Crane Ice Cream Co. v. Terminal Freezing & Heating Co.
Citation
128 A. 280 (Md. Court of Appeals, 1925)
Facts
Fredericke had a contract with Terminal Freezing & Heating Co. for the supply of ice. Fredericke assigned the contract to Crane Ice Cream Co., a much larger business with substantially different ice consumption patterns. Terminal refused to deal with Crane, and Crane sued to enforce the assigned contract.
Issue
Whether the assignment of a supply contract to a party whose requirements materially differed from the original obligee was valid and enforceable against the non-assigning party.
Holding
The court held that the assignment was invalid because it would materially alter Terminal’s obligation by requiring it to supply a substantially greater and different volume of ice.
Rule
A contract may not be assigned if the assignment would materially alter the obligor’s duty or materially increase the burden or risk; personal service contracts and output/requirements contracts are generally not assignable without consent.