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Rumbin v. Utica Mutual Insurance Co.8/15/2000
ng assignment when contract stipulated that " he ontractor shall not assign this contract or any part thereof . . . without the written prior approval of the wner"). These courts ignore the rule adopted by the majority of jurisdictions, which requires that in order to invalidate the assignment, the parties must include in their antiassignment provision language that specifically limits the power to assign or invalidates the assignment itself.
The modern approach offers the advantage of free assignability together with full protection for any obligor who actually suffers damages as a result of an assignment. An assignor who breaches a contractual provision limiting his or her right to assign will be liable for any damages that result from that assignment. See, e.g., Bel-Ray Co. v. Chemrite (Pty.) Ltd., supra, 181 F.3d 442 ("the provision limiting or prohibiting assignments will be interpreted merely as a covenant not to assign . . . . Breach of such a covenant may render the assigning party liable in damages to the non-assigning party. The assignment, however, remains valid and enforceable . . . ."); Cedar Point Apartments, Ltd. v. Cedar Point Investment Corp., supra, 693 F.2d 754 n.4 (breach of promise to refrain from assigning or to assign under certain conditions does not render assignment ineffective but may provide remedy for damages if breach was material); International Telecommunications Exchange Corp. v. MCI Telecommunications Corp., 892 F. Sup. 1520, 1533 (N.D. Ga. 1995) ("`a breach of covenant not to assign creates a right in the contract-obligee to recover against the obligor-assignor any damage suffered by reason of the assignment, but it does not affect the transfer of contract rights to the assignee'"); Pro Cardiaco Pronto Socorro Cardiologica, S.A. v. Trussell, supra, 863 F. Sup. 137 (" n assignment made in violation of a personal covenant prohibiting assignments is enforceable, although it does give rise to a damages action against the assignor"); Lomas Mortgage U.S.A., Inc. v. W.E. O'Neil Construction Co., supra, 812 F. Sup. 844 (finding that contractual clause "merely restricts the right to assign" and provides obligor "with a right to damages for breach of the portion of the contract forbidding assignment"); Paccom Leasing Corp. v. E.I. du Pont de Nemours & Co., supra, 1991 U.S. Dist. WL 226775, p. *7 ("if the contract . . . merely removed the right to assign . . . a duty was imposed on the promisor . . . not to assign and a breach of that duty would give rise to a cause of action, but the assignment would remain effective"); Jacquette v. CNA Ins. Cos., supra, Civil Action No. 98-1601 (NHP) (discussing that while obligor may have right to damages for breach of antiassignment provision, assignment must expressly state that it is void or invalid); Hanigan v. Wheeler, supra, 19 Ariz. App. 52 (" here a contract contains a promise to refrain from assigning . . . its breach . . . would simply subject the promisor to an action for damages while the assignment would be effective" [emphasis in original; internal quotation marks omitted.]); Randol v. Tatum, 98 Cal. 390, 397, 33 P. 433 (1893) (holding that assignment in violation of covenant not to assign is not void but provides remedy for breach of covenant); Garden State Buildings, L.P. v. First Fidelity Bank, N.A., supra, 305 N.J. Super. 522 ("`[a contractual] clause must contain express provisions that any assignment shall be void or invalid' . . . therwise, the assignment is effective, and the obligor merely has the right to damages"); Allhusen v. Caristo Construction Corp., 303 N.Y. 446, 450, 103 N.E.2d 891 (1952) (recognizing that when assignment valid despite antiassignment clause obligor has claim for damage for breach); Macklowe v. 42nd Str
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