Judge: Kerry Bensinger, Case: 23STCP03743, Date: 2023-11-07 Tentative Ruling
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Case Number: 23STCP03743 Hearing Date: November 7, 2023 Dept: 31
Tentative Ruling
Judge Kerry Bensinger, Department 31
HEARING DATE: November
7, 2023 TRIAL
DATE: N/A
CASE: J.G. Wentworth Originations, LLC v. Sean Daniels
CASE NO.: 23STCP03743
PETITION
FOR APPROVAL FOR TRANSFER OF PAYMENT RIGHTS
MOVING PARTY: Petitioner
J.G. Wentworth Originations, LLC
RESPONDING PARTY: No opposition
I. BACKGROUND
Payee, Sean Daniels, received a structured settlement in 2004
arising out of a personal injury claim. Payee is now 34 years old and wishes to use
the proceeds from his payment to pay off debts and secure housing.
Petitioner,
J.G. Wentworth Originations, LLC, now moves for approval of the transfer of certain
structured settlement payment rights by Payee to Petitioner and/or its assigns.
II. LEGAL STANDARD
This
Petition is governed by Insurance Code sections 10134–10139.5. (See also 321 Henderson Receivables
Origination LLC v. Sioteco (2009) 173 Cal.App.4th 1059, 1066.) Under Insurance Code section 10137, a transfer
of structured settlement payment rights is void unless a court reviews and
approves the transfer and finds the following conditions are met:
(a) The
transfer of the structured settlement payment rights is fair and reasonable and
in the best interest of the payee, taking into account the welfare and support
of his or her dependents.
(b) The
transfer complies with the requirements of this article, will not contravene
other applicable law, and the court has reviewed and approved the transfer as
provided in Section 10139.5.
Pursuant to
Insurance Code section 10139.5, subdivision (a), the Court must make the
following express findings as to a transfer of structured settlement payment
rights:
(1) The
transfer is in the best interest of the payee, taking into account the welfare
and support of the payee's dependents.
(2) The
payee has been advised in writing by the transferee to seek independent
professional advice regarding the transfer and has either received that advice
or knowingly waived that advice in writing.
(3) The
Petitioner has complied with the notification requirements pursuant to
Insurance Code section 10139.5, subdivision (f)(2), and transferee has provided
the payee with a disclosure form that complies with Section 10136 and the
transfer agreement complies with sections 10136 and 10138.
(4) The
transfer does not contravene any applicable statute or the order of any court
or other government authority.
(5) The
payee reasonably understands the terms of the transfer agreement, including the
terms set forth in the disclosure statement required by Section 10136.
(6) The
payee reasonably understands and does not wish to exercise the payee's right to
cancel the transfer agreement.
The
transfer agreement is effective only upon approval in a final court order. (Ins. Code, § 10139.5, subd. (a).)
When
determining whether the proposed transfer should be approved, including whether
the transfer is fair, reasonable, and in the payee’s best interest, the Court
shall consider the totality of the circumstances, including, but not limited
to:
(1) the
reasonable preference and desire of the payee to complete the proposed
transaction, taking into account the payee’s age, mental capacity, legal
knowledge, and apparent maturity level;
(2) the
stated purpose of the transfer;
(3) the
payee’s financial and economic situation;
(4) the
terms of the transaction, including whether the payee is transferring monthly
or lump sum payments or all or a portion of his or her future payments;
(5) whether
the future periodic payments were intended to pay for future medical care of
the payee related to the incident that was the subject of the settlement;
(6) whether
the payee has other means of income or support sufficient to meet the payee’s
future financial obligations for support of payee’s dependents, such as child
support;
(7) whether
there were previous transactions involving payee’s structured settlement
payments; and
(8) whether
the payee and his or her dependents are facing a hardship situation.
(Ins. Code, § 10139.5, subd. (b).)
Procedurally,
Insurance Code section 10136, subdivision (b) provides that ten or more days
before the payee executes a transfer agreement, the transferee shall provide
the payee with a separate written disclosure statement, accurately completed
with the information that applies to the transfer agreement in at least
12-point type. The Court-approval
process requires the transferee to file a petition in the county in which the
transferor resides for approval of the transfer. (Ins. Code, § 10139.5, subd. (f)(1).)
Further, at
the time of filing such a petition, the transferee shall file a copy of the
petition with the California Attorney General. (Ins. Code, § 10139.) Lastly, the Court shall retain continuing
jurisdiction to interpret and monitor the implementation of the transfer
agreement as justice requires. (Id.,
§ 10139.5, subd. (i).)
III. DISCUSSION
The Petition cannot be approved. Insurance Code section 10139.5, subdivision
(f)(2), provides that “[n]ot less than 20 days prior to the scheduled hearing
on any petition for approval of a transfer of structured settlement payment
rights under this article, the transferee shall file with the court and serve
on all interested parties a notice of the proposed transfer and the petition
for its authorization.” (Id.)
Here, Petitioner did not provide the Court with proof that Notice
and the petition was served on the California Attorney General as required by
Insurance Code section 10139.
Second, there is no evidence that Petitioner provided notice
to Payee’s attorney of record (who was counsel at the time the structured
settlement was created) in compliance with Insurance Code section 10139.5,
subdivision (f)(2)(L).
Notwithstanding the foregoing defects, the Court makes the
following findings and observations.
Insurance Code section 10139.5, subdivision (a)
Insurance
Code section 10139.5 provides that a direct or indirect transfer of structured
settlement payment rights is not effective unless the transfer has been
approved in a final court order based on certain express written findings by
the Court. (Ins. Code, § 10139.5, subd. (a)(1)-(6).) Upon review of the Petition,
the Court hereby makes the following findings:
Insurance
Code section 10139.5, subdivision (b)
When
determining whether the proposed transfer should be approved, including whether
the transfer is fair, reasonable, and in the payee’s best interest, the Court
shall consider the totality of the circumstances:
Here, Payee
states that he is 34 years old, unmarried, without children, and currently
unemployed (Daniels Decl., ¶ 8.) He further states that he is experiencing
financial hardship. Approval of this Petition
will allow him to pay off debts accrued in the last 6 months in connection with
housing, transportation, medical bills, travel expenses, and credit card
bills. (Id., ¶ 25.) Specifically, the settlement proceeds will
help Payee furnish and cover rent for his apartment for the next six months,
during which period he will search for employment. (Id.)
Payee has initiated at least fifteen prior transactions involving his
structured settlement payments. (Id. ¶
9-24.)
Insurance
Code section 10139.5, subdivision (c)(1)
Petitioner
complies with the venue requirement under Insurance Code section 10139.5,
subdivision (c)(1), as Payee resides in the County of Los Angeles. (Daniels Decl., ¶ 8.)
Insurance Code section
10139.5, subdivision (f)(2)
The requirements of Insurance Code section
10139.5, subdivision (f)(2) and Petitioner’s compliance therewith are listed
below:
(A) A copy
of the transferee’s current and any prior petitions. (See Daniels Decl., ¶¶ 9-24.)
(B) A copy
of the transfer agreement. (See Amended Exh.
A.)
(C) A
listing of each of the Payee’s dependents, together with each dependent's age.
(See Daniels Decl., ¶ 8.)
(D) A copy
of the disclosure required in subdivision (b) of section 10136. (See Exh. B.)
(E) A copy
of the annuity contract. (Exh. C.)
(F) A copy
of any qualified assignment agreement. (Exh.
C.)
(G) A copy
of the underlying structured settlement agreement. (Exh. C.)
(H) If a
copy of a document described in subparagraph (E), (F), or (G) is unavailable or
cannot be located, then the transferee is not required to attach a copy of that
document to the petition or notice of the proposed transfer if the transferee
satisfies the court that
reasonable
efforts to locate and secure a copy of the document have been made, including
making inquiry with the payee. If the documents are available, but contain a
confidentiality or nondisclosure provision, then the transferee shall summarize
in the petition the payments due and owing to the payee, and, if requested by
the court, shall provide copies of the documents to the court at a scheduled
hearing. (Not applicable.)
(I) Proof of
service showing compliance with the notification requirements of this section. (Filed October 12, 2023.)
(J)
Notification that any interested party is entitled to support, oppose, or
otherwise respond to the transferee's petition, either in person or by counsel,
by submitting written comments to the court or by participating in the hearing.
(See Notice of Hearing, p. 2:9-11.)
(K)
Notification of the time and place of the hearing and notification of the
manner in which and the time by which written responses to the petition must be
filed, which may not be less than 15 days after service of the transferee’s
notice, in order to be considered by the court. (See Notice of Hearing.)
IV. CONCLUSION
Based on the foregoing, J.G. Wentworth, LLC’s Petition for
Approval of Transfer of Payment Rights is CONTINUED to December 1, 2023 at 8:30
AM. Petitioner is to file an amended
Petition addressing the defects noted in this order no later than 5 court days
before the hearing.
Petitioner to give notice of this ruling.
Dated: November 7,
2023 ___________________________________
Kerry
Bensinger
Judge
of the Superior Court