South Carolina Code 15-50-30. Transfer agreements; disclosure statements
(1) amounts and due dates of the structured settlement payments being transferred;
Terms Used In South Carolina Code 15-50-30
- Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
- Discounted present value: means the present value of future payments determined by discounting the payments to the present using the most recently published applicable federal rate for determining the present value of an annuity, as issued by the United States Internal Revenue Service. See South Carolina Code 15-50-20
- Gross advance amount: means the sum payable to the payee or for the payee's account as consideration for a transfer of structured settlement payment rights before a reduction for transfer expenses or other deduction is made from the consideration. See South Carolina Code 15-50-20
- Independent professional advice: means advice of an attorney, certified public accountant, actuary, or other licensed professional advisor. See South Carolina Code 15-50-20
- Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
- Net advance amount: means the gross advance amount less the aggregate amount of the actual and estimated transfer expenses that must be disclosed pursuant to § 15-50-30(5). See South Carolina Code 15-50-20
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- 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
- 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.
- 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 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
- Transfer agreement: means the agreement providing for a transfer of structured settlement payment rights. See South Carolina Code 15-50-20
- Transfer expenses: means all expenses of a transfer that are required under the transfer agreement to be paid by the payee or deducted from the gross advance amount including, without limitation, court filing fees, attorneys' fees, escrow fees, lien recordation fees, judgment and lien search fees, finder's fees, commissions, and other payments to a broker or other intermediary. 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) aggregate amount of the payments;
(3) discounted present value of the payments being transferred, which must be identified as the "calculation of current value of the transferred structured settlement payments under federal standards for valuing annuities", and the amount of the applicable federal rate used in calculating the discounted present value;
(4) gross advance amount;
(5) itemized listing of all applicable transfer expenses, other than attorney’s fees and related disbursements payable in connection with the transferee’s application for approval of the transfer, and the transferee’s best estimate of the amount of the fees and disbursements;
(6) the effective annual interest rate, which must be disclosed in a statement in the following form: "On the basis of the net amount that you will receive from us and the amounts and timing of the structured settlement payments that you are transferring to us, you will, in effect be paying interest to us at a rate of ___ percent per year.";
(7) net advance amount;
(8) amount of penalties or liquidated damages payable by the payee if the payee breaches the transfer agreement;
(9) a statement that the payee has the right to cancel the transfer agreement, without penalty or further obligation, not later than the third business day after the date the agreement is signed by the payee;
(10) that the payee has the right to seek and receive independent professional advice regarding the proposed transfer and should consider doing so before agreeing to the transfer of any structured settlement payment rights. The notice must also contain: "It is prohibited for us to refer you to a specific independent professional adviser. We may refer you to a state or local referral service, bar association, legal aid, or any other entity unrelated to us which assists people with locating independent professional advice, if requested"; and
(11) that the payee has the right to seek out and consider additional offers for transferring the structured settlement payment rights and should do so.