United States: Florida Court Denies Petition To Transfer Structured Settlement Payment Rights
15 April 2013
Article by W. Mason 
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Like every other state, Florida law requires court approval of the transfer of the right to receive structured settlement payments. Typically, the approval process arises where a person entitled to a stream of payments wishes to transfer the right to receive those payments to a purchaser for a lump sum payment. In order to effectuate the transfer, the purchaser files a petition for approval of the transfer with the court. Typically, where the court finds that the purchaser has complied with certain stringent statutory notice requirements and the seller has otherwise established that the transfer is in his or her best interest, petitions for transfer are approved.
In a recent case, a Florida court denied approval of a structured settlement transfer where it was found that approval of the transfer would contravene the provisions of a Federal statute. In re Robotham, 2013 WL 127134. In Robotham, the seller, Derrick Robotham, was receiving periodic monthly payments as a result of a workers’ compensation claim he filed pursuant to the Longshore and Harbor Worker’s Compensation Act (“LHWCA”), 33 USCS § 916. The LHWCA is a Federal statute that essentially requires certain employers to pay worker’s compensation payment to longshore and harbor workers who are injured or contract diseases. The LHWCA states:
No assignment, release, or commutation of compensation or benefits due or payable under this chapter, except as provided by this chapter, shall be valid, and such compensation and benefits shall be exempt from all claims of creditors and from levy, execution, and attachment or other remedy for recovery or collection of a debt, which exemption may not be waived. 33 USC § 916. In the Fifth Judicial Circuit in and for Sumter County, Florida, Judge Michelle Morely noted that the Florida Structured Settlement Act conditions the approval of the transfer on compliance with applicable law. See Fla. Stat. 626.99296(3)(a)(1)(“The transfer complies with this section and does not contravene other applicable law”). Judge Morley found that approval of this particular transfer would contravene the LHWCA. Therefore, the petition was denied.
While typical structured settlement transfers will not implicate any conflict with Federal law, it is worth noting that the Florida Structured Settlement Act prevents approval of a transfer where a relevant Federal statute or other applicable law prevents assignment. As such, structured settlement purchasers and their attorneys should approach transactions that involve payment streams which result from a situation other than a typical personal injury settlement with additional scrutiny.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
In a recent case, a Florida court denied approval of a structured settlement transfer where it was found that approval of the transfer would contravene the provisions of a Federal statute. In re Robotham, 2013 WL 127134. In Robotham, the seller, Derrick Robotham, was receiving periodic monthly payments as a result of a workers’ compensation claim he filed pursuant to the Longshore and Harbor Worker’s Compensation Act (“LHWCA”), 33 USCS § 916. The LHWCA is a Federal statute that essentially requires certain employers to pay worker’s compensation payment to longshore and harbor workers who are injured or contract diseases. The LHWCA states:
While typical structured settlement transfers will not implicate any conflict with Federal law, it is worth noting that the Florida Structured Settlement Act prevents approval of a transfer where a relevant Federal statute or other applicable law prevents assignment. As such, structured settlement purchasers and their attorneys should approach transactions that involve payment streams which result from a situation other than a typical personal injury settlement with additional scrutiny.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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