Judge: Robert B. Broadbelt, Case: 22STCP03843, Date: 2022-12-16 Tentative Ruling

Case Number: 22STCP03843    Hearing Date: December 16, 2022    Dept: 53

Superior Court of California

County of Los Angeles – Central District

Department 53

MOVING PARTY:                Petitioner J.G. Wentworth Originations, LLC

RESPONDING PARTY:       n/a

First Amended Verified Petition for Approval for Transfer of Payment Rights

The court considered the first amended verified uncontested petition.  No response to the petition was filed.  

Background

Claimant Allan Jimenez (“Jimenez”) settled a personal injury lawsuit in or about 2011.  (First Amended Petition filed November 21, 2022 (“Pet.”), ¶ 3.)  The settlement provides for periodic structured payments.  (Pet., ¶ 4.)  Jimenez has agreed to sell, and petitioner J.G. Wentworth Originations, LLC (“Petitioner”) has agreed to purchase, a lump sum payment of $85,000, to be paid on February 1, 2025.  (Pet., ¶¶ 4, 7.)  

Petitioner submits the California Purchase Contract as Exhibit A to its Petition.  The California Purchase Contract states that Petitioner has agreed to purchase, and Jimenez has agreed to sell, Jimenez’s interest in the single payment of $85,000, to be paid on February 1, 2025.  (Pet., Ex. A, California Purchase Contract, ¶¶ 2, 10.)  Jimenez will receive $55,000 in exchange for the transfer of the payment described above.  (Pet., Ex. A, California Purchase Contract, ¶ 10.)  On December 8, 2022, Petitioner filed an amended Exhibit A, reflecting an amended California Purchase Contract.  The material terms are the same; Jimenez has agreed to sell to Petitioner his interest in the single payment of $85,000, to be paid on February 1, 2025, in exchange for $55,000.  (Amended Exhibit A to Pet., filed December 8, 2022, ¶¶ 2, 10.)  The Amended California Purchase Contract was signed by Jimenez on December 1, 2022.  (Id., at p. 12.)

Petitioner now seeks court approval of the agreement pursuant to Insurance Code section 10134 et seq.

Legal Standard

“A direct or indirect transfer of structured settlement payment rights is not effective and a structured settlement obligor or annuity issuer is not required to make any payment directly or indirectly to any transferee of structured settlement payment rights” unless the court approves the transfer in advance.  (Ins. Code, § 10139.5, subd. (a).)  To approve the settlement, the court must make express written findings that:

(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, in writing, the opportunity to receive the advice.

(3) The transferee has complied with the notification requirements pursuant to paragraph (2) of subdivision (f), the 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 understands the terms of the transfer agreement, including the terms set forth in the disclosure statement required by Section 10136.

(6) The payee understands and does not wish to exercise the payee’s right to cancel the transfer agreement.

(Ins. Code, § 10139.5, subd. (a)(1)-(6).) 

“When determining whether the proposed transfer should be approved, including whether the transfer is fair, reasonable, and in the payee’s best interest, taking into account the welfare and support of the payee’s dependents, the court shall consider the totality of the circumstances,” including the 15 circumstances set forth in Insurance Code § 10139.5, subdivision (b)(1)-(15).

DISCUSSION

Based on the petition and the evidence presented in support of it, the court finds and orders as follows.

First, the court finds that the transfer is in the best interest of the payee.  Jimenez states that he is experiencing a financial hardship, and that he intends to use the funds received from this transfer to pay for college credits and living costs while he is enrolled in school full time.  (Jimenez Decl., ¶ 11.)  Jimenez is not married, has no minor children, and does not have any court-ordered child support obligations.  (Jimenez Decl., ¶ 8.)  In light of these facts, the court finds the amended purchase contract to be in the payee’s best interests.

Second, the court finds that Jimenez “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, in writing, the opportunity to receive the advice.”  (Ins. Code, § 10139.5, subd. (a)(2).)  Petitioner submits a copy of the form entitled “Statement of Professional Representation,” which (1) states that the signee has been advised by Petitioner that he should obtain independent professional representation concerning the implications of the transaction, and that the signee understands the purchase agreement and the effects thereof and does not wish to seek out such independent professional representation, and (2) was signed by Jimenez on October 18, 2022.  (Pet., Ex. E, § A; Jimenez Decl., ¶¶ 12-13.) 

Third, the court finds that “[t]he transferee has complied with the notification requirements pursuant to paragraph (2) of subdivision (f), the transferee has provided the payee with a disclosure form that complies with Section 10136, and the transfer agreement complies with Sections 10136 and 10138.”  (Ins. Code, § 10139.5, subd. (a)(3).) 

Insurance Code section 10139.5, subdivision (f)(2) requires Petitioner to file and serve, not less than 20 days before the hearing on a petition for approval of a transfer of payment rights, a notice of the proposed transfer and the petition for its authorization, a copy of the proposed transfer agreement, a listing of each of the payee’s dependents, disclosures as required by section 10136, and, if available, copies of the annuity contract, any qualified assignment agreement, and the underlying structured settlement agreement.  Petitioner filed a Proof of Service establishing that Petitioner served Jimenez, the annuity issuer, and annuity obligor with its notice of hearing, verified petition, verified first amended petition, and declaration of Jimenez on November 21, 2022.  Petitioner has also served those parties with the Amended Exhibit “A” (i.e., the amended California Purchase Contract) filed on December 8, 2022, which, as set forth above, includes terms that are essentially the same as the original contract. 

The court notes that the First Amended Petition states that Petitioner was in the process of obtaining a copy of (1) the annuity contract, and (2) any qualified assignment agreement.  (Pet., p. 5:17-18; Pet., Ex. C.)  Petitioner has not submitted a copy of an annuity contract or a qualified assignment agreement; however, submission of those files is required only “if available.”  (Ins. Code, § 10139.5, subds. (f)(2)(E), (f)(2)(F).)  The court therefore finds that Petitioner has substantially complied with the notification requirements.

Section 10136 requires that the transfer agreement include certain information and have certain qualities, including that it be written in 12-point type, state it will not be effective until a court enters a final order approving it and that payment can be delayed, and set forth certain information, including the net amount to be paid to the payee.  (Ins. Code, § 10136, subd. (c).)  Section 10138 includes additional requirements, including that a transfer agreement cannot waive the seller/payee’s right to sue, require the seller/payee to indemnify the buyer, or require the seller/payee to pay the buyer’s attorneys’ fees and costs.   (Ins. Code, § 10138, subd. (a).)   

The court finds that Petitioner has served Jimenez with a disclosure form that complies with section 10136.  (Pet., Ex. B.)  The court further finds that the transfer agreement complies with the statutory requirements.  (Amended Ex. A, California Purchase Contract.)

            Fourth, the court finds that the transfer does not contravene any applicable statute or the order of any court or other government authority.

Fifth, the court finds that the payee understands the terms of the transfer agreement, including the terms set forth in the disclosure statement required by section 10136.  (Jimenez Decl., ¶ 13.)

Sixth, the court finds that the payee understands and does not wish to exercise his right to cancel the transfer agreement.  (Jimenez Decl., ¶ 14.)

Based on the findings set forth above, and after considering the circumstances set forth in Insurance Code section 10139.5, subdivision (b)(1)-(15) and Jimenez’s supporting declaration, the court determines that the proposed transfer of the structured settlement payment right should be approved and that the transfer is fair, reasonable, and in the payee’s best interest.

ORDER

The court grants petitioner J.G. Wentworth Originations, LLC’s petition for approval for transfer of payment rights.

The court orders that the transfer of the structured settlement payment right set forth in the California Purchase Contract, filed as “Amended Exhibit ‘A’ to First Amended Petition for Approval for Transfer of Payment Rights” on December 8, 2022, is approved.

The court orders petitioner J.G. Wentworth Originations, LLC to give notice of this order.

IT IS SO ORDERED.

DATED:  December 16, 2022

_____________________________

Robert B. Broadbelt III

Judge of the Superior Court