Aurora National Life Assurance Co. v. Harrison (462 F. Supp. 2d 951, 2006)

ORDER

GRITZNER, District Judge.

This matter comes before the Court on a Motion for Summary Judgment filed by Cross-Claim Plaintiff/Cross-Claim Defendant Patreka Harrison (Clerk’s No. 46) and a Cross-Motion for Summary Judgment filed by Cross-Claim Defendant/Cross-Claim Plaintiff Singer Asset Finance Company (Clerk’s No. 57). Also pending are Motions to Strike filed by Harrison (Clerk’s No. 59) and Singer (Clerk’s No. 49). Harrison is represented by Gail E. Boliver and Eric Bidwell, and Singer is represented by Mark D. Walz. Following an October 13, 2006, hearing, these matters are fully submitted and ready for disposition.

MATERIAL FACTS

Harrison is a resident of Amarillo, Texas. Singer is a Delaware limited liability company with its principal place of business in Florida.

On October 15, 1985, while Harrison was a minor, Harrison’s representative and the Security Bank of Nevada, through its Trust Department, acting as trustee and guardian of Harrison’s estate, entered into a structured settlement agreement and release (the “Settlement Agreement”) with Royal Insurance Company (“Royal Insur-anee”) to settle a personal injury action brought in Nevada by Harrison’s estate against William and Edith Price. The Prices were insureds of Royal Insurance. The Settlement Agreement was drafted and executed pursuant to an order entered by a Nevada state court.

The Settlement Agreement required the Prices, through Royal Insurance, to pay to the Security Bank of Nevada and eventually to Harrison an immediate lump sum of money as well as amounts disbursed periodically over several years (the “Periodic Payments”). The Periodic Payments were to be funded through the purchase of an annuity policy by Royal Insurance from Executive Life Insurance Company (“Executive Life”). Under the Settlement Agreement, Harrison would “have no rights of ownership in the annuity contract, no right to designate a beneficiary and no other right or control under the annuity contract whatsoever,” but the Settlement Agreement did not restrict Harrison’s right to assign the Periodic Payments.

The Settlement Agreement permitted Royal Insurance and the Prices to “assign their duties and obligations with respect to [the Periodic Payments] and the purchase of said annuity obligations to First Executive Corporation” (“First Executive”). Royal Insurance and the Prices made such an assignment. First Executive purchased an annuity policy (the “Annuity”) from Executive Life to fund its obligation to make the Periodic Payments. First Executive was later succeeded by FL Assignments.

Under the Settlement Agreement and the Annuity, Harrison was to be provided benefits in the following manner:

• $1200 per month for a period of five years, with the first payment due November 16, 1985, and the final payment due October 16,1990.

• $1200 per month for a period of five years, with the first payment due November 16, 1994, and the final payment due October 16,1999.

• $2500 per month for sixteen years, with the first payment due November 16, 1999, and the final payment due October 16, 2015. If Harrison lived beyond October 16, 2015, the annuity would pay $2500 per month on the 16th day of each month for the remainder of Harrison’s life beginning on November 16, 2015.

• Lump sum payments:

• $12,000 on November 16 in 1990, 1991, and 1992.

• $37,000 on November 16,1993.

• $50,000 on November 16,1998.

• $75,000 on November 16, 2003.

• $100,000 on November 16, 2008.

• $125,000 on November 16, 2013.

• $150,000 on November 16, 2018.

• $200,000 on November 16, 2023.

• $300,000 on November 16, 2028.

• $400,000 on November 16, 2033.

Harrison App. 4-10, 272.

Following the conservation and liquidation of Executive Life, the Annuity was assumed by Aurora National Life Assurance Company (“Aurora”), a California company, in 1993 at 100 percent of its initial value (the “Restructured Annuity”). Aurora issued new terms governing the Restructured Annuity. The terms of the Restructured Annuity describe and distinguish the roles of various parties to the contract:

Owner. The Owner of this contract as named in the Application or as changed by Written Request thereafter while the Annuitant is alive.... Payee.... The individual or entity to whom Benefit Payments are made under this contract. ...

Assignment. This contract may be assigned by Written Request by the Owner while any Annuitant was alive....

Owner.

e. Change. While the Annuitant is alive, the Owner may designate or change the ownership by Written Request or a contingent Owner may be designated or changed by Written Request—

See Harrison App. 20, 25, 29-30. Harrison was the Restructured Annuity’s payee, and FL Assignments was its owner. As the quoted terms show, the Restructured Annuity could not be assigned without a Written Request submitted by FL Assignments. The record is devoid of such a request.

Beginning in 1997, Harrison sought to increase her income during a period of economic distress. Through a series of four transactions executed over a sixteen-month period (collectively, the “Purchase Agreements”), Singer paid Harrison lump sums of money in exchange for Harrison’s promise to transfer control over the Periodic Payments to Singer. Each Purchase Agreement contains a clause indicating Harrison

hereby sells, transfers, assigns, sets over and conveys to [Singer], or at [Singerj’s election, [Singer]’s assignee, all right, title and interest of [Harrison] in and to the “Assigned Assets”, and, in reliance on the representations, warranties and covenants of [Harrison] contained herein and subject to the terms and conditions hereof, [Singer] hereby purchases and accepts the assignment of all right, title and interest of [Harrison] in and to the Assigned Assets, in consideration of the payment of the Purchase Price....

Harrison App. 257, 349, 450, 551.

Through a “Notice of Direction of Payments” attached to the Purchase Agreements, Harrison directed First Executive or FL Assignments and Aurora to remit all Periodic Payments to a bank account in Harrison’s name located in New York. The Notice attached to the first two Purchase Agreements directs the Periodic Payments to be made by wire transfer and includes wiring instructions to access an account owned by Harrison. The Notices do not indicate Harrison assigned or sold her right to receive payments under the Settlement Agreement, the Annuity, or the Restructured Annuity; instead, each Notice indicates Harrison was changing the address and bank account to which she wished the Periodic Payments to be sent. The account was actually apparently controlled by Singer, which would deduct an amount equaling the payments assigned by the Purchase Agreements and refund the balance to Harrison.

Under section 5(d) of the Purchase Agreements, Harrison agreed not to make changes in the instructions set forth in the Notices of Direction of Payments after execution of the Purchase Agreements. Section 5(f) of the Purchase Agreements required Harrison to “immediately deliver to [Singer] any checks, funds or other form of payment on account of or in connection with the Annuity or the Assigned Assets hereafter received by [Harrison] or anyone (other than [Singer]) claiming by or through [Harrison].” Harrison App. 262, 354, 455, 556.

Harrison executed a document labeled “Absolute Assignment and Waiver of Claim” with each Purchase Agreement. Through each waiver, Harrison “release[d] any rights, claims, interest, powers and privileges to any benefits or proceeds that [Harrison] might [have had] or in the future possess under the [Settlement Agreement], or in relation thereto, regarding the Assigned Assets.” Harrison App. 324, 426, 524, 624. Singer claims the waiver, when read with other documents attached to each Purchase Agreement, secures Singer’s right to receive all payments due to Harrison under the Settlement Agreement.

The four Purchase Agreements set forth the financial terms of each transaction. Via a Purchase Agreement dated July 18, 1997, Harrison received an immediate payment of $44,033, and Singer received the right to

30 monthly payments of $150.00 commencing August 16, 1997 through and including January 16, 2000; 30 monthly payments of $500.00 commencing February 16, 2000 through and including July 16, 2002; [l]ump sum payment as follows: $50,000.00 due November 16, 1998.

Harrison App. 268. Through this transaction, Harrison sold the right to receive nearly $69,500 in future payments for the immediate sum of $44,033. A letter from Harrison dated June 28, 1997, indicates she understood she was “accepting the quote for $44,033 in exchange for [the] lump sum of $50,000 due on 11/16/1998 and monthly payments in the amount [of] $150 for 30 months, then increasing to $500 for an additional 30 months.” Singer App. 6.

Through a Purchase Agreement dated April 23, 1998, Harrison sold the right to receive a “[l]ump sum payment of $75,000 due November 16, 2000” for $25,734 payable immediately. Harrison App. 362. And under a Purchase Agreement dated October 14, 1998, Harrison received an immediate payment of $47,023 but promised to give to Singer “120 monthly payments of $1,000.00 commencing November 16, 1999 through and including October 16, 2009; [and a] lump sum payment of $50,000.00 due November 16, 2008.” Harrison App. 463. Thus, Harrison sold $170,000 in future payments for $47,023.

Finally, Harrison signéd a Purchase Agreement on December 22, 1998, under which she received an immediate payment of $74,206, and Singer received

One monthly payment of $1,000.00 due July 16, 2002[;] 197 monthly payments of $1,500.00 commencing August 16, 2002 through and including December 16, 2018[;] lump sum payments as follows: $50,000.00 due November 16, 2008 and $125,000.00 due November 16, 2013.

Harrison App. 564. As a result of this transaction, Harrison sold the right to receive $471,500 in future payments, for the immediate sum of $74,206.

All Periodic Payments were directed to the New York account as directed by the Purchase Agreements from August 1997 through December 1999. After deducting the Assigned Assets, Singer remitted the balance of the Periodic Payments to Harrison. Singer argues this fact eliminates dispute regarding whether Harrison actually directed First Executive, FL Assignments, and Aurora to abide by the payment direction instructions submitted by Harrison as part of each Purchase Agreement, as well as whether Harrison’s instructions were followed.

In November 1999, Harrison noticed what she termed “discrepancies” in her payments. Harrison expected to receive a payment of $2500 that month but received less. After consulting with a paralegal, Harrison contacted Aurora in a letter dated November 4, 1999, and requested future payments be deposited in her personal account at a bank in Iowa. Her letter reflects that she “accepted] all responsibility to any actions that could be taken against [her] for” her request to have the payments redirected away from the New York account.

In December 1999 and January 2000, Aurora deposited monthly payments of $2500 in Harrison’s Iowa bank account. Singer claims this action violated the Purchase Agreements.

A Singer representative informed Harrison she could not change the recipient of the payments. As a result, in January 2000, Harrison instructed Aurora to direct payments back to Singer. Singer began receiving $2500 payments from Aurora in February 2000. Harrison alleges that once Singer was reimbursed for any missed payments, Singer refused to pay Harrison her portion of the $2500 payments. She attempted to resolve the issue with Singer but claims she was told by a Singer representative that the company would not pay her “another dime.”

According to Singer, Harrison diverted payments due December 16, 1999, onward and either changed or attempted to change the address to which those payments were sent such that Singer could not obtain monies to which it was entitled under the Purchase Agreements. As a result, Singer claims entitlement to the full amount of the Periodic Payments Harrison sold, in addition to interest, attorneys’ fees, and other costs.

Singer points to section 5(f) of the Purchase Agreements as containing the remedies to which it is entitled. Under section 5®, if

any of the Assigned Assets is ever denied, diverted, set-off, delayed or withheld from [Singer] by virtue of any claim, demand, attachment, or other act or omission of [Harrison] or any person acting or claiming by, through, or under [Harrison], then [Harrison] hereby promises to pay within ten (10) days of demand, the entire amount of any such Assigned Asset, together with interest at the rate of eighteen percent (18%) per annum (or the maximum rate allowable by law whichever is lesser) from the date which such Assigned Asset should have been received by [Singer] to the date of actual payment.

Harrison App. 262-263; 354; 455; 556. Singer claims Harrison is required under the quoted acceleration clause to immediately pay the total amount assigned by the Purchase Agreements, missed payments, interest on any arrears, all remaining scheduled payments, and attorneys’ fees and costs.

In a letter dated January 16, 2001, Kenneth R. Schild, Senior Vice President and General Counsel for Aurora, informed Singer’s counsel that under the terms of the Restructured Annuity, only FL Assignments, then the annuity’s owner, could “change direction of payments or assign payments.” Harrison App. 658. Mr. Sehild notes FL Assignments “specifically directed Aurora not to honor any redirection of payments or assignments unless there is authorization from the court that approved the settlement or direction by a court of competent jurisdiction has been directed to them.” Harrison App. 658. Aurora suspended making Periodic Payments entirely in February 2001. Harrison App. 659-662 (letter from Aurora’s counsel dated October 23, 2001, stating that “Aurora is currently holding (9) payments of $2500, for a total of $22,500.00, reflecting payments for the period February 2001 to and including October 2001”).

Harrison and her husband filed a voluntary petition in the United States Bankruptcy Court for the Southern District of Iowa (the “Bankruptcy Court”) on September 10, 2001, and received a discharge from bankruptcy on December 27, 2001. On December 2, 2002, Aurora initiated an adversary action in the Bankruptcy Court, joining as defendants Singer and Harrison, among others. Aurora sought declaratory judgment in an effort to resolve to whom Aurora should remit the Periodic Payments. Aurora sought and received permission to deposit payments into the registry of the Bankruptcy Court until the recipient of the Periodic Payments could be determined.

On June 20, 2005, Hon. Lee Jackwig, United States Bankruptcy Judge, granted the parties’ Joint Motion for Entry of Consent Order for Transfer of Funds. See In re Harrison, No. 01-04681-rjh7, slip op., at 1 (Bankr.S.D. Iowa June 20, 2005). Finding that the bankruptcy trustee had abandoned her claim to the Periodic Payments Aurora had deposited, Judge Jack-wig ordered those funds to be released to Aurora and ordered Aurora to initiate an interpleader action in this Court to resolve “[a]ll issues related to the disbursement of the [suspended Periodic Payments], including requests for attorneys’ fees and costs.” Id. at 1-2. Aurora complied on August 2, 2005, by filing a Complaint in this Court ushering the parties’ dispute here. Aurora inter-pleaded Harrison, Singer, FL Assignments, and Gary Ewing. Harrison and Singer then filed cross-claims against each other. Aurora was discharged by Order of this Court on April 20, 2006, See Aurora Nat'l Life Assurance Co. v. Harrison, No. 4:05-cv-00445, slip op., at 5-6 (S.D.Iowa Apr. 20, 2006), and has since deposited in this Court’s registry past Periodic Payments and payments becoming due during this proceeding. Those monies form the stake in the instant litigation.

In her cross-claim, Harrison has not set forth the legal basis under which she seeks relief. See Def. Harrison Ans. to Compl. for Interpleader & Cross-cl. (Clerk’s No. 4); Def. Harrison Am. Ans. to Compl. for Interpleader & Cross-cl. (Clerk’s No. 16). Her pleadings contain a declaration that she is in fact bringing a cross-claim, followed by an array of factual allegations and a claim to the stake. See Def. Harrison Ans. to Compl. for Interpleader & Cross-cl., at 2-6. She does not separate her theories of recovery into counts, see Fed.R.Civ.P. 10(b), does not state the legal bases for her claim, see Fed.R.Civ.P. 8(a)(2), and does not state which of the four co-defendants her cross-claim is against. The relief sought is an “order ... awarding [Harrison] payments, denying any debt to Singer, and ordering recommencement of the annuity payments directly to [Harrison].” Id. at 6.

Singer’s cross-claims against Harrison number five. In Count I, Singer brings a breach of contract claim against Harrison. In Counts II and III, Singer brings conversion and unjust enrichment claims, respectively, against Harrison. In Count IV, Singer seeks an injunction requiring Harrison to comply with the Purchase Agreements; and in Count V, Singer seeks a declaratory judgment against Harrison and FL Assignments establishing that the Purchase Agreements are valid and enforceable.

At bottom, Singer seeks a judgment declaring its right to receive payments Harrison purportedly assigned to it, as well as funds necessary to recoup any arrears, contract interest, fees, and costs. Singer claims these sums should be paid from those Periodic Payments which were not assigned to Singer. Singer also demands a declaratory judgment that the Purchase Agreements are valid and enforceable and that it holds a first, perfected security interest in payments assigned under the Purchase Agreements, as well as an order requiring Harrison to execute documents allowing Singer to enforce its rights to the collateral purportedly used to secure her performance under the Purchase Agreements.

Regarding the pending motions, Harrison does not specify whether she seeks summary judgment on her cross-claim or Singer’s cross-claims. Singer repeats the error in its resistance and in its own motion. However, because both parties address the validity and effect of the Purchase Agreements — and not, for example, whether Harrison committed the tort of conversion — the Court resolves that issue, alone. Harrison seeks an order that the Purchase Agreements “are null and void” and that any Periodic Payments in this Court’s registry be returned to her. Singer has combined its resistance to Harrison’s motion and its own Motion for Summary Judgment into one document, but see LR 7.1(d) (“For every motion, the moving party must prepare a brief .... ” (emphasis added)), so it is difficult to determine precisely what action Singer wishes the Court to take. A fair reading of Singer’s filings indicates it wishes the Court to declare the Purchase Agreements to be enforceable and to determine what amounts to which it is entitled.

DISCUSSION

I. Standards for Summary Judgment.

Federal Rule of Civil Procedure 56 permits cross-claim claimants and parties against whom cross-claims are brought to move for summary judgment. Fed. R.Civ.P. 56(a), (b). The standard is the same: “[t]he judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Id. R. 56(c). A dispute about a fact is genuine “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); see also id. at 249, 106 S.Ct. 2505 (“[Tjhere is no issue for trial unless there is sufficient evidence favoring the nonmov-ing party for a jury to return a verdict for that party.” (citing First Nat’l Bank of Ariz. v. Cities Serv. Co., 391 U.S. 253, 288-89, 88 S.Ct. 1575, 20 L.Ed.2d 569 (1968)); Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (“Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no ‘genuine issue for trial.’ ”)).

A genuine dispute about a fact is material if it “might affect the outcome of the suit under the governing law.” Anderson, 477 U.S. at 248, 106 S.Ct. 2505. The materiality element is not met if the record contains disputes about facts which are “irrelevant or unnecessary.” Id. And if the evidence supporting a claim or defense “is merely colorable or is not significantly probative, summary judgment may be granted.” Id. at 249-50, 106 S.Ct. 2505 (citing Cities Serv., 391 U.S. at 290, 88 S.Ct. 1575; Dombrowski v. Eastland, 387 U.S. 82, 87 S.Ct. 1425, 18 L.Ed.2d 577 (1967) (per curiam)); see also Matsushita Elec. Indus. Co., 475 U.S. at 586, 106 S.Ct. 1348 (explaining that a nonmoving party “must do more than simply show that there is some metaphysical doubt as to the material facts”). Applicable substantive law governs which facts are critical and which are irrelevant. Anderson, 477 U.S. at 248, 106 S.Ct. 2505; see also Nebraska v. Wyoming, 507 U.S. 584, 590, 113 S.Ct. 1689, 123 L.Ed.2d 317 (1993) (when deciding if a material factual dispute exists, a court must “view[] the evidence through the prism of the controlling legal standard”).

Procedurally, the moving party bears the burden of informing the court of the basis for its motion by pointing to places in the record demonstrating the absence of genuine issues of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The resisting party must then go beyond the pleadings and present “ ‘specific facts showing that there is a genuine issue for trial.’ ” Anderson, 477 U.S. at 250, 106 S.Ct. 2505 (quoting Fed.R.Civ.P. 56(e)); See Celotex Corp., 477 U.S. at 324, 106 S.Ct. 2548 (demanding a nonmoving party resist a properly supported motion “by [its] own affidavits, or by the depositions, answers to interrogatories, and admissions on file” to “designate specific facts showing that there is a genuine issue for trial” (quotation marks omitted)). If a party bears the burden of proof at trial, summary judgment is appropriate against that party if it “fails to make a showing sufficient to establish the existence of an element essential to that party’s case.” Celotex Corp., 477 U.S. at 322, 106 S.Ct. 2548; see also Nebraska v. Wyoming, 507 U.S. at 590, 113 S.Ct. 1689; Lujan v. Nat’l Wildlife Feder., 497 U.S. 871, 884, 110 S.Ct. 3177, 111 L.Ed.2d 695 (1990). Under these circumstances, “[t]he moving party is ‘entitled to judgment as a matter of law” because the nonmoving party has failed to make a sufficient showing on an essential element.” Celotex Corp., 477 U.S. at 323, 106 S.Ct. 2548; Lujan, 497 U.S. at 884, 110 S.Ct. 3177.

Throughout this process, the Court must view the evidence and inferences from the record in a light favorable to the nonmoving party, See Anderson, 477 U.S. at 255, 106 S.Ct. 2505, presume the nonmoving party’s version of a disputed issue is the correct one, Eastman Kodak Co. v. Image Technical Servs., Inc., 504 U.S. 451, 456, 112 S.Ct. 2072, 119 L.Ed.2d 265 (1992); Arizona v. Maricopa County Med. Soc., 457 U.S. 332, 339, 102 S.Ct. 2466, 73 L.Ed.2d 48 (1982), and steer clear of performing jury functions such as making “[cjredibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts,” Anderson, 477 U.S. at 255, 106 S.Ct. 2505. If, at the conclusion of this process, “it is quite clear what the truth is,” summary judgment may be granted, “for the purpose of the rule is not to cut litigants off from their right of trial by jury if they really have issues to try.’ ” Poller v. Columbia Broad. Sys., Inc., 368 U.S. 464, 467, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962) (quoting Sartor v. Ark. Natural Gas Corp., 321 U.S. 620, 627, 64 S.Ct. 724, 88 L.Ed. 967 (1944) (second omission by the Poller Court)).

Mindful of these standards, the Court turns to the parties’ motions. Because many of the facts in this care are uncontested, analyzing the present dispute centers largely around the legal issue of which party is entitled to the stake. To the extent fact disputes exist, they are resolved favorably to Harrison in the following discussion.

II. Analysis.

A. Choice of Law Issues.

Because much of the following discussion revolves around issues of contract validity, it is key at the outset to identify which states’ laws apply to which contracts. Iowa law governs choice of law decisions at this stage. See Whirlpool Corp. v. Ritter, 929 F.2d 1318, 1320-21 (8th Cir.1991) (providing that forum state’s choice of law rules apply in federal inter-pleader actions “because the federal inter-pleader action is merely a special brand of diversity jurisdiction” (dicta)); see also Republican Nat’l Comm. v. Taylor, 299 F.3d 887, 890 (D.C.Cir.2002) (directing federal courts to use choice of law rules of the forum state in statutory interpleader cases); Equitable Life Assurance Soc’y of the U.S. v. McKay, 837 F.2d 904, 905 (9th Cir.1988) (applying substantive law of the forum state in statutory interpleader action); Reynolds v. American-Amicable Life Ins. Co., 591 F.2d 343, 344 (5th Cir. 1979) (choice of law rules of forum state apply in an interpleader action); James Talcott, Inc. v. Allahabad Bank, Ltd., 444 F.2d 451, 462 n. 9 (5th Cir.1971) (“Under the applicable conflicts of law principle in interpleader actions, a federal court applies the choice of law rules of the state in which it is sitting.”); Williams v. McFerrin, 242 F.2d 53, 55 (5th Cir.1957) (forum state’s choice of law rules apply “since interpleader comes under the diversity jurisdiction of the federal court”). Cf. Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941) (holding that in diversity actions, federal courts apply conflict of law rules used by courts in the state in which the district court is located); Griffin v. McCoach, 313 U.S. 498, 503, 61 S.Ct. 1023, 85 L.Ed. 1481 (1941) (applying Klaxon in an interpleader action).

Because choice of law clauses express the intent of the parties to a contract, Iowa courts are generally deferential to such clauses. Gabe’s Constr. Co. v. United Capitol Ins. Co., 539 N.W.2d 144, 146 (Iowa 1995); see Restatement (Second) of Conflict of Laws § 187(1) (1971) (“The law of the state chosen by the parties to govern their contractual rights and duties will be applied if the particular issue is one which the parties could have resolved by an explicit provision in their agreement directed to that issue.”); see also Cole v. State Auto. & Cas. Underwriters, 296 N.W.2d 779, 781 (Iowa 1980) (citing Restatement (Second) of Conflict of Laws § 187).

The July 1997 and December 1998 Purchase Agreements state that they “shall be governed, construed and enforced in accordance with the substantive laws of the State of New York without regard to its choice of law rules.” Harrison App. 265; 559. The April 1998 and October 1998 Purchase Agreements contain similar provisions indicating Florida law applies. Harrison App. 357; 458. The Restructured Annuity contains a similar clause requiring California law to control its interpretation. Harrison App. 132. The Court concludes New York law applies to the July 1997 and December 1998 Purchase Agreements, Florida law applies to the April 1998 and October 1998 Purchase Agreements, and California law applies to the Restructured Annuity.

The Settlement Agreement does not contain a choice of law provision. Under Iowa choice of law principles, if a contract lacks a choice of law clause, the law of the state which “ ‘has the most significant relationship to the transaction and the parties’ ” applies. Gabe’s Constr. Co., 539 N.W.2d at 146 (quoting Restatement (Second) of Conflict of Laws § 188(1) (1971)). Factors considered include

(a) the place of contracting,

(b) the place of negotiation of the contract,

(c) the place of performance,

(d) the location of the subject matter of the contract, and

(e) the domicile, residence, nationality, place of incorporation and place of business of the parties.

Restatement (Second) of Contracts § 188(2) (quoted in Gabe’s Constr. Co., 539 N.W.2d at 146; cited in First Midwest Corp. v. Corporate Fin. Associates, 663 N.W.2d 888, 893 (Iowa 2003); Cole, 296 N.W.2d at 781); see also Joseph L. Wilmotte & Co. v. Rosenman Bros., 258 N.W.2d 317, 327-28 (Iowa 1977).

Two of the three signatories to the Settlement Agreement executed it in Nevada. The Settlement Agreement contains terms of settlement regarding a personal injury action then pending in Nevada. The personal injury action was brought by the estate of a Nevada resident. Payments under the Settlement Agreement were to be made to a Nevada bank until Harrison reached the age of majority. Balancing the factors quoted above requires the conclusion that Nevada law applies to the Settlement Agreement.

B. Summary of the Parties’ Arguments.

At its core, Harrison’s argument is twofold. First, she claims that under the terms of the Restructured Annuity, only the annuity’s owner could assign payments or change the address to which payments were made. Harrison argues that because the Purchase Agreements required her to assign payments made under the Restructured Annuity or change the address to which such payments were made, the Purchase Agreements are invalid. Second, Harrison argues the Court should not enforce the Purchase Agreements because they are violative of Iowa public policy.

Responding, Singer claims any anti-assignment language in the Restructured Annuity is not implicated because Harrison assigned rights generated by the Settlement Agreement. It follows, Singer argues, that because the Settlement Agreement contains neither anti-assignment language nor any other language restricting Harrison’s ability to sell or assign the right to receive payments thereunder, the Purchase Agreements memorialize valid transactions. Singer also argues the Purchase Agreements are not in violation of public policy.

C. Validity of the Purchase Agreements.

Harrison first argues that the Settlement Agreement did not authorize her to designate an alternative payee for the annuity payments and gave her no right of ownership in the Annuity, meaning the Purchase Agreements are void. She argues the Settlement Agreement deprived her of the right and power to assign payments. Resolution of this issue distills to whether Harrison had assignable rights under either the Restructured Annuity or Settlement Agreement; and, assuming neither document barred such transactions, whether Nevada law — which governs the Settlement Agreement — poses an independent bar to transactions of this type.

1. The Restructured Annuity.

The parties agree Harrison had no assignable rights under the Restructured Annuity because the right to assign or direct payments under the Restructured Annuity resided solely in the annuity’s owner, which is not — and has never been— Harrison. The record shows, however, that the Purchase Agreements did not only address those rights, if any, possessed by Harrison under the Annuity or Restructured Annuity. Harrison assigned

[a]ll right, title and interest of [Harrison], (and upon his [sic] death, all right, title and interest of his [sic] estate and of any beneficiary designate by him [sic]) to receive the Assigned Payments due to him [sic] (as defined in this Terms Rider) in, to and under the Release, the Annuity (or any funding asset substituted for the Annuity) the Qualified Assignment and any other documents executed in connection therewith or otherwise relating to the foregoing and all right, title and interest of [Harrison,] his [sic] estate or any beneficiary thereunder, to receive any monies under or pursuant to such agreements, any monies actually received by [Harrison] pursuant to or by reason of any such' agreements ... and any interest on the proceeds of all of the above composing or comprising all or any portion of the Assigned Payments, and all of [Harrison]’s present or future right, title and interest to sell, assign, transfer, cause an early termination of, settle, receive consideration for, or undertake any similar activity with respect to any of the above.

Harrison App. 268 (emphasis added); accord Harrison App. 362, 463, 564. The emphasized (and conjunctive) language makes clear Harrison assigned not only her right to payments under the Restructured Annuity — which she could not do— but also her right to payments under the Settlement Agreement. As a result, the parties’ dispute condenses to whether Harrison had assignable rights under the Settlement Agreement.

2. The Settlement Agreement.

Harrison claims generieally that an annuitant lacking ownership rights in an annuity cannot effectuate the assignment of payments made under the annuity policy. She argues that because neither First Executive nor FL Assignments approved the Purchase Agreements, they are not enforceable. Harrison further argues that the Settlement Agreement barred her from assigning Periodic Payments. She argues that because the Settlement Agreement restricted her from having any “right of ownership in the annuity contract, [any] right to designate a beneficiary and [any] other right or control under the annuity contract whatsoever,” she could not assign payments she was eligible to receive under the Settlement Agreement.

Responding, Singer claims the Settlement Agreement does not prevent Harrison from assigning the right to receive Periodic Payments under the Settlement Agreement. It points out that under the Settlement Agreement, Harrison could not transfer ownership of the annuity required to fund the Periodic Payments but was not similarly restricted with respect to the payments the Settlement Agreement itself required. Singer contends that because it purchased the right to receive payments paid to Harrison under the Settlement Agreement, and not payments made under the annuities themselves, Harrison assigned an assignable right.

A Third Circuit opinion authored by then-judge Alito provides a useful analytical road-map to aid in untangling this situation. See W. Union Life Assurance Co. v. Hayden, 64 F.3d 833 (3d Cir.1995). There, the subject of an adversary proceeding filed by debtors in a bankruptcy proceeding was a transaction in which one of the debtors, “in return for a cash payment, purported to assign ... her right to receive certain future periodic payments.” Hayden, 64 F.3d at 834. Much like the Periodic Payments, the payments were made pursuant to a settlement agreement. See id. at 834-35. The debtors contended the periodic payments belonged to the bankruptcy estate because the transaction was not an effective assignment. Id. at 834.

After deciding the document signed by the debtor was an assignment and not a contract to make a future assignment — an issue not raised here — the court focused on whether the debtor had assignable rights under the annuity or the settlement agreement. Id. at 838. Focusing first on the annuity, the court held that the annuity’s owner, as here, had exclusive power to change the payee and direct payments. Id. As a result, the debtor and assignee could not assign those payments. Id. With respect to the settlement agreement, the assignee argued that because the agreement “created a right to receive the periodic payments, [the debtor] could assign this right to receive the payments.” Id. at 838-39. The debtor commented that “because the settlement agreement did not require more than the purchase of an annuity and because the annuity was purchased, [the debtor] did not have any remaining assignable rights under the agreement.” Id.

Finding ambiguity in the settlement agreement, the court turned to the “surrounding circumstances, the situation of the parties, and the objects they apparently have in view” to determine the parties’ intent. Id. Arguing that the debtor intended to enter into a structured settlement in accordance with provisions of the Internal Revenue Code triggering certain tax advantages, See supra note 2, the as-signee claimed the debtor was required to “retain a right to periodic payments under the settlement agreement,” Hayden, 64 F.3d at 839. The court agreed, concluding that “[t]he annuity [was] merely a convenient funding mechanism,” and did not alter the obligor’s “continuing obligation to pay the periodic payments to the recipient.” Id. at 841.

The same situation exists here with one twist: Royal Insurance and the Prices assigned their obligation to make the Periodic Payments to First Executive, which was then succeeded by FL Assignments. Under Hayden, FL Assignments maintains a continuing obligation to pay Harrison sums of money under the Settlement Agreement; the Restructured Annuity is merely a convenient way to fund that obligation. Harrison therefore possesses the right to receive payments required by the Settlement Agreement.

The Hayden court then considered whether the right to receive a stream of future payments was an assignable right. Id. at 841. One argument advanced mirrors that made here:

[The debtors] contend that the settlement agreement must be read together with the annuity contract and that a provision of the annuity contract prevents the assignment of [the debtor]’s rights under both that contract and the settlement agreement.

Id. at 842. Reading the annuity contract and the settlement agreement together, the court concluded the debtor could assign the right to receive payments. See Id. at 842-43. There, the annuity contract contemplated restricting involuntary assignments in attempts “to protect the payee from creditors by preventing them from attaching the annuity payments.” Id. at 843. However, the court concluded that even if the annuity contract prohibited the payee from voluntarily assigning the right to receive payments, that fact did not in turn imply that the debtor could not assign the right to receive payments under the settlement agreement. Id. The court held that the annuity’s anti-assignment language “plainly state[d] that it applie[d] to the annuity payments,” and no evidence was submitted that the “clause was intended also to apply to payments made under the settlement agreement.” Id. (quotation marks omitted). As a result, the court rejected the argument that the debtor’s right to receive payments under the settlement agreement was not assignable. Id.

The case at bar is analogous. Harrison claims her ability to assign the Periodic Payments is restricted by the Settlement Agreement. However, the provisions identified by Harrison only prevent her from claiming ownership in the annuity, from designating a beneficiary under the annuity, or from controlling the annuity. As in Hayden, this restriction was probably put in place to activate tax advantages available where an annuitant-payee lacks actual or constructive ownership of the annuity. Harrison has not pointed to evidence suggesting any clause of the Settlement Agreement, Annuity, or Restructured Annuity impeding her right to control or assign the annuity delimitated her ability to assign the right to receive payments under the Settlement Agreement. If the parties to the Settlement Agreement intended to prevent such transactions, they could have drafted language similar to that restricting Harrison’s ability to control the annuity.

As a result, many of the cases cited by Harrison are not particularly persuasive. E.g., Short v. Singer Asset Fin. Co., 107 Fed.Appx. 738, 739 (9th Cir.2004) (“find[ing] that the structured settlement’s anti-assignment clause deprived [the recipient of payments] of not only the right to make the assignment ..., but also the power to do so” because of “the plain language of the structured settlement’s anti-assignment clause, which expressly curtailed the recipient’s] ‘power’ to assign”); Liberty Life Assurance Co. of Boston v. Gilbert, No. 2:02-CV-341, 2006 WL 1211161, at *5 (E.D.Tenn. May 3, 2005) (concluding the recipient of payments under a settlement agreement lacked the power to assign payments where the agreement provided “that neither ‘the Plaintiff [nor] any Payee shall have the power to sell, mortgage, encumber, or anticipate Periodic Payments, or any part thereof, by assignment or otherwise’ ”); Singer Asset Fin. Co. v. Bachus, 294 A.D.2d 818, 741 N.Y.S.2d 618, 619-21 (N.Y.App.Div.2002) (where payments were “not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge or encumbrance” and that “no part of the payments ... [was] to be subject to execution or any legal process for any obligation in any manner, nor shall [the recipient] have the power to sell, mortgage, or encumber same, or any part thereof, nor anticipate the same, or any part thereof, by assignment or otherwise,” the recipient could not enter into a loan agreement where a bank acquired the recipient’s right to receive monthly annuity payments (quotation marks omitted; first alteration in the original)); see also In re Terry, 245 B.R. 422, 423-26 (Bankr. N.D.Ga.2000) (holding an assignment was valid even where a settlement agreement contained anti-assignment language because the recipient ignored the language to assign certain payments, making an attempted revival of the anti-assignment clause to aid the recipient in funding a bankruptcy plan “disingenuous and not supported by applicable law”). Here, the Settlement Agreement is not equipped with language prohibiting Harrison from assigning her right to payments to which she was entitled to receive under the Settlement Agreement.

Two additional cases cited by Harrison require a more focused discussion. In the first, the recipient of annuity payments executed an agreement wherein the recipient “agreed to execute, as sureties, [the recipient’s friend]’s bail bond” in exchange for the recipient agreeing to “irrevocably assign ... all of his right, title and interest to and in the ... annuity contract and proceeds due thereunder” up to and including the amount of the bond. Allstate Ins. Co. v. Am. Bankers Ins. Co. of Fla., 882 F.2d 856, 858 (4th Cir.1989) (quotation marks omitted; second omission in the original). The recipient’s friend failed to appear, resulting in forfeiture of the bond. Id. at 859. Demand for reimbursement was then made upon the annuitant and the annuity’s owner. See id. The annuitant initiated an action seeking rescission of the assignment, arguing it was not a valid assignment. Id. Noting first that the recipient had no ownership rights in the annuity, the court held that the annuitant “could not lawfully assign” it. Id.

The court next considered whether the annuitant could have assigned his “rights to receive ... the annuity payments that were to become payable to him in the future ...; [whether] those rights constituted an interest of his which was lawfully assignable; and [whether] the assignment operated to transfer those rights.Id. at 860. There, unlike here, the assignee asked the court to specifically enforce the purported assignment against the annuity owner and payment obligor. Id. The court held that specifically enforcing the assignment would be “inequitable and unjust specifically to enforce the assignment” because the party seeking specific enforcement executed the purported assignment after having been told by an agent of the annuity’s owner that the annuitant’s “interests therein were not assignable.” Id.

Allstate Insurance is distinguishable in at least two respects. Most obviously, the recipient of the annuity payments there sought to assign the annuity itself. Id. at 859-60. That is not what Harrison did here; she also assigned her right to receive payments under the Settlement Agreement. Second, the Allstate Insurance court endorsed the lower court’s refusal to specifically enforce the attempted assignment because “equity would not decree specific performance of a contract that is founded in fraud, imposition, mistake, undue advantage, or gross misrepresentation, or where ... it would be un-conscientious to enforce it.” Id. at 860 (quotation marks omitted). Harrison does not press those principles here. Instead of relying on equitable principles to specifically enforce the Purchase Agreements, she argues the transactions embodied in the Purchase Agreements are barred by the Settlement Agreement. The two situations are very different.

In the second case, Grieve v. General American Life Insurance Co., a plaintiff and her mother entered into a structured settlement agreement with the insurance carrier of the operator of a bicycle upon which the plaintiff was riding when she was injured. Grieve v. Gen. Am. Life Ins. Co., 58 F.Supp.2d 319, 320 (D.Vt.1999). The plaintiff was a minor when she was injured but had reached majority age when the structured settlement agreement was executed. Id. at 319-20. The settlement agreement specifically provided that periodic payments made thereunder could not “be accelerated, deferred, increased or decreased by [the plaintiff] or any Payee; nor [could the plaintiff] or any Payee have the power to sell, mortgage, encumber, or anticipate the periodic payments, or any part thereof, by assignment or otherwise.” Id. at 321 (quotation marks omitted). The insurance company made a qualified assignment of its obligation to make payments under the settlement agreement. Id. The new obligor funded the payments through the purchase of an annuity policy. Id.

The qualified assignment contained the proviso that no periodic payments could be “accelerated, deferred, increased or decreased, nor [could any payments be] anticipated, sold, assigned or encumbered.” Id. (quotation marks omitted). The annuity policy established that the plaintiff did not own the annuity, had no ownership rights under the contract, and could not “assign or otherwise use it as collateral.” Id. The policy further provided that “[n]o amounts payable under [the] contract to a payee other than [the contract owner] may be assigned by that payee.” Id. (first and third alterations in the original; quotation marks omitted).

Several years later, the plaintiffs financial situation worsened. Id. She contemplated entering into purchase agreements similar to those here with Singer Asset Financial Company — the same entity involved in this case — wherein she agreed to “give up” some future payments for an immediate lump sum. Id. The plaintiff requested that the address to which payments were sent be changed to a New York post office box. Id. As a condition of the address change, the plaintiff was asked to execute an affidavit stating that she was not assigning any rights under the annuity. Id. Instead of executing the affidavit, the plaintiff filed a complaint for declaratory relief, demanding that the annuity’s owner and issuer honor her assignment to Singer. Id.

The purchase agreements were never finalized. Id. After initiating her lawsuit, the plaintiff and Singer entered into a “loan agreement” where the plaintiff received a sum from a bank through a loan which would be assigned to Singer. Id. In exchange, Singer received a series of future payments. Id.

The annuity owner and issuer claimed the settlement agreement, qualified assignment, and annuity policy all prohibited the plaintiff from selling or assigning her right to payments under the settlement agreement, that such assignments were barred by law, and that public policy rejected the sale or assignment of periodic payments from structured settlement agreements. Id. at 322. The plaintiff claimed any restrictions on the sale or assignment of the periodic payments were non-enforceable. Id.

The court first concluded that the “prohibitions of assignment [were] valid, enforceable terms,” primarily in reliance on Vermont’s version of Article 9 of the Uniform Commercial Code. See id. at 323-24. Harrison has elected not to present an argument based on the details of Article 9. Instead, Harrison points to the Grieve court’s alternative holding: that the sale of proceeds of structured settlement agreements on the record before it violated public policy. Id. at 324. The court wrote,

[The plaintiff] is currently in substantial financial need. The Court is asked to enforce a transaction which will place her in significantly greater financial need, by cutting her income stream in half for the next fifteen years. [The plaintiff], like any other citizen is free to make agreements which this Court might deem unwise. But this Court will not lend its approval to the voiding of unambiguous, bargained-for contract terms in order to enable Singer to profit, at an exorbitant rate of interest, from [the plaintiffl’s financial distress.

Id. Unfortunately for Harrison, the two pillars of the court’s analysis — a high interest rate resulting from a secondary loan agreement and multiple instances of clear anti-assignment language — are absent here. Grieve is therefore distinguishable and the policy argument less compelling.

The parties have identified nothing in the Settlement Agreement or Restructured Annuity preventing Harrison from assigning her right to receive payments under the Settlement Agreement. The Court must conclude the Purchase Agreements memorialized transactions not barred by the Settlement Agreement.

3. Nevada Law.

Because the Settlement Agreement itself did not prevent Harrison from assigning her right to receive Periodic Payments, the next issue is whether Nevada law otherwise restricted her from taking that action. Nevada law applies because the assignable right — entitlement to the Periodic Payments — was created by a contract governed by Nevada law. The Court invited Harrison to present at oral argument any provision in Nevada law restricting her freedom to assign portions of the Settlement Agreement. She identified none. Singer, however, cites one case, Wood v. Chicago Title Agency of Las Vegas, Inc., 109 Nev. 70, 847 P.2d 738 (1993), for the proposition that a payee in Harrison’s position may assign the right to receive money due under a settlement agreement under Nevada law.

Wood has little in common with the case at bar. There, Chicago Title Agency of Las Vegas, Inc., held money in escrow which was the subject of litigation between Robert Chapman and Dasco, Inc. Wood, 847 P.2d at 739. Chapman executed a promissory note to Warren Wood, which was payable on or before settlement of Chapman’s litigation with Dasco. Id. Chapman then assigned his interest in the escrow account to Wood. Id. Wood notified Chicago Title of the assignment. Id. A court order following a stipulated settlement agreement between Chapman and Dasco authorized Chicago Title to release a portion of the funds held in escrow to Chapman. Id. The order also further directed Chapman to pay assignments or liens filed as a result his litigation with Dasco. Id. Chapman’s attorney presented Chicago Title with a copy of the order, but Chicago Title did not pay Wood as directed by Chapman’s assignment. Id. Wood subsequently filed a lawsuit against Chicago Title; Chicago Title filed a third-party complaint against Chapman for indemnification. Id. At issue was whether the order following the stipulated settlement excused Chicago Title — the obligor — from honoring the contractual obligation in favor of the assignee — Wood—where neither Wood nor Chicago Title was before the court entering the order. Id.

The issue here is entirely different. In Wood, the parties did not contest whether the assignee could assign the portion of the account to which he was entitled. The issue was whether the obligor was excused of its obligation to render payment to the assignee under the circumstances of that case.

The parties have identified no provision under Nevada law which would bar the transactions embodied in the Settlement Agreements. As a result, the Court con-eludes Nevada law poses no independent barrier to Singer’s enforcement of the provisions they contain.

4. Conclusion.

Harrison’s claim that the Settlement Agreement and Restructured Annuity prevented her from assigning the Periodic Payments fails. And because the Purchase Agreements effected transactions not prevented by the Settlement Agreement, the Restructured Annuity, or Nevada law, each basis — excepting public policy considerations — upon which Harrison’s cross-claim rests must also fail. The Court is compelled to conclude the Purchase Agreements are valid, enforceable contracts not voided or otherwise invalidated by the Settlement Agreement, the Restructured Annuity, or Nevada law.

D. Public Policy Considerations.

Harrison alternatively argues that the Court should rescind the Purchase Agreements because their enforcement would “violate the intent of the Settlement Agreement and ignore the doctrine of equity.” Harrison claims “public policy favors the prohibition of assigning structured settlement payments, as opposed to the factoring of such payments, which strips structured settlements of their very purpose.” The parties agree that Iowa law applies to this issue.

Other than repeating that the Purchase Agreements should be invalidated as against public policy, Harrison does not identify a legal reason for rescinding the Purchase Agreements. As a result, the Court concludes Harrison seeks to have the Purchase Agreements declared unenforceable on public policy grounds and does not seek rescission. In her Reply, Harrison identifies the Iowa Structured Settlement Agreement Protection Act, Iowa Code ch. 682 (2006), as indicative of a public policy against the assignment of proceeds of structured settlements. As a result, Harrison argues, the Court should invalidate the Purchase Agreements.

Applicable to transfers of structured settlement payment rights occurring on or after July 31, 2001, id. § 682.7(4), the Iowa Structured Settlement Protection Act wove procedural and substantive safety nets applicable to those wishing to assign or sell rights created by structured settlement agreements. The Act reads, in relevant part,

1. A transfer of structured settlement payment rights shall not be effective and a structured settlement obligor or annuity issuer shall not be required to make any payment directly or indirectly to a transferee of structured settlement payment rights unless the transfer has been approved in advance in a final court order or order of a responsible administrative authority based on express findings by such court or responsible administrative authority regarding all of the following:

a. The transfer is in the best interest of the payee, taking into account the welfare and support of the payee’s dependents.

b. The payee has been advised in writing by the transferee to seek independent professional advice regarding the transfer and has either received such advice or knowingly waived such advice in writing.

c. The transfer does not contravene any applicable statute or the order of any court or other government authority.

Id. § 682.4(1). If the Purchase Agreements were executed today, approval by a “court or responsible administrative authority” would be required before the transfer envisioned by the Purchase Agreements would become effective. See id. While Harrison concedes this Act “does not apply to [her] case,” she argues that “its eventual enactment must be recognized by this Court as indicative of Iowa public policy.” As a result, Harrison argues, the Purchase Agreements should not be enforced.

1. Applicable Legal Principles.

Under Iowa law, a contract contravening public policy will not be enforced. Walker v. Gribble, 689 N.W.2d 104, 110 (Iowa 2004) (collecting cases); Rogers v. Webb, 558 N.W.2d 155, 156-57 (Iowa 1997) (collecting cases); Walker v. Am. Family Mut. Ins. Co., 340 N.W.2d 599, 601 (Iowa 1983); Wunschel Law Firm, P.C. v. Clabaugh, 291 N.W.2d 331, 335 (Iowa 1980) (collecting cases); Rowen v. Le Mars Mut. Ins. Co. of Iowa, 282 N.W.2d 639, 650 (Iowa 1979) (collecting cases); See Harvey v. Care Initiatives, Inc., 634 N.W.2d 681, 684 & n. 4 (Iowa 2001) (concluding that the tort of discharge in violation of public policy did not extend to protect independent contractors who have available to them contract remedies unavailable to at-will employees including, inter alia, the ability to void a contract if it is in violation of public policy). If a contract “ ‘tends to be injurious to the public or contrary to the public good,’ ” it ought not be enforced. Walker v. Gribble, 689 N.W.2d at 111 (quoting Rogers, 558 N.W.2d at 157).

Exercising caution before excising terms from a contract on public policy grounds is required because courts must balance the identified public policy against a strong policy in favor of parties’ freedom to contract. This is a patently high standard. “Before striking down a contract for public policy reasons, it must be shown that the preservation of the general public welfare outweighs the weighty societal interest in the freedom of contract.” Walker v. Gribble, 689 N.W.2d at 111; accord Grinnell Mut. Reinsurance Co. v. Jungling, 654 N.W.2d 530, 540 (Iowa 2002); Shelter Gen. Ins. Co. v. Lincoln, 590 N.W.2d 726, 730 (Iowa 1999); Rogers, 558 N.W.2d at 157; Walker v. Am. Family Mut. Ins. Co., 340 N.W.2d at 601; see also DeVetter v. Principal Mut. Life Ins. Co., 516 N.W.2d 792, 794 (Iowa 1994) (Only if “the preservation of the general public welfare imperatively so demands invalidation so as to outweigh the weighty societal interest in the freedom of contract” may a court invalidate a contract on public policy grounds.). The balance must be so one-sided that the “power to invalidate a contract on public policy grounds must be used ... only in cases free from doubt.” DeVetter, 516 N.W.2d at 794 (citing Walker v. Am. Family Mut. Ins. Co., 340 N.W.2d at 601); accord Grinnell Mut. Reinsurance Co., 654 N.W.2d at 540; Shelter Gen. Ins. Co., 590 N.W.2d at 730; Rogers, 558 N.W.2d at 157; Wunschel Law Firm, P.C., 291 N.W.2d at 335. In more anthropomorphic terms, “ ‘[t]here is a certain danger in too freely invalidating private contracts on the basis of public policy.... [F]or a court to undertake to invalidate private contracts upon the ground of ‘public policy’ is to mount a very unruly horse, and when you once get astride it, you never know where it will carry you.’ ” Jungling, 654 N.W.2d at 540 (quoting Skyline Harvestore Sys., Inc. v. Centennial Ins. Co., 331 N.W.2d 106, 109 (Iowa 1983)) (quotation marks omitted).

While the term “public policy” is not easily defined, the thrust of the term “is quite clear: ‘a court ought not enforce a contract which tends to be injurious to the public or contrary to the public good.’ ” Rogers, 558 N.W.2d at 157 (quoting Walker v. Am. Family Mut. Ins. Co., 340 N.W.2d at 601). Legislative pronouncements and judicial decisions can be reliable sources of public policy. See, e.g., Walker v. Am. Family Mut. Ins. Co., 340 N.W.2d at 601-03; see also Restatement (Second) of Contracts § 178(1) (1981) (“A promise or other term of an agreement is unenforceable on grounds of public policy if legislation provides that it is unenforceable or the interest in its enforcement is clearly outweighed in the circumstances by a public policy against the enforcement of such terms.” (quoted in Mincks Agri Ctr., Inc. v. Bell Farms, Inc., 611 N.W.2d 270, 275 (Iowa 2000); cited in Rogers, 558 N.W.2d at 157)). Proof that the contract caused a “feared evil” is unnecessary; a tendency to have the feared result is enough. Rogers, 558 N.W.2d at 157 (discussing Wunschel Law Firm, P.C., 291 N.W.2d at 335).

2. Analysis.

A series of Iowa cases stands for the proposition that a contract should be invalidated on public policy grounds if it violates a regulatory statute in existence at the time the contract was