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Lingel v. Olbin8/29/2000
n Wilson observed in invalidating an agreement to repay a loan from a close friend with a percentage of a wrongful death recovery,
"It matters not that any particular contract is free from any taint or fraud, oppression, or corruption . . . . The law looks to the general tendency of such agreements, and it closes the door to temptation, by refusing them recognition in any courts of the country. It is enough that the contract belongs to a class which has a tendency contrary to public good." 688 So. 2d at 270, quoting Sampliner v. Motion Picture Patents Co., 255 F. 242, 251-52 (2d Cir. 1918), rev'd on other grounds, 254 U.S. 233, 41 S. Ct. 79, 65 L. Ed. 240 (1920).
Accordingly, we conclude the trial court did not err in finding the wrongful death proceeds at issue here unassignable.
Underinsured Motorist Benefits
Lastly, the Lingels challenge the trial court's ruling that the UIM proceeds from the automobile insurance policy they had purchased were likewise subject to the rule of nonassignability, pointing out that contract claims are freely assignable. Their argument, however, ignores the fact that these proceeds were paid as a result of Erik's death and the tortfeasor's inability to fully compensate the Olbins for their loss. That is, the UIM proceeds were used to pay the Olbins' wrongful death claim, and as such, were not assignable. See A.R.S. § 20-259.01(B), (G) (underinsured motorist benefits payable only upon "bodily injury or death"); Brockman (regardless of label, assignments of personal injury actions or the proceeds therefrom are not valid); Allstate (same); cf. § 20-259.01(K) (abrogating common law prohibition against assigning causes of action for personal injury only to the extent provided in § 20-259.01(I)). As the Olbins point out, almost all payments for personal injury or wrongful death are made by insurance companies; the nonassignability rule and its underlying public policy would be eviscerated by such an exception.
Conclusion
In view of Arizona's judicial precedents and public policy underlying the prohibition against assignment of personal injury causes of action, as well as case law from other jurisdictions on both sides of the issue, we conclude that the trial court properly determined that the parties' agreement was void and unenforceable as to wrongful death proceeds, regardless of their source. Although the Lingels present some salient reasons for dispensing with that prohibition, absent legislation to the contrary we are constrained to defer to our existing jurisprudence, as was the trial court.
The trial court's judgment in favor of the Olbins is affirmed.
PHILIP G. ESPINOSA, Chief Judge
CONCURRING: JOSEPH W. HOWARD, Presiding Judge
BRAMMER, Judge, specially concurring.
Although I concur with the majority that there is no principled distinction between the assignment of personal injury and wrongful death causes of action and the assignment of proceeds that may result from prosecuting those actions, I write separately to express my confusion about, and ultimate disagreement with, the underlying rationale prohibiting the assignment of proceeds from either type of action.
In 1955, the Arizona legislature permitted the survival of personal injury claims under former A.R.S. § 14-477. The genesis of the rule prohibiting the assignment of a personal injury cause of action appears to be dicta offered over thirty years ago in Harleysville. The court began its analysis by citing three pre-1955 decisions as precedent and observed that, prior to the 1955 statutory enactment, "Arizona courts adhered to the generally accepted rule
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