A new business enterprise about to commence the manufacture of clothing, entered into a written agreement to purchase all of its monthly requirements of a certain elasticized fabric for a period of three years from a textile mill at a specified unit price and agreed-upon delivery and payment terms. The agreement also included a covenant that the parties not assign this contract.The textile mill promptly made an ‘‘assignment of the contract'' to a bankAs security for a $100,000 loan. The clothing company subsequently ordered, took delivery of, and paid the mill the agreed price ($5,000) for its requirement of the fabric for the first month of its operation.Which of the following accurately states the legal effect of the covenant not to assign the contract?
A、 The covenant made the assignment to the bank ineffective.
B、 The covenant had no legal effect.
C、 The textile mill's assignment was a breach of its contract with the clothing company but was nevertheless effective to transfer to the bank the mill's rights against the clothing company.
D、 By normal interpretation, a covenant against assignment in a sale-of- goods agreement applies only to the buyer, not the seller.
发布时间：2025-01-23 21:12:51
