While a party to a contract may as a general rule assign all his beneficial rights, except where a personal relation is involved, his liability under the contract is not assignable inter vivos, because any one who is bound to any performance whatever or who owes money cannot by any act of his own, or by any act in agreement with any other person than his creditor or the one to whom his performance is due, cast off his own liability and substitute another's liability. If this were not true, obligors could free themselves of their obligations by the simple expedient of assigning them. A further ground for the rule is that not only is a party entitled to know to whom he must look for the satisfaction of his rights under the contract but, in the familiar.
Defendant seller and the buyer entered into an agreement whereby the seller would supply the buyer with quantities of ice per week. The quantities were not explicitly established in the agreement because they were based upon the buyer's needs per week. The buyer then sold his ice cream business and assigned his interest in the agreement to the plaintiff assignee. The seller notified the buyer that the agreement was at an end and declined to deliver any ice to the assignee. The assignee initiated an action against the seller for breach of contract. The trial court entered judgment for the seller finding that the rights and duties of the contract were of such a personal character that they could not be assigned. On appeal, the court found that the assignment was unenforceable.
Was defendant seller bound to respect the assignment?
The seller entered into the agreement with the buyer based upon his character, credit, and resources. Since the terms of the contract were undefined, the seller would be obligated to obey the demands of the assignee. The demands would create a new measure of ice to be supplied and a new term in the agreement that the seller never bound itself to perform.