Another State Court Limits The Enforceability Of Anti-Assignment Clauses

We recently wrote about the California Supreme Court's decision in Fluor Corporation v. Superior Court to limit the enforceability of clauses in third party liability insurance policies that prohibit the policyholder from assigning its interests in the policy without the insurer's prior consent. The court held that these so-called anti-assignment clauses are not enforceable after a third party has suffered personal injury or property damage covered under the policy and for which the insured may be liable. A New Jersey appellate court has reached the same conclusion in Givaudan Fragrances Corp. v. Aetna Casualty & Surety Co. There, Givaudan Fragrances Corporation sought coverage under a corporate affiliate's insurance policies for numerous claims brought against Givaudan for environmental contamination. The appellate court concluded that the policies' anti-assignment clause was no longer enforceable as to the losses that had occurred before the assignment.