An injured plaintiff may be awarded a structured settlement for personal injuries or sickness suffered due to no fault of his or her own. Structured settlements are periodic payments designed to protect at-risk victims from spending all of the award money at once.
It is not uncommon for purchasing companies to prey on disabled and/or mentally impaired injury victims, buying the settlement amounts for a mere pittance.
“When we set up a settlement with an annuity for the rest of the client’s life or structured payments for a number of years,” notes Virginia injury lawyer Doug Landau, “we do not want the client selling it, at a fraction of the value, unless there’s absolutely a true, once in a lifetime emergency.”
Lawyer Landau was glad the Structured Settlement Protection Act passed and was signed by the Governor.
Some recall the Washington Post expose where the Portsmouth Circuit Court received bad press concerning how easy it was for a factoring company to unravel a structured settlement, paying injured plaintiffs pennies on the dollar to buy their annuities.
Thousands of structured settlements were undone. Fortunately, Virginia Trial Lawyers Association and our Virginia legislature’s bipartisan efforts were able to get this bill passed.
Here are some of the new requirements:
- Petition for approval of the transaction must be brought in the circuit court of the city or county in which the payee resides.
- The payee is required to appear in person unless the court makes an exception due to good cause.
- The petition must advise the court of prior “factoring” transactions.
- Such petitions may no longer be approved by a responsible administrative authority.
- Provisions from North Carolina’s Structured Settlement Protection Act were also incorporated
- The discount rate must not be more than the annualized prime plus five percentage points
- Expenses must be no more than two percent of the net payable to the payee
- The court must find that the transaction is fair and reasonable
If you or someone you know has been injured and has received a structured settlement, please understand the protections you are afforded by law in Virginia. If there are questions or you suspect you are being taken advantage of by a purchasing company, email or call Abrams Landau, Ltd. at once (703-796-9555).