On appeal from the Superior Court of New Jersey, Law Division, Atlantic County, Docket No. L-2540-09.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted February 1, 2012
Before Judges Axelrad and Sapp-Peterson.
In this appeal, we consider whether an anti-assignment clause in an insurance policy between a homeowner and defendant, Franklin Mutual Insurance Company (Franklin Mutual), invalidated the homeowner's assignment to plaintiff, CPR Restoration and Cleaning Services, LLC (CPR), of the right to collect payment under the policy. The trial court granted summary judgment in favor of Franklin Mutual, dismissing CPR's claim against it and finding the non-assignment clause invalidated the assignment of benefits from the homeowner to plaintiff. We reverse and remand for further proceedings. We do not retain jurisdiction.
In March 2007, homeowner, Luke Witherspoon, obtained a homeowner's insurance policy from Franklin Mutual. The insurance policy covered, among other things, loss resulting from fire. Under the General Conditions, the policy stated "No assignment of this policy or an interest here is binding on us without our written consent."
Following a fire at his residence on February 19, 2008, Witherspoon retained CPR to perform emergency clean-up and mitigation services and executed three assignments to CPR dated February 19, 2008, February 20, 2008, and April 8, 2008. The assignments all included the following language:
Providing the owner had valid effective insurance coverage for all or part of the services to be performed by CPR, the owner further authorizes and directs their insurance carrier, mortgage company and/or public adjuster to make direct payments to CPR for work performed. Owner, INTENDING TO BE LEGALLY BOUND HEREBY, further agrees to assign, promises to assign, and does assign to CPR all of his/her/its rights and benefits under the insurance policy to the extent necessary to pay CPR all of the sums due for work performed by CPR, as set forth in CPR's invoice.
CPR shall bill all charges and/or costs to owner and a copy of these invoices shall be sent to the insurance carrier and/or public adjuster. It is fully understood and agreed to by [o]wner that all charges are due upon completion of work and the [o]wner is personally responsible for any and all charges and/or costs not paid by insurance to CPR. Any and all charges for services not paid by insurance carrier are the sole responsibility of the [o]wner and are to be paid upon completion of work. . . .
Insurance Carrier: _______________
On the line for Insurance Carrier, either "Franklin" or "Franklin Mutual" was written but none of these documents were signed by a representative from Franklin Mutual.
After completing the work, CPR submitted four invoices totaling $32,004.38 to Witherspoon's public adjuster, Altman & Altman, who in turn forwarded them to Franklin Mutual. Franklin Mutual reviewed the claims and receipts submitted and issued payment to Witherspoon in the amount of $26,521.18 for the bills submitted on behalf of CPR. After Franklin Mutual settled Witherspoon's claim, CPR contacted the public adjuster to complain that it had not been compensated for its services. On June 20, 2009, the public adjuster issued a check to CPR in the amount of $7,354.54, and promised that "[t]he remaining monies due will be paid out of the draws on the building."
Having received no further payment, CPR brought suit against Franklin Mutual and Witherspoon for $26,644.84, the outstanding balance it claimed was due. Franklin Mutual filed a motion for summary judgment. Franklin Mutual's motion was initially denied, as the court found there were genuine issues of material fact in dispute, namely, the validity of the assignment and the amount paid by Franklin Mutual to Witherspoon. Franklin Mutual subsequently moved for reconsideration, which the court granted. After hearing oral arguments, the motion judge granted summary judgment to Franklin Mutual on the basis that the alleged assignment was invalid and Franklin Mutual therefore did not breach its contractual obligations by rendering payment to Witherspoon directly. The court reasoned:
This case does not sound in tort and should not be made to conform to a precedent based entirely on the settlement of a tort claim. As a result, the holding in Owen [v. CNA Insurance/Continental Casualty, 167 N.J. 405 (2001)] is distinguishable and does not bind this [c]court. . . . In short, [Franklin Mutual] did nothing [wrong] and should not be penalized because Mr. Witherspoon chose not to compensate CPR. It is impossible to be in breach of someone else's contract. The fact that [Franklin Mutual] never agreed to be bound by the purported assignment means that it was not ...