Willis, Judge Hennepin County District Court File No. 02-007968
Considered and decided by Willis, Presiding Judge; Toussaint, Chief Judge;
and Shumaker, Judge.
áI. A valid present assignment of the right to receive payment under a contract is enforceable notwithstanding a non-assignment clause if the clause does not explicitly limit the power of assignment or declare that assignments are void.
II. An assignee of compensation due under a contract with an arbitration clause may compel arbitration.
The opinion of the court was delivered by: Willis, Judge
Appellant challenges the district court's order granting respondent's motion to stay arbitration. Because we conclude that appellant received a valid assignment of the compensation due from respondent and that the assignment allows appellant to compel arbitration, we reverse.
The underlying dispute in this case concerns the claim of appellant Lexington-Silverwood, L.P. that it was assigned the compensation that James E. Lennon was due under a "management agreement" to which Lennon, George Berkey, and respondent Travertine Corporation, a real-estate development venture, were parties.
In August 1989, Travertine entered into the management agreement with Lennon and Berkey. The agreement provides that Lennon and Berkey would serve as the board of directors and officers of Travertine and would "provide all of the management services necessary to undertake the land acquisition, assembly and disposition" described in Travertine's business plan. In return for their services, Travertine agreed to pay Lennon and Berkey a percentage of its net profits.
The management agreement provides that if Travertine terminates the agreement, Lennon and Berkey would be entitled to compensation for their services up to the termination date. Disputes under the agreement are subject to an arbitration clause, which provides that
[i]n the event of a dispute between the parties with reference to the interpretation of this agreement or their rights hereunder, the same shall be submitted to arbitration.
And the agreement further provides that it is binding on the parties and their respective personal representatives, successors and assigns; provided, however, that the rights and obligations of Berkey/Lennon shall not be assignable except that Berkey may ...