South Carolina Code 15-50-40. Direct or indirect transfer of payment rights; approval by final court order
(1) transfer is in the best interest of the payee;
Terms Used In South Carolina Code 15-50-40
- Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
- Annuity issuer: means an insurer that has issued a contract to fund periodic payments under a structured settlement. See South Carolina Code 15-50-20
- Assignee: means a person acquiring or proposing to acquire structured settlement payments from a structured settlement purchase company or transferee after, or concurrently with, the transfer of the structured settlement payment rights by the payee to the structured settlement purchase company or transferee. See South Carolina Code 15-50-20
- Dependents: include a payee's spouse and minor children and all other persons for whom the payee legally is obligated to provide support, including alimony. See South Carolina Code 15-50-20
- Guardian: A person legally empowered and charged with the duty of taking care of and managing the property of another person who because of age, intellect, or health, is incapable of managing his (her) own affairs.
- Independent professional advice: means advice of an attorney, certified public accountant, actuary, or other licensed professional advisor. See South Carolina Code 15-50-20
- Payee: means an individual who is receiving tax-free payments under a structured settlement and who proposes to make a transfer of payment rights under the settlement. See South Carolina Code 15-50-20
- Periodic payments: includes recurring payments and scheduled future lump-sum payments. See South Carolina Code 15-50-20
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- Statute: A law passed by a legislature.
- Structured settlement: means an arrangement for periodic payment of damages for personal injuries or sickness established by settlement or judgment in resolution of a tort claim. See South Carolina Code 15-50-20
- Structured settlement obligor: means , with respect to a structured settlement, the party that has the continuing obligation to make periodic payments to the payee under a structured settlement agreement or a qualified assignment agreement. See South Carolina Code 15-50-20
- Structured settlement payment rights: means rights to receive periodic payments under a structured settlement, whether from the structured settlement obligor or the annuity issuer, if the:
(a) payee is domiciled in, or the domicile or principal place of business of the structured settlement obligor or the annuity issuer is located in, this State; or
(b) structured settlement agreement was approved by a court in this State; or
(c) structured settlement agreement is governed expressly by the laws of this State. See South Carolina Code 15-50-20 - Transfer: means the sale, assignment, pledge, hypothecation, or other alienation or encumbrance of structured settlement payment rights made by a payee for consideration; except that the term "transfer" does not include the creation or perfection of a security interest in structured settlement payment rights under a blanket security agreement entered into with an insured depository institution, in the absence of an action to redirect the structured settlement payments to the insured depository institution, or an agent or successor in interest of it, or otherwise to enforce the blanket security interest against the structured settlement payment rights. See South Carolina Code 15-50-20
- Transferee: means a party acquiring or proposing to acquire structured settlement payment rights through a transfer. See South Carolina Code 15-50-20
(2) payee has been advised in writing by the transferee to seek independent professional advice regarding the legal, tax, and financial implications of the transfer and has knowingly and in writing waived receipt of that advice; and
(3) transfer does not contravene an applicable statute or the order of any court or other government authority.
(B) In determining whether a proposed transfer is in the best interest of the payee pursuant to subsection (A)(1), the courts must take into consideration the welfare and support of the payee and the payee’s dependents, if any. The court must also consider:
(1) the reasonable preference of the payee, in light of the payee’s age, mental capacity, maturity level, understanding of the terms of the agreement, and stated purpose for the transfer;
(2) if the periodic payments were intended to cover future income or losses or future medical expenses, whether the payee has means of support aside from the structured settlement to meet these obligations;
(3) whether the payee can meet the financial needs of, and obligations to, the payee’s dependents if the transfer is allowed to proceed, including child support and spousal maintenance;
(4) whether the payee completed previous transactions involving the payee’s structured settlement payment rights, and the timing, amount, stated purpose, and actual use of the proceeds;
(5) the impact of the proposed transfer on current or future eligibility of the payee or the payee’s dependents for public benefits; and
(6) any other factors or facts the court determines to be relevant.
(C) No direct or indirect transfer of a payee’s structured settlement payment rights by a payee’s conservator, if a conservator has been appointed, shall be effective and no structured settlement obligor or annuity issuer shall be required to make a payment directly or indirectly to a transferee or assignee of structured settlement payment rights unless, in addition to the findings required under this section, the court also finds that the proceeds of the proposed transfer would be applied solely for the benefit of the payee.
(D) No direct or indirect transfer of a minor’s structured settlement payment rights by a parent, conservator, or guardian shall be effective and no structured settlement obligor or annuity issuer shall be required to make a payment directly or indirectly to a transferee or assignee of structured settlement payment rights unless, in addition to the findings required under this section, the court also finds that:
(1) the proceeds of the proposed transfer would be applied solely for support, care, education, health, and welfare of the minor payee; and
(2) any excess proceeds would be preserved for the future support, care, education, health, and welfare of the minor payee and transferred to the minor payee upon emancipation.
(E) The final court order must expressly state that the best interest factors enumerated in subsection (B) have been considered, and if the court approves the transfer of payment rights, the order must state that the court finds that it is in the best interest of the payee to approve the transfer.