Supreme Court, Suffolk County, October 29, 2019

Yankwitt LLP, White Plains, for petitioner.

Malik Washington, respondent pro se.

Ordered that after a hearing held on October 22, 2019, and upon the supplemental submissions of petitioner made thereafter, the petition is denied, and petitioner's proposed order is marked "Unsigned."

By order to show cause, signed by this court on July 8, 2019, petitioner J.G. Wentworth Originations, LLC sought an order approving the transfer of "structured settlement payment rights," as defined by General Obligations Law § 5-1701 (o), from respondent payee Malik Washington to it, through an order of this court pursuant to General Obligations Law § 5-1706. According to the petition, Mr. Washington was the payee of "certain structured settlement payment(s)" (verified petition para 2), although no mention of the type of personal injury action, an index number, the court in which it was settled, nor the terms of a "structured settlement" were mentioned in the petition or provided as exhibits thereto. As exhibit "A" to the petition, petitioner attached a poor photograph of a letter from another listed "interested party," Metropolitan Life Insurance Co. The letter, as best can be read, also does not specifically mention the case/lawsuit that resulted in the "structured settlement," although it does suggest in a paragraph entitled "What you need to do" that Mr. Washington "contact the attorney who settled the case, or the court where the case was settled," to obtain other legal documents concerning the structured settlement. Although served, none of the "interested parties" submitted responses in support of or opposition to the petition. Upon the return of the petition, by order dated October 9, 2019, this court set the issues raised in the petition for a hearing on October 22, 2019.

On that date, counsel for petitioner appeared, along with payee Malik Washington. At the hearing petitioner's counsel{**65 Misc 3d at 1135} called Mr. Washington to testify. His testimony established that he was a reasonable and prudent person, that he was employed, and that he had a well planned use for the $160,000 that he hoped to receive from petitioner in exchange for his assignment of "structured settlement payment rights" of $218,244 he was to receive pursuant to his "structured settlement agreement" on January 11, 2023.

As the court had searched the "eCourts" filing system but was unable to find a case or settlement involving Mr. Washington that gave rise to the "structured settlement" in the petition, the court asked him the type of personal injury action that brought it about. Mr. Washington told the court that he had not been involved in a personal injury action or settlement, but rather that payments he had already received and future payments, including the one which he wished to assign to petitioner, were the result of a "life insurance policy" his father had before his death in the tragedy of September 11, 2001. Counsel appearing for petitioner appeared to be unaware of this, believing that the application was based upon the settlement of a personal injury case, but conceded that he was unfamiliar with the case and the settlement, knowing only what appeared in the petition.

The court placed some of petitioner's exhibits submitted in support of the petition in the record as court's exhibits 1-3, and upon all of the testimony and evidence, including that involving the anticipated agreement, gave its conditional approval to the transfer of structured settlement rights as the agreement appeared to meet the requirements of General Obligations Law § 5-1706 (b), (c) and (e), but determined that additional information and corrections in petitioner's submission were necessary, as was the submission of a new proposed order approving the transfer. Subsequently, petitioner submitted a copy of the "structured settlement agreement," entitled "AWARD DETERMINATION PERIODIC PAYMENT AGREEMENT" (the [*2]award) (NY St Cts Elec Filing [NYSCEF] Doc No. 17), and a new proposed order approving the transfer (NYSCEF Doc No. 18). Upon review of these documents it is now clear to the court that it has no authority to grant an order pursuant to General Obligations Law § 5-1706 in this matter.

Although the copy of the award, which was both "e-filed" and "faxed" to the court, is reproduced in poor quality, there are a few things about it that are clear.

For the court to approve the transfer of "structured settlement payment rights" under General Obligations Law § 5-1706, {**65 Misc 3d at 1136}the agreement must meet the definition of "structured settlement payments rights" under General Obligations Law § 5-1701 (o). As the payee, Mr. Washington, is domiciled in the state, the requirement of General Obligations Law § 5-1701 (o) (i) is met, but the additional requirement of compliance with either General Obligations Law § 5-1701 (o) (ii) or (iii) is not met.

General Obligations Law § 5-1701 (o) (ii) requires that the settlement agreement be approved by a court in this state. As shown by the terms of the award, it was not approved by a court, but approved and made by the Special Master of the September 11th Victim Compensation Fund, appointed pursuant to title IV of the Air Transportation Safety and System Stabilization Act (ATSSSA) (Pub L 107-42, 115 US Stat 230, formerly codified at 49 USC § 40101 Note). Under ATSSSA § 405 (c) (3) (B), by accepting the option of proceeding before the Special Master a claimant waives the right to file a civil action. There is no action filed in any court, whether state or federal, in New York relating to the award. Although ATSSSA § 408 (b) provides exclusive jurisdiction in the US District Court, Southern District of New York for all lawsuits brought involving the terror attacks of September 11, 2001, by those who did not opt into the compensation plan established by the Act, it provides no review of any awards made by the Special Master by that court or any other court (see Schneider v Feinberg, 345 F3d 135 [2d Cir 2003]). As the award was not approved by a court in this state, the requirement of General Obligations Law § 5-1701 (o) (ii) has not been met.

The alternative provided by General Obligations Law § 5-1701 (o) (iii), that the "structured settlement agreement" is expressly governed by the laws of New York, is also inapplicable. Not only is there no explicit reference in the award that the laws of New York would govern its application, applicable case law recognizes that ATSSSA preempts state law on issues involving the air disasters of September 11, 2001 (see Matter of World Trade Ctr. Disaster Site, 414 F3d 352 [2d Cir 2005]; Matter of Antine v City of New York, 14 Misc 3d 161 [Sup Ct, NY County 2006]). Without meeting either General Obligations Law § 5-1701 (o) (ii) or (iii), the award to Mr. Washington fails to meet the definition of "structured settlement payments rights" under General Obligations Law § 5-1701 (o).

As the award to Mr. Washington does not meet the definition of "structured settlement payment rights" set forth in General {**65 Misc 3d at 1137}Obligations Law § 5-1701 (o), the award is not a structured settlement payment right which can be approved for transfer pursuant to the provisions of General Obligations Law § 5-1706. Accordingly, the court must deny the petition.

After deciphering the poor copy of the award provided by petitioner after the hearing, and reviewing a magnified copy of the letter to Mr. Washington submitted as exhibit "A," both contain language that prohibit the payee from transferring or assigning the periodic payments under the award. For this reason, even if the award had been determined to be a "structured settlement payment right" under General Obligations Law § 5-1701 (o), it could not be transferred by Mr. Washington to petitioner. Although a "structured settlement payment right" containing such a non-transferability provision may be transferable by the waiver of the non-transferability by the obligor, the payee may not waive that prohibition. Mere [*3]silence of the obligor by failing to appear in opposition to the petition cannot be determined to be a waiver of the non-transferability language included in the award to the payee (see Matter of 321 Henderson Receivables Origination LLC, 19 Misc 3d 504 [Sup Ct, Queens County 2008]). This forms a separate basis for denial of the application.

Proceedings for the transfer of structured settlement rights under General Obligations Law § 5-1706 should rest upon a clear, candid and open presentation of the factors required by the statute. Minimally, this should include a copy of the original structured settlement agreement approved by a court, the index number of that action and whatever other information petitioner and its counsel believe will be helpful to the court to make a proper determination of the petition. Although stated by the Second Department in another context, the principle that a court should not be required "to comb through a litigant's papers to find information [or the law] that is required to be set forth" is equally applicable here (see Abizadeh v Abizadeh, 159 AD3d 856, 857 [2d Dept 2018]).

The petition is denied and dismissed.