Hawaii Follows Henkel: Consent is Required for Assignments
In 2006, I spoke at an ABA forum concerning the California Supreme Court decision in Henkel. The court had rejected a company's claim that it was entitled, as a corporate successor, to coverage issued to an earlier company. The ABA asked me to defend the court's decision enforcing limitations on assignments. My position was unpopular; most conference participants dismissed Henkel as an aberration. It was, therefore, interesting (and gratifying) to see the Supreme Court of Hawaii adopt a pro-Henkel view at the end of 2007. Del Monte Fresh Produce v. Fireman's Fund Insurance Co., 2007 Haw. LEXIS 380 (Haw. Dec. 26, 2007). The Del Monte court held that: "The relevant insurance policies in the instant case contain a no assignment clause that requires the consent of the insurer to bind it to any assignment made by the named insured. It is undisputed that Del Monte Corp. is the only named insured covered by the policies. It is also undisputed that Del Monte Corp. did not obtain any of the insurers' consent prior to the 1989 assignment. Because the policies were assignment by Del Monte Corp. without the insurers' consent, we hold that Del Monte Fresh is not an insured under any of the Defendant-Appellant insurers' policies...." The court enforced the provision requiring insurers' consent for assignments. Policy language counts.
