Judge: Theresa M. Traber, Case: 25STCP00413, Date: 2025-04-18 Tentative Ruling

Case Number: 25STCP00413    Hearing Date: April 18, 2025    Dept: 47

Tentative Ruling

Judge Theresa M. Traber, Department 47

HEARING DATE:     April 18, 2025                        TRIAL DATE: NOT SET

CASE:                         Nobility Settlement Funding, LLC v. L.G.

CASE NO.:                 25STCP00413           

PETITION FOR APPROVAL OF TRANSFER OF STRUCTURED SETTLEMENT PAYMENT RIGHTS

MOVING PARTY:               Petitioner Nobility Settlement Funding, LLC

RESPONDING PARTY(S): No response on eCourt as of April 15, 2025

CASE HISTORY:

·         02/03/25: Petition filed.

·         03/24/25: First Amended Petition filed.

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

            Petitioner seeks court approval of a proposed transfer of structured settlement payments.  

TENTATIVE RULING:

Petitioner seeks court approval of a proposed transfer of structured settlement payments.  

A direct or indirect transfer of structured settlement payment rights is not effective unless the transfer has been approved by a court order finding:  

(1) The transfer is in the best interest of the payee, considering 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(a).) 

As a result of a personal injury settlement, Payee Leonicio Gutierrez became entitled to certain structured settlement payments.

Leonicio Gutierrez, as Payee, and Petitioner Nobility Settlement Funding, LLC, as Assignee, have entered into a Structured Settlement Payments Purchase Agreement, under which Payee is to sell future payments totaling $150,000 in exchange for a purchase price of $127,000 (Amended Petition Exh. 2.)  

The discounted present value of the amount being sold is $143,516.10 calculated by applying the 5.2% discount rate used by the Internal Revenue Service to value annuities in probate proceedings. The purchase price was calculated using a discount rate of 19.71%. If Payee did not sell the right to receive structured settlement payments but instead borrowed the net amount of $127,000 and paid that loan back in installments with each of the payments he is now selling, the equivalent interest rate would be 19.71%. (Ibid.) 

All this information has been properly disclosed to Payee by way of the disclosure form in compliance with Insurance Code § 10136, as required by § 10139.5(a)(3). (Amended Petition Exh. 2.) Payee was advised in writing to seek independent professional advice, both legal and financial. (Ibid.) Payee chose not to seek an independent professional’s advice. (Amended Petition, Exh 7.) Thus, Petitioner has complied with the statutory disclosure requirements. (Ins. Code § 10139.5(a)(2).) 

The transfer agreement (Notice of Increased Purchase Price Re: Petition) also complies with Insurance Code §§ 10136 and 10138 as required by § 10139.5(a)(3). It does not contravene any applicable statute or order of any court or other governmental authority. (Ins. Code § 10139.5(a)(4).)  

A copy of the underlying structured settlement agreement has been provided as required by Insurance Code section 10139.5(f)(2)(G). However, the Amended Petition does not address whether an annuity contract or qualified assignment agreement exists and does not account for those documents, as required by subdivisions (f)(2)(E) and (f)(2)(F). This information must be provided before the Court may approve the transfer.

Information About Transferor 

Payee is 22 years old. (Amended Petition Exh. 4 ¶ 3.).  

Payee states that his address is 3710 Garnet Street Apt. 201, Torrance, CA 90503. (Id. ¶ 2.).

Payee has stated his marital status (unmarried) as required by Insurance Code § 10139.5(c)(2). (¶ 4.) 

Payee has stated that he has one minor child, age 11 months, as required by Insurance Code § 10139.5(c)(3). (¶ 5.)

Payee has indicated the amount and source of his monthly income as required by Insurance Code § 10139.5(c)(4). (¶ 6.) 

Payee has stated that he has no child support obligations, as required by Insurance Code § 10139.5(c)(5). (¶ 7.) 

Payee has provided information regarding previous transfers, as required by Insurance Code § 10139.5(c)(6). (Id. ¶ 12.) 

In sum, Payee has provided all the information required by Insurance Code § 10139.5(c). 

Payee indicates how the proceeds would be used as required by Insurance Code § 10139.5(b)(2): He intends to use the funds to make home repairs and improvements. (¶ 11.) He has not expressly indicated whether he is currently experiencing financial difficulty as contemplated by Insurance Code § 10139.5(b)(3).  

Payee has indicated that the periodic payments were not intended for necessary living expenses nor medical expenses, as required by Insurance Code § 10139.5(b)(5)-(7). (¶ 8.) 

Given the foregoing, the Court finds that the transfer is fair, reasonable and in the best interest of Payee. (Insurance Code § 10139.5(a)(1) & (b)(1)-(15).)  The Payee understands the terms of the transfer agreement, including those set forth in the § 10136 disclosure statement, as required by Insurance Code § 10139.5(a)(5). In signing the California Disclosure Statement and in his declaration and affidavit in support of to the Petition, Payee has evidenced an understanding of the right to cancel and election not to cancel the transfer agreement, as required by Insurance Code § 10139.5(a)(6). 

            Thus, Petitioner has met all the procedural requirements under the Insurance Code, except for the need to provide a qualified assignment agreement or annuity contract. Petitioner has also served a copy of the notice to all interested parties and the Attorney General.  

In light of the chief procedural defect addressed above, the Court cannot grant the petition at this time. Instead, the Court will permit a short continuance and instruct Petitioner to furnish the Court with a sworn affidavit by someone with personal knowledge accounting for the qualified assignment agreement and annuity contract or stating that no such documents exists.

 Accordingly, the petition for approval of structured settlement payments is CONTINUED to Friday, May 9, 2025, at 9:00 AM.

Moving party to give notice, unless waived. 

IT IS SO ORDERED.

Dated:  April 18, 2025                                    ___________________________________

                                                                                    Theresa M. Traber

                                                                                    Judge of the Superior Court

            Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept47@lacourt.org by no later than 4:00 p.m. the day before the hearing. All interested parties must be copied on the email. It should be noted that if you submit on a tentative ruling the court will still conduct a hearing if any party appears. By submitting on the tentative you have, in essence, waived your right to be present at the hearing, and you should be aware that the court may not adopt the tentative, and may issue an order which modifies the tentative ruling in whole or in part.