How Can the Wording of Assignment and Integration Clauses Determine Which Rights an Assignee Actually Receives?
Lyles v. Santander Consumer USA Inc., 2025 WL 3274817 (Md. 2025)
For businesses that regularly buy contracts or loan portfolios, a recent Maryland Supreme Court decision is a reminder that companies cannot assume every term in the dealer’s paperwork travels with the assignment. Here, a car buyer signed two documents with the dealership: a one-page purchase order for the vehicle, which referenced a separate arbitration agreement, and a Retail Installment Sales Contract (RISC) that set out the financing terms but contained no arbitration clause. The RISC said the dealer was assigning “this contract” to Santander and stated that, upon assignment, “only this contract and the addenda to this contract” would make up the entire agreement between the buyer and the assignee.
Santander later tried to force the borrower into arbitration based on the purchase order’s arbitration language, arguing that all documents in the transaction should be treated as a single, integrated contract. The Supreme Court assumed, for the sake of argument, that a binding arbitration agreement existed between the buyer and the dealer, but held that the agreement fell outside the scope of the assignment to Santander. Reading the assignment clause together with the RISC’s integration language, the court concluded that the dealer assigned only the RISC (and its addenda), not the “entire agreement” that also included the purchase order. Because the arbitration language lived only in the unassigned purchase order, Santander could not compel arbitration, and the judgment compelling arbitration was reversed.
For lenders, serviceers, and purchasers of contract rights, the takeaway is clear.
The ability to enforce arbitration, fee provisions, waivers, or other protective terms depends on the precise wording of your assignment and integration clauses.
If the documents say the assignee’s agreement is “only this contract,” courts may treat all other deal papers as outside the assignment.
For consumers and businesses on the other side of these contracts, this case shows that even when signing an arbitration clause with the original counterparty, a later assignee may not automatically inherit that right if the written assignment language is narrower than the overall structure suggests.
This post is for informational purposes only and does not constitute legal advice. If you have questions about your specific situation, you should contact a lawyer for assistance. Nothing herein is intended to create any attorney-client relationship between you and DLM LAW.
