Language and Form, Generally

Property can be vested with the assignee, if the language expresses the intention of the owner of a claim or chose in action to transfer the assignment.  Whether the language is informal is immaterial.[i] Courts look into the substance rather than the form in determining whether there is an assignment.  No special phrase or words are needed to assign a chose in action.[ii]

In Hogan v. Dalziel, 40 Ill. App. 2d 19 (Ill. App. Ct. 2d Dist. 1963), the court observed that no particular form of assignment is required to effect an assignment.  Any document which shows the intent of the assignor to vest ownership in the assignee is sufficient to effect an assignment in equity.  Therefore, to constitute a valid assignment of a debt or other chose in action, in equity, no particular form of words is necessary.  Any words that show an intention of transferring or appropriating the chose in action to the assignee for a valuable consideration can constitute a valid assignment.

How an assignment is made is not the issue.  Rather, an assignment must contain clear evidence of the intent to transfer rights, must describe the subject matter of the assignment, and must give notice to the obligor.[iii] The court observed in Atkins v. GE Capital Mortg. Servs., 993 F. Supp. 1406 (M.D. Ala. 1998) that there is no requirement that magical words must be used to accomplish an assignment.[iv] The test is whether the purported assignor intended to transfer a present interest in the subject matter of the contract.[v]

However, in the absence of a statutory provision prescribing the mode of assignment, there is no need for a particular mode or form in order to effectuate a valid assignment of property, claims, or debts so as to defeat garnishment proceedings by a creditor of the assignor.[vi] An assignment can be in the form of an agreement, if the intent of the parties is clearly established.[vii] It was observed in In re Pearl-Wick Corp., 26 B.R. 604 (S.D.N.Y. 1982) that an assignment of rights generally requires language that exhibits an intention by the owner of the right to make the transfer.  Similarly, there must be sufficient language to establish a completed transfer of title of a present right.

It was observed in Northwest Nat’l Bank v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 25 Ark. App. 279 (Ark. Ct. App. 1988) that if the assignment is in writing, no special form of words or language is required to be used, although the words of an assignment generally used are “sell, assign, and transfer” or “sell, assign, and set over.”

[i] Houtz v. General Bonding & Ins. Co., 235 F.2d 591 (10th Cir. N.M. 1956)

[ii] Silver v. Ridley-Yates Co., 166 Ga. 49 (Ga. 1928), see also Baker v. Sutton, 47 Ga. App. 176 (Ga. Ct. App. 1933)

[iii] Northstream Invs., Inc. v. 1804 Country Store Co., 2005 SD 61, P14 (S.D. 2005)

[iv] Birmingham News Co. v. Chamblee & Harris, 617 So. 2d 689 (Ala. Civ. App. 1993)

[v] Moncrief v. Donohoe, 892 So. 2d 379 (Ala. Civ. App. 2003)

[vi] LSF Franchise REO I, LLC. v. Emporia Rests., Inc., 283 Kan. 13 (Kan. 2007)

[vii] Idaho Apple Growers’ Ass’n v. Brown, 51 Idaho 540 (Idaho 1932)

Inside Language and Form, Generally