Anti-assignment

In this subsection, “promissory note” includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in subsection (e) and Sections 7-2A-303 and 7-9A-407, and subject to subsection (h), a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (1) prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

Subsection (d) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under Section 7-9A-610 or an acceptance of collateral under Section 7-9A-620.

This section is subject to law other than this article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

This section prevails over any inconsistent provision of an existing or future statute, rule, or regulation of this State unless the provision is contained in a statute of this State, refers expressly to this section, and states that the provision prevails over this section.

(i) Inapplicability to health-care-insurance receivable. This section does not apply to an assignment of a health-care-insurance receivable.

(2) “Account,” except as used in “account for,” “account statement,” “account to,” “commodity account” in paragraph (14), “customer’s account,” “deposit account” in paragraph (29), “on account of,” and “statement of account,” means a right to payment of a monetary obligation, whether or not earned by performance, (i) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of, (ii) for services rendered or to be rendered, (iii) for a policy of insurance issued or to be issued, (iv) for a secondary obligation incurred or to be incurred, (v) for energy provided or to be provided, (vi) for the use or hire of a vessel under a charter or other contract, (vii) arising out of the use of a credit or charge card or information contained on or for use with the card, or (viii) as winnings in a lottery or other game of chance operated or sponsored by a State, governmental unit of a State, or person licensed or authorized to operate the game by a State or governmental unit of a State. The term includes controllable accounts and health-care-insurance receivables. The term does not include (i) chattel paper , (ii) commercial tort claims, (iii) deposit accounts, (iv) investment property, (v) letter-of-credit rights or letters of credit, (vi) rights to payment for money or funds advanced or sold, other than rights arising out of the use of a credit or charge card or information contained on or for use with the card , or (vii) rights to payment evidenced by an instrument .

Except as otherwise provided in (e) of this section, AS 45.29.407 , and AS 45.12.303 , and subject to (h) of this section, a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it (1) prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or (2) provides that the assignment, transfer, creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

The provisions of (d) of this section do not apply to the sale of a payment intangible or promissory note, other than a sale under a disposition under AS 45.29.610 or an acceptance of collateral under AS 45.29.620 .

This section is subject to law other than this chapter that establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

This section does not apply to an assignment of a health care insurance receivable.

Except as otherwise provided in (b) of this section, a term in a promissory note or in an agreement between an account debtor and a debtor that relates to a health care insurance receivable or a general intangible, including a contract, permit, license, or franchise, and that prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to the assignment or transfer of, or creation, attachment, or perfection of a security interest in the promissory note, health care insurance receivable, or general intangible is ineffective to the extent that the term (1) would impair the creation, attachment, or perfection of a security interest; or (2) provides that the assignment, transfer, creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health care insurance receivable, or general intangible.

The provisions of (a) of this section apply to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note, other than a sale under a disposition under AS 45.29.610 or an acceptance of collateral under AS 45.29.620 .

(d) In this subdivision, “promissory note” includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in subdivisions (e) and (k) and in Sections 9407 and 10303, and subject to subdivision (h), a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it does either of the following: (1) Prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note. (2) Provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

(e) Subdivision (d) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under Section 9610 or an acceptance of collateral under Section 9620.

(h) This section is subject to law other than this division which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

(k) Subdivisions (d), (f), and (j) do not apply to a security interest in an ownership interest in a general partnership, limited partnership, or limited liability company.

(a) Except as otherwise provided in subdivision (b), a term in a lease agreement is ineffective to the extent that it does either of the following: (1) Prohibits, restricts, or requires the consent of a party to the lease to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, an interest of a party under the lease contract or in the lessor’s residual interest in the goods. (2) Provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the lease. (b) Except as otherwise provided in subdivision (g) of Section 10303, a term described in paragraph (2) of subdivision (a) is effective to the extent that there is either of the following: (1) A transfer by the lessee of the lessee’s right of possession or use of the goods in violation of the term. (2) A delegation of a material performance of either party to the lease contract in violation of the term. (c) The creation, attachment, perfection, or enforcement of a security interest in the lessor’s interest under the lease contract or the lessor’s residual interest in the goods is not a transfer that materially impairs the lessee’s prospect of obtaining return performance or materially changes the duty of or materially increases the burden or risk imposed on the lessee within the purview of subdivision (d) of Section 10303 unless, and then only to the extent that, enforcement actually results in a delegation of material performance of the lessor.

(b) Except as provided in subdivision (c) and Section 9407, a provision in a lease agreement which (1) prohibits the voluntary or involuntary transfer, including a transfer by sale, sublease, creation or enforcement of a security interest, or attachment, levy, or other judicial process, of an interest of a party under the lease contract or of the lessor’s residual interest in the goods, or (2) makes such a transfer an event of default, gives rise to the rights and remedies provided in subdivision (d), but a transfer that is prohibited or is an event of default under the lease agreement is otherwise effective.

(c) A provision in a lease agreement which (1) prohibits a transfer of a right to damages for default with respect to the whole lease contract or of a right to payment arising out of the transferor’s due performance of the transferor’s entire obligation, or (2) makes such a transfer an event of default, is not enforceable, and such a transfer is not a transfer that materially impairs the prospect of obtaining return performance by, materially changes the duty of, or materially increases the burden or risk imposed on, the other party to the lease contract within the purview of subdivision (d).

(i) This section does not apply to an assignment of a health care insurance receivable.

(d) Subject to subdivision (c) and Section 9407: (1) If a transfer is made which is made an event of default under a lease agreement, the party to the lease contract not making the transfer, unless that party waives the default or otherwise agrees, has the rights and remedies described in subdivision (b) of Section 10501. (2) If paragraph (1) is not applicable and if a transfer is made that (A) is prohibited under a lease agreement or (B) materially impairs the prospect of obtaining return performance by, materially changes the duty of, or materially increases the burden or risk imposed on, the other party to the lease contract, unless the party not making the transfer agrees at any time to the transfer in the lease contract or otherwise, then, except as limited by contract, (C) the transferor is liable to the party not making the transfer for damages caused by the transfer to the extent that the damages could not reasonably be prevented by the party not making the transfer and (D) a court having jurisdiction may grant other appropriate relief, including cancellation of the lease contract or an injunction against the transfer.

(g) In a consumer lease, to prohibit the transfer of an interest of a party under the lease contract or to make a transfer an event of default, the language must be specific, by a writing, and conspicuous.

In the present case, the annuity contract provided that “[n]o payment under this annuity contract may be . . . assigned” by the plaintiff. This antiassignment provision limited the plaintiffs right to assign, but not his power to do so. The provision did not contain any express language to limit the power to assign or to void the assignment itself. Therefore, in accordance with the modem approach, we conclude that the plaintiffs assignment to Wentworth is valid and enforceable despite the plaintiffs breach of the contract’s antiassignment provision.

We further conclude, however, that Safeco is free to sue for any damages that it might sustain as a result of the assignment by bringing an action for breach of contract against the plaintiff as assignor. See, e.g., Bel-Ray Co. v. Chemrite (Pty.) Ltd., supra, 181 F.3d 442 ; Pro Cardiaco Pronto Socorro Cardiologica, S.A. v. Trussell, supra, 863 F. Sup. 137-38; Macklowe v. 42nd Street Development Corp., supra, 170 App. Div. 2d 389; Sullivan v. International Fidelity Ins. Co., supra, 96 App. Div. 2d 556. Alternatively, Safeco may pursue damages from Wentworth, who, as the assignee, “ ‘stands in the shoes of the assignor.’ ” 3 E. Farnsworth, supra, § 11.8, p. 105; see id., 105-107; 3 S. Williston, Contracts (3d Ed. I960) § 404, p. 5, and § 432, pp. 181-83. Safeco, therefore, is fully protected against any actual damages that it might sustain as a result of the plaintiffs breach of the antiassignment provision. 11 *278 The modem approach thus serves the dual objectives of free assignability of contracts together with full compensation for any actual damages that might result from an assignment made in breach of an antiassignment provision. The judgment is affirmed.

We conclude, in accordance with case law and § 322 of the Restatement (Second) of Contracts, that the antiassignment provision at issue here does not render the assignment of the annuity ineffective, but, instead, gives the annuity issuer, Safeco, the right to recover damages for breach of the antiassignment provision.

(d) Term restricting assignment generally ineffective. — In this subsection, “promissory note” includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in subsection (e) and Sections 2A-303 and 9-407, and subject to subsection (h), a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (1) prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

(i) Inapplicability. — This section does not apply to: (1) an assignment of a health-care-insurance receivable; (2) a claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. § 104(a)(1) or (2), as amended from time to time; (3) a claim or right to receive benefits under a special needs trust as described in 42 U.S.C. § 1396p(d)(4), as amended from time to time; (4) an interest in a trust, including any right or power of a beneficiary (including a settlor) or owner of a trust, arising under a governing instrument (as defined in Section 3301(e) of Title 12), Title 12, or other applicable law, to the extent that Delaware law governs such interest; or (5) an interest in a partnership or limited liability company.

(e) Inapplicability of subsection (d) to certain sales. — Subsection (d) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under Section 9-610 or an acceptance of collateral under Section 9-620.

(h) Rule for individual under other law. — This section is subject to law other than this Article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

(e) Inapplicability. — This section does not apply to: (1) a claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. § 104(a)(1) or (2), as amended from time to time; (2) a claim or right to receive benefits under a special needs trust as described in 42 U.S.C. § 1396p(d)(4), as amended from time to time; (3) an interest in a trust, including any right or power of a beneficiary (including the settlor) or owner of a trust, arising under a governing instrument (as defined in Section 3301(e) of Title 12), Title 12, or other applicable law, to the extent that Delaware law governs such interest; or (4) an interest in a partnership or limited liability company.

(4) For the purposes of this subsection, the term “promissory note” includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in subsections (5) and (12) and ss. 680.303 and 679.4071, and subject to subsection (8), a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it:(a) Prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or (b) Provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

(1) Subject to subsections (2)-(9) and (13), an account debtor on an account, chattel paper, or a payment intangible may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, signed by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and may not discharge the obligation by paying the assignor.

(5) Subsection (4) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under s. 679.610 or an acceptance of collateral under s. 679.620.

(8) This section is subject to law other than this chapter which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes. Subsections (4) and (6) do not apply to the creation, attachment, perfection, or enforcement of a security interest in:(a) A claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. s. 104(a)(1) or (2). (b) A claim or right to receive benefits under a special needs trust as described in 42 U.S.C. s. 1396p(d)(4). (c) The interest of a debtor who is a natural person in reemployment assistance or unemployment, alimony, disability, pension, or retirement benefits or victim compensation funds. (d) The interest of a debtor who is a natural person in other benefits which are designated solely for his or her maintenance, support, or education, the assignability of which is expressly prohibited or restricted by statute.

(9) Subsections (4), (6), and (8) apply only to a security interest created after January 1, 2002.

(10) This section does not apply to an assignment of a health-care-insurance receivable. (11) This section prevails over any inconsistent statute, rule, or regulation.

(12) Subsections (4), (6), and (11) do not apply to a security interest in an ownership interest in a general partnership, a limited partnership, or a limited liability company.

(13) Subsections (1)-(3) and (7) do not apply to a controllable account or controllable payment intangible.

We conclude that the certificate of deposit is not properly classified as an account, chattel paper, contract right, or general intangible. The Bank is, therefore, not an "account debtor" as defined in section 679.105(1)(a). Accordingly, it may not avail itself of the article 9 defenses delineated in section 679.318(1). By the same token, since the transaction does not amount to a "contract between an account debtor and an assignor," section 679.318(4) does not operate to invalidate the restrictions on assignment here.

(2) Subject to subsections (8) and (13), notification is ineffective under subsection (1):(a) If it does not reasonably identify the rights assigned; (b) To the extent that an agreement between an account debtor and a seller of a payment intangible limits the account debtor’s duty to pay a person other than the seller and the limitation is effective under law other than this chapter; or (c) At the option of an account debtor, if the notification notifies the account debtor to make less than the full amount of any installment or other periodic payment to the assignee, even if:1. Only a portion of the account, chattel paper, or payment intangible has been assigned to that assignee; 2. A portion has been assigned to another assignee; or 3. The account debtor knows that the assignment to that assignee is limited. (3) Subject to subsections (8) and (13), if requested by the account debtor, an assignee shall seasonably furnish reasonable proof that the assignment has been made. Unless the assignee complies, the account debtor may discharge its obligation by paying the assignor, even if the account debtor has received a notification under subsection (1).

(6) Except as otherwise provided in subsection (12) and ss. 680.303 and 679.4071, and subject to subsections (8) and (9), a rule of law, statute, or regulation that prohibits, restricts, or requires the consent of a government, governmental body or official, or account debtor to the assignment or transfer of, or creation of a security interest in, an account or chattel paper is ineffective to the extent that the rule of law, statute, or regulation:(a) Prohibits, restricts, or requires the consent of the government, governmental body or official, or account debtor to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in the account or chattel paper; or (b) Provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account or chattel paper.

(7) Subject to subsections (8) and (13), an account debtor may not waive or vary its option under paragraph (2)(c).

We have before us certified questions from the United States Court of Appeals for the Fifth Circuit, concerning the set-off rights and defenses available to an obligor against the assignee of a non-negotiable certificate of deposit. Bornstein v. Citizens National Bank of Orlando, 564 F.2d 721 (5th Cir.1977). This proceeding is authorized by section 25.031, Florida Statutes (1977) and Fla.R.App.P. 9.510. We conclude: (1) that the transfer of the certificate of deposit as security for the purchase of a bond was the assignment of a non-negotiable instrument entitled to secured transaction treatment under article 9 of the Florida Uniform Commercial Code, sections 679.101 et seq., Florida Statutes (1973); (2) that neither the provisions of section 679.104(9) nor section 679.104(11) exclude the transfer from coverage under article 9; (3) that section 679.318(4) does not invalidate the prohibitions against assignment; and (4) that the obligor, "Bank," is not an "account debtor" entitled to any article 9 defenses under section 679.318(1). We do not reach certified question III.

Summarizing our answers to the questions certified, we find that the assignment by Milford of the certificate of deposit as security for the payment of a bond purchased from National Indemnity was the assignment of a non-negotiable instrument entitled to secured transaction treatment under article 9; that neither the provisions of section 679.104(9) nor section 679.104(11) exclude the transfer from coverage under article 9; that section 679.318(4) does not invalidate the restrictions on assignment since the transaction is not a "contract between an account debtor and an assignor;" and that neither by incorporation through section 673.306 nor by the express terms of article 9 is the Bank's asserted right to set-off established under section 679.318(1). ENGLAND, C.J., and ADKINS and BOYD, JJ., concur. OVERTON and ALDERMAN, JJ., dissent.

(a) Subject to subsections (b) through (i) of this section, an account debtor on an account, chattel paper or a payment intangible may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, authenticated by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and may not discharge the obligation by paying the assignor.

Except as otherwise provided in subsection (e) of this section and sections 28-9-407 and 28-12-303, Idaho Code, and subject to subsection (h) of this section, a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (1) Prohibits, restricts or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection or enforcement of a security interest in, the account, chattel paper, payment intangible or promissory note; or (2) Provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible or promissory note.

Subsection (d) of this section does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under section 28-9-610, Idaho Code, or an acceptance of collateral under section 28-9-620, Idaho Code.

Except as otherwise provided in subsection (b) of this section, a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health care insurance receivable or a general intangible, including a contract, permit, license, or franchise, and which term prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or creation, attachment, or perfection of a security interest in, the promissory note, health care insurance receivable, or general intangible, is ineffective to the extent that the term: (1) Would impair the creation, attachment or perfection of a security interest; or (2) Provides that the assignment or transfer or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health care insurance receivable, or general intangible.

(b) Subsection (a) of this section applies to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note, other than a sale pursuant to a disposition under section 28-9-610, Idaho Code, or an acceptance of collateral under section 28-9-620, Idaho Code.

To the extent that a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health care insurance receivable or general intangible or a rule of law, statute or regulation described in subsection (c) of this section would be effective under law other than this chapter but is ineffective under subsection (a) or (c) of this section, the creation, attachment, or perfection of a security interest in the promissory note, health care insurance receivable, or general intangible: (1) Is not enforceable against the person obligated on the promissory note or the account debtor; (2) Does not impose a duty or obligation on the person obligated on the promissory note or the account debtor; (3) Does not require the person obligated on the promissory note or the account debtor to recognize the security interest, pay or render performance to the secured party, or accept payment or performance from the secured party; (4) Does not entitle the secured party to use or assign the debtor’s rights under the promissory note, health care insurance receivable, or general intangible, including any related information or materials furnished to the debtor in the transaction giving rise to the promissory note, health care insurance receivable, or general intangible; (5) Does not entitle the secured party to use, assign, possess, or have access to any trade secrets or confidential information of the person obligated on the promissory note or the account debtor; and (6) Does not entitle the secured party to enforce the security interest in the promissory note, health care insurance receivable, or general intangible.

A term in a letter of credit or a rule of law, statute, rule, regulation, custom or practice applicable to the letter of credit which prohibits, restricts or requires the consent of an applicant, issuer or nominated person to a beneficiary’s assignment of or creation of a security interest in a letter of credit right is ineffective to the extent that the term or rule of law, statute, rule, regulation, custom or practice: (1) Would impair the creation, attachment or perfection of a security interest in the letter of credit right; or (2) Provides that the assignment or the creation, attachment or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the letter of credit right.

This section is subject to law other than this chapter which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family or household purposes.

This section does not apply to an assignment of a health care insurance receivable, an award of compensation made pursuant to the crime victims compensation act, chapter 10, title 72, Idaho Code, or a lottery prize subject to the provisions of chapter 74, title 67, Idaho Code.

(b) When notification ineffective. Subject to subsections (h) and (l), notification is ineffective under subsection (a): (1) if it does not reasonably identify the rights assigned; (2) to the extent that an agreement between an account debtor and a seller of a payment intangible limits the account debtor's duty to pay a person other than the seller and the limitation is effective under law other than this Article; or (3) at the option of an account debtor, if the notification notifies the account debtor to make less than the full amount of any installment or other periodic payment to the assignee, even if: (A) only a portion of the account, chattel paper, or payment intangible has been assigned to that assignee; (B) a portion has been assigned to another assignee; or (C) the account debtor knows that the assignment to that assignee is limited.

(d) Term restricting assignment generally ineffective. In this subsection, "promissory note" includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in subsection (e) and Sections 2A-303 and 9-407, and subject to subsection (h), a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (1) prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

(e) Inapplicability of subsection (d) to certain sales. Subsection (d) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under Section 9-610 or an acceptance of collateral under Section 9-620.

(a) Discharge of account debtor; effect of notification. Subject to subsections (b) through (i) and (l), an account debtor on an account, chattel paper, or a payment intangible may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, signed by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and may not discharge the obligation by paying the assignor.

(c) Proof of assignment. Subject to subsections (h) and (l), if requested by the account debtor, an assignee shall seasonably furnish reasonable proof that the assignment has been made. Unless the assignee complies, the account debtor may discharge its obligation by paying the assignor, even if the account debtor has received a notification under subsection (a).

(g) Subsection (b)(3) not waivable. Subject to subsections (h) and (l), an account debtor may not waive or vary its option under subsection (b)(3). (h) Rule for individual under other law. This Section is subject to law other than this Article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes. (i) Inapplicability to health-care-insurance receivable. This Section does not apply to an assignment of a health-care-insurance receivable.

(a) Term restricting assignment generally ineffective. Except as otherwise provided in subsection (b), a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or a general intangible, including a contract, permit, license, or franchise, and which term prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or creation, attachment, or perfection of a security interest in, the promissory note, health-care-insurance receivable, or general intangible, is ineffective to the extent that the term: (1) would impair the creation, attachment, or perfection of a security interest; or (2) provides that the assignment or transfer or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health-care-insurance receivable, or general intangible.

(d) Limitation on ineffectiveness under subsections (a) and (c). To the extent that a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or general intangible or a rule of law, statute, or regulation described in subsection (c) would be effective under law other than this Article but is ineffective under subsection (a) or (c), the creation, attachment, or perfection of a security interest in the promissory note, health-care-insurance receivable, or general intangible: (1) is not enforceable against the person obligated on the promissory note or the account debtor; (2) does not impose a duty or obligation on the person obligated on the promissory note or the account debtor; (3) does not require the person obligated on the promissory note or the account debtor to recognize the security interest, pay or render performance to the secured party, or accept payment or performance from the secured party; (4) does not entitle the secured party to use or assign the debtor's rights under the promissory note, health-care-insurance receivable, or general intangible, including any related information or materials furnished to the debtor in the transaction giving rise to the promissory note, health-care-insurance receivable, or general intangible; (5) does not entitle the secured party to use, assign, possess, or have access to any trade secrets or confidential information of the person obligated on the promissory note or the account debtor; and (6) does not entitle the secured party to enforce the security interest in the promissory note, health-care-insurance receivable, or general intangible.

(f) Legal restrictions on assignment generally ineffective. Except as otherwise provided in Sections 2A-303 and 9-407 and subject to subsections (h) and (i), a rule of law, statute, or regulation that prohibits, restricts, or requires the consent of a government, governmental body or official, or account debtor to the assignment or transfer of, or creation of a security interest in, an account or chattel paper is ineffective to the extent that the rule of law, statute, or regulation: (1) prohibits, restricts, or requires the consent of the government, governmental body or official, or account debtor to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in the account or chattel paper; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account or chattel paper.

(l) Inapplicability of certain subsections. Subsections (a), (b), (c), and (g) do not apply to a controllable account or controllable payment intangible.

(b) Applicability of subsection (a) to sales of certain rights to payment. Subsection (a) applies to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note, other than a sale pursuant to a disposition under Section 9-610 or an acceptance of collateral under Section 9-620.

(c) Legal restrictions on assignment generally ineffective. A rule of law, statute, or regulation that prohibits, restricts, or requires the consent of a government, governmental body or official, person obligated on a promissory note, or account debtor to the assignment or transfer of, or creation of a security interest in, a promissory note, health-care-insurance receivable, or general intangible, including a contract, permit, license, or franchise between an account debtor and a debtor, is ineffective to the extent that the rule of law, statute, or regulation: (1) would impair the creation, attachment, or perfection of a security interest; or (2) provides that the assignment or transfer or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health-care-insurance receivable, or general intangible.

In this subsection, “promissory note” includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in subsections 5 and 10A and sections 554.9407 and 554.13303, and subject to subsection 8, a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: a. prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or b. provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

Subsection 4 does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under section 554.9610 or an acceptance of collateral under section 554.9620.

This section is subject to law other than this Article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

Subsections 4, 6, and 10 do not apply to a security interest in an ownership interest in a general partnership, limited partnership, or limited liability company.

Except as otherwise provided in subsection 2, a term in a lease agreement is ineffective to the extent that it: a. prohibits, restricts, or requires the consent of a party to the lease to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, an interest of a party under the lease contract or in the lessor’s residual interest in the goods; or b. provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the lease.

Except as otherwise provided in section 554.13303, subsection 7, a term described in subsection 1, paragraph “b”, is effective to the extent that there is: a. a transfer by the lessee of the lessee’s right of possession or use of the goods in violation of the term; or b. a delegation of a material performance of either party to the lease contract in violation of the term.

Except as provided in subsection 3 and section 554.9407, a provision in a lease agreement which prohibits the voluntary or involuntary transfer, including a transfer by sale, sublease, creation or enforcement of a security interest, or attachment, levy, or other judicial process, of an interest of a party under the lease contract or of the lessor’s residual interest in the goods, or makes such a transfer an event of default, gives rise to the rights and remedies provided in subsection 4, but a transfer that is prohibited or is an event of default under the lease agreement is otherwise effective.

In a consumer lease, to prohibit the transfer of an interest of a party under the lease contract or to make a transfer an event of default, the language must be specific, by a writing, and conspicuous.

Except as otherwise provided in subsection (e), subsection (g) of K.S.A. 17-76,134, K.S.A. 84-2a-303 and K.S.A. 2025 Supp. 84-9-407, and amendments thereto, and subject to subsection (h), a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it:

Prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or

Subsection (d) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under K.S.A. 2025 Supp. 84-9-610, and amendments thereto, or an acceptance of collateral under K.S.A. 2025 Supp. 84-9-620, and amendments thereto.

(h) Rule for individual under other law. This section is subject to law other than this article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

(i) Inapplicability to health-care-insurance receivable. This section does not apply to an assignment of a health-care-insurance receivable.

(2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

(j) Section prevails over specified inconsistent law. This section prevails over any inconsistent provisions of any laws, rules, and regulations.

(f) Legal restrictions on assignment generally ineffective. Except as otherwise provided in subsection (g) of K.S.A. 17-76,134, K.S.A. 84-2a-303 and K.S.A. 2025 Supp. 84-9-407, and amendments thereto, and subject to subsections (h) and (i), a rule of law, statute, or regulation that prohibits, restricts, or requires the consent of a government, governmental body or official, or account debtor to the assignment or transfer of, or creation of a security interest in, an account or chattel paper is ineffective to the extent that the rule of law, statute, or regulation: (1) Prohibits, restricts, or requires the consent of the government, governmental body or official, or account debtor to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in the account or chattel paper; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account or chattel paper.

(a) Term restricting assignment generally ineffective. Except as otherwise provided in subsection (b), a term in a lease agreement is ineffective to the extent that it: (1) Prohibits, restricts, or requires the consent of a party to the lease to the assignment or transfer or the creation, attachment, perfection, or enforcement of a security interest in an interest of a party under the lease contract or in the lessor's residual interest in the goods; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the lease.

(b) Effectiveness of certain terms. Except as otherwise provided in K.S.A. 84-2a-303(7), and amendments thereto, a term described in subsection (a)(2) is effective to the extent that there is: (1) A transfer by the lessee of the lessee's right of possession or use of the goods in violation of the term; or (2) a delegation of a material performance of either party to the lease contract in violation of the term.

(2) Except as provided in subsection 3 and K.S.A. 2025 Supp. 84-9-407 and amendments thereto, a provision in a lease agreement which (a) prohibits the voluntary or involuntary transfer, including a transfer by sale, sublease, creation or enforcement of a security interest, or attachment, levy, or other judicial process, of an interest of a party under the lease contract or of the lessor's residual interest in the goods, or (b) makes such a transfer an event of default, gives rise to the rights and remedies provided in subsection (4), but a transfer that is prohibited or is an event of default under the lease agreement is otherwise effective.

In this Subsection, "promissory note" includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in Subsections (e), (i), and (k) of this Section and R.S. 10:9-407 and 9-410, and subject to Subsection (h) of this Section, a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (1) prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

Subsection (d) of this Section does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under R.S. 10:9-610 or an acceptance of collateral under R.S. 10:9-620.

the trial court equated an assignor/assignee relationship to constitute an actual “transfer of interest” and concluded that because the Swift Energy accounts payable had not been transferred in ownership to Factor King and were nothing more than collateral security, La.R.S. 10:9-406(a) did not apply to the litigation. We find merit in Factor King’s argument that this conclusion was error on the part of the trial court.

these definitions clearly establish that accounts receivable may be sold or made the subject of a security interest.

we find that the notice required by La.R.S. 10:9-406(a) was not effected prior to Swift Energy’s payment to Plemco-South.

This Section does not apply to an assignment of a health-care-insurance receivable. This Section further does not apply to an assignment of any pension, disability, annuity, retirement or other benefit, distribution or allowance right or payment from any governmental retirement system or pension fund or any other governmental unit, workers' compensation claims or payments, unemployment compensation benefits, public assistance payments, crime victim compensation, or lottery payments.

This Section does not apply to an assignment of any pension, disability, annuity, retirement or other benefit, distribution or allowance right or payment from any governmental retirement system or pension fund or any other governmental unit, workers' compensation claims or payments, unemployment compensation benefits, public assistance payments, crime victim compensation, or lottery payments.

Except as otherwise provided in Subsections (b) and (f) and R.S. 10:9-410, a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or a general intangible, including a contract, permit, license, or franchise, and which term prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or creation, attachment, or perfection of a security interest in, the promissory note, health-care-insurance receivable, or general intangible, is ineffective to the extent that the term: (1) would impair the creation, attachment, or perfection of a security interest; or (2) provides that the assignment or transfer or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health-care-insurance receivable, or general intangible.

To the extent that a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or general intangible or statute or regulation described in Subsection (c) would be effective under law other than this Chapter but is ineffective under Subsection (a) or (c), the creation, attachment, or perfection of a security interest in the promissory note, health-care-insurance receivable, or general intangible: (1) is not enforceable against the person obligated on the promissory note or the account debtor; (2) does not impose a duty or obligation on the person obligated on the promissory note or the account debtor; (3) does not require the person obligated on the promissory note or the account debtor to recognize the security interest, pay or render performance to the secured party, or accept payment or performance from the secured party; (4) does not entitle the secured party to use or assign the debtor's rights under the promissory note, health-care-insurance receivable, or general intangible, including any related information or materials furnished to the debtor in the transaction giving rise to the promissory note, health-care-insurance receivable, or general intangible; (5) does not entitle the secured party to use, assign, possess, or have access to any trade secrets or confidential information of the person obligated on the promissory note or the account debtor; and (6) does not entitle the secured party to enforce the security interest in the promissory note, health-care-insurance receivable, or general intangible.

(k) Subsections (d) and (f) do not apply to the assignment or transfer of or creation of a security interest in: (1) a claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. 104(a)(1) or (2), as amended; or (2) a claim or right to receive benefits under a special needs trust as described in 42 U.S.C. 1396p(d)(4), as amended. (l) Inapplicability of certain Subsections. Subsections (a), (b), (c), and (g) of this Section do not apply to a controllable account or controllable payment intangible.

(h) Rule for individual under other law. This Section is subject to law other than this Chapter which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

(g) "Promissory note." In this Section, "promissory note" includes a negotiable instrument that evidences chattel paper. (h) Subsections (a) and (c) of this Section do not apply to the assignment or transfer or creation of a security interest in: (1) a claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. 104(a)(1) or (2), as amended; or (2) a claim or right to receive benefits under a special needs trust as described in 42 U.S.C. 1396p(d)(4), as amended.

Accordingly, we find no merit in Factor King’s two assignments of error. DISPOSITION For the foregoing reasons, we affirm the trial court judgment in all respects. We assess all costs of this appeal to Factor King, LLC. AFFIRMED.

Except as otherwise provided in subsection (2) , a term in a promissory note or in an agreement between an account debtor and a debtor that relates to a health-care-insurance receivable or a general intangible, including a contract, permit, license or franchise, and which term prohibits, restricts or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or creation, attachment or perfection of a security interest in, the promissory note, health-care-insurance receivable or general intangible, is ineffective to the extent that the term:

Subject to subsections (2) to (10) , an account debtor on an account, chattel paper or a payment intangible may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, signed by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and may not discharge the obligation by paying the assignor.

Subject to subsections (8) and (10) , notification is ineffective under subsection (1) : (a). If it does not reasonably identify the rights assigned;

Subject to subsections (8) and (10) , if requested by the account debtor, an assignee shall seasonably furnish reasonable proof that the assignment has been made. Unless the assignee complies, the account debtor may discharge its obligation by paying the assignor, even if the account debtor has received a notification under subsection (1) .

Except as otherwise provided in subsection (5) and sections 2‑1303 and 9‑1407 , and subject to subsection (8) , a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (a). Prohibits, restricts or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection or enforcement of a security interest in, the account, chattel paper, payment intangible or promissory note; or

This section is subject to law other than this Article that establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family or household purposes.

This section does not apply to an assignment of a health-care-insurance receivable.

Section 670 provides: “[n]o certificate of approval holder shall unreasonably withhold consent to any assignment, transfer or sale of the wholesaler’s business whenever the wholesaler to be substituted meets the material and reasonable qualifications and standards required of its wholesalers.”

Based on these facts, the justice did not err in concluding that Vintners “reasonably refused” consent to Eastern’s transfer of business to three wholesalers unable to meet the geographical coverage qualification.

Because we agree that Vintners’s refusal of consent was reasonable, we also agree with the justice’s correct statement that Eastern’s attempted assignments failed. 3 Williston, Law of Contracts § 442 at 302 (3d ed. 1960). Those transfers by Eastern to Dirigo, Colonial, and United were void; the transfer by Vintners to Pine State was not invalidated by any provision of the Act.

Judgment for Vintners Group Ltd. against Dirigo Distributors, Colonial Distributors, Inc., and United Distributors of Maine, Inc. affirmed. Judgment for Vintners Group Ltd. against Eastern of Maine, Inc. vacated and remanded for further proceedings consistent with this opinion.

The Superior Court found Vintners had good cause to terminate the distributorship agreement based on Eastern's first assignment without Vintners’ consent, splitting the sales territory and permitting the unapproved assignee to commence distribution of Vintners’ products. Reviewing the court’s finding by the clearly erroneous standard, we determine there is competent evidence in the record to support it.

§670. Assignment, transfer or sale of business (REPEALED) SECTION HISTORY PL 1979, c. 270 (NEW). PL 1987, c. 45, §A3 (RP).

We agree that Vintners’ knowing violation of the notice provisions might be evidence of bad faith. On the basis of this record, however, we conclude that the Superior Court did not clearly err in finding that Vintners did not terminate the agreement in bad faith.

Eastern has not proven it suffered any harm by Vintners’ failure to give 90 days notice of termination. Indeed, Eastern forged ahead single-mindedly with its plan to sell the Sebastiani distribution rights to three buyers in the face of Vintners’ express disapproval of dividing the sales territory. There is no error in the Superior Court’s finding that Eastern was not entitled to equitable relief. The entry is: Judgment affirmed.

Everyone has a right to select and determine with whom he will contract and the obligee of a contract cannot be deprived of that security of performance anticipated by him from the character, ability, honesty *471 and financial stability of the named obli-gor by the mere assignment of the contract without the obligee’s consent. The assignment to Peninsula, without the consent of the Dugans, could only operate as an assignment of the benefits of the contract, and not of the conjoined personal obligations of Sprague.

Subsection (4) does not apply to the sale of a payment intangible or promissory note other than a sale pursuant to a disposition under section 9‑1610 or an acceptance of collateral under section 9‑1620 .

(a). Would impair the creation, attachment or perfection of a security interest; or

(b). Provides that the assignment or transfer or the creation, attachment or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination or remedy under the promissory note, health-care-insurance receivable or general intangible.

Subsection (1) applies to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note, other than a sale pursuant to a disposition under section 9‑1610 or acceptance of collateral under section 9‑1620 .

To the extent that a term in a promissory note or in an agreement between an account debtor and a debtor that relates to a health-care-insurance receivable or general intangible or a rule of law, statute or regulation described in subsection (3) would be effective under law other than this Article but is ineffective under subsection (1) or (3) , the creation, attachment or perfection of a security interest in the promissory note, health-care-insurance receivable or general intangible: (a). Is not enforceable against the person obligated on the promissory note or the account debtor;

Does not require the person obligated on the promissory note or the account debtor to recognize the security interest, pay or render performance to the secured party or accept payment or performance from the secured party;

Does not entitle the secured party to enforce the security interest in the promissory note, health-care-insurance receivable or general intangible.

DUFRESNE, Justice (concurring in result). In my view the assignor-buyer, Bruce B. Sprague, lost his standing to appeal from the decision below when his assignee, First Peninsula Company, did not appeal and the judgment against it became final.

Contract rights are generally assignable, except where the assignment is (1) prohibited by statute; 2 (2) prohibited by contract; (3) or where the contract involves a matter of personal trust or confidence.

The primary purpose of clauses prohibiting the assignment of contract rights is to protect the contracting party from dealing with parties he has not chosen to do business with.

We did not require that the parties use specific terms to preclude assignment, but merely required the parties to include something expressing their intent that the contract not be assignable. Because there was nothing in the terms of the contract manifesting the intention of the parties that it was not to be assigned, we upheld the assignment.

According to the Bel-Ray court, in order to limit the parties’ power to assign, “the assignment provision must generally state that nonconforming assignments (i) shall be ‘void’ or ‘invalid,’ or (ii) that the assign-ee shall acquire no rights or the nonassign-ing party shall not recognize any such assignment.” Id. at 442 (citations omitted). “In the absence of such language, the provision limiting or prohibiting assignments will be interpreted merely as a covenant not to assign * * Id. Breach of the covenant may give rise to damages, but it will not render the assignment invalid or unenforceable. Id. Finally, the Supreme Court of Oklahoma has held that the following contract language “clearly and unambiguously precludes assignment”: “Plaintiffs agree that they maintain no right to * ⅜ * have power to sell, mortgage, encumber, or anticipate the future payments, or any part thereof by assignment or otherwise.” In re Kaufman, 37 P.3d 845, 855 (Okla.2001) (emphasis added). The Seventh Circuit, however, has rejected the requirement of using such “magic words,” classifying them as “empty verbiage.” Bank of America, N.A v. Moglia, 330 F.3d 942, 948 (7th Cir.2003) (applying law of Illinois, which had adopted Restatement (Second) of Contracts § 322). We agree with the Seventh Circuit. We will not impose formulaic restraints on the language that contracting parties may employ to craft an anti-assignment clause that limits the power to assign. We believe the best approach is to simply apply the plain meaning of the words employed by the parties. When a contract prohibits assignment in very specific and unmistakable terms, any purported assignment is void.

In this case, we need not adopt the default interpretive rules provided by the Restatement (Second) of Contracts § 322 because our precedent that parties may agree that their contractual rights and obligations are not to be assigned is well-established.

With the exception that Berkey may assign to Lennon and Lennon may assign to Berkey, the management agreement provides that “the rights and obligations of Berkey/Lennon shall not be assignable.” (Emphasis added.) We hold that the anti-assignment clause is a valid and enforceable term of the management agreement, and that the parties intended to deny Lennon the power to assign his rights under the management agreement to anyone but Berkey. Therefore, Lennon’s purported assignment of his right to compensation to Lexington-Silverwood is void.

Lexington-Silverwood urges us to adopt the default interpretive rules provided by the Restatement (Second) of Contracts: (1) Unless the circumstances indicate the contrary, a contract term prohibiting assignment of “the contract” bars only the delegation to an assignee of the performance by the assignor of a duty or condition. (2) A contract term prohibiting assignment of rights under the contract, unless a different intention is manifested, (a) does not forbid assignment of a right to damages for breach of the whole contract or a right arising out of the assignor’s due performance of his entire obligation; (b) gives the obligor a right to damages for breach of the terms forbidding assignment but does not render the assignment ineffective; (c) is for the benefit of the obligor, and does not prevent the assignee from acquiring rights against the assign- or or the obligor from discharging his duty as if there were no such prohibition. Restatement (Second) of Contracts § 322 (1981). We will not adopt a provision of a Restatement of the Law if our precedent is to the contrary and we believe that our precedent still reflects the proper rule of law.

We are cognizant of the fact that Minn.Stat. § 181.05 (2002) provides that an assignment of unearned wages or salary is void: No assignment, sale, or transfer, however made or attempted, of any unearned wages or salary shall be in any manner valid or effectual for the transfer of any salary or wages to be earned or accruing after the making of such assignment, sale, or transfer, unless the person, firm or corporation from whom such wages or salary are to accrue shall consent thereto in writing. Any employer or agent of such employer accepting or charging any fee or commission for collecting the amount due on any such assignment, sale, or transfer shall be deemed guilty of a misdemeanor. The record before us, however, is inconclusive with regard to (1) Lennon’s employment relationship with Travertine; and (2) the time period over which Lennon earned the compensation he purported to assign to Lexington-Silverwood. For these reasons, we decline Travertine's invitation to decide this case based upon application of Minn.Stat. § 181.05.

The insurers contend that their interpretation of the anti-assignment clauses is supported by our decision in Travertine Corp. v. Lexington-Silverwood, 683 N.W.2d 267 (Minn.2004). In Travertine, we held that an "anti-assignment clause is a valid and enforceable term" that precludes the assignment of a right to payment under a contract. Id. at 269, 274 . But the contract at issue in Travertine was a management contract rather than an insurance policy. Id. at 269 . While we have stated that insurance policies follow general principles of contract law unless there are statutory laws to the contrary, Bobich, 258 Minn. at 294 , 104 N.W.2d at 24 , we conclude our analysis in Travertine is not helpful in resolving the issues presented because the statutory framework regarding auto glass insurance, as laid out above, makes the insurance policies at issue sufficiently different from management contracts.

A nonnegotiable written contract for the payment of money or the delivery of personal property may be transferred by endorsement the same as a negotiable instrument. The endorsement transfers all the rights of the assignor under the contract to the assignee, subject to all equities and defenses existing in favor of the maker at the time of the endorsement or arising before notice of the assignment is received by the maker.

a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (a) prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note;

This section is subject to law other than this chapter that establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

Hedges argues that anti-assignment clauses in franchise agreements are enforceable only against the contracting party, not against an assignee, which status she claims to hold.

Whether the District Court erred in concluding that John forfeited his right to use the dealership property by violating anti-assignment clauses contained in the parties’ settlement agreements.

Because we conclude that John forfeited his right to use the dealership property by ceasing to personally operate Country Ford, we need not address this argument.

Hedges did not raise these arguments in her brief to the District Court. This Court has frequently refused to consider new issues on appeal.

Subsection (4) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under 30-9A-610 or an acceptance of collateral under 30-9A-620 .

In this subsection (4), "promissory note" includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in 30-2A-303 , 30-9A-407 , and subsections (5) and (10) of this section, and subject to subsection (8) of this section, a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it:

Subsections (4) and (6) do not apply to a security interest in an ownership interest in a general partnership, limited partnership, or limited liability company.

Except as otherwise provided in subsections (2) and (7), a term in a promissory note or in an agreement between an account debtor and a debtor that relates to a health-care-insurance receivable or a general intangible, including a contract, permit, license, or franchise, and that prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or the creation, attachment, or perfection of a security interest in, the promissory note, health-care-insurance receivable, or general intangible is ineffective to the extent that the term:

A term in a letter of credit or a rule of law, including a provision in a statute or governmental rule or regulation, custom, or practice applicable to the letter of credit that prohibits, restricts, or requires the consent of an applicant, issuer, or nominated person to a beneficiary's assignment of or creation of a security interest in a letter-of-credit right is ineffective to the extent that the term or rule of law, custom, or practice:

Montana law enforces contract clauses requiring consent prior to assignment of a party's rights. In Rother-Gallagher v. Montana Power Co. (1974), 164 Mont. 360, 522 P.2d 1226, this Court held that an attempted assignment of a party's rights to a roadbuilding and timber removal contract was void.

We conclude that the District Court was correct in determining that the contractual restrictions on assignment of the Melaleuca contract must be met in order to accomplish a valid assignment of the contract during Johnson's lifetime.

Subject to subsections (2) through (9) and (11), an account debtor on an account, chattel paper, or payment intangible may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, signed by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and may not discharge the obligation by paying the assignor.

This section does not apply to an assignment of a health-care-insurance receivable.

Subsection (1) applies to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note, other than a sale pursuant to a disposition under 30-9A-610 or an acceptance of collateral under 30-9A-620 .

Defendant had no authority to assign the lease without the consent of plaintiff. Such consent was never given or received and defendant’s contention that it transferred certain interests in the lease is necessarily immaterial as no valid rights could have been transferred or acquired in the absence of plaintiff’s consent.

In Nebraska, an assignment by a lessee of an interest in a lease which prohibits such assignment without the lessor’s consent is ineffective without such consent.

Nevertheless, the assignments without consent, even though invalid, were still violations of the covenants in the leases.

A provision in a contract for the sale of land prohibiting an assignment of the contract without the consent of the other party is usually considered to be a provision to safeguard performance of the contract. Where the contract has been performed, or performance has been tendered as in this case, the provision is usually considered unenforceable.

We further note that a contract provision requiring a seller’s consent to any future sale or assignment by the buyer is considered to have a limited application; namely, that such provision is intended as security for the seller, and when such security is not at issue, the provision is not enforceable.

Wagner also holds that where such provision contains no penalty or forfeiture for its breach, it will not prevent sale or assignment.

Under the circumstances in this case, the provision of the contract prohibiting assignment of the contract without the permission of the Sellers is unenforceable.

There is no foreclosure provision linked to the nonassignment clause, which is in the final sentence of the contract.

It is undisputed that the assignment at issue occurred after the contracts were breached. The anti-assignment clause therefore did not bar the assignment of the claims at issue.

Assigning an interest in a lease directly affects the parties’ actual performance of the contract, whereas the assignment of a right to collect damages for a breach of contract, as in the instant case, does not.

Otherwise, contractual rights are generally assignable unless the terms validly preclude assignment or the assignment is contrary to statute or public policy.

We have held that a contractual right to the benefit of a promise cannot be assigned if the obligor reasonably intended for the right to be exercised only by the party with whom it contracted.

We conclude that in the absence of a statute to the con- trary, a postloss assignment of a claim under a homeowner’s insurance policy for the homeowner’s property damage casu- alty loss is valid, despite a nonassignment clause.

We further note that we are not confronted with a direct contradiction of explicit contrac- tual language, i.e., Farm Bureau’s policy did not expressly prohibit assignment of a postloss claim.

we conclude that appellant, OB-GYN, has failed to show that the nonassignment provision in Blue Shield should be called void for public policy reasons.

where a commercial lease does not expressly permit a lessor to withhold consent to an assignment or subletting and contains an approval clause, such as a provision that there can be no assignment of the lease or subletting without the lessor’s prior consent, a lessor may withhold consent only when the lessor has a good faith and reasonable objection to assignment of the lease or subletting, even in the absence of a lease provision that the lessor’s consent will not be unreasonably withheld.

We leave for another day and another case the question whether an express lease provision permitting a lessor to withhold consent amounts to a restraint on alienation, in contravention of public policy in Nebraska.

A contract, which shows by its nature or terms that it is personal in character, that is, that reliance for its performance is placed on the integrity, credit, or responsibility of a party, or that confidence or trust is reposed in him personally for its performance, is not assignable, even in the sense of its performance being delegated to another, without the consent of the other party to the contract

A term in any lease between a rent party and an assignor is ineffective if it prohibits assignment of a lease or rents due or to become due pursuant to the lease, if it prohibits creation of a security interest in rents due or to become due, or if it requires the consent of the rent party to such assignment or a security interest in rents.

Except as provided in the Income Withholding for Child Support Act, every assignment of the wages or earnings of the head of a family and every contract or agreement intending or purporting to have the effect of such assignment shall be void unless such contract, agreement, assignment, or transfer is executed and acknowledged by both husband and wife in the same manner that conveyances of real estate are required to be signed and acknowledged by the laws of this state and shall be limited to a percentage of the wages of the head of household not greater than that subject to the operation of attachment, execution, and garnishee process as provided in section 25-1558 .

The assignee of a thing in action may maintain an action thereon in the assignee's own name and behalf, without the name of the assignor.

We next note the relevancy of Neb. U.C.C. § 9-318(4) (Reissue 1980), which provides: A term in any contract between an account debtor and an assignor is ineffective if it prohibits assignment of an account or prohibits creation of a security interest in a general intangible for money due or to become due or requires the account debtor’s consent to such assignment or security interest.

Thus, it is clear that § 9-318(4) negated any provision in the February 13, 1981, accelerated payment agreement restricting Chapman from pledging moneys receivable under the accounting practice sale agreement as collateral for his loan from Home Federal.

As part of these duties, § 9-406(a) provides: . . . [A]n account debtor on an account, chattel paper, or a payment intangible may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, authenticated by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and may not discharge the obligation by paying the assignor.

Further, Blue Shield has presented evidence to show its nonassignment clause is a valuable tool in persuading health care providers to participate in its physician’s voluntary cost effectiveness program and accept set fees for health services, keeping health care costs down and passing that savings on to its subscribers, who number 450,000 in Nebraska. Such evidence indicates a far stronger public policy than that relied on by OB-GYN.

Assignment instrument shall mean any mortgage, trust deed, assignment of leases, assignment of rents, or other instrument or agreement which creates, provides, assigns, or grants a security interest in rents;

(d) Term restricting assignment generally ineffective. Except as otherwise provided in subsection (e), 12A:2A-303 and 12A:9-407, and subject to subsection (h), a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (1) prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

(e) Inapplicability of subsection (d) to certain sales. Subsection (d) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under 12A:9-610 or an acceptance of collateral under 12A:9-620.

(f) Legal restrictions on assignment generally ineffective. Except as otherwise provided in 12A:2A-303 and 12A:9-407 and subject to subsections (h), (i) and (j), a rule of law, statute, or regulation that prohibits, restricts, or requires the consent of a government, governmental body or official, or account debtor to the assignment or transfer of, or creation of a security interest in, an account or chattel paper is ineffective to the extent that the rule of law, statute, or regulation: (1) prohibits, restricts, or requires the consent of the government, governmental body or official, or account debtor to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in the account or chattel paper; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account or chattel paper.

(i) Inapplicability. This section does not apply to an assignment of a health-care-insurance receivable. Subsection (f) does not apply to an assignment or transfer of, or the creation, attachment, perfection or enforcement of a security interest in, a right the transfer of which is prohibited or restricted by any of the following statutes to the extent that the statute is inconsistent with subsection (f): R.S.34:15-29 (workers' compensation claims); section 13 of P.L.1970, c.13 (C.5:9-13) (State lottery winnings); and P.L.2001, c.139 (C.2A:16-63 et seq.) (structured settlement agreements).

(j) Section prevails over specified inconsistent law. Except to the extent otherwise provided in subsection (i), this section prevails over any inconsistent provision of an existing or future statute, rule or regulation of this State, unless the provision is contained in a statute of this State, refers expressly to this section and states that the provision prevails over this section.

(h) Rule for individual under other law. This section is subject to law other than this chapter which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

Case law underscores the principle that rights arising by contract are generally assignable, subject to exceptions for anti-assignment contractual language, statutes prohibiting the assignment of certain categories of contractual rights, and other expressions of public policy against the assignment of specific interests.

Their contracts contained the following prohibitory provision: “ The assignment by the second party [Kroc] of this contract or any interest therein, or of any money due or to become due by reason of the terms hereof without the written consent of the first party [defendant] shall be void.”

We have now before us a clause embodying clear, definite and appropriate language, which may be construed in no other way but that any attempted assignment of either the contract or any rights created thereunder shall be “ void ” as against the .obligor. One would have to do violence to the language here employed to hold that it is merely an agreement by the subcontractor not to assign. The objectivity of the language precludes such a construction. We are therefore compelled to conclude that this prohibitory clause is a valid and effective restriction of the right to assign.

But these decisions are not to be read as meaning that there can be no enforcible contractual prohibition against the assignment of a claim; indeed, they are authority only for the proposition that, in the absence of language clearly indicating that a contractual right thereunder shall be nonassignable, a prohibitory clause will be interpreted as a personal covenant not to assign.

(d) Term restricting assignment generally ineffective. For purposes of this subsection, "promissory note" includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in subsection (e) and Sections 2-A-303 and 9--407, and subject to subsection (g), a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (1) prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

(e) Inapplicability of subsection (d) to certain sales. Subsection (d) does not apply to the sale of a payment intangible or promissory note.

Our courts have not construed a contractual provision against assignments framed in the language of the clause now before us. Such kindred clauses as have been subject to interpretation usually have been held to be either (1) personal covenants limiting the covenantee to a claim for damages in the event of a breach (as, e.g., Manchester v. Kendall, 19 Jones & Sp. 460, affd. 103 N. Y. 638 ; Sacks v. Neptune Meter Co., 144 Misc. 70 , affd. 238 App. Div. 82 ), or (2) ineffectual because of the use of uncertain language (State Bank v. Central Mercantile Bank, 248 N. Y. 428 ).

In the Manchester case (supra) it was held (p. 463) that the words, “ 1 This contract not to be assigned, or any part thereof, or any installments to grow due under the same ’ ”, must be construed as an agreement not to assign, the breach of which would give rise to a claim for damages by the covenantee.

The judgment should be affirmed, with costs. Loughran, Ch. J., Lewis, Conway, Desmond, Dye and Fuld, JJ., concur. Judgment affirmed.

(a) Discharge of account debtor; effect of notification. Subject to subsections (b) through (i), an account debtor on an account, chattel paper, or a payment intangible may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, signed by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and may not discharge the obligation by paying the assignor.

(b) When notification ineffective. Subject to subsections (g) and (i), notification is ineffective under subsection (a): (1) if it does not reasonably identify the rights assigned; (2) to the extent that an agreement between an account debtor and a seller of a payment intangible limits the account debtor's duty to pay a person other than the seller and the limitation is effective under law other than this article; or (3) at the option of an account debtor, if the notification notifies the account debtor to make less than the full amount of any installment or other periodic payment to the assignee, even if: (A) only a portion of the account, chattel paper, or payment intangible has been assigned to that assignee; (B) a portion has been assigned to another assignee; or (C) the account debtor knows that the assignment to that assignee is limited.

(c) Proof of assignment. Subject to subsections (g) and (i), if requested by the account debtor, an assignee shall seasonably furnish reasonable proof that the assignment has been made. Unless the assignee complies, the account debtor may discharge its obligation by paying the assignor, even if the account debtor has received a notification under subsection (a).

(g) Rule for individual under other law. This section is subject to a rule of law, statute, rule or regulation other than this article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes. (h) Inapplicability. This section does not apply to: (1) an assignment of a health care insurance receivable to the extent such assignment conflicts with other law or the parties have otherwise agreed in writing that such receivable is non-assignable, (2) a claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. § 104(a)(1) and (2), as amended from time to time, or (3) a claim or right to receive benefits under a special needs trust as described in 42 U.S.C. § 1396p (d)(4), as amended from time to time.

(i) Inapplicability of certain subsections. Subsections (a), (b), (c) and (f) do not apply to a controllable account or controllable payment intangible.

(a) Term restricting assignment generally ineffective. Except as otherwise provided in subsection (b), a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or a general intangible, including a contract, permit, license, or franchise, and which term prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or creation, attachment, or perfection of a security interest in, the promissory note, health-care-insurance receivable, or general intangible, is ineffective to the extent that the term: (1) would impair the creation, attachment, or perfection of a security interest; or (2) provides that the assignment or transfer or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health-care-insurance receivable, or general intangible.

(b) Applicability of subsection (a) to sales of certain rights to payment. Subsection (a) applies to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note.

(c) Limitation on ineffectiveness under subsection (a). To the extent that a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or general intangible would be effective under law other than this article but is ineffective under subsection (a), the creation, attachment, or perfection of a security interest in the promissory note, health-care-insurance receivable, or general intangible: (1) is not enforceable against the person obligated on the promissory note or the account debtor; (2) does not impose a duty or obligation on the person obligated on the promissory note or the account debtor; (3) does not require the person obligated on the promissory note or the account debtor to recognize the security interest, pay or render performance to the secured party, or accept payment or performance from the secured party; (4) does not entitle the secured party to use or assign the debtor's rights under the promissory note, health-care-insurance receivable, or general intangible, including any related information or materials furnished to the debtor in the transaction giving rise to the promissory note, health-care-insurance receivable, or general intangible; (5) does not entitle the secured party to use, assign, possess, or have access to any trade secrets or confidential information of the person obligated on the promissory note or the account debtor; and (6) does not entitle the secured party to enforce the security interest in the promissory note, health-care-insurance receivable, or general intangible.

(d) Term Restricting Assignment Generally Ineffective. - In this subsection, "promissory note" includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in subsection (e) of this section and G.S. 25-2A-303 and G.S. 25-9-407, and subject to subsection (h) of this section, a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it does either of the following: (1) Prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note.

Subsection (d) of this section does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under G.S. 25-9-610 or an acceptance of collateral under G.S. 25-9-620.

This section is subject to law other than this Article that establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes.

This section does not apply to an assignment of a health-care-insurance receivable or an interest in a partnership or limited liability company.

(b) Except as provided in subsection (c) of this section and G.S. 25-9-407, a provision in a lease agreement which (i) prohibits the voluntary or involuntary transfer, including a transfer by sale, sublease, creation, or enforcement of a security interest, or attachment, levy, or other judicial process, of an interest of a party under the lease contract or of the lessor's residual interest in the goods; or (ii) makes such a transfer an event of default, gives rise to the rights and remedies provided in subsection (d) of this section, but a transfer that is prohibited or is an event of default under the lease agreement is otherwise effective.

(c) A provision in a lease agreement which (i) prohibits a transfer of a right to damages for default with respect to the whole lease contract or of a right to payment arising out of the transferor's due performance of the transferor's entire obligation, or (ii) makes such a transfer an event of default, is not enforceable, and such a transfer is not a transfer that materially impairs the prospect of obtaining return performance by, materially changes the duty of, or materially increases the burden or risk imposed on, the other party to the lease contract within the purview of subsection (d) of this section.

In a consumer lease, to prohibit the transfer of an interest of a party under the lease contract or to make a transfer an event of default, the language must be specific, by a writing, and conspicuous.

(2) Provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

(a) Discharge of Account Debtor; Effect of Notification. - Subject to subsections (b) through (i) and ( l ) of this section, an account debtor on an account, chattel paper, or a payment intangible may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, signed by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and shall not discharge the obligation by paying the assignor.

(b) When Notification Ineffective. - Subject to subsections (h) and ( l ) of this section, notification is ineffective under subsection (a) of this section under any of the following conditions: (1) If it does not reasonably identify the rights assigned. (2) To the extent that an agreement between an account debtor and a seller of a payment intangible limits the account debtor's duty to pay a person other than the seller and the limitation is effective under law other than this Article. (3) At the option of an account debtor, if the notification notifies the account debtor to make less than the full amount of any installment or other periodic payment to the assignee, even if any of the following applies: a. Only a portion of the account, chattel paper, or payment intangible has been assigned to that assignee. b. A portion has been assigned to another assignee. c. The account debtor knows that the assignment to that assignee is limited.

(c) Proof of Assignment. - Subject to subsections (h) and ( l ) of this section, if requested by the account debtor, an assignee shall seasonably furnish reasonable proof that the assignment has been made. Unless the assignee complies, the account debtor may discharge its obligation by paying the assignor, even if the account debtor has received a notification under subsection (a) of this section.

Subsections (a), (b), (c), and (g) of this section do not apply to a controllable account or controllable payment intangible.

(g) Subdivision (b)(3) Not Waivable. - Subject to subsections (h) and ( l ) of this section, an account debtor shall not waive or vary its option under subdivision (b)(3) of this section.

In this subsection, "promissory note" includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in subsections 5 and 11 and sections 41-02.1-33 and 41-09-69, and subject to subsection 8, a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it:

Prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or - Provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

Subsection 4 does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under section 41-09-107 or an acceptance of collateral under section 41-09-115.

Subsections 4, 6, and 10 do not apply to a security interest in an ownership interest in a general partnership, limited partnership, or limited liability company.

Except as otherwise provided in subsections 2 and 6, a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health care insurance receivable or a general intangible, including a contract, permit, license, or franchise, and which term prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or creation, attachment, or perfection of a security interest in, the promissory note, health care insurance receivable, or general intangible, is ineffective to the extent that the term:

Would impair the creation, attachment, or perfection of a security interest; or - Provides that the assignment, transfer, creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health care insurance receivable, or general intangible. - Subsection 1 applies

Subsection 1 applies to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note, other than a sale pursuant to a disposition under section 41-09-107 or an acceptance of collateral under section 41-09-115.

To the extent that a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health care insurance receivable or general intangible or a rule of law, statute, or regulation described in subsection 3 would be effective under law other than this chapter but is ineffective under subsection 1 or 3, the creation, attachment, or perfection of a security interest in the promissory note, health care insurance receivable, or general intangible: - Is not enforceable against the person obligated on the promissory note or the account debtor; - Does not impose a duty or obligation on the person obligated on the promissory note or the account debtor; - Does not require the person obligated on the promissory note or the account debtor to recognize the security interest, pay or render performance to the secured party, or accept payment or performance from the secured party; - Does not entitle the secured party to use or assign the debtor's rights under the promissory note, health care insurance receivable, or general intangible, including any related information or materials furnished to the debtor in the transaction giving rise to the promissory note, health care insurance receivable, or general intangible; - Does not entitle the secured party to use, assign, possess, or have access to any trade secrets or confidential information of the person obligated on the promissory note or the account debtor; and - Does not entitle the secured party to enforce the security interest in the promissory note, health care insurance receivable, or general intangible.

This section does not apply to a security interest in an ownership interest in a general partnership, limited partnership, or limited liability company.

This section is subject to law other than this chapter which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes. - This section does not apply to an assignment of a health care insurance receivable. - This section prevails over any inconsistent statute, rule, or regulation.

As to the second question, we answer that such a chose in action is transferable despite the existence of an anti-assignment provision contained in the policy as to the duty to indemnify. We are unable to answer definitively whether such a chose in action is transferable as to the duty to defend.

[A]n account debtor on an account * * * may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, authenticated by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and may not discharge the obligation by paying the assignor.

The distinction between Ray and Henkel is that under Ray, the chose arises at the time of the loss, whereas in Henkel, the chose arises when the claim has been reduced to a sum of money owed.

we do not read the statute as precluding a lawsuit by an assignee to collect an unpaid debt. The statute simply provides that a debtor may continue to make scheduled payments to the original creditor

We adopt the same principle and hold that a chose in action arises under an occurrence-based insurance policy at the time of the covered loss.

The duty to indemnify implicates both property damage and bodily injury. The losses are fixed at the time of the occurrence. We see no reason to deviate from the standard rule on this issue, and thus we hold that the chose in action as to the duty to indemnify is unaffected by the anti-assignment provision when the covered loss has already occurred.

receiving notice of an assignment. Here, however, Obanion did not pay anyone. If her claim about a lack of notice of the assignment is true, she may have been justified in continuing to pay Premier Athletic Center. Given her failure to do so, however, she now is required to pay Credit Investments, the assignee.

This case requires us to decide whether R.C. 1309.406(A) applies to payments made by an account debtor that is a governmental unit. R.C. 1309.109(D)(14) states, “This chapter does not apply to * * * [a] transfer by a government, state, or governmental unit.”

The words of that statute clearly state that when an account debtor makes payments to an assignor of an account receivable after the account debtor has received notice of an assignment, the account debtor is still liable to the assignee for the payments made to the assignor.

Accordingly, we hold that pursuant to R.C. 1309.109(D)(14), R.C. 1309.406(A) does not apply to payments made by an account debtor that is a governmental unit.

In this subsection, “promissory note” includes a negotiable instrument that evidences chattel paper. Except as otherwise provided in subsection (5) of this section and ORS 72A.3030 and 79A.4070, and subject to subsection (8) of this section, a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (a) Prohibits, restricts or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection or enforcement of a security interest in, the account, chattel paper, payment intangible or promissory note; or (b) Provides that the assignment or transfer or the creation, attachment, perfection or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination or remedy under the account, chattel paper, payment intangible or promissory note.

Subsection (4) of this section does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under ORS 79A.6100 or an acceptance of collateral under ORS 79A.6200.

This section is subject to law other than this chapter which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family or household purposes.

This section does not apply to the assignment of a health-care-insurance receivable. (b) Subsections (4) and (6) of this section do not apply to the assignment or transfer of, or the creation of a security interest in, a claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. 104(a)(2), provided that such transaction constitutes a sale of such claim or right. The limitation in this paragraph is intended to leave to the court the determination of the proper rules in such cases. The court may not infer from that limitation the nature of the proper rule in such cases and may continue to apply established approaches. (c) Subsections (4) and (6) of this section do not apply to the following: (A) The assignment or transfer of, or the creation of a security interest in, a claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. 104(a)(1); (B) The assignment or transfer of, or the creation of a security interest in, a claim or right to receive benefits under a special needs trust as described in 42 U.S.C. 1396p(d)(4); or (C) The assignment or transfer of, or the creation, attachment, perfection or enforcement of a security interest in, the benefits, rights, privileges or options accruing under an annuity policy, to the extent that the annuity policy provides for such a restriction and the restriction is permitted under ORS 743.049.

We answer those questions as follows: (1) The tenant’s merger into its wholly owned subsidiary effected a transfer of the lease “by operation of law,” requiring the landlord’s consent. (2) A duty of good faith applies to lease agreements; here, however, the landlord’s refusal to consent did not contravene that duty, because the landlord’s refusal did not contravene the “reasonable expectations” of the parties as manifested in the express terms of the lease agreement at issue.

It does, however, expressly provide that a “transfer” of the lease “in any manner,” “whether voluntary or involuntary or by operation of law,” is an event requiring the consent of Landlord.

More pertinently, however, Section 18.2, which is worded in a broad and all-encompassing manner, does not exclude mergers. A downstream merger is one way in which the rights and obligations under a lease pass — that is, transfer — from one corporate entity to another.

Bank is not entitled, therefore, to a declaration that it became the tenant of the property in compliance with the lease agreement. The decision of the Court of Appeals is affirmed on different grounds. The judgment of the circuit court is reversed, and the case is remanded to the circuit court for further proceedings.

The plaintiff states the general rule correctly and concisely, that a contract can not b'e assigned when its terms forbid an assignment, or when there is an implied intention that personal service is required by the contract.

It held that the restriction need not be expressed in the contract, but that it may appear from the implied intention of the parties. Following this rule the subsequent cases have depended chiefly upon the point whether personal service or liability was intended by the contract.

It would be quite unjust to a party to be bound to an assignee, with whom, possibly, he would not have made a contract in the first instance, simply because it had not occurred to him to mention in the contract that it could not be assigned.

It is mutually understood and agreed that the contractor shall not assign, transfer, convey, sublet or otherwise dispose of this contract or his right, title or interest therein, or his power to execute such contract, to any other person, company or corporation, without the previous consent, in writing, of the Purchasing Agent.

This clause clearly prohibits the transfer of rights that the defendant attempted to carry out in its liquidation agreement with Hodess.

In effect, the right to settle disputes by arbitration is not an assignable right. Because plaintiffs never entered into an agreement to arbitrate with defendant, they cannot be compelled by defendant to enter into arbitration, nor can Hodess enter into an agreement that essentially assigns its own right to arbitrate an issue with plaintiffs.

We are of the opinion that the decision of the trial court that the withholding of consent to the assignment of the lease was unreasonable is not clearly wrong.

In the present case the court is unable to say, as a matter of law to what extent the personal service of Dr. Swarts may have been important.

In this case the contract seems to us to imply a personal service, not only from the nature of the work to be done, but also by its terms

We are, therefore, of opinion that the demurrers to the plea should be overruled.

In summary, the defendant was not in privity with the plaintiffs and cannot invoke the pass-through doctrine. Therefore, the trial justice did not err in permanently enjoining the defendant from proceeding with arbitration against the plaintiffs.

a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (1) Prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or

(2) Provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

(e) Subsection (d) does not apply to the sale of a payment intangible or promissory note other than a sale pursuant to a disposition under § 57A-9-610 or an acceptance of collateral under § 57A-9-620 .

(k) Subsections (d), (f), and (j) do not apply to a security interest in an ownership interest in a general partnership, limited partnership, or limited liability company.

(a) Except as otherwise provided in subsections (b) and (f), a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or a general intangible, including a contract, permit, license, or franchise, and which term prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or creation, attachment, or perfection of a security interest in, the promissory note, health-care-insurance receivable, or general intangible, is ineffective to the extent that the term: (1) Would impair the creation, attachment, or perfection of a security interest; or (2) Provides that the assignment or transfer or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health-care-insurance receivable, or general intangible.

(b) Subsection (a) applies to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note, other than a sale pursuant to a disposition under § 57A-9-610 or an acceptance of collateral under § 57A-9-620 .

(d) To the extent that a term in a promissory note or in an agreement between an account debtor and a debtor which relates to a health-care-insurance receivable or general intangible or a rule of law, statute, or regulation described in subsection (c) would be effective under law other than this article but is ineffective under subsection (a) or (c), the creation, attachment, or perfection of a security interest in the promissory note, health-care-insurance receivable, or general intangible: (1) Is not enforceable against the person obligated on the promissory note or the account debtor; (2) Does not impose a duty or obligation on the person obligated on the promissory note or the account debtor; (3) Does not require the person obligated on the promissory note or the account debtor to recognize the security interest, pay or render performance to the secured party, or accept payment or performance from the secured party; (4) Does not entitle the secured party to use or assign the debtor's rights under the promissory note, health-care-insurance receivable, or general intangible, including any related information or materials furnished to the debtor in the transaction giving rise to the promissory note, health-care-insurance receivable, or general intangible; (5) Does not entitle the secured party to use, assign, possess, or have access to any trade secrets or confidential information of the person obligated on the promissory note or the account debtor; and (6) Does not entitle the secured party to enforce the security interest in the promissory note, health-care-insurance receivable, or general intangible.

(f) This section does not apply to a security interest in an ownership interest in a general partnership, limited partnership, or limited liability company.

(d) Except as otherwise provided in Subsection (e) and Sections 2A.303 and 9.407 , and subject to Subsection (h), a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: (1) prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note.

(e) Subsection (d) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under Section 9.610 or an acceptance of collateral under Section 9.620 .

(h) This section is subject to law other than this chapter that establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes. (i) This section does not apply to an assignment of a health-care-insurance receivable. (j) This section does not apply to an interest in a partnership or limited liability company. (k) An assignment under this section is subject to Section 466.410 , Government Code, except to the extent that Section 466.410 (a), Government Code, prohibits the assignment of installment prize payments due within the final two years of the prize payment schedule, in which case this section shall prevail over Section 466.410 solely to the extent necessary to permit such assignment.

(f) Except as otherwise provided in Sections 2A.303 and 9.407 , and subject to Subsections (h), (i), and (k), a rule of law, statute, or regulation that prohibits, restricts, or requires the consent of a government, governmental body or official, or account debtor to the assignment or transfer of, or creation of a security interest in, an account or chattel paper is ineffective to the extent that the rule of law, statute, or regulation: (1) prohibits, restricts, or requires the consent of the government, governmental body or official, or account debtor to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account or chattel paper; or (2) provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account or chattel paper.

(b) Subject to Subsection (h), notification is ineffective under Subsection (a): (1) if it does not reasonably identify the rights assigned; (2) to the extent that an agreement between an account debtor and a seller of a payment intangible limits the account debtor's duty to pay a person other than the seller and the limitation is effective under law other than this chapter; or

(a) Except as otherwise provided in Subsection (b), a term in a promissory note or in an agreement between an account debtor and a debtor that relates to a health-care-insurance receivable or a general intangible, including a contract, permit, license, or franchise, and which term prohibits, restricts, or requires the consent of the person obligated on the promissory note or the account debtor to, the assignment or transfer of, or creation, attachment, or perfection of a security interest in, the promissory note, health-care-insurance receivable, or general intangible, is ineffective to the extent that the term: (1) would impair the creation, attachment, or perfection of a security interest; or (2) provides that the assignment or transfer or the creation, attachment, or perfection of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the promissory note, health-care-insurance receivable, or general intangible. (b) Subsection (a) applies to a security interest in a payment intangible or promissory note only if the security interest arises out of a sale of the payment intangible or promissory note, other than a sale pursuant to a disposition under Section 9.610 or an acceptance of collateral under Section 9.620 .

(e) This section does not apply to an interest in a partnership or limited liability company.

Except as otherwise provided in Subsection (5) and Sections 70A-2a-303 and 70A-9a-407 , and subject to Subsection (8) , a term in an agreement between an account debtor and an assignor or in a promissory note is ineffective to the extent that it: prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the account, chattel paper, payment intangible, or promissory note; or provides that the assignment or transfer or the creation, attachment, perfection, or enforcement of the security interest may give rise to a default, breach, right of recoupment, claim, defense, termination, right of termination, or remedy under the account, chattel paper, payment intangible, or promissory note

Subsection (4) does not apply to the sale of a payment intangible or promissory note, other than a sale pursuant to a disposition under Section 70A-9a-610 or an acceptance of collateral under Section 70A-9a-620

Subject to Subsections (2) through (9) , an account debtor on an account, chattel paper, or a payment intangible may discharge its obligation by paying the assignor until, but not after, the account debtor receives a notification, authenticated by the assignor or the assignee, that the amount due or to become due has been assigned and that payment is to be made to the assignee. After receipt of the notification, the account debtor may discharge its obligation by paying the assignee and may not discharge the obligation by paying the assignor.

Subject to Subsections (8) and (10), notification is ineffective under Subsection (1) : if it does not reasonably identify the rights assigned; to the extent that an agreement between an account debtor and a seller of a payment intangible limits the account debtor's duty to pay a person other than the seller and the limitation is effective under law other than this chapter; or at the option of an account debtor, if the notification notifies the account debtor to make less than the full amount of any installment or other periodic payment to the assignee, even if: only a portion of the account, chattel paper, or payment intangible has been assigned to that assignee; a portion has been assigned to another assignee; or the account debtor knows that the assignment to that assignee is limited. Subject to Subsection (8) , if requested by the account debtor, an assignee shall seasonably furnish reasonable proof that the assignment has been made. Unless the assignee complies, the account debtor may discharge its obligation by paying the assignor, even if the account debtor has received a notification under Subsection (1) .

This section is subject to law other than this chapter which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes. This section does not apply to an assignment of a health-care-insurance receivable. Subsections (1) through (3) and (7) do not apply to a controllable account or controllable payment intangible.

The LeGallo group, clearly agreeing that the property was burdened by the deed of trust, had the right under the land contract to make the assignment. The assignor was not required to obtain the consent of anyone. However, in the event of an assignment, the original sellers had certain rights that they could exercise at their option. One of those rights was the privilege to call note 2. But the “due on sale” clause in no way impeded the free assignability of the land contract.

The deed of trust, which dispenses with the necessity of a foreclosure suit, has almost entirely taken the place in this State of a mortgage as a security for the payment of a debt. The authorities seem to hold with unanimity that a mortgage is never construed as such an assignment of a leasehold interest as to cause a forfeiture under a covenant in the lease prohibiting assignment, unless it be that the mortgagee has an absolute right to enter on the property or to sell the estate of the lessee in the leasehold, and actually exercises such authority.

we hold that the trial court did not err in refusing to grant specific performance of the land contract and in refusing to declare the deed of trust invalid as being in violation of the assignee’s contract rights. Accordingly, the judgment below will be Affirmed.

The Superior Court ruled the antiassignment clause contained in the contract between the District and Cummings prohibited the assignment by the District to Berschauer/ Phillips of a breach of contract cause of action against Cummings. We disagree and reverse the Superior Court.

14.6 Assignment. The Owner and the Architect, respectively, bind themselves, their partners, successors, assigns and legal representatives to the other party to this Agreement, and to the partners, successors, assigns and legal representatives of such other party with respect to all covenants of this Agreement. Neither the Owner nor the Architect shall assign, sublet or transfer any interest in this Agreement without the written consent of the other.

Berschauer/Phillips argues this is a general antiassignment clause and thus does not prohibit the assignment of a breach of contract cause of action. In contrast, Cummings argues the contract language plainly prohibits the District from assigning any interest in the agreement without first obtaining Cummings’ written consent. Cummings asserts any interest means all interests, including a cause of action for breach of contract. Contracts are assignable unless such assignment is expressly prohibited by statute or contract, or is in contravention of public policy.

We follow the reasoning adopted in Portland Elec, and hold a general antiassignment clause, one aimed at prohibiting the assignment of a contractual performance, does not, absent specific language to the contrary, prohibit the assignment of a breach of contract cause of action. The assignment clause between Cummings and the District is a boilerplate provision intended to prohibit the exchange of contractual performances. Cummings completed the terms of its contract prior to the District’s assignment of the breach of contract claim to Berschauer/Phillips. Given complete performance, the rule in Portland Elec, makes good sense. We therefore hold a general assignment clause, one directed at performance of the contract, does not, after performance is completed, prohibit the assignment of a cause of action for breach of contract.

The primary purpose of clauses prohibiting the assignment of contract rights without a contracting party’s permission is to protect him [or her] in selecting the persons with whom he [or she] deals.

We also hold a general antiassignment provision in a contract does not prohibit the assignment of a breach of contract cause of action after the completion of performance.

Contracts are assignable unless such assignment is expressly prohibited by statute, contract, or is in contravention of public policy. [37] The traditional test for whether a cause of action is assignable is whether the claim would survive to the personal representative of the assignor upon death. [38] If it would, the cause of action is assignable. [39] A right of action arising from a contract is a chose in action and personal property.

We also conclude that the homeowners' obtained valid assignments of the original purchasers' breach of contract claims. Even general anti-assignment clauses in contracts, aimed at prohibiting the assignment of contractual performance, will not be construed to prohibit assignments of a breach of contract cause of action unless the contract contains specific language to the contrary.

Relying on Robbins v. Hunts Food & Indus., Inc., [44] Harbour Homes argues that claims involving "personal confidence" are an exception to the general assignability of claims. [45] But the issue in Robbins was whether an executory sales contract making one party the exclusive sales agent of the other could be assigned. The court noted the personal confidence exception, but found that it did not apply where there was no evidence the contract was based "upon the business and financial skill, judgment, and credit" of the assignor. [46] ¶ 37 Here, unlike Robbins, the assignments at issue are assignments of claims, not contractual performance. Moreover, this case does not involve executory contracts or a "relation of personal confidence." The personal confidence exception does not apply.

We conclude that consistent with long- standing Wisconsin law, the anti-assignment provisions in Wausau’s policies are not enforceable as to these assignments because the assignments are “post-loss.” We hold that notwithstanding the language in the anti-assignment clauses requiring insurer consent, such consent is not required for an assignment of insurance recovery rights made after a “loss” has occurred under an occurrence-based policy.

[A]lthough the policy provides that an assignment thereof, without the consent of the company, will avoid the contract, yet the law is well settled that this only applies to an assignment before a loss under it. After a loss, the claim, like any other chose in action, may be assigned without affecting the insurer’s liability.

Here, Huff’s alleged asbestos exposure was the “occurrence,” and because it took place during the relevant coverage periods, the loss had already occurred prior to any transfer.

The “loss” referred to in an occurrence-based policy is the actual “occurrence”; here, the “loss” is the asbestos exposure that allegedly took place during the Wausau policy periods.

Since 1880, Wisconsin case law has applied this general rule. In a case involving a post-loss assignment, the Wisconsin Supreme Court held that rights under an insurance policy are freely assignable after a loss with or without insurer consent:

Accordingly, we reaffirm Wisconsin’s longstanding rule that an anti- assignment clause in an occurrence-based policy is unenforceable when the assignment is made post-loss.

Under these standards, we conclude that the language in Red Arrow regarding the effect of the anti-assignment clause is dicta.

Accordingly, we reverse the circuit court’s decision granting summary judgment to Wausau and denying summary judgment to Pepsi. On remand, the circuit court should grant Pepsi’s motion for summary judgment on its Declaratory Judgment-Duty to Defend claim and conduct further proceedings as necessary and consistent with this opinion. BACKGROUND A. The Policies ¶2 This is an insurance dispute arising out of a history of assignments and transfers going back more than half a century. The history begins in 1963, when Wausau issued primary and umbrella liability insurance policies to Waukesha Foundry Company (Old Waukesha). These policies were in effect from 1963 to 2 No. 2021AP635 1968. The Wausau policies generally provide that Wausau “will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of … bodily injury or … property damage … caused by an occurrence.” The policy defines “occurrence” as “an accident, including injurious exposure to conditions, which results, during the policy period, in bodily injury or property damage neither expected nor intended from the standpoint of the insured.” ¶3 The policies require Wausau to defend any suit against the insured seeking damages on account of such bodily injury or property damage, “even if any of the allegations of the suit are groundless, false or fraudulent.” The policies further contained what is commonly referred to as an anti-assignment clause, stating in relevant part that “[a]ssignment of interest under this policy shall not bind the company until its consent is endorsed hereon[.]” B. The Corporate Succession and Assignment History ¶4 In August 1968, Old Waukesha assigned and transferred all of its assets and liabilities to Illinois Central Industries, Inc. (I.C.). The parties entered into an “Agreement and Plan of Reorganization” (Reorganization Agreement) on August 16, 1968, whereby I.C. acquired substantially all of the assets and liabilities of Old Waukesha through a new wholly-owned subsidiary, to be called Waukesha Foundry Company, Inc. (New Waukesha). New Waukesha was to take over the Old Waukesha business, and Old Waukesha would dissolve. According to the Reorganization Agreement, New Waukesha acquired “substantially all of the property, assets and business” of Old Waukesha, as well as “all the liabilities … other than those expressly excepted.” Regarding assumption of liabilities, the agreement states as follows: 3 No. 2021AP635 At the Closing I.C. shall cause [New Waukesha] by appropriate written instrument or instruments to assume and agree to pay, perform and discharge when due all of the debts, liabilities, obligations and contracts of [Old Waukesha] existing on the Closing Date, except the following: (a) liabilities against which [Old Waukesha] is insured or otherwise indemnified to the extent of such insurance or indemnification. The closing was set for August 30, 1968. ¶5 The reorganization was accomplished by closing on August 30, 1968. At the closing, Old Waukesha and New Waukesha signed two documents concerning the liabilities and assets transferred between the two companies. An “Assumption and Liabilities” agreement required New Waukesha to “assume and agree to pay, perform and discharge when due all of the debts, liabilities, obligations and contracts of [Old Waukesha] existing” as of the closing date. Consistent with the Reorganization Agreement, the Assumption and Liabilities agreement excepted “liabilities against which [Old Waukesha] is insured or otherwise indemnified to the extent of such insurance.” A separate agreement, a “Bill of Sale and General Assignment,” conveyed, among other things, “all” of Old Waukesha’s “rights under contracts, insurance policies … claims, rights, [and] choses in action” to New Waukesha. Wausau issued new policies to New Waukesha which ran from 1968 through 1971. As to the provisions at issue here, the new policies contained the same language as the policies issued to Old Waukesha. ¶6 In 1974, New Waukesha merged with Abex Corporation (Abex). The merger left Abex as the surviving corporation, with Abex succeeding to all the assets and liabilities of New Waukesha by operation of law, including rights as a successor in interest to New Waukesha’s insurance policies. 4 No. 2021AP635 ¶7 On August 23, 1990, Abex entered into an Assignment and Assumption Agreement whereby it assigned all of its assets and rights to PA Holdings Corporation, its sole stockholder. Abex then dissolved. Under the agreement, Abex transferred “all of [Abex’s] right, title and interest in, to and under all of the assets, properties and rights of [Abex] of every type and description, of every kind and nature, owned or held by [Abex].” The agreement stated further that the general assignment of Abex’s assets did not include those that were “not capable of being Transferred … without the consent, approval or waiver of a third person or entity.” On November 1, 1990, PA Holdings Corporation changed its name to Pneumo Abex Corporation. ¶8 Pneumo Abex Corporation remained as the surviving corporate entity from 1990 until 2004, when it merged with and into Pneumo Abex, LLC. Pneumo Abex Corporation then ceased to exist. Pneumo Abex, LLC, is the successor in interest to Abex, which in turn is the successor in interest to New Waukesha. ¶9 In 2019, Pneumo Abex, LLC and Pepsi entered into assignment agreement, whereby Pneumo Abex, LLC stated that it was the successor in interest to the Waukesha foundry companies, that Pepsi is the “net-of-insurance” indemnitor of Pneumo Abex, LLC for numerous asbestos suits relating to the Waukesha entities, and that Pneumo Abex, LLC assigned its rights under the Wausau policies to Pepsi.1 1 “Net of insurance” indemnification means that, with respect to liability for qualifying claims, including the Waukesha asbestos lawsuits, Pepsi is entitled to Pneumo Abex, LLC’s insurance recoveries applicable to claims for which Pepsi indemnifies Pneumo Abex, LLC. It is undisputed that Pepsi’s indemnification of Pneumo Abex, LLC would not bar recovery. 5 No. 2021AP635 C. The asbestos suits and summary judgment motions ¶10 Over 100 plaintiffs alleged injurious asbestos exposure attributed to a pump manufactured by the Waukesha foundry companies (Waukesha asbestos lawsuits). As relevant to this appeal, in 2017, Huff, a mesothelioma claimant, filed a lawsuit in Missouri state court against “Pneumo Abex, LLC, as Successor in Interest to Abex Corporation,” among other defendants. The complaint alleged that Huff was exposed to asbestos during the Wausau policy periods and that the defendants “manufactured, designed, labeled, distributed, supplied, or sold” the asbestos products which caused his injury. The complaint alleged, among other things, claims for negligence, strict liability, and conspiracy against the defendants. ¶11 Pepsi tendered defense to Wausau, asserting that Pneumo Abex, LLC was entitled to coverage under the Old Waukesha and New Waukesha polices. Wausau denied coverage, stating, as relevant to this appeal, that “it appears that Pneumo Abex, LLC is being sued not for any liabilities related to Waukesha Pump, but for the historical liabilities of Abex Corporation.” ¶12 Pepsi then paid defense and settlement costs relating to some of the Waukesha asbestos lawsuits, including Huff’s action. In 2019, Pneumo Abex, LLC, assigned to Pepsi the right to pursue and keep insurance proceeds for the Waukesha asbestos lawsuits under the Wausau policies. Pepsi then commenced this action seeking a determination of Wausau’s duties to defend the Waukesha asbestos lawsuits and to indemnify Pepsi. As relevant to this appeal, Pepsi moved for partial summary judgment as to the Huff complaint, arguing that Pneumo Abex, LLC, was a successor to insurance rights under the Wausau policies, thus triggering Wausau’s duty to defend the Huff complaint. Pepsi further alleged that Wausau previously defended other asbestos-related lawsuits in which Pneumo Abex, LLC, was a named 6 No. 2021AP635 defendant. Wausau opposed the motion and filed a cross-motion for summary judgment seeking to dismiss Pepsi’s claims not only with respect to the Huff complaint, but to all of the Waukesha asbestos lawsuits on the grounds that Pneumo Abex, LLC, was not a successor in interest to rights under either the Old Waukesha or the New Waukesha policies and, accordingly, could not claim the rights of an “insured.” Specifically, Wausau argued that in order for Pepsi to succeed on its claims, it had to prove an unbroken chain of transferred policy rights from Old Waukesha to New Waukesha and then through the transaction history to Pneumo Abex, LLC, which it could not do pursuant to the policies’ anti-assignment provision. ¶13 The circuit court, relying on our decision in Red Arrow Products Co., Inc. v. Employers Insurance of Wausau, 2000 WI App 36, 233 Wis. 2d 114, 607 N.W.2d 294, agreed with Wausau. Specifically, the court found that the anti- assignment provisions in the Wausau policies prevented any transfer of insurance rights without Wausau’s consent. The court also found that Pepsi had failed to demonstrate a transfer of insurance rights from either Old Waukesha to New Waukesha or from Abex to PA Holdings. Consequently, the court denied Pepsi’s motion for partial summary judgment and granted Wausau’s motion for summary judgment. Pepsi now appeals. DISCUSSION I. Standard of Review ¶14 “We review de novo a circuit court’s ruling on summary judgment, and apply the same legal principles.” Chapman v. B.C. Ziegler & Co., 2013 WI App 127, ¶2, 351 Wis. 2d 123, 839 N.W.2d 425. Summary judgment is appropriate where “the pleadings, depositions, answers to interrogatories, and admissions on 7 No. 2021AP635 file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” WIS. STAT. § 802.08(2) (2019-20). The purpose of summary judgment is “to avoid trials when there is nothing to try.” Tews v. NHI, LLC, 2010 WI 137, ¶42, 330 Wis. 2d 389, 793 N.W.2d 860. II. The Anti-Assignment Clauses ¶15 We begin with the question at the center of this appeal: whether the anti-assignment provisions in Wausau’s policies preclude coverage because those rights could not be transferred from Old Waukesha to New Waukesha in 1968, and again from Abex to PA Holdings in 1990. We conclude that consistent with long- standing Wisconsin law, the anti-assignment provisions in Wausau’s policies are not enforceable as to these assignments because the assignments are “post-loss.” We hold that notwithstanding the language in the anti-assignment clauses requiring insurer consent, such consent is not required for an assignment of insurance recovery rights made after a “loss” has occurred under an occurrence-based policy. Here, Huff’s alleged asbestos exposure was the “occurrence,” and because it took place during the relevant coverage periods, the loss had already occurred prior to any transfer. See, e.g., Plastics Eng’g Co. v. Liberty Mutual Ins. Co., 2009 WI 13, ¶31, 315 Wis. 2d 556, 759 N.W.2d 613. Accordingly, the anti-assignment provisions did not relieve Wausau of the duty to defend Huff’s case. ¶16 Wausau’s policies at issue in this case were issued to Old Waukesha from 1963-1968, and then to New Waukesha from 1968-1971. Huff alleges his exposure occurred during the Wausau policy periods. The policies are substantially the same, providing coverage for an “occurrence,” which is defined as “an accident, including injurious exposure to conditions, which results, during the policy period, 8 No. 2021AP635 in bodily injury or property damage neither expected nor intended from the standpoint of the insured.” Occurrence-based policies are “triggered” by the occurrence of property damage or bodily injury during the policy period, even if the damage or injury is not discovered until much later. See id., ¶53. As relevant to this appeal, “exposure to asbestos falls within an exposure to conditions” as referenced in the policies because “[w]ithout exposure, no bodily injury takes place.” See id., ¶31.2 ¶17 As noted above, the Waukesha foundry companies went through a series of transfers that purported to assign the right to insurance with those transfers. The occurrence-based policies at issue here contain an “anti-assignment” clause, which provides as follows: “Assignment of interest under this policy shall not bind the company until its consent is endorsed hereon[.]” The purpose of a non- assignment clause is to protect the insurer from increased liability. After the loss has occurred, assignment of the right to recover under the policy does not increase the insurer’s risk. See 3 STEVEN PLITT ET AL., COUCH ON INSURANCE § 35:8 (3d ed. 1995). In this case, the assignment was after the loss already had occurred (post- loss). ¶18 Wisconsin has been among the majority of states following the general maxim that policies prohibiting assignments of the policy, except with the consent of the insurer, apply only to assignments before loss, and do not prevent an assignment after loss, for the obvious reason that the clause by its own terms ordinarily prohibits merely the assignment of the policy, as distinguished from a claim arising under the policy, and the assignment before loss involves a transfer of a contractual 2 A claims-made-and-reported policy provides that the policy only provides coverage if the policy holder makes the claim during the policy period. Anderson v. Aul, 2015 WI 19, ¶3, 361 Wis. 2d 63, 862 N.W.2d 304. 9 No. 2021AP635 relationship while the assignment after loss is the transfer of a right to a money claim. Id. (footnote omitted). Thus, an anti-assignment provision “prohibiting an assignment after loss has occurred is generally regarded as void, in that it is against public policy to restrict the relation of debtor and creditor by restricting or rendering, subject to the control of the insurer, an absolute right in the nature of a chose in action.” Id., § 35:9. The “loss” referred to in an occurrence-based policy is the actual “occurrence”; here, the “loss” is the asbestos exposure that allegedly took place during the Wausau policy periods. See Plastics Eng’g Co., 315 Wis. 2d 556, ¶31; COUCH ON INSURANCE § 35:8 (equating loss with “events giving rise to the insurer’s liability”). ¶19 Since 1880, Wisconsin case law has applied this general rule. In a case involving a post-loss assignment, the Wisconsin Supreme Court held that rights under an insurance policy are freely assignable after a loss with or without insurer consent: [A]lthough the policy provides that an assignment thereof, without the consent of the company, will avoid the contract, yet the law is well settled that this only applies to an assignment before a loss under it. After a loss, the claim, like any other chose in action, may be assigned without affecting the insurer’s liability. Dogge v. Northwestern Nat’l Ins. Co., 49 Wis. 501, 503, 5 N.W. 889 (1880). The supreme court revisited this issue a year later, in Alkan v. New Hampshire Ins. Co., 53 Wis. 136, 147, 10 N.W. 91 (1881), another post-loss assignment case, when it held that “the assignment of the policy to the plaintiff after the loss does not render the policy void.” Similarly, the supreme court in Max L. Bloom Co. v. United States Casualty Co., 191 Wis. 524, 210 N.W. 689 (1926), yet another post-loss assignment case, drew upon its previous opinions in holding: 10 No. 2021AP635 [T]he language of the policies, prohibiting assignment of the policies, refers only to assignments before loss, and does not refer to assignments of the choses in action after loss. If such be the construction, we should hold that the provision of the policy would be contrary to public policy and void. Id. at 535.3 ¶20 Indeed Wisconsin has long been regarded as a jurisdiction that has never applied anti-assignment clauses to bar post-loss assignment of rights. By 1926, Wisconsin was one of the states adhering to the “universally accepted rule” that after a loss, the claim to recover that loss may be effectively assigned by the insured, so as to vest in the assignee the absolute right to the insurance, provided, of course, the insured himself had that right at the time when the loss was incurred, and that the assignment itself was otherwise valid. Annotation, Claim under contract of property insurance as assignable after loss, 56 A.L.R. 1391 (1928). 3 That these Wisconsin cases involved first-party liability claims by the insureds does not change the analysis. As noted above, the purpose underlying an anti-assignment provision is to protect the insurer from increased liability. In the case of a first-party claim, an assignment of a claim for the right to recover after a loss does not increase the insurer’s liability, it merely changes the identity of the person or entity to whom the insurer’s duty to indemnify is owed. So too in the context of a third-party liability claim. If the facts giving rise to the claim place it within the scope of the liability policy, then the insurer’s duties to defend and indemnify are triggered. An assignment of rights to recover under the policy that occurs after the loss or “occurrence” that exposes the insured to liability does not increase the insurer’s liability but instead changes the identity of the person or entity entitled to assert claims for defense and indemnity under the policy. As the supreme court has repeatedly held, “[a]fter a loss, the claim, like any other chose in action, may be assigned without affecting the insurer’s liability.” Dogge v. Northwestern Nat’l Ins. Co., 49 Wis. 501, 503, 5 N.W. 889 (1880). Thus, we see no legal support for distinguishing between the assignment of claims for defense versus indemnity—both claims can be assigned post-loss. Moreover, in this case, and as is well-established under Wisconsin law, the duty to defend is dependent upon the duty to indemnify, which Wausau clearly recognizes with its arguments that the anti-assignment provisions preclude indemnity coverage, and therefore, there is no duty to defend. In short, a holding that an anti-assignment clause is not enforceable for purposes of an indemnity claim, but is enforceable for purposes of duty to defend claim finds no support in Wisconsin law. 11 No. 2021AP635 ¶21 The Supreme Court of California aptly explained the purpose of anti- assignment clauses and the policy implications of enforcing such clauses after a loss has occurred: The recognized rationale for enforcing a consent-to- assignment clause is to protect an insurer from bearing a risk or burden relating to a loss that is greater than what it agreed to undertake when issuing a policy. It is undisputed that an insured may not transfer the policy itself to another without the insurer’s consent, and in this sense all parties agree. But the “postloss exception” to the general rule restricting assignability … is itself a venerable rule that arose from experience in the world of commerce. The rule has been acknowledged as contributing to the efficiency of business by minimizing transaction costs and facilitating economic activity and wealth enhancement. Fluor Corp. v. Superior Ct., 354 P.3d 302, 329-30 (Cal. 2015) (citation omitted). The court went on: “[A] major rationale for commercial insurance is to facilitate economic activity and growth by providing risk management protection for economic actors .... In the modern American economy, mergers, acquisitions, and sales are part of corporate life. For the most part, economists approve of this activity because it allows the marketplace to allocate resources to their most profitable uses. To the extent that insurance protection (for past but possibly unknown losses) may be more freely assigned as part of corporate recombinations, this lowers transaction costs and facilitates economic activity and wealth enhancement. Consequently, the general rule permitting post-loss assignment is a good rule—which is why the courts have crafted it over the years even though it appears to contradict the clear text of many insurance policies and the courts’ expressed fidelity to contract language. The post-loss exception to the general rule of restricted insurance assignability is a venerable rule borne of experience and practicality. That is why courts have adopted it.” The post-loss rule prevents an insurer from engaging in unfair or oppressive conduct—namely, precluding assignment of an insured’s right to invoke coverage under a policy attributable to past time periods for which the insured had paid premiums. 12 No. 2021AP635 Id. at 330 (alteration in original, citation omitted); see also Ocean Accident & Guar. Corp. v. Southwestern Bell Tel. Co., 100 F.2d 441, 446 (8th Cir. 1939) (a post-loss assignment is not the assignment of the policy itself but rather “the assignment of a claim, or debt, or chose in action”).4 ¶22 Wausau argues that our decision in Red Arrow controls this case. Based on Red Arrow, Wausau contends that without its consent, “there could be no transfer of insurance rights in 1968 from Old Waukesha to New Waukesha, or in 1990 from Abex (New Waukesha’s successor by merger) to PA Holdings, even if the applicable transactional documents attempted to transfer those rights.” In Red Arrow, we wrote that the anti-assignment provision in Wausau’s policies “makes clear that without Wausau’s permission, no assignee or transferee has any rights to any benefits under the Wausau policies.” 233 Wis. 2d 114, ¶21. This is the statement upon which Wausau hangs its hat. 4 We rest our holding firmly on long-established Wisconsin law. However, we are mindful that Wisconsin has long been a leader in this area of insurance law. In Ocean Accident & Guarantee Corp. v. Southwestern Bell Telephone Co., 100 F.2d 441 (8th Cir. 1939), the Eighth Circuit Court of Appeals reviewed the law regarding enforceability of insurance clauses prohibiting assignment without consent. The court cited our decision in Dogge as one of the cases in the “great weight of authority” settling the law that once an insurer’s liability has become fixed, it, “like any other chose in action was assignable regardless of the conditions of the policy in question.” Id. at 445. In Fluor Corp. v. Superior Court, 354 P.3d 302 (Cal. 2015), the California Supreme Court followed Ocean Accident, and thoughtfully traced the precepts from that case to present day supporting the general rule that an anti-assignment clause is not enforceable post-loss. Fluor, 354 P.3d at 325-328. The court then interpreted the California statute consistently with that general rule. Id. at 329-330. We find the court’s analysis to be a useful reminder that routine business transactions include the transfer of a predecessor’s historical liabilities accompanied by the transfer of claims for the predecessor’s right to recover under its insurance policies for those historical losses. The transfer of liabilities and the corresponding assets (the right to recover insurance for those liabilities) has been firmly embedded in corporate law, and as applicable here, the black letter law recognized in the above-cited three Wisconsin Supreme Court cases. 13 No. 2021AP635 ¶23 We disagree that Red Arrow changed Wisconsin law regarding the enforceability of anti-assignment clauses for post-loss assignments. That sentence is extraneous to the holding based on the facts underlying Red Arrow. Unlike the present case, we were not called upon to examine the enforceability of an anti- assignment clause in Red Arrow because both parties in that case agreed that there had been no transfer of the recovery rights under the insurance policies to begin with. 233 Wis. 2d 114, ¶¶7, 14. As we noted, “New Red Arrow does not dispute that the Wausau policies were not … included in the sale.” Id., ¶7. Thus, the court did not need to decide whether there was as assignment of the rights to recover under the policies—the parties stipulated to the fact that there was not. It follows that whether the terms of the policies precluded an assignment was not at issue; the provision was irrelevant. The only issue before the court was whether the successor was entitled to coverage by operation of law, when it had no contractual right to coverage. Id., ¶¶7, 20, 22. The Red Arrow court’s answer was no. Id., ¶35. ¶24 Because there was no assignment of rights under the insurance policies in Red Arrow, our undeveloped comment about a hypothetical effect of the anti-assignment provision in Wausau’s policies had no bearing on the issue actually litigated in the case and certainly did not (and could not) overrule a century of Wisconsin Supreme Court precedent, none of which it even mentioned. ¶25 Indeed, the only case we cited in Red Arrow on this point, Loewenhagen v. Integrity Mutual Insurance Co., 164 Wis. 2d 82, 473 N.W.2d 574 (Ct. App. 1991), involved an alleged assignment of benefits that occurred before the loss for which coverage was claimed. Red Arrow, 233 Wis. 2d 114, ¶21. In Loewenhagen, 164 Wis. 2d at 86, the buyer of a used car had an accident with Loewenhagen on the evening of the same day he purchased the car. The buyer had obtained (but had not registered) title to the car and had not obtained his own 14 No. 2021AP635 insurance. Id. The seller’s policy was in effect at the time of the accident merely because the seller had not called his insurance agent to cancel it. Id. Loewenhagen sought coverage from the seller’s insurance company on several grounds, including that the seller’s insurance agent had “agree[d] to an assignment of the policy” by making cancellation of the seller’s policy effective several days after the sale, rather than on the date of sale. Id. at 92. The court of appeals rejected Loewenhagen’s argument based on the policy language prohibiting assignment “without [the insurer’s] written consent.” Id. Thus, the passing reference to anti-assignment clauses in Red Arrow is grounded in Loewenhagen’s analysis of a purported pre- loss assignment, a situation that is materially distinguishable from the present case. ¶26 Notwithstanding the factual and legal distinctions between the present case and Red Arrow, Wausau argues that we must follow it. We disagree that we must interpret the language in Red Arrow as binding precedent that implicitly overrules a century of Wisconsin law. ¶27 As our supreme court observed in Zarder v. Humana Insurance Co., 2010 WI 35, ¶52 n.19, 324 Wis. 2d 325, 782 N.W.2d 682, Wisconsin courts have formulated two definitions of dicta. Under one line of cases, dicta has been defined as “a statement or language expressed in a court’s opinion which extends beyond the facts in the case and is broader than necessary and not essential to the determination of the issues before it.” State v. Sartin, 200 Wis. 2d 47, 60 n.7, 546 N.W.2d 449 (1996). The other definition holds that a court’s discussion of a question that is germane to a controversy is not dictum even if it is “not necessarily decisive of … the controversy” but rather is “a judicial act of the court which it will thereafter recognize as a binding decision.” State v. Picotte, 2003 WI 42, ¶61, 261 Wis. 2d 249, 661 N.W.2d 381 (citation omitted). 15 No. 2021AP635 ¶28 Under these standards, we conclude that the language in Red Arrow regarding the effect of the anti-assignment clause is dicta. Under the definition set forth in Sartin, the statement about the anti-assignment clause extended beyond the facts in Red Arrow because it was undisputed that the rights to recover under the insurance contracts were not assigned. Thus, the statement was “broader than necessary and not essential to” determine whether there had been an assignment by operation of law. Sartin, 200 Wis. 2d at 60 n.7. Under the definition set forth in Picotte, the statement in Red Arrow was not “germane to … the controversy” because there was no controversy with respect to the anti-assignment clause in that case. Picotte, 261 Wis. 2d 249, ¶61. For these reasons, we conclude that Red Arrow does not control the outcome in this case.5 ¶29 Accordingly, we reaffirm Wisconsin’s longstanding rule that an anti- assignment clause in an occurrence-based policy is unenforceable when the assignment is made post-loss. Old Waukesha and New Waukesha already paid the premiums for these policies to protect against the loss that is claimed here. The assignment of Old Waukesha and New Waukesha’s rights to assert claims seeking recovery under the policies did not increase Wausau’s coverage risks because the alleged occurrences had already taken place. While the loss that took place during the policy periods may not be known for many years, it allegedly occurred during Wausau’s policy periods. In reliance on longstanding Wisconsin law, the right to 5 The dissent cites Judge Brown’s concurring opinion in State v. Sanders, 2007 WI App 174, ¶41, 304 Wis. 2d 159, 737 N.W.2d 44 (Brown, J., concurring) but that opinion supports our determination that Paragraph 20 in Red Arrow is dicta. Dissent, ¶4. In Sanders, Judge Brown separately expressed his view that lawyers too frequently attempt to avoid language unfavorable to their positions by labelling it dicta, and that that term should apply only to “those situations where a court notes, in passing, that a certain issue is lurking in the background, gives its off-the-cuff opinion without analysis and leaves it at that.” Sanders, 304 Wis. 2d 159, ¶41 (Brown, J., concurring). In Red Arrow, the anti-assignment provision was not even lurking in the background, and the off-the-cuff statement lacked supporting analysis, as evidenced by the citation to a pre-loss case. 16 No. 2021AP635 make claims under the insurance was assigned post-loss to subsequent entities. Such assets would prove illusory if post-loss assignments made in reliance on longstanding Wisconsin law are retroactively disallowed. ¶30 Wausau raises an additional argument, that an assignment is not post- loss unless the loss has actually been reported, and the insurance company knows that it will have liability. Wisconsin law is clear under the “known loss doctrine” that the loss arises at the time of the injury, not when a lawsuit is filed. The known loss doctrine holds that insurers are not obligated under third-party liability policies to provide coverage for injury or damage which was already occurring when the coverage is written or which has already occurred, and about which the insured knew. American Fam. Mut. Ins. Co. v. American Girl, Inc., 2004 WI 2, ¶86, 268 Wis. 2d 16, 673 N.W.2d 65; American Fam. Mut. Ins. Co. v. Bateman, 2006 WI App 251, ¶26, 297 Wis. 2d 828, 726 N.W.2d 678. Wausau’s interpretation of an “occurrence” under its policy also is contrary to the plain language of the policy. An “occurrence” under the policy is “an accident, including injurious exposure to conditions, which results, during the policy period, in bodily injury or property damage neither expected nor intended from the standpoint of the insured.” Nothing in the policy refers to an “occurrence” as requiring notice of potential legal liability. In addition, the policy does not distinguish between bodily injury and property damage. We reject this attempt to avoid coverage by redefining the terms of the policy. The insurer’s liability is established by the occurrence of the actual injury, not by the reporting of the injury prior to assignment. ¶31 We therefore affirm Wisconsin’s longstanding rule, agreeing with the majority of jurisdictions, that post-loss assignments of insurance rights under an occurrence policy do not require consent to assignment. 17 No. 2021AP635 III. Corporate Succession ¶32 Wausau contends that even if the anti-assignment provision is unenforceable, Pepsi still cannot succeed on its claims because Old Waukesha’s rights under the Wausau policies were never assigned to New Waukesha, and subsequently Pneumo Abex, LLC, via corporate transactional documents. Specifically, Wausau argues that Pepsi failed to produce evidence showing a specific list of insurance policies that were transferred from Old Waukesha to New Waukesha as part of the 1968 Reorganization Agreement. Wausau also contends that Pepsi failed to produce evidence that the Wausau policies, or any rights thereunder, were transferred to PA Holdings as part of the 1990 dissolution of Abex. We disagree. A. 1968 Transfer of Rights from Old Waukesha to New Waukesha ¶33 As relevant to this appeal, the Reorganization Agreement stated the following regarding Old Waukesha’s insurance policies: [Old Waukesha] has delivered to I.C. a Schedule of Contracts listing and summarizing the pertinent terms of all of the ... insurance policies ... and any other material contracts or proposals to which [Old Waukesha] is a party ... and all material amendments thereof …. All of said contracts, agreements and commitments are assignable to [New Waukesha], except as specified in the Schedule, and at the Closing Date [Old Waukesha] shall deliver to I.C. any consents to assignment that may be required. ¶34 Wausau contends that because Pepsi did not produce a complete Schedule containing the Old Waukesha policy, we cannot conclude that either the policy or the rights to recovery transferred to New Waukesha. We disagree. The language of the Reorganization Agreement, dated and signed on August 16, 1968, expressly states that the transfer includes all liabilities unless they are expressly 18 No. 2021AP635 excepted. New Waukesha would also receive all assets, “tangible and intangible, real, personal and mixed.” The agreement excepted “liabilities against which [Old Waukesha] is insured or otherwise indemnified to the extent of such insurance or indemnification.” Certain documents were required to be transferred at closing. ¶35 On the date of closing, August 30, 1968, Old Waukesha and New Waukesha signed a Bill of Sale, which applies to the parties as well as their respective successors and assigns. The Bill of Sale assigned “all the property and assets, tangible and intangible, of every kind, nature and description and wherever situated, owned, possessed or held by [Old Waukesha],” including its “rights under contracts, insurance policies … claims, rights, [and] choses in action.” The Bill of Sale transferred to New Waukesha “all of [Old Waukesha’s] right, title and interest in, to and under each of said contracts, agreements, commitments and arrangements,” including, but not limited to, “insurance policies” and “group insurance policies.” New Waukesha expressly accepted this transfer. ¶36 Wausau argues that the Bill of Sale’s language is more general than that of the Reorganization Agreement and therefore we should accept the Reorganization Agreement as the operational document. We disagree. The contents of the schedule referenced in the Reorganization Agreement would only be relevant if the Bill of Sale stated that New Waukesha only acquired the contract rights identified on the Schedule. The use of the term “all” in the Bill of Sale expressed Old Waukesha’s intent to transfer all contract rights to New Waukesha. In short, the Bill of Sale is the operative agreement that actually effectuated the transfer of all of Old Waukesha’s rights—including its rights under the Wausau policies—to New Waukesha. See Bank of America NA v. Neis, 2013 WI App 89, ¶48, 349 Wis. 2d 461, 835 N.W.2d 527 (citing McDonald v. Nat’l Enters., Inc., 547 S.E.2d 204, 210 (Va. 2001)) (noting that a bill of sale and assignment of loans was “an operative 19 No. 2021AP635 legal document that embodies and evidences [a] conveyance”) (alteration in original). B. 1990 Transfer of Rights from Abex to PA Holdings and Pneumo Abex LLC ¶37 Wausau also contends that another break in the chain of corporate succession precluded the transfer of insurance rights to Pneumo Abex, LLC. 6 This was the 1990 transfer of Abex’s assets to PA Holdings. We conclude that the right to recovery under the Wausau policies was similarly assigned. The assignment agreement notes that PA Holdings, prior to the assignment, was the sole shareholder of Abex. As a result of the assignment, Abex dissolved and PA Holdings became the surviving corporation. The assignment agreement between Abex and PA Holdings transferred “all of [Abex’s] right, title and interest in, to and under all of the assets, properties and rights of [Abex] of every type and description, of every kind and nature, owned or held by [Abex] ….” The only limitation on this broad assignment concerned assets that were “not capable of being Transferred … without the consent, approval or waiver of a third person or entity.” Wausau argues that the anti-assignment provisions of its policies preclude the transfer here. We already have discussed that argument and reject Wausau’s position for the reasons stated above. ¶38 Accordingly, we conclude that the insureds’ rights under the Wausau policies were continuously assigned through each of the corporate transactions and mergers, including the 1968 transition from Old Waukesha to New Waukesha, the 6 Wausau does not dispute that New Waukesha merged into Abex, nor does it challenge the transfer of rights under the insurance policies from New Waukesha to Abex. 20 No. 2021AP635 1990 assignment of rights from Abex to PA Holdings, and later to Pneumo Abex, LLC. IV. The Huff Complaint ¶39 Finally, Wausau argues that even if the insurance rights transferred to Pnuemo Abex, LLC—and subsequently, to Pepsi—it has no duty to defend the Huff lawsuit. The crux of Wausau’s argument is that Huff’s complaint does not allege claims that are covered by either the Old Waukesha or New Waukesha polices. Wausau also contends that the complaint only names Pneumo Abex, LLC, rather than either Old Waukesha or New Waukesha. Because Pneumo Abex, LLC, did not obtain rights under the Wausau policies, Wausau contends, it has no duty to defend Pneumo Abex. Again, we disagree. ¶40 When an insurance policy creates a duty to defend an insured, that duty is broader than the insurer’s obligation to indemnify the insured. Fireman’s Fund Ins. Co. v. Bradley Corp., 2003 WI 33, ¶20, 261 Wis. 2d 4, 660 N.W.2d 666. The duty to defend hinges on the nature, not the merits, of the plaintiff’s claim. Wausau Tile, Inc. v. County Concrete Corp., 226 Wis. 2d 235, 266, 593 N.W.2d 445 (1999). We determine whether an insurance company has a duty to defend by comparing the allegations in the plaintiff’s complaint to the terms of the insurance policy. See Fireman’s Fund, 261 Wis. 2d 4, ¶19. An insurer has a duty to defend its insured if the allegations contained within the four corners of the complaint would, if proved, result in a covered loss. Id. We “must liberally construe the allegations contained in the underlying complaint, assume all reasonable inferences from the allegations made in the complaint, and resolve any ambiguity in the policy terms in favor of the insured.” Water Well Sols. Serv. Grp., Inc. v. Consolidated Ins. Co., 2016 WI 54, ¶15, 369 Wis. 2d 607, 881 N.W.2d 285. “If the policy, 21 No. 2021AP635 considered in its entirety, provides coverage for at least one of the claims in the underlying suit, the insurer has a duty to defend its insured on all the claims alleged in the entire suit.” Id., ¶16.7 ¶41 We start with the “four corners of the complaint and compare it to the policy to see if there is any potential for coverage—any such potential would trigger the duty and end further inquiry.” 5 Walworth, LLC v. Engerman Contracting, Inc., 2021 WI App 51, ¶22, 399 Wis. 2d 240, 963 N.W.2d 779. We look to determine whether the policy, in its entirety, provides coverage for at least one claim in the underlying suit. See Water Well Sols., 369 Wis. 2d 607, ¶16. This is different from a coverage analysis, where “the parties are not necessarily bound by the four corners of the complaint in determining whether there is coverage.” 5 Walworth, 399 Wis. 2d 240, ¶22. The parties can “introduce evidence showing the true facts (as opposed to those alleged in the complaint), and we can review such evidence in determining whether coverage exists, or at least may exist, if the evidence results in liability against the insured following a trial on the merits of the underlying claims.” Id. ¶42 In looking at Huff’s complaint to determine whether any potential for coverage exists, it is clear from the entirety of the complaint that Huff alleged facts connecting his injury to asbestos exposure incurred during the Wausau policy periods. Huff, a mesothelioma claimant, alleged that he was exposed to asbestos in the 1950s through the 1980s in various capacities. One of the named defendants 7 If an insurer refuses to defend, and the claim succeeds and is later determined to be covered by the policy, the insurer must not only indemnify the insured and pay the resulting judgment, but is liable as well for the insured’s legal expenses, as well as “any additional costs that the insured can show naturally resulted from the breach.” Maxwell v. Hartford Union High Sch. Dist., 2012 WI 58, ¶54, 341 Wis. 2d 238, 814 N.W.2d 484. Thus, an insurer often brings a declaratory judgment action to determine its duty to defend. See Liebovich v. Minnesota Ins. Co., 2008 WI 75, ¶55, 310 Wis. 2d 751, 751 N.W.2d 764. 22 No. 2021AP635 was Pneumo-Abex, LLC, as successor in interest to Abex. Wausau admitted to Pepsi in pre-suit correspondence that it issued policies to Old Waukesha and New Waukesha, from 1963 to 1971, which covers time periods named in the complaint. Wausau further admitted that New Waukesha effectively became Abex. Wausau argues that by requiring it to defend this lawsuit, it will be required to defend claims related to asbestos-containing pump products that were not manufactured by Old Waukesha or New Waukesha, thus posing an increased liability risk. In addition, Wausau objected to increased liability based on an allegation in the complaint that Pneumo Abex, LLC, was part of a conspiracy. These concerns about potential issues for which Wausau may or may not be required to indemnify are inappropriate considerations at this point. When Wausau makes coverage determinations it can evaluate each individual claim and determine what the policy does and does not cover. However, when evaluating its duty to defend, it is clear that the allegations in the Huff complaint are sufficient. ¶43 Wausau also contends that the Huff complaint “fails to implicate any liability of Old or New Waukesha” because it “[m]erely name[s] ‘Pneumo Abex’ as successor to ‘Abex’” without pointing to any actual liability. We have already established that Abex was the direct successor of rights under the Old Waukesha and New Waukesha insurance policies. Old Waukesha and New Waukesha were the manufacturers of the pump products implicated in the complaint. Wausau points to no Wisconsin authority requiring a plaintiff to name with specificity the entire chain of corporate succession leading to a named defendant’s responsibility.8 In his 8 The only authority that Wausau cites for the proposition that the complaint must specifically name the successor to the product is a federal case interpreting Minnesota law. Continental Ins. Co. v. Daikin Applied Americas Inc., 998 F.3d 356, 360–61 (8th Cir. 2021). We disagree with Wausau’s interpretation of the case, and find that it actually supports Pepsi’s position. However, we do not rely on it. 23 No. 2021AP635 complaint, Huff named numerous defendants and various sources of injury. Our task is to search the complaint for any possibility of coverage, not to exclude coverage for a covered company when other companies are named who are not insured. “An insurer’s duty to defend is broader than its duty to indemnify because the duty to defend exists when it is merely arguable that the policy in question provides coverage.” Red Arrow, 233 Wis. 2d 114, ¶17. ¶44 Because Wausau knew that the product was manufactured by Old or New Waukesha, which merged into Abex, then into Pneumo Abex, LLC, it should come as no surprise that it has a duty to defend the lawsuit which involves products made by a company that it insured at the time the products were manufactured. CONCLUSION ¶45 In conclusion, based on the reasoning above, we hold that: (1) the anti-assignment clause in the Wausau policies did not prohibit the post-loss assignment of insurance rights from the Waukesha companies through to Pneumo Abex, LLC; (2) the chain of transfer of insurance rights, specifically the duty to defend, was unbroken from Old Waukesha to New Waukesha and Abex to PA Holdings; and (3) the Huff complaint is sufficient to invoke Wausau’s duty to defend. Accordingly, we reverse the circuit court’s decision granting Wausau’s cross-motion for summary judgment and denying Pepsi’s motion for partial summary judgment. On remand, the circuit court should grant Pepsi’s motion for summary judgment on the Declaratory Judgment-Duty to Defend claim and conduct further proceedings consistent with this opinion. By the Court.—Order reversed and cause remanded with directions.

No three justices reach agreement to either affirm, reverse, or affirm in part and reverse in part the court of appeals decision. Because the court did not reach a majority as to the mandate, the decision of the court of appeals is affirmed.