Opinion ID: 2626151
Heading Depth: 3
Heading Rank: 1

Heading: Basic Assignment Law

Text: ¶ 13 It is well recognized that [t]he assignee [stands] in the shoes of the assignor. 9 John E. Murray, Jr., Corbin on Contracts § 51.1 (rev. ed. 2007). Therefore, `[t]he assignee is subject to any defenses that would have been good against the [assignor]; the assignee cannot recover more than the assignor could recover; and the assignee never stands in a better position than the assignor.' SME Indus., 2001 UT 54, ¶ 16, 28 P.3d 669 (second alteration in original) (emphasis omitted) (quoting 6 Am. Jur. 2d Assignments § 144 (1999)). [A]n assignee gains nothing more, and acquires no greater interest than had his assignor. Aird Ins. Agency v. Zions First Nat'l Bank, 612 P.2d 341, 344 (Utah 1980) (citing Cheney v. Rucker, 14 Utah 2d 205, 381 P.2d 86, 91 (1963)). In other words, the common law puts the assignee in the assignor's shoes, whatever the shoe size. Olvera v. Blitt & Gaines, P.C., 431 F.3d 285, 289 (7th Cir. 2005). ¶ 14 The parties, as well as Judge Bench in his dissent, chose the term privity to characterize the relationship created between an assignee and an obligor. Therefore, the extent to which an assignment creates a relationship roughly equivalent to traditional notions of privity and the extent to which privity extends to periods both before and after the assignment are relevant inquiries. ¶ 15 For guidance on these questions, we look further into the purpose behind the maxim that an assignee stands in the shoes of its assignor. Corbin on Contracts states, [t]he essential purpose of the principle is to protect the obligor, the party who must perform the correlative duty of the assigned right, so that the risk to the obligor is not materially enlarged over the risk created by its agreement with the assignor. Murray, supra, § 51.1. In other words, the purpose behind the rule is that an assignee has rights and liabilities identical to those of its assignor. We believe that the relationship between the assignee and obligor is not best characterized as a form of privity, but rather as a continuation of the rights and liabilities of the assignor as evidenced by the assigned agreements and any further limitations stated in the assignment itself. ¶ 16 RB & G argued to the court of appeals and to this court that an assignee cannot recover damages that accrue after the date of the assignment, regardless of whether the cause of action accrued before the assignment, because to permit such recovery would be to place the assignee in a better position than its assignor. RB & G's argument is based on SME Industries, 2001 UT 54, 28 P.3d 669. There, we reiterated the rule that an assignee cannot stand in a better position than its assignor. Id. ¶ 16. Thus, we now turn to a discussion of SME Industries and how it affects the law of assignments.