A proposed transfer of structured settlement payment rights that results in the payee receiving less than half of the discounted present value is not fair and reasonable under the New York Structured Settlement Protection Act, a New York state trial court judge ruled in a recent SSPA matter.
In the case of In the Matter of 1 Apollo (Pardo), Index No.: 606049/15, Supreme Court, Nassau County, N.Y. (N.Y. Sup. Ct. Dec. 14, 2015) (Thomas Feinman, J.S.C.), Justice Feinman reviewed many of the long list of previous trial court decisions concerning the New York SSPA, which he said was “enacted as a result of concern that the structured settlement payees are especially prone to being victimized and quickly dissipating their awards.”
In the Pardo matter, the court took note of the lack of evidence to support the allegations in the factoring company’s papers, saying that while an affidavit from the payee sais he was a sales representative and that he planned to use the proceeds of the transfer for a down payment for a home, the petitioner did not “provide any documentation to substantiate” these reprsentations, and left blank information about the payee’s employer.
Further, the court was “concerned” that the payee waived the right to receive independent professional advice and was “not satisfied” that the payee “appreciates the consequences of the proposed transaction, especially when the proposed transfer requires the payee . . . to receive an amount that is grossly less than half the discount present value and as so, not fair nor reasonable.”
Accordingly, the court denied and dismissed the petitioner, saying the transferdid not meet the New York SSPA’s “best interest” and “fair and reasonable” requirements.