Title 51. Torts
Chapter 12. Damages
Article 4. Damages in Tort Actions
O.C.G.A. 51-12-70 (2009)
As used in this article, the term:
(1) “Administrator” means the administrator of the “Fair Business Practices Act of 1975” appointed pursuant to subsection (a) of Code Section 10-1-395 or his or her designee.
(2) “Annuity issuer” means an insurer that has issued an insurance contract used to fund periodic payments under a structured settlement.
(3) “Applicable law” means:
(A) The federal laws of the United States;
(B) The laws of this state, including principles of equity applied in the courts of this state; and
(C) The laws of any other jurisdiction:
(i) Which is the domicile of the payee or any other interested party;
(ii) Under whose laws a structured settlement agreement was approved by a court or responsible administrative authority; or
(iii) In whose courts a settled claim was pending when the parties entered into a structured settlement agreement.
(4) “Discounted present value” means the fair present value of future payments, as determined by discounting such 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.
(5) “Interested parties” means, with respect to any structured settlement agreement, the payee, any 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 such structured settlement.
(6) “Payee” means an individual who is receiving tax-free damage payments under a structured settlement and proposes to make a transfer of payment rights thereunder.
(7) “Qualified assignment agreement” means an agreement providing for a qualified assignment within the meaning of Section 130 of the United States Internal Revenue Code, United States Code Title 26.
(8) “Settled claim” means the original tort claim or workers’ compensation claim resolved by a structured settlement.
(9) “Structured settlement” means an arrangement for periodic payment of damages for personal injuries established by settlement or judgment in resolution of a tort claim or for periodic payments in settlement of a workers’ compensation claim.
(10) “Structured settlement agreement” means the agreement, judgment, stipulation, or release embodying the terms of a structured settlement, including the rights of the payee to receive periodic payments.
(11) “Structured settlement obligor” means, with respect to any structured settlement, the party that has the continuing periodic payment obligation to the payee under a structured settlement agreement or a qualified assignment agreement.
(12) “Structured settlement payment rights” means rights to receive periodic payments (including lump sum payments) under a structured settlement, whether from the settlement obligor or the annuity issuer, where:
(A) The payee or any other interested party is domiciled in this state;
(B) The structured settlement agreement was approved by a court or responsible administrative authority in this state; or
(C) The settled claim was pending before the courts of this state when the parties entered into the structured settlement agreement.
(13) “Terms of the structured settlement” includes, with respect to any structured settlement, the terms of the structured settlement agreement, the annuity contract, any qualified assignment agreement, and any order or approval of any court or responsible administrative authority or other government authority authorizing or approving such structured settlement.
(14) “Transfer” means any sale, assignment, pledge, hypothecation, or other form of alienation or encumbrance made by a payee for consideration, but does not include:
(A) Any transaction which is expressly provided for in the structured settlement agreement and is executed within 30 days after execution of the structured settlement agreement; or
(B) Any testamentary disposition by the payee.
(15) “Transfer agreement” means the agreement providing for the transfer of structured settlement payment rights from a payee to a transferee.
51-12-71. Transfer not effective unless certain disclosures made; notice of transfer
(a) No direct or indirect transfer of structured settlement payment rights shall be effective and no structured settlement obligor or annuity issuer shall be required to make any payment directly or indirectly to any transferee of structured settlement payment rights unless the transfer has been approved in advance in a final court order by a court of competent jurisdiction or order of any government authority vested by law with exclusive jurisdiction over the settled claim resolved by the structured settlement based on express findings by the court or government authority that:
(1) The transfer complies with the requirements of this article and does not contravene any federal or state statute or the order of any court or any responsible administrative authority;
(2) The transfer is in the best interest of the payee taking into account the welfare and support of the payee’s dependents;
(3) Not less than ten days prior to the date on which the transfer agreement is executed in writing, the transferee has provided to the payee an informational pamphlet relating to transfers of structured settlements as provided for in subsection (b) of Code Section 51-12-73, when available, and a separate disclosure statement in bold type, no smaller than 14 points, setting forth:
(A) The amounts and due dates of the structured settlement payments to be transferred;
(B) The aggregate amount of such payments;
(C) The discounted present value of such payments, together with the discount rate used in determining such discounted present value;
(D) The gross amount payable to the payee in exchange for such payments;
(E) An itemized listing of all brokers’ commissions, service charges, application fees, processing fees, closing costs, filing fees, administrative fees, legal fees, notary fees and other commissions, fees, costs, expenses, and charges payable by the payee or deductible from the gross amount otherwise payable to the payee;
(F) The net amount payable to the payee after deduction of all commissions, fees, costs, expenses, and charges described in subparagraph (E) of this paragraph;
(G) The quotient (expressed as a percentage) obtained by dividing the net payment amount by the discounted present value of the payments; and
(H) The amount of any penalty and the aggregate amount of any liquidated damages (inclusive of penalties) payable by the payee in the event of any breach of the transfer agreement by the payee; and
(4) The transferee has given written notice of the transferee’s name, address, and taxpayer identification number to the annuity issuer and the structured settlement obligor and has filed a copy of the notice with the court.
(b) At least 20 days before the hearing which is scheduled on an application for authorizing a transfer of structured settlement payment rights under this Code section, the transferee shall file with the court and deliver to all interested parties a notice of the proposed transfer and the application for its authorization. The notice shall include the following:
(1) A copy of the transferee’s application to the court;
(2) A copy of the transfer agreement;
(3) A copy of the disclosure statement required under paragraph (3) of subsection (a) of this Code section;
(4) Notification that an interested party may support, oppose, or otherwise respond to the transferee’s application, either in person or through counsel, by participating in the hearing or by submitting written comments to the court; and
(5) A rule nisi containing notification of the time and place of the hearing and notification of the manner in and the time by which any written response to the application must be filed in order to be considered by the court. A written response shall be filed within 15 days after service of the transferee’s notice.
(c) Delivery of notice as required by subsection (b) of this Code section may be made as provided in Code Section 9-11-4 or by registered or certified mail, return receipt requested. Notice by registered or certified mail is effective upon the date of delivery as shown on the return receipt. If notice by registered or certified mail is refused or returned undelivered, notice shall be delivered as provided in Code Section 9-11-4.
(d) The venue for any application brought under this Code section shall be in the county in which any transferee or transferor resides or in any county in which any of the transferees or transferors have consented to venue.
51-12-72. Transfer to be executed in writing and filed; right of rescission
(a) Any transfer agreement of structured settlement payment rights must, in addition to the other requirements of this article, be executed in writing and filed as provided in Code Section 51-12-71. The transfer agreement shall not be so executed until after the expiration of the ten-day period provided for in paragraph (3) of subsection (a) of Code Section 51-12-71.
(b) No payee shall incur any obligation of any type with respect to a proposed transfer of structured settlement payment rights prior to the execution in writing of the transfer agreement.
(c) Any payee who executes in writing a transfer agreement shall have the right to rescind the transfer at any time within the next 21 days following the written execution of the transfer agreement or at the hearing provided for in subsection (b) of Code Section 51-12-71, whichever event occurs last. The transferee shall furnish to the payee at the time of execution of the transfer agreement a notice to the payee allowing the payee 21 days to cancel the transfer. This right to cancel shall not limit or otherwise affect the payee’s right to cancel pursuant to any other provision of applicable law. The notice shall serve as the cover sheet to the transfer documents. It shall be on a separate sheet of paper with no other written or pictorial material, in at least ten-point bold type, double spaced, and shall read substantially as follows:
“NOTICE OF CANCELLATION RIGHTS:
Please read this form completely and carefully. It contains valuable cancellation rights.
You may cancel this transaction at any time prior to 5:00 P.M. of the twenty-first day following receipt of this notice or at the hearing on the application for authorization of a transfer of structured settlement payment rights, whichever event occurs last.
This cancellation right cannot be waived in any manner.
To cancel, sign this form, and mail or deliver it to the address below by 5:00 P.M. of __________ (the twenty-first day following the transaction). It is best to mail it by certified mail or statutory overnight delivery, return receipt requested, and to keep a photocopy of the signed form and your post office receipt.
Address to which cancellation is to be returned:
I (we) hereby cancel this transaction.
51-12-73. Rules, regulations, and orders; instructional pamphlets
(a) The administrator is authorized to promulgate, adopt, and issue rules, regulations, and orders necessary or convenient to carry out the provisions and purposes of this article. Any such rules of a substantive nature shall be promulgated only when it is determined by the administrator, in the reasonable exercise of his or her discretion and on the basis of his or her expertise and the facts, submissions, evidence, and all information before him or her, that such rules are needed to prohibit or control acts or practices which create the probability of actual injury to payees.
(b) The administrator shall prepare a pamphlet containing information designed to help payees evaluate proposed transfers of structured settlements and shall distribute such pamphlets free of charge, except that persons engaged in the business of purchasing structured settlement payment rights may be charged a reasonable fee for such pamphlets.
51-12-74. Enforcement procedures
(a) Chapter 13 of Title 50, the “Georgia Administrative Procedure Act,” shall apply to all actions and proceedings of an administrative nature taken by the administrator pursuant to this article, except where the administrator is acting under Part 2 of Article 15 of Chapter 1 of Title 10, the “Fair Business Practices Act of 1975.” A violation of this article shall also be considered a violation of Part 2 of Article 15 of Chapter 1 of Title 10, the “Fair Business Practices Act of 1975.”
(b) In addition to any other proceedings authorized by this article, the administrator may bring a civil action in the superior courts to enjoin any violation or threatened violation of any provision of this article or any rule, regulation, or order issued by the administrator pursuant to this article.
51-12-75. Penalties for violations
(a) In order to enforce this article or any orders, rules, and regulations promulgated pursuant thereto, the administrator may issue an administrative order imposing a penalty not to exceed $1,000.00 for each violation, whenever he or she determines, after a hearing, that any person has violated any provisions of this article or any rules, regulations, or orders promulgated under this article.
(b) The hearing and any administrative review thereof shall be conducted in accordance with the procedure for contested cases under Chapter 13 of Title 50, the “Georgia Administrative Procedure Act.” Any person who has exhausted all administrative remedies available and who is aggrieved or adversely affected by a final order or action of the administrator shall have the right of judicial review thereof in accordance with Chapter 13 of Title 50, the “Georgia Administrative Procedure Act.” All penalties recovered as provided in this Code section shall be paid into the state treasury.
(c) The administrator may file, in the superior court of the county in which the person under an order resides, or if the person is a corporation, in the superior court of the county in which the corporation under an order maintains its principal place of business, or in the superior court of the county in which the violation occurred, a certified copy of the final order of the administrator unappealed from or of a final order of the administrator affirmed upon appeal. Thereupon, the court shall render judgment in accordance therewith and shall notify the parties. Such judgment shall have the same effect and proceedings in relation thereto shall thereafter be the same as though the judgment had been rendered in an action duly heard and determined by such court.
(d) The penalty prescribed in this Code section shall be concurrent, alternative, and cumulative with any and all other civil, criminal, or alternative rights, remedies, forfeitures, or penalties provided, allowed, or available to the administrator with respect to any violation of this article and any order, rules, or regulations promulgated pursuant thereto.
51-12-76. Waiver prohibited; penalties for failure to finalize transfers prohibited
(a) The provisions of this article may not be waived.
(b) No payee who proposes to make a transfer of structured settlement payment rights shall incur any penalty, forfeit any application fee or other payment, or otherwise incur any liability to the proposed transferee based on:
(1) Any failure of such transfer to satisfy the conditions of this article; or
(2) Any failure by the payee to execute the transfer agreement or any cancellation by the payee within the time prescribed in Code Section 51-12-72.
Nothing contained in this article shall be construed to authorize any transfer of structured settlement payment rights in contravention of applicable law or to give effect to any transfer of structured settlement payment rights that is invalid under applicable law