Wednesday, October 9, 2013

Can causes of actions be assigned in Texas?

Can causes of action be assigned – General Rule and Exceptions

As a general rule, causes of action are freely assignable. City of Brownsville ex rel. Pub. Utils. Bd. v. AEP Tex, Cent. Co., 348 S.W.3d 348, 358 (Tex. App.-Dallas 2011, pet. denied). The Texas Supreme Court has recognized a few exceptions to this general rule, but it has not held that bill-of-review claims may not be assigned. See PPG Indus., Inc. v. JMB/Houston Ctrs. Partners Ltd. P'ship, 146 S.W.3d 79, 92 (Tex.2004) (holding that "DTPA claims generally cannot be assigned by an aggrieved consumer to someone else"); State Farm Fire & Cas. Co. v. Gandy, 925 S.W.2d 696, 707-11 (Tex.1996) (discussing four circumstances in which claims cannot be assigned: legal-malpractice claims, Mary Carter agreements, assignments of a plaintiffs claim to a joint tortfeasor, and assignments of certain interests in an estate). The law generally prohibits the assignment of a claim only when the particular assignment presents specific dangers, such as jury confusion, the multiplication of disputes, and potential prejudice to the parties. See Gandy, 925 S.W.2d at 707-11. Unless the assignment of a bill-of-review claim like HSBC's would present similar dangers, the general rule of assignability ought to apply.

SOURCE:  DALLAS COURT OF APPEALS - No. 05-10-00676-CV – 6/15/2012

The policy of this State is to permit the assignment of a cause of action in the absence of policy reasons to forbid the particular kind of assignment. See generally Gandy, 925 S.W.2d at 705-11. We have not been presented with any reason to conclude that permitting the assignment of Fieldstone's bill-of-review rights to HSBC would be inimical to public policy. We conclude that HSBC is correct and that Fieldstone's right to bring a bill of review to challenge the underlying default judgment is assignable.

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