Judge: Robert B. Broadbelt, Case: 23STCP00240, Date: 2023-03-17 Tentative Ruling

Case Number: 23STCP00240    Hearing Date: March 17, 2023    Dept: 53

Superior Court of California

County of Los Angeles – Central District

Department 53

MOVING PARTY:                 Petitioner Peachtree Settlement Funding, LLC         

RESPONDING PARTY:       Unopposed

Amended Verified Petition for Approval for Transfer of Payment Rights

The court considered the moving papers filed in connection with this petition.  No opposition papers were filed.

BACKGROUND

Claimant Vontae Dexter (“Dexter”), by and through their Guardian ad Litem, settled a wrongful death action on or about July 27, 2007.  (Amended Petition filed February 17, 2023 (“Pet.”), ¶ 3.)  Dexter has agreed to sell, and petitioner Peachtree Settlement Funding, LLC (“Petitioner”) has agreed to purchase, future payment rights to (1) 27 monthly payments of $1,500 each, beginning on April 1, 2023 and ending on June 1, 2025, and (2) 1 payment of $125,000 on October 19, 2041.  (Pet., ¶ 4; Pet., Ex. A, Purchase Contract (California), ¶ 2, subd. (B).)  Dexter will receive $49,115.00 in exchange for the transfer of the payment rights described above.  (Pet., Ex. A, Purchase Contract, ¶ 11.)

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 Dexter, the payee.  (Ins. Code, § 10139.5, subd. (a)(1).)  Dexter submits that the agreement is in their best interest because Dexter is experiencing a financial hardship.  (Dexter Decl., ¶ 11.)  Dexter is not married and has no minor children.  (Dexter ¶ 8.)  Dexter is currently unemployed.  (Ibid.)  If approved, Dexter will use the funds to reopen their own business as a tow truck operator.  (Dexter Decl., ¶ 11.)  Specifically, Dexter will use the funds to purchase another truck and reopen the business Dexter had operated previously.  (Ibid.)

Second, the court finds that Dexter has been advised in writing by Petitioner to seek independent professional advice regarding the transfer, and that Dexter has knowingly waived, in writing, the opportunity to receive the advice.  (Ins. Code, § 10139.5, subd. (a)(2).)  Petitioner has submitted a copy of the form entitled “California [¶] Statement of Professional Representation,” which (1) states that the signee (i) has been advised that they should obtain independent professional representation concerning the legal, tax, and/or financial implications of the transaction, and (ii) understands the purchase agreement and the effects of the transaction and does not wish to seek out such representation, and (2) was signed by Dexter on December 20, 2022.  (Pet., Ex. E.)

Third, the court finds that Petitioner has complied with the notification requirements pursuant to paragraph (2) of subdivision (f), that Petitioner has provided Dexter with a disclosure form that complies with Section 10136, and the purchase 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.

On February 1, 2023, Petitioner filed a Proof of Service establishing that Petitioner served Dexter, the annuity issuer, and the annuity obligor with the notice of hearing on the petition, the original verified petition, and other case management documents.  On February 17, 2023, Petitioner attached a Proof of Service to its Amended Petition establishing that Dexter, the annuity issuer, and the annuity obligor were served with the amended petition.  The amended petition includes copies of the Purchase Contract, California Disclosure Statement, annuity contract, original settlement agreement, and Statement of Professional Representation.  (Pet., Exs. A-E.)  Petitioner also filed Proofs of Service establishing service on the annuity issuer and annuity obligor of the “Declaration of Payee in Support of Petitioner’s Petitioner for Approval for Transfer of Payment Rights” and the “Notice of Submission of Proof of Use of Funds in Support of Declaration in Support of Petitioner’s Petitioner for Approval for Transfer of Payment Rights.”  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).)¿¿¿Petitioner has submitted a copy of the form entitled “California Disclosure Statement,” which is signed by Dexter.  (Pet., Ex. B.)  The court finds that the disclosure statement complies with Section 10136.  The court further finds that the purchase agreement complies with Sections 10136 and 10138.  (Pet., Ex. A, 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.  (Ins. Code, § 10139.5, subd. (a)(4).)

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

Sixth, the court finds that Dexter understands and does not wish to exercise their right to cancel the transfer agreement.  (Dexter 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)-(b)(15), and Dexter’s supporting declaration and evidence submitted in support of the declaration, the court finds that the proposed transfer of the structured settlement payment rights should be approved and that the transfer is fair, reasonable, and in the payee’s best interest.

ORDER

The court grants petitioner Peachtree Settlement Funding, LLC’s Amended Verified Petition for Approval for Transfer of Payment Rights.

The court orders that the transfer of structured settlement payment rights set forth in the Purchase Contract (California), attached as Exhibit “A” to the Amended Verified Petition for Approval for Transfer of Payment Rights filed by petitioner Peachtree Settlement Funding, LLC on February 17, 2023, is approved.

This order shall constitute a final “Qualified Order” pursuant to 26 U.S.C. section 5891.

The court orders petitioner Peachtree Settlement Funding, LLC to give notice of this ruling.

IT IS SO ORDERED.

DATED:  March 17, 2023

_____________________________

Robert B. Broadbelt III

Judge of the Superior Court