Maryland Structured Settlements Law

Yes, you can trade Maryland structured settlement payments for upfront cash.

Statute and Bill #: Md. Code Ann., Courts and Judicial Proceedings €€ 5-1101 - 5-1105 (HB 357)
Enacted 5/11/2000 Effective 10/1/2000
Summary: Permits the sale or assignment of Maryland structured settlement payment rights, subject to a court's review and approval based on showing that the proposed transfer is in the consumer's "best interests," taking into account the welfare of the consumer's dependents (if any). Requires certain disclosures and other consumer protections.


Full Text Of Bill:

Maryland Structured Settlement Protection Act

5-1101.
(A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS INDICATED.
(B) "DISCOUNTED PRESENT VALUE" MEANS THE FAIR PRESENT VALUE OF FUTURE
PAYMENTS, AS DETERMINED BY DISCOUNTING 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.
(C) "INDEPENDENT PROFESSIONAL ADVICE" MEANS ADVICE OF AN ATTORNEY, CERTIFIED
PUBLIC ACCOUNTANT, ACTUARY, OR OTHER LICENSED PROFESSIONAL ADVISER:
(1) WHO IS ENGAGED BY A PAYEE TO RENDER ADVICE CONCERNING THE LEGAL, TAX, AND
FINANCIAL IMPLICATIONS OF A TRANSFER OF STRUCTURED SETTLEMENT PAYMENT RIGHTS;
(2) WHO IS NOT AFFILIATED WITH OR COMPENSATED BY THE TRANSFEREE OF THE
TRANSFER; AND
(3) WHOSE COMPENSATION IS NOT AFFECTED BY WHETHER A TRANSFER OCCURS.
(D) "INTERESTED PARTIES" MEANS THE PAYEE, EACH BENEFICIARY DESIGNATED UNDER
THE ANNUITY CONTRACT TO RECEIVE PAYMENTS FOLLOWING THE PAYEE'S DEATH, THE
ANNUITY ISSUER, THE STRUCTURED SETTLEMENT OBLIGOR, AND ANY OTHER PARTY THAT HAS
CONTINUING RIGHTS OR OBLIGATIONS UNDER A STRUCTURED SETTLEMENT.
(E) "PAYEE" MEANS AN INDIVIDUAL WHO RECEIVES DAMAGE PAYMENTS THAT ARE NOT
SUBJECT TO INCOME TAXATION UNDER A STRUCTURED SETTLEMENT AND PROPOSES TO MAKE A
TRANSFER OF PAYMENT RIGHTS.
(F) "RESPONSIBLE ADMINISTRATIVE AUTHORITY" MEANS A GOVERNMENT AUTHORITY VESTED
WITH EXCLUSIVE JURISDICTION OVER THE SETTLED CLAIM RESOLVED BY A STRUCTURED
SETTLEMENT.
(G) (1) " STRUCTURED SETTLEMENT " MEANS AN ARRANGEMENT FOR PERIODIC PAYMENT OF
DAMAGES FOR PERSONAL INJURY ESTABLISHED BY A SETTLEMENT OR JUDGMENT IN
RESOLUTION OF A TORT CLAIM.
(2) " STRUCTURED SETTLEMENT " DOES NOT INCLUDE AN ARRANGEMENT FOR PERIODIC
PAYMENT OF DAMAGES FOR PERSONAL INJURY ESTABLISHED BY A JUDGMENT BY CONFESSION.
(H) " STRUCTURED SETTLEMENT AGREEMENT" MEANS AN AGREEMENT, JUDGMENT,
STIPULATION, OR RELEASE EMBODYING THE TERMS OF A STRUCTURED SETTLEMENT.
(I) " STRUCTURED SETTLEMENT OBLIGOR" MEANS A PARTY WHO HAS THE CONTINUING
PERIODIC PAYMENT OBLIGATION TO THE PAYEE UNDER A STRUCTURED SETTLEMENT
AGREEMENT OR A QUALIFIED ASSIGNMENT AGREEMENT.
(J) " STRUCTURED SETTLEMENT PAYMENT RIGHTS" MEANS THE RIGHTS TO RECEIVE
PERIODIC PAYMENTS, INCLUDING LUMP-SUM PAYMENTS UNDER A STRUCTURED SETTLEMENT,
WHETHER FROM THE SETTLEMENT OBLIGOR OR THE ANNUITY ISSUER, IF:
(1) AN INTERESTED PARTY IS DOMICILED IN THIS STATE;
(2) THE STRUCTURED SETTLEMENT AGREEMENT WAS APPROVED BY A COURT OR RESPONSIBLE
ADMINISTRATIVE AUTHORITY IN THIS STATE; OR
(3) THE SETTLED CLAIM WAS PENDING BEFORE A COURT OF THIS STATE WHEN THE
PARTIES ENTERED INTO THE STRUCTURED SETTLEMENT AGREEMENT.
(K) "TERMS OF THE STRUCTURED SETTLEMENT " INCLUDES THE TERMS OF THE
STRUCTURED SETTLEMENT AGREEMENT, THE ANNUITY CONTRACT, A QUALIFIED ASSIGNMENT,
AND AN ORDER OR APPROVAL OF A COURT OR RESPONSIBLE ADMINISTRATIVE AUTHORITY
AUTHORIZING OR APPROVING A STRUCTURED SETTLEMENT.
(L) "TRANSFER" MEANS A SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION, OR OTHER FORM
OF ALIENATION OR ENCUMBRANCE MADE BY A PAYEE FOR CONSIDERATION.
(M) "TRANSFER AGREEMENT" MEANS THE AGREEMENT PROVIDING FOR THE TRANSFER OF
STRUCTURED SETTLEMENT PAYMENT RIGHTS FROM A PAYEE TO A TRANSFEREE.

5-1102.
(A) A DIRECT OR INDIRECT TRANSFER OF STRUCTURED SETTLEMENT PAYMENT RIGHTS TO A
TRANSFEREE IS EFFECTIVE AS PROVIDED IN THIS SUBTITLE.
(B) A STRUCTURED SETTLEMENT OBLIGOR OR ANNUITY ISSUER SHALL MAY NOT MAKE
ANY PAYMENT DIRECTLY OR INDIRECTLY TO A TRANSFEREE OF STRUCTURED SETTLEMENT
PAYMENT RIGHTS IF UNLESS THE TRANSFER IS AUTHORIZED IN AN ORDER OF A COURT
BASED ON A FINDING THAT:
(1) THE TRANSFER IS AUTHORIZED IN AN ORDER OF A COURT BASED ON A FINDING
THAT THE TRANSFER IS NECESSARY, REASONABLE, OR APPROPRIATE;
(2) THE TRANSFER IS NOT EXPECTED TO SUBJECT THE PAYEE, THE PAYEE'S DEPENDENTS,
OR BOTH, TO UNDUE OR UNREASONABLE FINANCIAL HARDSHIP IN THE FUTURE;
(3) THE PAYEE RECEIVED INDEPENDENT PROFESSIONAL ADVICE REGARDING THE LEGAL,
TAX, AND FINANCIAL IMPLICATIONS OF THE TRANSFER; AND
(4) THE TRANSFEREE DISCLOSED TO THE PAYEE THE DISCOUNTED PRESENT VALUE.

5-1103.
(A) THE CIRCUIT COURT THAT HAS JURISDICTION OVER A PERSON AN INTERESTED
PARTY OR THE CIRCUIT COURT FOR THE COUNTY IN WHICH THE ORIGINAL CLAIM OCCURRED
SHALL HAVE NONEXCLUSIVE JURISDICTION OVER AN APPLICATION FOR A TRANSFER OF
STRUCTURED SETTLEMENT PAYMENT RIGHTS UNDER SECTION 5-1102 OF THIS SUBTITLE.
(B) A TRANSFEREE SHALL FILE WITH THE COURT AND SERVE ON THE INTERESTED PARTIES
AT LEAST 20 DAYS BEFORE THE HEARING ON THE APPLICATION, A NOTICE OF THE
PROPOSED TRANSFER AND AN APPLICATION FOR ITS AUTHORIZATION, INCLUDING:
(1) A COPY OF THE TRANSFEREE'S APPLICATION;
(2) A COPY OF THE TRANSFER AGREEMENT; AND
(3) NOTIFICATION:
(I) OF THE TIME AND PLACE OF THE HEARING; AND
(II) THAT EACH INTERESTED PARTY IS ENTITLED TO SUPPORT, OPPOSE, OR OTHERWISE
RESPOND TO THE TRANSFEREE'S APPLICATION, IN PERSON OR BY COUNSEL, BY SUBMITTING
WRITTEN COMMENTS TO THE COURT OR BY PARTICIPATING IN THE HEARING.

5-1104.
IF A PAYEE MAKES A TRANSFER OF STRUCTURED SETTLEMENT PAYMENT RIGHTS IN
VIOLATION OF THIS SUBTITLE, THE STRUCTURED SETTLEMENT OBLIGOR OR ANNUITY ISSUER
MAY NOT INCUR ANY ADDITIONAL LIABILITY. IF A TRANSFER OF STRUCTURE SETTLEMENT
PAYMENT RIGHTS HAS BEEN AUTHORIZED UNDER THIS SUBTITLE, NEITHER THE ANNUITY
ISSUER NOR THE STRUCTURED SETTLEMENT OBLIGOR SHALL HAVE ANY LIABILITY TO THE
PAYEE OR TO ANY OTHER PARTY FOR ANY PAYMENT MADE TO THE TRANSFEREE IN
ACCORDANCE WITH THE AUTHORIZATION.

5-1105.
(A) THE PROVISIONS OF THIS SUBTITLE MAY NOT BE WAIVED.
(B) NOTHING CONTAINED IN THIS SUBTITLE MAY BE CONSTRUED TO AUTHORIZE A
TRANSFER OF STRUCTURED SETTLEMENT PAYMENT RIGHTS IN CONTRAVENTION OF APPLICABLE
LAW OR TO GIVE EFFECT TO A TRANSFER OF STRUCTURED SETTLEMENT PAYMENT RIGHTS
THAT IS INVALID UNDER APPLICABLE LAW.
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall apply to any transfer
of structured settlement payment rights under a transfer agreement entered into
on or after the effective date of this Act; provided, however, that nothing
contained in this section shall imply that any transfer under a transfer
agreement entered into prior to the effective date of this Act is ineffective.
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect October
1, 2000.