Assignment of Rights
Excellence in Claims Handling
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The Supreme Court, moving in a new direction, considered Arizona case law that generally allows the assignment of unliquidated legal claims except those involving personal injury.
The broad prohibition on assignment exemplified the common law view that litigation was vexatious or otherwise socially undesirable. The reasoning was stated by Lord Coke in 1613:
And first was observed the great wisdom and policy of the sages and founders of our law, who have provided that no possibility, right, title, nor thing in action, shall be granted or assigned to strangers, for that would be the occasion of multiplying of contentions and suits, of great oppression of the people. [Lampet’s Case, (1613) 77 Eng. Rep. 994, 997 (K.B.)].
The Arizona Supreme Court noted that as courts became more accessible and litigation a more accepted means for resolving disputes, the prohibition on assignment gradually became the exception rather than the rule. However, one class of unliquidated claims was excluded from the emerging rule of assignability: personal injury claims.
Since Roman times, bodily injury claims were considered “personal” to the claimant and could not be asserted by others. Many courts concluded that whether a claim would survive the claimant’s death should also determine whether it could be assigned during the claimant’s life and applied this test to both personal injury and other claims. This “survivability” test did not itself survive in Arizona after 1955, when the legislature enacted a statute providing for the survival of most causes of action, including personal injury claims.
The state Supreme Court subsequently endorsed and expressly relied on public policy considerations in reaffirming the rule against assignment of personal injury claims.[1] Public policy considerations have also guided courts in determining the assignability of claims not involving personal injury.
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About Barry Zalma
An insurance coverage and claims handling author, consultant and expert witness with more than 48 years of practical and court room experience.
