In Matter of Petition of Featherfall Restoration

• Court: Court of Appeals of Maryland
• Decided: July 24, 2025
• Docket: 17o/24
• Status: Published

Opinion

In the Matter of the Petition of Featherfall Restoration, LLC, No. 17, September Term, 2024. Opinion by Gould, J.

INSURANCE POLICIES ‒ CHOSE IN ACTION ‒ POST-LOSS ASSIGNMENTS – ANTI-ASSIGNMENT CLAUSE

The Supreme Court of Maryland held that a post-loss claim for money payments under a policy is a chose in action, and, therefore, an assignable property right separate from the policy itself. Therefore, an insurance policy’s anti-assignment clause prohibiting assignments of “this policy” does not bar an assignment of a single post-loss claim under the policy. Circuit Court for Baltimore City Case No.: 22-C-22-002071 Argued: December 9, 2024

IN THE SUPREME COURT

OF MARYLAND

No. 17

September Term, 2024

______________________________________

IN THE MATTER OF THE PETITION OF FEATHERFALL RESTORATION, LLC

Fader, C.J., Watts, Booth, Biran, Gould, Eaves, Killough,

JJ. ______________________________________

Opinion by Gould, J. ______________________________________

Filed: July 24, 2025

Pursuant to the Maryland Uniform Electronic Legal Materials Act (§§ 10-1601 et seq. of the State Government Article) this document is authentic.

2025.07.24 15:46:50 -04'00' Gregory Hilton, Clerk In this case, we consider whether an anti-assignment clause in a homeowner’s

insurance policy that prohibits an assignment of “this policy” without the insurer’s consent

applies to the assignment of a post-loss claim under the policy. For the reasons set forth

below, we hold that it does not.

I

A

In early 2019, G.K. and K.K. (the “Policyholders”) purchased a “High Value”

homeowners insurance policy from Travelers Home and Marine Insurance Company

(“Travelers”) for their Potomac, Maryland residence. The one-year policy ran from

February 23, 2019, through February 22, 2020. The policy contained an anti-assignment

clause: “5. Assignment. Assignment of this policy will not be valid unless we give our

written consent.”

On May 20, 2020, approximately three months after the policy expired, the

Policyholders notified Travelers of damage to their roof that they contended resulted from

wind and a hailstorm that occurred on June 2, 2019. That same day, the Policyholders hired

Featherfall Restoration, LLC (“Featherfall”) to repair their roof.

At the Policyholders’ request, Travelers arranged for Featherfall to attend an

inspection of the roof on June 2, 2020. During the inspection, Travelers’ claim

representative found no signs of wind or hail damage, but instead observed signs of wear,

tear, and deterioration of the roof shingles. As a result, Travelers denied the Policyholders’

claim and on June 19, 2020, sent them a letter explaining the basis for the denial. That same day, Featherfall emailed Travelers an “Assignment of Claim” form (the

“Assignment”) that had been executed by the Policyholders. Through this document, the

Policyholders purported to “irrevocably transfer, assign, and set over onto Featherfall

Restoration, LLC . . . any and all insurance rights, benefits, proceeds, and any causes of

action under applicable insurance policies[.]” Featherfall also sent Travelers an opinion

letter from its attorney stating that the Assignment was legally enforceable despite the anti-

assignment clause in the policy.

Relying on the Assignment, Featherfall attempted to discuss with Travelers its

coverage determination. Travelers refused, citing the anti-assignment clause in the policy.

Travelers contended that the anti-assignment clause invalidated any attempt by the

Policyholders to assign their claim to Featherfall without Travelers’ express written

consent, which it had not given.

B

Travelers’ refusal prompted Featherfall to file a complaint with the Maryland

Insurance Administration (the “MIA”). The Policyholders were not parties to the

complaint. Featherfall asserted that it stepped into the Policyholders’ shoes and thus

enjoyed all rights they had under the policy, including the right to talk to the insurer and

the right to receive a copy of the denial letter. Featherfall did not challenge the merits of

Travelers’ denial of the claim. Rather, it asked the MIA to compel Travelers to honor the

Assignment and Featherfall’s right to act in place of the Policyholders. Featherfall argued

that, by refusing to provide a copy of the denial letter, Travelers violated section 27-303(6)

of the Insurance Article of the Annotated Maryland Code, MD. CODE ANN., INS. (“IN”)

2 § 27-303(6) (2017 Repl. Vol.). 1 Featherfall also contended that, although not specifically

listed in the statute as an unfair trade practice, Travelers’ wider policy of refusing to honor

all assignments violated IN § 27-102. 2 Travelers requested that the MIA use its

discretionary enforcement power under IN § 27-104 to identify and address this policy as

a prohibited unfair trade practice. 3

Travelers responded that the anti-assignment clause prohibited the Policyholders

from entering into the Assignment.

On August 19, 2020, the MIA issued a determination letter concluding that

Travelers did not violate the Insurance Article because the Assignment was prohibited

under the policy’s anti-assignment clause, and Travelers’ handling of the claim complied

with Maryland law.

Featherfall timely requested a hearing on the MIA’s determination under IN § 2-

210(a)(2), arguing that, as a matter of law, it was error for the MIA to allow Travelers to

use an anti-assignment clause to refuse to honor a post-loss assignment of an insurance

claim.

IN § 27-303 lists actions that constitute unfair claim settlement practices. 1

Featherfall alleged that Travelers violated IN § 27-303(b) by “fail[ing] to provide promptly on request a reasonable explanation of the basis for a denial of a claim[.]”

IN § 27-102 provides: “A person may not engage in the State in a trade practice 2

that is defined in this title as, or determined under this title to be, an unfair method of competition or an unfair or deceptive act or practice in the business of insurance.”

The Commissioner of the MIA has discretion to bring an enforcement action for 3

an act or practice that, “although not defined in this title, is an unfair method of competition or an unfair or deceptive act or practice[.]” IN § 27-104(a). 3 At the pre-hearing conference, Featherfall and Travelers agreed that the material

facts were undisputed and that the case was appropriate for resolution on motions for

summary decision. In Featherfall’s motion, it reaffirmed that it did “not want a ruling on

the merits of the insurance claim[,]” but rather sought a declaration that (1) anti-assignment

clauses do not reach post-loss assignments of benefits; and (2) refusing to honor an

assignment violates IN § 27-303. Featherfall also reasserted its allegations under IN §§ 27-

303(6) and 27-104. Featherfall made an additional allegation, which was not in its initial

complaint, that Travelers violated IN §§ 27-304(2) and (4) by refusing to communicate

with it about the claim. 4 Travelers argued that the anti-assignment clause is enforceable

against post-loss assignments of claims and that its “unambiguous terms” prohibited the

Assignment. Travelers also contended that it did not violate IN § 27-303 when it denied

coverage to the Policyholders.

MIA Commissioner Kathleen A. Birrane (the “Commissioner”) heard oral argument

on the cross-motions on May 7, 2021. Ten months later, she issued a memorandum opinion

granting Travelers’ motion, denying Featherfall’s motion, denying Featherfall’s request for

a hearing, and dismissing the case.

4 IN § 27-304 expands the list of prohibited claim settlement practices to include those “committed with the frequency to indicate a general business practice[.]” Relevant here, IN § 27-304(2) provides that it is an unfair claim settlement practice to “fail to acknowledge and act with reasonable promptness on communications about claims that arise under policies[,]” and IN § 27-304(4) provides that it is an unfair claim settlement practice to “refuse to pay a claim without conducting a reasonable investigation based on all available information[.]” 4 The Commissioner determined that the anti-assignment clause prohibited the

assignment of claims as well as the policy itself, which rendered the Assignment void. The

Commissioner also determined that anti-assignment clauses are enforceable regardless of

whether assignments occur pre-loss or post-loss, primarily relying on two cases that

enforced anti-assignment clauses against post-loss assignments of claims: Dwayne Clay,

M.D., P.C. v. Government Employees Insurance Co., 356 Md. 257 (1999), and Michaelson

v. Sokolove, 169 Md. 529 (1936). Thus, the Commissioner determined: (1) Featherfall was

not a “claimant”; (2) Featherfall received no rights under the policy by virtue of the

Assignment; and (3) Featherfall was not “aggrieved” by the MIA decision. The

Commissioner therefore determined that Featherfall was not entitled to a hearing pursuant

to IN § 2-210(a)(2), COMAR 31.16.10.09, or COMAR 31.02.01.03.

The Commissioner alternatively found that even if the Assignment was valid,

Travelers did not violate IN §§ 27-303 and 27-304 when it refused to communicate with

Featherfall about the claim. The Commissioner held that Travelers’ actions were timely

and reasonable because Travelers responded promptly to the claim, inspected the roof with

Featherfall present, and sent a detailed denial letter within one month of receiving notice

of the claim. The Commissioner determined that IN § 27-303(6) and §§ 27-304(2) and (4)

do not include the refusal to recognize an assignment as an unfair claim settlement practice.

Therefore, she declined to exercise her discretion under IN § 27-104 to find a violation on

that basis.

5 C

Featherfall petitioned for judicial review of the Commissioner’s decision in the

Circuit Court for Baltimore City, coupling its administrative appeal with a request for

declaratory and injunctive relief. The court affirmed the Commissioner’s decision. The

court also denied Featherfall’s request for declaratory judgment, explaining that the

Declaratory Judgment Act prohibits declaratory relief when a relevant statute specifically

provides a special form of remedy.

D

Featherfall timely appealed to the Appellate Court of Maryland, and in a reported

opinion, the court affirmed the judgment of the circuit court upholding the Commissioner’s

determination that the Assignment was invalid. In the Matter of the Petition of Featherfall

Restoration LLC, 261 Md. App. 105 (2024).

The Appellate Court held that anti-assignment clauses are enforceable under

Maryland law regardless of whether the assignment is made pre-loss or post-loss, explicitly

rejecting any distinction between the two. Id. at 135-36. As did the Commissioner, the

court primarily relied on Michaelson and Clay, both of which involved post-loss

assignments that were rendered void by anti-assignment clauses. 5 Featherfall, 261 Md.

5 Featherfall argued before the Appellate Court and this Court that the following four nineteenth century cases supported its position: Whiting v. Independent Mutual Insurance Co., 15 Md. 297 (1860), Washington Fire Insurance Co. of Baltimore v. Kelly, 32 Md. 421 (1870), Consolidated Real Estate & Fire Insurance Co. v. Cashow, 41 Md. 59 (1874), and Dickey, Tansley & Co. v. Pocomoke City National Bank, 89 Md. 280 (1899). Featherfall, 261 Md. App. at 130-36. Travelers and the MIA disagree with Featherfall, and the Appellate Court was likewise not convinced that these cases supported Featherfall’s

6 App. at 134-36. The court also rejected Featherfall’s contention that the Assignment

concerned only a claim and not the policy itself, describing the language of the Assignment,

which purported to transfer “any and all insurance rights, benefits, proceeds, and any

causes of action under applicable insurance policies[,]” as a broad transfer that went well

beyond the mere assignment of a post-loss claim. Id. at 140-41. Finding no basis for

Featherfall to claim aggrieved party status under IN § 2-210, the court agreed with the

Commissioner that Featherfall lacked standing to pursue its claim. Id. at 141-44.

E

Featherfall filed a petition for writ of certiorari, which we granted. In the Matter of

the Petition of Featherfall Restoration LLC, 487 Md. 264 (2024). Featherfall presented

four questions for our review, three of which 6 boil down to whether the Commissioner

erred in holding that the policy’s anti-assignment clause barred the Policyholders’

assignment of their claim to Featherfall.

II

When reviewing an administrative agency’s final decision, we “look[] through the

circuit court’s and intermediate appellate court’s decisions” and directly evaluate the

position. We have reviewed the cases and find them of little help in determining whether the Assignment to Featherfall is covered by the anti-assignment clause in the policy. 6 Featherfall’s fourth question addressed the circuit court’s refusal to entertain its declaratory judgment claim. The circuit court was correct. The circuit court had jurisdiction to review the decision of the MIA under IN § 2-215. That section defined the available forms of relief, which did not include issuing a declaratory judgment. 7 agency’s decision. Montgomery Park, LLC v. Md. Dep’t of Gen. Servs., 482 Md. 706, 724

(2023) (quoting Anne Arundel County v. 808 Bestgate Realty, LLC, 479 Md. 404, 419

(2022)). Accordingly, we are reviewing the Commissioner’s decision here, not the decision

of the circuit court or the Appellate Court.

An agency’s conclusions of law are reviewed without deference. Comptroller of

Md. v. FC-GEN Operations Invs. LLC, 482 Md. 343, 360 (2022). “[T]he interpretation of

a contract, including the question of whether the language of a contract is ambiguous, is a

question of law[.]” Credible Behav. Health, Inc. v. Johnson, 466 Md. 380, 392 (2019)

(quoting Myers v. Kayhoe, 391 Md. 188, 198 (2006)); see also Moscarillo v. Pro. Risk

Mgmt. Servs., Inc., 398 Md. 529, 540 (2007) (explaining that insurance policies are

construed according to contract principles because an insurance policy is a contract). The

application of Maryland case law is also a legal determination. Plank v. Cherneski, 469

Md. 548, 569 (2020). As such, we will review without deference the Commissioner’s

interpretations of the policy and Assignment as well as her application of this Court’s

precedent on post-loss assignments. And because these are matters that do not implicate

the MIP’s expertise, no deference to the Commissioner is warranted. FC-GEN Operations

Invs., 482 Md. at 360.

With limited exceptions, contracts are generally assignable under Maryland law.

See La Belle Epoque, LLC v. Old Eur. Antique Manor, LLC, 406 Md. 194, 211 (2008)

(finding that a lease agreement is assignable); Macke Co. v. Pizza of Gaithersburg, Inc.,

259 Md. 479, 482 (1970); Bimestefer v. Bimestefer, 205 Md. 541, 545 (1954). The parties

8 agree that one exception to the general rule favoring assignability is where the contract

contains an anti-assignment clause, which is likewise generally enforceable under

Maryland law. See Macke Co., 259 Md. at 482; Della Ratta v. Larkin, 382 Md. 553, 570

(2004); Pub. Serv. Comm’n of Md. v. Panda-Brandywine, L.P., 375 Md. 185, 188 (2003).

The parties dispute, however, whether the policy’s anti-assignment clause applies

to the Assignment. Featherfall contends that the Assignment did not purport to assign the

policy, but rather the rights associated with a specific claim that arose under the policy.

Travelers counters that the anti-assignment clause applies to “any right or claim under the

Policy to which Travelers has not consented.” According to Travelers, “[a]ny other

interpretation would carve out atextual categories of assignable rights, like ‘post-loss

claims’ based on ‘public policy,’ not the text of the contract.” Similarly, the MIA argues

that the language of the anti-assignment clause “necessarily eliminates the power to assign

a claim that exists only because of the Policy.” 7

C

We construe insurance policies as we do other contracts, namely, “based on what a

reasonable person in the position of the parties would have understood the language to

mean and not ‘the subjective intent of the parties at the time of formation.’” Credible

Behav. Health, 466 Md. at 393 (quoting Ocean Petroleum, Co. v. Yanek, 416 Md. 74, 86

(2010)). We focus, therefore, on the “ordinary and accepted meaning” of the contract’s

plain language. Id. at 394 (quoting Ocean Petroleum, 416 Md. at 88). And in doing so, we

7 On June 16, 2022, when this case was before the circuit court, the MIA filed a notice to participate, and it joined as a Respondent. 9 frequently consult dictionary definitions “to identify the common and popular

understanding of the words used in the contract as evidence of what a reasonable person in

the position of the parties would have understood those terms to mean.” Tapestry, Inc. v.

Factory Mut. Ins. Co., 482 Md. 223, 240 (2022) (quoting W.F. Gebhardt & Co. v. Am. Eur.

Ins. Co., 250 Md. App. 652, 668 (2021)). In addition, “we attempt to construe the contract

as a whole, interpreting ‘separate provisions harmoniously, so that, if possible, all of them

may be given effect.’” See Adventist Healthcare, Inc. v. Behram, 488 Md. 410, 433 (2024)

(quoting Credible Behav. Health, 466 Md. at 396).

The central issue here is whether, as Featherfall maintains, the Assignment operated

to assign a specific claim, or, as Travelers maintains, “the Policyholders assigned the whole

policy and all the rights and benefits flowing from it[.]” The MIA agrees with Travelers

that the Assignment attempted to transfer all of the Policyholders’ rights to Featherfall and

that it “allowed Featherfall to simply stand in the shoes” of the Policyholders with respect

to the entire Policy.

Travelers and the MIA argue that the policy and a “claim” under the policy are not

“conceptually distinct[.]” We disagree. The policy establishes the terms of the contractual

relationship between Travelers and the Policyholders. A claim is different. The policy uses

the word “claim” to refer to specific requests for coverage or payment. For example, under

“Claim Expenses,” the policy discusses how claims arising under the policy will be

handled. Elsewhere in the policy, “claim” is used to refer to specific requests for coverage

or payment for specific losses:

10 • “We may investigate and settle any claim or suit that we decide is appropriate.”

• The insured must submit proof of loss that includes “[e]vidence or affidavit that supports a claim under the Credit Card, Electronic Fund Transfer Card Or Access Device, Forgery and Counterfeit Money coverage[.]”

• The insured must submit proof of loss that includes “[r]eceipts, bills or other records that support your claim for ‘expenses[.]’”

• “The injured person or someone acting for the injured person will . . . [g]ive us written proof of claim, under oath if required[.]”

The distinction between a contract and a claim arising under it is firmly embedded

in Maryland law, including in the insurance context. In Ruberoid Co. v. Glassman

Construction Co., this Court adopted the principle that “[i]n the absence of language to the

contrary in the contract, a provision against assignment does not govern claims for money

due or claims for money damages for nonperformance[.]” 248 Md. 97, 103 (1967) (quoting

Trubowitch v. Riverbank Canning Co., 182 P.2d 182, 188 (Cal. 1947)). Here, the anti-

assignment clause does not, by its terms, apply to post-loss claims for money under the

policy.

The same principle was also confirmed in State of Maryland, Central Collection

Unit v. Columbia Medical Plan, where we held that an insured made a valid assignment of

her right to hospital benefits under her health insurance policy. 300 Md. 318, 331-32

(1984). There, upon being admitted to the hospital, the insured signed a registration form

that read, in part: “I hereby authorize payment direct to the University of Maryland Hospital

of the benefits for hospital expense otherwise payable to me as determined by the Insurance

Company[.]” Id. at 320. The patient died before paying the hospital’s bill. Id. The hospital,

relying on the registration form, demanded payment from the insurance company to no

11 avail. Id. at 320-21. The hospital, owned by the State of Maryland, transferred the account

to the Central Collection Unit, which then sued. Id.

The issue in Columbia Medical Plan was whether the language in the registration

form constituted an assignment or a mere authorization to pay the hospital directly. Id. at

321. If the former, the hospital succeeded to the insured’s rights as an assignee; if the latter,

the hospital had no direct action against the insurance company. Id. We concluded that the

language of the hospital form demonstrated that the “[a]ppellee’s insured intended to

transfer to the hospital her rights to the hospital benefits otherwise payable to her under the

terms of her insurance policy.” Id. at 331. As a result, we held that “the University of

Maryland Hospital obtained an independent right to recover those benefits under the

assignor’s insurance policy[.]” Id. (emphasis added). In so holding, we recognized the

distinction between assigning the insurance policy and assigning “a right to receive funds

under an insurance policy[,]” which we noted was permissible under Maryland law. Id. at

329 (citing Hewlett v. Home for Incurables, 74 Md. 350, 354-55 (1891)).

The distinction between a contract and a claim arising under it is also reflected in

precedent from the early nineteenth century cases addressing choses in action. A chose in

action is defined as a “proprietary right in personam, such as a debt owed by another person

. . . or a claim for damages in tort” and a “right to bring an action to recover a debt, money,

or thing.” Chose in action, Black’s Law Dictionary (12th ed. 2024). A chose in action is a

form of property. Roman Cath. Archbishop of Washington v. Doe, 489 Md. 514, 539 (2025)

(citing Hoffman Chevrolet, Inc. v. Washington Co. Nat’l Savings Bank, 297 Md. 691, 701

n.4 (1983)). The term “chose in action” has long been used to describe “all personal rights

12 of property which can only be claimed or enforced by action” including “rights of action

on a contract[.]” W.S. Holdsworth, The History of the Treatment of Choses in Action by

the Common Law, 33 HARV. L. REV. 997, 997 (1920) (quoting Torkington v. Magee, [1902]

2 K.B. 427, 430).

Such rights include the right to enforce claims for breach of contract or for benefits

under a contract, such as payment of money. A chose in action is therefore distinct from

the contract instrument from which it arose. See Mayor & City Council of Balt. v. Thornton

Mellon, LLC, 478 Md. 396, 451 (2022) (holding that a judgment foreclosing the right of

redemption was a chose in action, and therefore assignable, because “the judgment d[id]

not vest legal title to real property—it grant[ed] an equitable interest or the right to acquire

legal title upon the payment of the purchase price”); Deering v. Deering, 292 Md. 115, 127

(1981) (finding that a contractual right to pension benefits was a chose in action that gave

the employee a property right to pension benefits when he performed his end of the

employment contract).

We acknowledged the assignability of a chose in action as early as 1811. See Noland

v. Ringgold, 3 H. & J. 216, 218 (Md. 1811). In 1829, the legislature abolished the common

law rule that “an assignee of a chose in action[] cannot maintain an action at law in his own

name[.]” Kent v. Somervell, 7 G. & J. 265, 270 (Md. 1835). Since then, this Court has

recognized the ability of an assignee of a chose in action for the payment of money to

maintain “an action at law in this state, in his own name against the debtor.” Id. at 271; see

also, e.g., Adair v. Winchester, 7 G. & J. 114, 118 (Md. 1835) (stating that an assignee of

a chose in action is “entitled to all the remedies of the seller”); Crawford v. Brooke, 4 Gill

13 213, 221 (Md. 1846); Hampson v. Owens, 55 Md. 583, 586 (1881). More recent cases have

also confirmed that a chose in action, arising in tort or contract, is generally assignable.

See, e.g., Thornton Mellon, 478 Md. at 451; Roberts v. Total Health Care, Inc., 349 Md.

499, 522 (1998); Summers v. Freishtat, 274 Md. 404, 407 (1975).

Applying the foregoing principles here, we hold that the policy’s anti-assignment

clause does not prohibit the assignment of Claim IHV6005 to Featherfall because a

“reasonable person in the position of the parties” would not have understood a prohibition

on the assignment of “this policy” to include a prohibition on the assignment of a single

post-loss claim. See Credible Behav. Health, 466 Md. at 393. The title of the document is

“Assignment of Claim.” The Policyholders wrote the address of their home in the portion

of the form titled “Loss Location” and included both a claim number and a policy number.

The Assignment authorizes Featherfall to perform services “at the property located at the

above listed Loss Location address.” In paragraph 2, it states:

Assignment of Claim: In consideration of work and services being rendered or to be rendered by Featherfall Restoration, LLC pursuant to the separately executed Work Authorization Agreement, as well as any change orders thereafter, I the undersigned Insured (“Assignor”) hereby irrevocably transfer, assign, and set over onto Featherfall Restoration, LLC (“Assignee”) any and all insurance rights, benefits, proceeds, and any causes of action under applicable insurance policies for the above mentioned claim.

This language is tailored to transfer only the Policyholders’ rights to “the above

mentioned claim”—identified specifically as claim number “IHV6005” and resulting from

a loss that occurred on “6-2-2019.” The Assignment does not purport to transfer the policy

14 itself, the ongoing contractual relationship with Travelers, or any future claims that might

arise under the policy.

So, notwithstanding the Assignment, the Policyholders still had coverage under the

policy for other losses. If a tree fell on their residence, the Policyholders could still pursue

coverage under the policy. The same goes if, while vacationing, the Policyholders were

robbed of personal belongings, or if their credit card was stolen, or if, upon returning from

vacation, the Policyholders discovered that a power outage has caused all the food in their

fridge to spoil. Simply put, the Policyholders did not assign their rights to coverage for any

loss other than the specific loss for which they hired Featherfall, a point that Travelers

conceded at oral argument before this Court. 8 Thus, the Assignment operated only to assign

the Policyholders’ rights with respect to a specific claim, not the policy itself, and was

therefore not prohibited by the policy’s anti-assignment clause.

F

Travelers and the MIA argue that, under both Michaelson v. Sokolove, 169 Md. 529

(1936), and Dwayne Clay, M.D., P.C. v. Government Employees Insurance Co., 356 Md.

257 (1999), the Assignment is subject to the anti-assignment clause in the policy. The

Appellate Court likewise determined that both cases favor the Commissioner’s

8 At oral argument, Travelers’ counsel admitted that the policy was still in effect for the Policyholders’ benefit for subsequent occurrences. Travelers’ counsel also agreed that “something less than the entire Policy was transferred by the Assignment of Claim.” Further, Travelers’ counsel conceded that the Policyholders assigned rights and benefits, such as the right to payment and the right to negotiate coverage in the context of only this claim. 15 determination. Featherfall, 261 Md. App. at 134-36. We conclude that both cases are

distinguishable on the facts.

Michaelson dealt with an anti-assignment clause in a life insurance policy, 169 Md.

at 530; Clay involved a health insurance policy, 356 Md. at 261. We held that, under the

particular facts in each case, the anti-assignment clauses invalidated the assignors’ post-

loss assignments of insurance benefits. Michaelson, 169 Md. at 533-34; Clay, 356 Md. at

269-70. In both cases, the beneficiaries did not contend, nor could they have credibly

contended based on the express language of the anti-assignment clauses, that the clauses

did not apply to their assignments by their plain terms. That’s because in Michaelson, the

policy explicitly provided that “neither the supplementary contract nor any benefits

accruing thereunder shall be transferable or subject to surrender, commutation,

anticipation, or encumbrance[.]” 169 Md. at 531. Similarly, in Clay, the policy contained

a broad clause stating that “[a]ssignment of interest under this policy will not bind us

without our consent.” 356 Md. at 260.

Because these clauses prohibited the assignment of not only the policies but also

any “benefits” or “interest” thereunder, the assignees in Michaelson and Clay were forced

to make different arguments. In Michaelson, the appellant argued that a Maryland statute

allowing assignees of choses in action to maintain suits in their own names somehow

overrode the contractual restriction. 169 Md. at 534. In Clay, the physician-assignee

contended that enforcing the anti-assignment clause against healthcare providers was

contrary to public policy because accident victims needed to be able to assign benefits to

16 receive necessary medical treatment. 356 Md. at 262. In neither case did those arguments

overcome the plain language of the anti-assignment clauses.

Here, however, Featherfall is not advancing a public policy argument to overcome

the anti-assignment clause; Featherfall instead makes the argument that the assignees in

Michaelson and Clay could not make—that the Assignment was not prohibited by the plain

language of the anti-assignment clause. Thus, neither Michaelson nor Clay supports the

notion that here, the anti-assignment clause prohibited the Assignment.

III

In conclusion, we hold that the anti-assignment clause, which prohibits an

assignment of the policy but not claims arising under the policy, did not invalidate the

Assignment. Thus, Featherfall was a valid assignee and therefore had standing as an

aggrieved party to request a hearing under IN § 2-210(a). We take no position on whether,

on the merits, Travelers properly denied the claim. We do, however, conclude that

Travelers should have honored the Assignment and handled Featherfall’s claim no

differently than if it had been asserted by the Policyholders.

We must now decide the appropriate disposition. The statute gives us three options:

(1) affirm the decision of the Commissioner; (2) remand the case for further proceedings; or (3) reverse or modify the decision of the Commissioner if substantial rights of the petitioners may have been prejudiced because administrative findings, inferences, conclusions, or decisions: ... (iv) are affected by other error of law[.]

IN § 2-215(h).

17 We are mindful that the Commissioner made the alternative finding that Travelers

handled the claim appropriately and therefore did not violate IN §§ 27-303(6) and 27-

304(2) and (4). That said, we are not convinced that this finding was not influenced by her

erroneous legal conclusion that Featherfall was not a valid assignee. For starters,

Featherfall emphasized repeatedly that its complaint filed with the MIA was focused on

Travelers’ refusal to honor the Assignment, not on the merits of the denial. Thus, the

Commissioner addressed an issue that was not even before the MIA.

Moreover, the record shows that Travelers refused to speak to Featherfall solely

because it believed the Assignment was invalid. From that, we infer that Travelers would

likely have spoken to Featherfall and handled the claim differently had it known that the

Assignment was valid. To put it bluntly, we have our doubts that Travelers would have

dealt with its customers, the Policyholders, the same way it dealt with Featherfall. With

additional facts concerning how Travelers typically handles such situations with insureds,

the Commissioner will be better positioned to determine the merits of Featherfall’s claims.

Accordingly, we reverse the decision of the Commissioner and order a remand of

this matter to the MIA for further proceedings consistent with this opinion.

JUDGMENT OF THE APPELLATE COURT OF MARYLAND REVERSED, WITH INSTRUCTIONS TO ORDER A REMAND TO THE CIRCUIT COURT WITH INSTRUCTIONS FOR THE CIRCUIT COURT TO REMAND TO THE MARYLAND INSURANCE ADMINISTRATION FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. COSTS TO

18 BE PAID BY RESPONDENT TRAVELERS HOME AND MARINE INSURANCE COMPANY.