COMMITTEE SUBSTITUTE
FOR
H. B. 4613
(By Delegates Webster, Walters, Kessler, Caputo, Fleischauer,
Ellem, Brown, Manchin, Shook and Hamilton)
(Originating in the Committee on the Judiciary.)
[February 20, 2008]
A BILL to amend and reenact §46A-6H-3 of the Code of West Virginia,
1931, as amended, relating to requiring court approval for
certain structured settlement transfers; requiring appointment
of guardian ad litem; payment of guardian ad litem, attorneys'
fees and costs; required findings; and standard of proof.
Be it enacted by the Legislature of West Virginia:
That §46A-6H-3 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows
:
§46A-6H-3. Requirement of court approval for certain structured
settlement transfers.
(a) In addition to the requirements of this article,
the all
transfer
agreement shall agreements must be approved by the circuit
court of the county wherein the consumer resides or where the
structured settlement agreement was executed when
(1) The structured settlement payment rights belong to an
infant or an incompetent person; or
(2) The the structured settlement payment rights arise from a personal injury or other claim.
and:
(i) The aggregate of the structured settlement payment rights
exceeds forty thousand dollars; or
(ii) The structured settlement agreement contains a provision
restricting the right of the consumer to assign or transfer the
consumer's future payment rights.
(b) The transferee shall commence the action by filing a
petition with the court seeking approval of the transfer and
providing to the court the disclosure statement required by
subsection (a), section two of this article.
(c) The circuit court shall set a time and date for a hearing
on the matter within twenty-one days of the date of the filing of
the petition. The transferee shall notify the consumer and all
interested parties of the date and time of the hearing and provide
them with a copy of the petition.
(d) The court
shall may appoint a guardian ad litem
for the
consumer in
all cases,
and shall appoint a guardian at litem for
the consumer in any case where the structured settlement payment
rights belong to an infant, an incompetent person or a ward of the
court. The guardian ad litem shall review the requisite
disclosures and make an independent inquiry to determine whether
the proposed transfer is fair, reasonable and in the best interests
of the consumer
and any dependents of the consumer as well and
determine if transfer has been attempted or accomplished before.
Such The information shall be reported to the court during the
hearing on the matter.
(e) An interested party has the right to appear and contest
the proposed transfer at the time of the hearing. If, after proper
notice, the interested party does not make an appearance, then the
interested party shall be bound by the court's ruling.
(f) After a hearing or upon its own motion, the court may
approve the transfer if the court finds that:
(1) The consumer has
clearly demonstrated that: (A) He or
she, or his or her family is facing a financial hardship
that the
transfer would alleviate and that the transfer would not subject
the consumer or the consumer's family to undue financial hardship
in the future; or (B) the transfer is in the best interest of the
consumer:
Provided, That the judge shall
disclose the inquire of
the guardian ad litem and the transferee as to possible adverse tax
consequence to the consumer
and inform the consumer of the result
of said inquiry;
(2) The transferee is in compliance with the provisions of
section two of this article; and
(3) The transfer agreement does not contravene the terms of
the structured settlement agreement, including any restrictions on
the right of the consumer to transfer his or her structured
settlement payment rights, unless the annuity issuer and structured
settlement obligor have consented to the transfer. However, the
approval of the annuity issuer and the structured settlement
obligor shall not be required if, at the time the consumer and the
transferee entered into the transfer agreement, a favorable tax
determination was in effect.
(g) The court shall award the guardian ad litem reasonable
fees for representing the consumer.
Such Attorneys' fees
and costs
shall be paid by the transferee.
(h) A consumer may request court approval for a transfer that
does not mandate court approval under this section. Such voluntary
petition by the consumer shall then become subject to the
provisions of this section. The transferee shall be responsible
for filing the action pursuant to subsection (b) of this section
and
the consumer shall be responsible for attorney's fees or
guardian ad litem fees.