SCV-255215; Freedom Financial v. Griffiths

Freedom Financial Solutions, LLC, has petitioned for approval of the transfer of structured settlement payments. In order for the court to grant the petition, the court must find all of the following: (1) The transfer is in the best interest of the payee, taking into account 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 Ins. Code section 10139.5(f)(2), 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; and, (6) The payee understands and does not wish to exercise the payee’s right to cancel the transfer agreement. (Ins. Code § 10139.5(a).)

Based upon the documents filed with the court in support of this petition, the court cannot affirmatively find all of the above. The petition is defective as follows: it does not establish that Mr. Griffiths is domiciled in California; it does not contain his full address; it does not indicate the amounts and sources of payee’s monthly income—Mr. Griffiths states that he is unemployed yet he does not intend to use the money for day to day necessaries; there is no information regarding whether Mr. Griffiths has previously attempted to transfer his payments; the disclosure required by Ins. Section 10136(b) is missing portions of the required language, including that transferee would pay up to $1,500 for Mr. Griffiths to hire independent legal or financial services; the transfer agreement does not contain all of the required language of Ins. Section 10136(b) (see Ins. Code §§ 10136(c)(3), (5) and (6)); the effective interest rate in the transfer agreement is listed as .0%; and, it does not contain sufficient facts for the court to consider factors pursuant to Ins. Code § 10139.5(b)(5),(6),(7),(10),(11),(12), and (13).

Additionally, the court does not have sufficient information to determine that the transaction is fair and reasonable. However, attorney fees and administration costs of $4,000.00 seem unreasonable.

The petition is denied without prejudice.