This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
The opportunity to effect a complete fusion of law and equity upon the question of assignment has been lost in many states: in part by the fact that the statutes have been drawn in rather narrow terms, and that many kinds of assignment are not included within the terms of the statutes which permit the action to be brought in the name of the real party in interest, and in part by the narrow views taken by some of the courts, and by the persistence of certain of the courts, in refusing to recognize as an assignment at law a transaction which the same court would recognize as a sufficient assignment in equity. For these reasons in many jurisdictions equitable assignments as distinguished from legal assignments still persist.1 An assignment of an interest to be acquired in the future may be regarded as a good assignment in equity, even though it may not be recognized at law.2 An assignment of a claim may operate in equity as an assignment of a right to sue on a bond which is given for the purpose of securing such claim.3 A's payment of B's debts which C has assumed and agreed to pay, at least if made by A in good faith in order to protect his interests, may be regarded as an equitable assignment of such debts.4 An order may be regarded as an assignment in equity.5 A partial assignment, if accepted by the debtor, may be regarded in equity as a valid assignment of such part of the debt.6
8 In Maine the assignee must file a copy of the assignment with the writ in order to sue in his own name. Sleeper v. Gagne, 99 Me. 306, 59 Atl.
472. He may still sue in the name of the assignor without filing such copy. Hall v. Hall, 112 Me. 234, 91 Atl. 949.
9 Bohanan v. Thomas, 159 Ala. 410. 49 So. 308; Lord v. Downs, 112 Me. 396, 92 Atl. 327; American Lithograph Co. v. Ziegler, 216 Mass. 2S7, 103 N. E. 909.
10 Andrews v. Rue, 34 N. J. L. 402.
11 England. Fitzroy v. Cave , 2 K. B. 364.
United States. Delaware County v. Diebold Safe and Lock Co., 133 U. S.
473, 33 L. ed. 674.
California. Heisen v. Smith, 138 Cal. 216, 94 Am. St. Rep. 39, 71 Pac. 180.
Colorado. Rambo v. Armstrong, 45 Colo. 124, 100 Pac. 586.
Illinois. Congress Construction Co. v. Farson & Libbey Co., 199 111. 398, 65 N. E. 357.
Kansas. Stewart v. Price, 64 Kan. 191, 64 L. R. A. 581, 67 Pac. 553.
Massachusetts. Worster v. Stone, 217 Mass. 523, 105 N. E. 383.
Michigan. McKnight v. Lowitz, 176 Mich. 452, 142 N. W. 769.
Montana. Haupt v. Burton, 21 Mont. 572, 69 Am. St. Rep. 698, 55 Pac. 110.
New York. Foster v. Bank, 183 N. Y. 379, 76 N. E. 338.
Ohio. Allen v. Miller, 11 O. S. 374.
Wisconsin. Hankwitz v. Barrett, 143 Wis. 639, 128 N. W. 430.
12 Gilman v. Controlling Co., 180 Mass. 319, 62 N. E. 267.
13 See Sec. 1256.
The practical difference between the legal and the equitable assignment under modern statutes is that if the assignment is recognized as a legal assignment, the assignee may sue in his own name, while if the assignment is not recognized as a legal assign ment, and it is sufficient as an equitable assignment, the assignee may sue, but he must sue in the name of his assignor.7 It is to be regretted that the historical distinction should survive to perplex modern law, after its true purpose should have been accomplished by the complete adoption by the common law, aided by legislation, of the equitable theory of assignments.
Delaware. New Castle County National Bank v. Taylor, 8 Del. Cfa. 456, 68 Atl. 387.
Georgia Western & A. Ry. Co. v. Union Inv. Co., 128 Ga. 74, 57 S. E. 100.
Illinois. Story v. Hull, 143 111. 506, 32 N. E. 265.
Indiana. Kintz v. Scully Steel & Iron Co., 184 Ind. 160, 110 N. E. 086.
Maryland. Kellas v. Slack & Slack Co., 120 Md. 535, 00 Atl. 677.
North Carolina. Godwin v. Murchi-son National Bank, 145 N. Car. 320, 17 L. R. A. (N.S.) 035, 50 S. E. 154.
Oregon. Wasco County v. New England Equitable Insurance Co., 88 Or. 465, 172 Pac. 126.
Tennessee. Horn v. Nicholas, 130 Tenn. 453, 201 S. W. 756.
Virginia. Rinehart & Dennis Co. v. McArthur, 123 Va. 556, 06 S. E. 820.
Washington. Paul v. Vancouver, 8 Wash. 331, 154 Pac. 453; Northwestern National Bank v. Guardian Casualty & Guaranty Co., 03 Wash. 635, 161 Pac 473; National Market Co. v. Maryland Casualty Co., - Wash. - , 174 Pac. 470.
2 Cogan v. Conover Mfg. Co., 60 N. J. Eq. 800, 115 Am. St. Rep. 620, 64 Atl. 073 [reversing, 60 N. J. Eq. 358, 60 Atl. 408]; Godwin v. Murchison National Bank, 145 N. Car. 320, 17 L. R. A. (N.S.) 035, 50 S. E. 154.
3Northwestern National Bank v. Guardian Casualty & Guaranty Co., 03 Wash. 635, 161 Pac. 473; National Market Co. v. Maryland Casualty Co., - Wash. - , 174 Pac. 470.
4 Paul v. Vancouver, 80 Wash. 331, 154 Pac. 453.
5 Wasco County v. New England Equitable Insurance Co., 88 Or. 465, 172 Pac. 126.
6 In re Macauley, 158 Fed. 322; Kints v. Scully Steel & Iron Co., 184 Ind. 160, 110 N. E. 086. See Sec. 2261.
7 In re Hawley Down-Draft Furnace Co., 233 Fed. 451 [denying rehearing In re Hawley Down-Draft Furnace Co., 230 Fed. 471].
"The counsel for the defendant contended, that a bond or other specialty could only be assigned by deed so as to pass the legal title, or make it a good and effectual assignment at law. But I do not understand what is meant by the words, at law, when used in this connection. If by a legal assignment or an assignment at law is meant such an assignment as would at common law enable the assignee to sue upon the instrument in his own name, I am ignorant of any mode by which that can be done. At common law, a bond or other specialty was not assignable in any way, so as to enable the assignee to sue upon it in his own name; and our statute, giving the assignee a right to do so, does not prescribe any form or mode of assignment.
"Some confusion has resulted from the use of the terms, legal and equitable assignments, or assignments at law and in equity. But these expressions have no reference to the form or mode of making the assignments, whether by deed or parol, but merely to the remedy or manner of enforcing the rights of an assignee. No form of assignment, either by deed or parol, is a legal assignment or an assignment at law of a judgment or specialty or a mere right of action, in such a sense as to give the assignee a remedy at law in his own name.
"All such assignments, whether by deed or parol, were called equitable assignments, because originally. they could only be, enforced or protected in a court of equity, or as now, by the equitable interferences of courts of law. Whereas in the general sense of the term, every transfer or assignment of a chose in action, whether by deed, by writing not under seal or merely by delivery, if for a good or valuable consideration, is a lawful assignment, or good and valid assignment at law as well as in equity." Allen v. Pancoast, 20 N. J. L. 68.
"The distinction is what may be termed wholly technical. It is that between legal and equitable titles. The ancient prejudice against assigned rights of action having worn itself out, the only practical consequence left is the manner of naming the plaintiff. Unless the legal title passes by the transfer, the one in whom was originally the right of action must be named as the plaintiff in any suit brought. If ' the right to receive the funds has passed to another,the action is brought in the name of the legal plaintiff to the use of the assignee, who becomes the equitable plaintiff. If the legal title has passed, the assignee brings suit in his own name as the assignee of the legal plaintiff. An illustration is afforded by the Pennsylvania statute on the subject of the assignment of bonds. The act requires (among other things) two witnesses to an assignment. If such an assignment is made, the assignee may sue as such. If the assignment, although the same in all other respects, has but one witness, it does not pass the legal title, and suit is brought in the name of the obligor to the use of the obligee. Either assignment is good to all intents and purposes. One is a legal assignment, the other an equitable one; but one is as good as the other. There is no other difference than this: if, for instance, one is void or voidable, because in fraud of creditors, the other is." In re Hawley Down-Draft Furnace Co., 233 Fed. 451 [denying rehearing, In re Hawley Down-Draft Furnace Co., 230 Fed. 471].