The petitioner commenced this proceeding pursuant to General Obligations Law Title 17, known as the Structured Settlement Protection Act ("SSPA"), for the transfer of certain structured settlement payments that it wants to purchase from Vincent Angelillo.

The SSPA requires that certain procedural and substantive safeguards be followed before a structured settlement payment may be transferred (GOL § 5-1705). The procedure includes that a copy of a disclosure statement as required under GOL § 5-1703 be attached to the petition and that proof of service upon the payee be provided. Moreover, pursuant to GOL section 5-1706, entitled Approval of Transfers of Structured Settlement Payment rights:

No direct or indirect transfer of structured settlement 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 authorized in advance in a final order of a court of competent jurisdiction based upon express findings by such court that:

(a) the transfer complies with the requirements of this title; [*2]

(b) the transfer is in the best interests of the payee, taking into account the welfare and support of the payee's dependents; and whether the transaction including the discount rate used to determine the net advance amount are fair and reasonable. Provided the court makes findings as outlined in this subdivision, there is no requirement for the court to find that an applicant is suffering from a hardship to approve transfer of structured settlement payments under this subdivision;

(c) the payee has been advised in writing by the transferee to seek independent professional advice regarding the transfer and has either received such advice or knowingly waived such advice in writing;

(d) the transfer does not contravene any applicable government statute or the order of any court or other government authority; and

(e) is written in plain language and in compliance with section 5-702 of this article.

In determining the matter at issue, the Court is required to assess whether the statutory mandates of the SSPA have been met. A review of the submissions accompanying the petition demonstrates that the application procedurally and facially complies with GOL sections 5-1703 and 5-1706(a), (c), (d), and (e). Since such procedural compliance is evident, the Court must then determine if "the transfer is in the best interest of the payee, taking into account the welfare and support of the payee...and whether the transaction, including the discount rate used to determine the advance amount are fair and reasonable" (GOL § 5-1706[b]).

The funds that are subject of this petition represent a portion of certain structured settlement payments due to Mr. Angelillo in accordance with the settlement of a personal injury claim. Pursuant to the terms of the structured settlement, Mr. Angelillo became the recipient of certain structured settlement payment rights which provided for a series of deferred cash payments as follows: one lump sum payment of $7,500 due and payable on or about November 13, 2012; one lump sum payment of $7,500 due and payable on or about November 13, 2015; and one lump sum payment of $21,650.

Mr. Angelillo seeks the transfer the following payments: one lump sum payment of $7,500 due and payable on or about November 13, 2012; one lump sum payment of $7,500 due and payable on or about November 13, 2015; and one lump sum payment of $15,000 due and payable on or about November 13, 2017. In return, Mr. Angelillo will receive immediate compensation in the gross amount of $10,851.33.

In this proposed transfer of Mr. Angelillo's settlement payments, the aggregate amount of the structured settlement payments to be transferred is $30,000. The discounted present value of the payments to be transferred is $24,615.33 (using the applicable federal rate of 3.4 %). The gross advance amount is $10,851.33, which, according to the "Disclosure Statement Pursuant to New York Law" submitted in support of the petition, represents a "nominal" annual discount rate [*3]of 18.36 % assuming monthly compounding and a funding date of February 15, 2010. The net advance amount (less $1,200 in legal fees and $200 in processing fees) is $9,451.33 which represents 38.39 % of the discounted present value.

From the lump sum payment he would receive, Mr. Angelillo stated that it is his intention to use $2,300 to complete his Bachelor's degree, $2,000 to pay off credit card debt, and the remaining $5,151 for dental work. Although Mr. Angelillo states that he is currently employed, he does not specify his income or explain why his income and future annuity payments would be inadequate to help him meet his stated goals. He does not explain if he took any steps to apply for financial aid or student loans which would have terms more beneficial to him. Further, Mr. Angelillo has not consulted an attorney or financial advisor for advice in connection with the proposed transfer. This Court is not satisfied that Mr. Angelillo appreciates the consequences of such transfer.

The Court notes that a previous application, which was not mentioned by either the petitioner nor Mr. Angelillo in his affidavit, was made for the sale of the same payments to petitioner on June 8, 2009. The prior application sought approval of an agreement which would have transferred all of Mr. Angelillo's payments in exchange for a gross advance of $12,007.676. According to "Disclosure Statement Pursuant to New York Law" submitted in support of the prior application, the nominal annual discount rate applied was 16.56 %. Additionally, in an affidavit in support of the prior application, Mr. Angelillo stated the same intention for the use of the funds he would have been advanced as he did in this application. The prior application was denied in an Order dated July 23, 2009, by Justice Robert J. McDonald, in a well-reasoned, four-page opinion, which found that the transfer was neither in Mr. Angelillo's best interest nor was it fair and reasonable. See, Matter of Imperial Structured Settlements v. Vincent Daniel Angelillo, Allstate Assignment Co., and All State Life Ins. Co., Index No. 15008/2009, dated July 23, 2009, and entered on July 31, 2009 [Sup Ct. Queens County] [Robert J. McDonald, J.].

Upon reviewing the submissions, which were nearly identical to the prior application, the petitioner failed to establish that the 18.36% discount rate applied against the funds sought to be transferred is fair and reasonable within the meaning of the SSPA (see, Matter of 321 Henderson Receivables Origination LLC (Logan), 19 Misc 3d 504 [Sup Ct Queens County 2008] [decided by the undersigned] [18.58% discount rate not accepted as fair and reasonable]; Matter of Settlement Capital Corp. (Ballos), 1 Misc 3d 446 [Sup Ct Queens County 2003] [Patricia Satterfield, J.] [15.591% discount rate not accepted as fair and reasonable]; Matter of Settlement Funding of NY (Cunningham), 195 Misc 2d 721 [Sup Ct. Rensselaer County 2003] [15.36 % discount rate not accepted as fair and reasonable]).

Furthermore, the petitioner failed to establish that the transfer is in Mr. Angelillo's best interests (see, Settlement Funding of NY, LLC v Hartford-Comprehensive Empl. Ben. Svc. Co., 2009 WL 3630802, 2009 NY Slip Op 52201 [U], 25 Misc 3d 1220(A) [2009] [decided by the undersigned]). [*4]

Accordingly, the application of petitioner for approval of transfer of the structured settlement rights is denied and the proceeding is dismissed.

The foregoing constitutes the decision and order of the Court.

Dated: October 1, 2010

J.S.C.