ reminds us that one must be prudent when the rules applicable to litigious rights may apply. The Civil Code² provides that when litigious rights are sold, the person from whom they are claimed is discharged by paying to the buyer the sale price, the costs and interest on the price computed from the day on which the payment was made.

Although this rule is not new, it still causes difficulties when, for example, a transfer of enterprise occurs as a result of the sale of assets which includes the rights of the seller in judicial proceedings which have already been undertaken. This right, conferred on the person against whom a claim exists, is called the redemption right.