Also known as: voluntary assignments · assignment for benefit of creditors
Written by attorneys · grounded in primary & secondary sources — see below
A transfer of rights or interests effected by agreement between the assignor and assignee rather than arising by operation of law.
Vincent Vale paid the full balance on a mortgage held by Alpha Precision after Nova Precision defaulted on the factory loan. Alpha Precision agreed to transfer the mortgage and note to Vincent Vale by written instrument. Vincent Vale recorded the assignment and later enforced the mortgage against the factory in Nova Precision's hands.
In a Georgia divorce proceeding the court awarded a wife the full beneficial interest in a trust created by her former husband. The wife later executed a voluntary assignment of part of that interest to her new spouse. The assignment was later challenged in a tax proceeding in Illinois.
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Voluntary assignment occurs when the mortgagee and payor agree to transfer the mortgage and obligation. Equitable subrogation arises by operation of law when a payor satisfies the obligation to prevent unjust enrichment. The Restatement treats the two routes as alternative means to achieve the same result for the payor.
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The Restatement notes that after performance the subrogee is entitled to receive a formal written assignment upon request. Recording that assignment helps ensure that others recognize the subrogee's rights.
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A valid spendthrift provision restrains both voluntary assignments by the beneficiary and involuntary transfers by creditors. Language stating that the interest is held subject to a spendthrift trust is sufficient to make any attempted voluntary assignment ineffective.
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…the mandate of the appellate court, the Superior Court of Cook County entered its decree which found the assignments to be “voluntary assignments of a part of the interest of said Edward Tyler Blair in said trust estate” and as such adjudged them to be valid. At that time there were pending before the Board of Tax Appeals…