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A BILL TO BE ENTITLED
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AN ACT
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relating to disclosures and transfer expenses for transfers of |
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structured settlement payments. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 141.003, Civil Practice and Remedies |
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Code, is amended to read as follows: |
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Sec. 141.003. REQUIRED DISCLOSURES TO PAYEE. At least 10 |
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[three] days before the date on which the payee signs a transfer |
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agreement, the transferee shall provide to the payee a separate |
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disclosure statement, in bold type at least 14 points in size, that |
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states in plain language: |
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(1) the amounts and due dates of the structured |
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settlement payments to be transferred; |
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(2) the aggregate amount of the payments; |
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(3) the discounted present value of the payments to be |
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transferred, which shall be identified as the "calculation of |
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current value of the transferred structured settlement payments |
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under federal standards for valuing annuities," and the amount of |
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the Applicable Federal Rate used in calculating the discounted |
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present value; |
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(4) the gross advance amount; |
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(5) an itemized listing of all applicable transfer |
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expenses, other than attorney's fees and related disbursements |
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payable in connection with the transferee's application for |
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approval of the transfer, and the transferee's best estimate of the |
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amount of those expenses; |
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(6) the net advance amount; |
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(7) the amount of any penalties or liquidated damages |
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payable by the payee in the event of any breach of the transfer |
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agreement by the payee; [and] |
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(8) [a statement] that the payee has the right to |
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cancel the transfer agreement, without penalty or further |
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obligation, not later than the third business day after the date the |
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agreement is signed by the payee; and |
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(9) that the payee is advised to seek independent |
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legal and financial advice before entering into the transaction and |
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that the transferee will reimburse the payee up to $1,500 for the |
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costs incurred in obtaining that advice. |
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SECTION 2. Chapter 141, Civil Practice and Remedies Code, |
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is amended by adding Section 141.0035 to read as follows: |
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Sec. 141.0035. MAXIMUM TRANSFER EXPENSES; REIMBURSEMENT OF |
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CERTAIN PAYEE COSTS. (a) A transferee may not charge a payee |
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transfer expenses in excess of six percent of the aggregate amount |
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of the structured settlement payments due to the payee. The |
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limitation described by this subsection excludes reasonable |
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attorney's fees, taxes incurred by the transferee as a result of the |
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transfer, and any other liabilities or costs arising from obtaining |
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approval of the transfer under this chapter. |
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(b) The transferee shall reimburse the payee up to $1,500 of |
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the payee's costs to obtain independent legal and financial advice |
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with respect to the transfer agreement before the agreement is |
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entered into. The transferee may not refer the payee to an attorney |
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or financial advisor. |
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SECTION 3. This Act takes effect September 1, 2015. |