IN THE COURT OF APPEALS OF TENNESSEE

AT KNOXVILLE

March 10, 2014 Session

 IN RE A TRANSFER OF STRUCTURED SETTLEMENT PAYMENT RIGHTS BY

LAUREL J. SHANKS

Appeal from the Circuit Court for Hamblen County

No. 13CV101 Thomas J. Wright, Judge

No. E2013-01702-COA-R3-CV-FILED-MAY 27, 2014

The respondent financial services company appeals the trial court’s entry of an order

approving a transfer of the payee’s structured settlement payment rights to the petitioner

financial services company and its assignee, pursuant to Tennessee’s Structured Settlement

Protection Act (“SPPA”). See Tenn. Code Ann. §§ 47-18-2601 to 2607 (2013). The trial

court found that the transfer at issue met all statutory requirements. On appeal, the

respondent company raises the issue of whether the transfer order contravened two prior

court orders partially transferring the payee’s structured settlement payment rights to the

respondent and if so, whether this contravened applicable law under the SSPA. Discerning

no error, we affirm.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court

Affirmed; Case Remanded

THOMAS R. FRIERSON, II, J., delivered the opinion of the Court, in which CHARLES D.

SUSANO, JR., C.J., and D. MICHAEL SWINEY, J., joined.

Jason H. Long, Knoxville, Tennessee, for the appellant, JG Wentworth Originations, LLC.

Paul W. Kruse, Chris Raybeck, and Olatayo O. Atanda, Nashville, Tennessee; and E. John

Gorman, Houston, Texas, pro hac vice, for the appellee, RSL Funding, LLC.

OPINION

I. Factual and Procedural Background

The essential facts underlying this action are undisputed. The structured settlement

rights at issue originated with a settlement agreement entered by the parents of Laurel J.
Shanks on her behalf on June 9, 1994, when Ms. Shanks was a minor. The settlement was

for personal injuries Ms. Shanks suffered from an automobile collision. To fund the

settlement, the structured settlement obligor, Keyport Life Insurance Company (“Keyport”),

purchased an annuity requiring the annuity issuer, Liberty Life Assurance Company of

Boston (“Liberty”), to make periodic payments to Ms. Shanks.

On May 8, 2008, the Anderson County Circuit Court entered an order approving a

transfer of partial structured settlement payment rights from Ms. Shanks to the respondent,

JG Wentworth Originations, LLC (“Wentworth”), as described in a Purchase Agreement

incorporated into the order. According to the order, Wentworth was required to pay Ms.

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Shanks $16,500 as a lump sum in return for annual payments of $5,000 from July 1, 2008,

through July 1, 2010, and annual payments of $12,500 from July 1, 2015, through July 1,

2016. All periodic payments from Liberty were to be made to Wentworth, which would in

turn forward any unassigned portion of the payments to Ms. Shanks.

On November 24, 2008, the Cocke County Circuit Court entered an order approving

a second transfer of partial structured settlement rights from Ms. Shanks to Wentworth, as

described in a second Purchase Agreement incorporated into the order. This order

transferred additional payments, requiring Wentworth to pay Ms. Shanks $16,750 as a lump

sum in return for one payment of $5,000 due on July 1, 2009; one payment of $5,000 due on

July 1, 2010; one payment of $6,250 due on July 1, 2015; one payment of $6,250 due on July

1, 2016; one payment of $12,500 due on July 1, 2017; one payment of $15,000 due on July

1, 2018; and one payment of $20,000 due on July 1, 2019. As with the previous order, all

periodic payments from Liberty were made to Wentworth, which would forward any

unassigned portions to Ms. Shanks.

On May 20, 2013, the petitioner, RSL Funding, LLC (“RSL”), filed an application in

the Hamblen County Circuit Court (“trial court”), requesting approval of a Transfer

Agreement executed by RSL and Ms. Shanks (“Transfer Agreement”). According to the

Transfer Agreement, RSL would pay Ms. Shanks a lump sum of $40,000 for the remaining

portions of her periodic payments that were not assigned to Wentworth. These consisted of

one payment of $6,250 due on July 1, 2015; one payment of $6,250 due on July 1, 2016; one

payment of $12,500 due on July 1, 2017; one payment of $15,000 due on July 1, 2018; and

one payment of $20,000 due on July 1, 2019.

On May 28, 2013, RSL filed an amendment to its petition, requesting that the trial

court add Wentworth as an interested party and “prior assignee.” On June 12, 2013,

The 2008 transfer orders and agreements list 321 Henderson Receivables, now known as JG

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Wentworth, as the transferee.

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Wentworth subsequently filed a motion to intervene and an objection, asserting that approval

of the Transfer Agreement would contravene the court orders entered previously by the other

courts and would impose upon Wentworth obligations and liabilities to which it did not

contract.

The trial court granted Wentworth’s motion to intervene. Following a bench hearing,

the trial court approved the Transfer Agreement, finding that it met all requirements of the

SSPA and was in Ms. Shanks’s best interest. The court specifically overruled Wentworth’s

objection, finding that the Transfer Agreement did not contravene applicable law under the

SSPA or impose undue obligations upon Wentworth. The court entered an Order of Transfer

on June 19, 2013, incorporating the Transfer Agreement and also ordering Wentworth to

forward the previously unassigned portions of the periodic payments to the designated

assignee of RSL, Extended Holdings, Ltd. (“Extended Holdings”), as it would have to Ms.

Shanks under the previous court orders. Wentworth timely appealed.

II. Issue Presented

Wentworth presents one issue on appeal, which we restate as follows:

Whether the trial court erred by entering an order transferring structured

settlement payments from Ms. Shanks, as payee, to RSL and its assignee upon

the court’s finding, inter alia, that the order did not contravene applicable law

or two previous orders of other courts partially transferring Ms. Shanks’s

structured settlement payment rights to Wentworth.

III. Standard of Review

The issue raised is primarily a question of law, specifically involving interpretation

of Tennessee’s SPPA. See Tenn. Code Ann. §§47-18-2601 to 2607. We review questions

of law, including those ofstatutory construction, de novo with no presumption of correctness.

See Cunningham v. Williamson Cnty. Hosp. Dist., 405 S.W.3d 41, 43 (Tenn. 2013) (citing

Mills v. Fulmarque, Inc., 360 S.W.3d 362, 366 (Tenn. 2012)). Our Supreme Court has

summarized the principles involved in statutory construction as follows:

When dealing with statutory interpretation, well-defined precepts apply. Our

primary objective is to carry out legislative intent without broadening or

restricting the statute beyond its intended scope. Houghton v. Aramark Educ.

Res., Inc., 90 S.W.3d 676, 678 (Tenn. 2002). In construing legislative

enactments, we presume that every word in a statute has meaning and purpose

and should be given full effect if the obvious intention of the General

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Assembly is not violated by so doing. In re C.K.G., 173 S.W.3d 714, 722

(Tenn. 2005). When a statute is clear, we apply the plain meaning without

complicating the task. Eastman Chem. Co. v. Johnson, 151 S.W.3d 503, 507

(Tenn. 2004). Our obligation is simply to enforce the written language. Abels

ex rel. Hunt v. Genie Indus., Inc., 202 S.W.3d 99, 102 (Tenn. 2006). It is only

when a statute is ambiguous that we may reference the broader statutory

scheme, the history of the legislation, or other sources. Parks v. Tenn. Mun.

League Risk Mgmt. Pool, 974 S.W.2d 677, 679 (Tenn. 1998). Further, the

language of a statute cannot be considered in a vacuum, but “should be

construed, if practicable, so that its component parts are consistent and

reasonable.” Marsh v. Henderson, 221 Tenn. 42, 424 S.W.2d 193, 196 (1968).

Any interpretation of the statute that “would render one section of the act

repugnant to another” should be avoided. Tenn. Elec. Power Co. v. City of

Chattanooga, 172 Tenn. 505, 114 S.W.2d 441, 444 (1937). We also must

presume that the General Assembly was aware of any prior enactments at the

time the legislation passed. Owens v. State, 908 S.W.2d 923, 926 (Tenn.

1995).

In re Estate of Tanner, 295 S.W.3d 610, 613-14 (Tenn. 2009).

To the extent that we need also review the factual findings of the trial court, we

presume those findings to be correct and will not overturn them unless the evidence

preponderates against them. See Tenn. R. App. P. 13(d); Morrison v. Allen, 338 S.W.3d 417,

425-26 (Tenn. 2011). “In order for the evidence to preponderate against the trial court’s

findings of fact, the evidence must support another finding of fact with greater convincing

effect.” Wood v. Starko, 197 S.W.3d 255, 257 (Tenn. Ct. App. 2006).

IV. Transfer Order Not in Contravention of Applicable Law or Prior Orders

Wentworth contends that the trial court erred by entering the Order of Transfer

because the Order violated the previous orders entered by the Anderson County and Cocke

CountyCircuit Courts, which Wentworth argues constitute “applicable law” under Tennessee

Code Annotated § 47-18-2603 of Tennessee’s SSPA. RSL contends that the transfer at issue

does not contravene applicable law or the prior court orders. We agree with RSL.

Pursuant to Tennessee’s SSPA, a “payee,” such as Ms. Shanks in the instant action,

is defined as “an individual who is receiving tax-free damage payments under a structured

settlement and proposes to make a transfer of payment rights thereunder . . . .” See Tenn.

Code Ann. § 47-18-2602(7). Tennessee is one of a majority of states to have enacted an

SSPA in an effort to protect payees from “bargaining away their interests in structured

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settlement agreements for less than adequate consideration.” See In re Sparks, No. 03-

38563L, 2005 WL 1669609 (Bankr. W.D. Tenn. July 14, 2005); see generally, Jay M. Zitter,

Annotation, Construction and Application of State Structured Settlement Protection Acts, 27

A.L.R.6th 323 (2007). Enacted in 2000, Tennessee’s SSPA, similar to those enacted in other

states, is based on a model SSPA written with the contributions of, inter alia, the National

Association of Settlement Purchasers. See Symetra Life Ins. Co. v. Rapid Settlements, Ltd.,

657 F. Supp. 2d 795, 799-803 (S.D. Tex. 2009) (“Symetra II”); Zitter, 27 A.L.R. 6th at 323.

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The SSPAs typically, as Tennessee’s does, “require the factoring company to disclose fully

the effects of the proposed transfer and require a state-court judge to decide whether to

approve the transfer as in the best interests of the [payee].” See Symetra II, 657 F. Supp. 2d

at 799; see also Tenn. Code Ann. § 47-18-2603; Zitter, 27 A.L.R. 6th at 323. The financial

companies purchasing structured settlement payment rights, such as Wentworth and RSL,

are often described as “factoring” companies, referring to the “factoring discount” amount

they accept in exchange for acquisition of a payee’s structured settlement payment rights.

See 26 U.S.C.A. § 5891(a), (c)(3)-(4) (2002) (excepting structured settlement factoring

transactions approved by a qualified state order from imposition of a federal tax that would

otherwise be equal to forty percent of the factoring discount).

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In Tennessee, the requirements for a transfer of structured settlement payment rights

are delineated in Tennessee Code Annotated § 47-18-2603, which provides:

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 authorized in

advance in a final order of a court of competent jurisdiction or a responsible

administrative authority, and complies with all of the following:

The district court in Symetra II noted in 2009 that forty-seven states had enacted an SSPA based 2

on the model statute. Symetra II at 657 F. Supp. 2d at 799 n.1. Since that time, a forty-eighth state, Vermont,

has also enacted an SSPA, which took effect on July 1, 2012. See Vt. Stat. Ann. 9 § 2480dd (2013). Our

research shows that to date, neither New Hampshire nor Wisconsin has enacted an SSPA. 

26 U.S.C.A. § 5891(c)(4) defines “factoring discount” as:

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an amount equal to the excess of–

(A) the aggregate undiscounted amount of structured settlement payments being

acquired in the structured settlement factoring transaction, over

(B) the total amount actually paid by the acquirer to the person from whom

such structured settlement payments are acquired. 

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(1) The Transfer complies with the requirements of this part and will not

contravene other applicable law;

(2) Not less than ten (10) days prior to the date on which the payee

executes the transfer agreement, the transferee has provided to the

payee a disclosure statement in bold type, no smaller than fourteen (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, notary fees and other commissions, fees,

costs, expenses and charges, and a good faith estimate of all

legal fees and court costs 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

subdivision (2)(E); and

(G) 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;

(3) The payee has established that the transfer is fair and reasonable and in

the best interest of the payee;

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(4) The payee has been advised by the transferee, in writing, to seek

independent professional advice regarding the financial, legal and tax

implications of the transfer; and

(5) 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 such notice with

the court or responsible administrative authority.

Circuit courtsin Tennessee have nonexclusive jurisdiction over applicationsfor authorization

of transfers of structured settlement payment rights. Tenn. Code Ann. § 47-18-2604(a).

At specific issue in the instant action is the statutory requirement that the “transfer

. . . will not contravene other applicable law.” See Tenn. Code Ann. § 47-18-2603(1); -2606

(“Nothing contained in this part 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.”). The SSPA

defines “applicable law” as “state or federal statutes of the United States.” Tenn. Code Ann.

§47-18-2602(2). Because Tennessee circuit courts are granted the authority by statute to

approve proposed transfers of structured settlements, see Tenn. Code Ann. § 47-18-2604(a),

Wentworth argues that the orders previously entered by the Anderson County Circuit Court

and the Cocke County Circuit Court are “applicable law” under the statutory definition.

Prior to the filing of this opinion, Tennessee state appellate courts had not yet been

called upon to interpret provisions of the SSPA. One federal bankruptcy court decision from

the Western Division of Tennessee does address a debtor’s/decedent’sright to payment under

a transfer order qualified under the Tennessee SSPA as property of the debtor’s/decedent’s

estate. See In re Sparks, 2005 WL 1669609 at *4-5 (also explaining the background and

basic requirements of Tennessee’s SSPA). The court in Sparks does not address the

requirement of adhering to applicable law. Id. We note also that the Sparks order is a federal

bankruptcy court decision and as such, is not binding on this Court. See Gossett v. Tractor

Supply Co., 320 S.W.3d 777, 785 n.3 (Tenn. 2010) (explaining that even opinions of federal

intermediate courts are “only persuasive authority and not binding” on Tennessee state

courts).

Tennessee’s SSPA does not include a definition of “contravene,” but we note the plain

meaning as “to violate or infringe” or “to be contrary to.” See BLACK’S LAW DICTIONARY

352 (8th ed. 2004); see, e.g., Planned Parenthood of Middle Tenn. v. Sundquist, 38 S.W.3d

1, 8 (Tenn. 2000) (“We may only invalidate a statute when it contravenes either the federal

or state constitution.”). The Tennessee General Assembly did, however, take pains to define

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“applicable law” to the SSPA as “state or federal statutes of the United States.” Tenn. Code

Ann. § 47-18-2602(2). We are unconvinced, asthe trial court was, by Wentworth’s argument

that the legislature intended something other than this clear and straightforward definition.

See Rich v. Tenn. Bd. of Med. Examiners, 350 S.W.3d 919, 927 (Tenn. 2011) (applying the

“canon of construction ‘expressio unius est exclusio alterius,’ which holdsthat the expression

of one thing implies the exclusion of others . . . .”); cf. In re Rapid Settlements LTD’s

Application for Approval of Structured Settlement Rights, 136 P.3d 765, 772 (Wash. Ct. App.

2006) (explaining that Washington’s SSPA explicitly provides that an order transferring

structured settlement payment rights in that state must “not violate the order of any court”)

(citing Wash. Rev. Code § 19.205.030(3)). We stress again that our primary objective when

interpreting statutes is to “carry out legislative intent without broadening or restricting the

statute beyond its intended scope.” See In re Estate of Tanner, 295 S.W.3d at 613.

Wentworth also argues that because 26 U.S.C.A. § 5891 defines a transfer order

qualifying for the federal tax exception in part as one that “does not contravene any Federal

or State statute or the order of any court or responsible administrative authority,” any

contravention of a prior transfer order would contravene applicable federal law. See 26

U.S.C.A. § 5891(b)(2)(A)(i). 26 U.S.C.A. § 5891 provides in pertinent part:

(a) Imposition of tax.–There is hereby imposed on any person who

acquires directly or indirectly structured settlement payment rights in

a structured settlement factoring transaction a tax equal to 40 percent

of the factoring discount as determined under subsection (c)(4) with

respect to such factoring transaction.

(b) Exception for certain approved transactions–

(1) In general.–The tax under subsection (a) shall not apply in the

case of a structured settlement factoring transaction in which the

transfer of structured settlement payment rights is approved in

advance in a qualified order.

(2) Qualified order.–For purposes of this section, the term

“qualified order” means a final order, judgment, or decree

which–

(A) finds that the transfer described in paragraph (1)–

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(i) does not contravene any Federal or State statute or

the order of any court or responsible

administrative authority, and

(ii) is in the best interest of the payee, taking into

account the welfare and support of the payee’s

dependents, and

(B) is issued–

(i) under the authority of an applicable State statute

by an applicable State court, or

(ii) by the responsible administrative authority (if

any) which has exclusive jurisdiction over the

underlying action or proceeding which was

resolved by means of the structured settlement.

We agree that the plain meaning of 26 U.S.C.A. § 5891(b)(2)(A)(i) is that a transfer

order contravening a priorstate court order would not qualify for the tax exception delineated

by that federal statute. We do not determine, however, that such an unqualified order would

contravene the federal statute; it would simply fail to qualify for the exception. The resultant

financial consequence of such a failure to qualify the order would be borne by the factoring

company acquiring the payee’s structured settlement payment rights, in this case, RSL. See

26 U.S.C.A. § 5891(a), (b)(2)(A)(i). We conclude that in order for a transfer order to

contravene applicable law, pursuant to Tennessee Code Annotated §§ 47-18-2603(1) and

-2606, it must contravene a state or federal statute of the United States, pursuant to

Tennessee Code Annotated § 47-18-2602(2). Because a prior circuit court order does not

constitute a statute, it does not constitute “applicable law” under Tennessee’s SSPA.

Moreover, upon a thorough review of the record, we determine that the transfer order

at issue does not contravene the prior court orders. In explaining this conclusion, it is helpful

to track the portion of periodic payments not assigned and therefore retained by Ms. Shanks

upon entry of each order. The May 8, 2008 Anderson County Circuit Court order approved

a transfer from Ms. Shanks to Wentworth of the following periodic payment portions:

• July 1, 2008 $5,000 (unassigned portion: $10,000)

• July 1, 2009 $5,000 (unassigned portion: $10,000)

• July 1, 2010 $5,000 (unassigned portion: $10,000)

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• July 1, 2015 $12,500 (unassigned portion: $12,500)

• July 1, 2016 $12,500 (unassigned portion: $12,500)

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Pursuant to the May 2008 order, Wentworth was obligated to forward the unassigned

portions noted above to Ms. Shanks upon receipt of the periodic payments from the annuity

issuer.

The November 24, 2008 Cocke County Circuit Court order subsequently approved a

transfer from Ms. Shanks to Wentworth of the following previously unassigned payment

portions:

• July 1, 2009 $5,000 (unassigned portion: $5,000)

• July 1, 2010 $5,000 (unassigned portion: $5,000)

• July 1, 2015 $6,250 (unassigned portion: $6,250)

• July 1, 2016 $6,250 (unassigned portion: $6,250)

• July 1, 2017 $12,500 (unassigned portion: $12,500)

• July 1, 2018 $15,000 (unassigned portion: $15,000)

• July 1, 2019 $20,000 (unassigned portion: $20,000)

As before, Wentworth was obligated to forward the remaining unassigned payment portions

to Ms. Shanks upon receipt from the annuity issuer.

In the Order of Transfer at issue, entered on June 19, 2013, the trial court approved

a transfer from Ms. Shanks to RSL and its assignee of the following previously unassigned

payment portions:

• July 1, 2015 $6,250 (unassigned portion: $0)

• July 1, 2016 $6,250 (unassigned portion: $0)

• July 1, 2017 $12,500 (unassigned portion: $0)

• July 1, 2018 $15,000 (unassigned portion: $0)

• July 1, 2019 $20,000 (unassigned portion: $0)

Upon entry of this last order, Ms. Shanks no longer retained ownership of any portion of her

periodic payments from the structured settlement.

It is undisputed that at the time Ms. Shanks entered the Transfer Agreement with RSL,

she owned the rights to the periodic payment portions she had not previously assigned to

Unassigned portions are taken from a “Breakdown of Annuity Payments,” attached to the Order of 4

Transfer, as well as analysis of the collective effect of the three transfer orders.

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Wentworth. The instant Order of Transfer modified the prior court orders only insofar as it

authorized Ms. Shanks’s request to have Wentworth remit payment portions to an assignee,

RSL (and in turn RSL’s assignee, Extended Holdings), rather than directly to her. Both of

the prior orders contained the following provision:

Any further transfer of structured settlement payment rights by Payee may be

made only after compliance with all of the requirements of the Act [SSPA].

Nothing in the May 2008 order or November 2008 order prevented Ms. Shanks from seeking

authorization, pursuant to the SSPA, of a transfer of those payment rights that still belonged

to her upon entry of each respective order. In fact, the November 2008 order was the result

of Ms. Shanks’s seeking such a transfer to Wentworth of additional payment portions

remaining after entry of the first order. The difference with the order at issue is that Ms.

Shanks sought transfer of her structured settlement payment rights to a factoring company

other than Wentworth. We find no provision in either of the 2008 orders that prevented Ms.

Shanks from entering a future transfer agreement with a different transferee, provided that

the payment rights she transferred were her own and that the transfer complied with all

requirements of the SSPA.

Wentworth also asserts that in entering the Order of Transfer at issue, the trial court

violated and “ignored” the terms of the orders entered by the Anderson County and Cocke

County Circuit Courts. Wentworth argues that the trial court improperly “modified the prior

court-ordered obligation of [Wentworth] to its customer, Laurel Shanks” in requiring

Wentworth to remit the previously unassigned portions of the periodic payments to RSL’s

assignee, Extended Holdings, rather than Ms. Shanks. We disagree.

In its Order of Transfer, the trial court stated in pertinent part:

Portions of the Periodic Payments due beginning on July 1, 2015

through and including July 1, 2019 (the “Wentworth Serviced Payments”), as

more particularly set forth and described herein and in Exhibit A, which

include the RSL Assigned Payments, are currently being serviced by J.G.

Wentworth Originations, LLC (“Wentworth”), as custodian, and not as

principal, for the benefit of Ms. Shanks, and Sun Life and/or Liberty Life.

Upon entry of this Order, the Wentworth Serviced Payments shall be received

by Wentworth, as custodian, and not as principal, for the benefit of Ms. Shanks

and Extended Holdings, Ltd. (“Assignee”), with such payments being remitted

to Assignee by Wentworth promptly within five (5) business days of

Wentworth’s receipt of such payments from Liberty Life.

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Wentworth filed an objection in this matter as an Interested Party

asserting this Court cannot grant the proposed transfer. Wentworth claims that

if this Court were to do so, then this Court’s order would violate the Act by

contravening prior court ordersin violation of Tennessee Code Annotated §47-

18-2603. The prior court orders Wentworth referenced are in Case No.

A8LA0157 from the 7th Circuit Court of Anderson County, TN and in Case

No. CV-031371-III . . . in the 4th Circuit Court of Cocke County, TN (the

“Prior Wentworth-Shanks Orders”). This Court is not persuaded by

Wentworth’s arguments and Wentworth’s objection is overruled.

Nothing in this Order is intended to or shall create a fiduciary, trust,

principal-agent, or partnership relationship by and between Wentworth and

RSL Funding, Assignee, or Ms. Shanks. Specifically, with respect to the

Court’s order that Wentworth shall receive certain lump sum structured

settlement/annuity payments from Liberty Life from July 1, 2015 through and

including July 1, 2019 (the “Wentworth Term Payments”) and retain the

portion of said payments which were transferred and assigned to Wentworth

in connection with the transactions approved as part of the Prior WentworthShanks Orders (the “Wentworth Assigned Payments”), and remit the totality

of the remainder of said payments, which are the RSL Assigned Payments, (the

“Wentworth-Extended Holdings Serviced Payments”) to Assignee (Extended

Holdings[,] Ltd.) from July 1, 2015 through and including July 1, 2019 (the

“Wentworth Servicing Term”), the “Wentworth Servicing Arrangement” will

not create any fiduciary, trust, principal-agent, or partnership by and between

Wentworth, on the one hand, and/or RSL Funding, Assignee, or Ms. Shanks

on the other hand. However, a special custodial relationship is being created

wherein Wentworth is a servicer and custodian of the Wentworth Serviced

Payments for the benefit of Ms. Shanks and Assignee. This special custodial

relationship does not create any ownership rights or interest by Wentworth to

or in the Wentworth Serviced Payments. Moreover, by virtue of this Final

Order, Wentworth’s obligations shall be to solely and exclusively to [sic]

receive the Wentworth Term Payments, retain the Wentworth Assigned

Payments, and remit the Wentworth-Extended Holdings Serviced Payments to

Assignee as further described herein. Wentworth’s obligation under this order

terminates upon final payment to assignee as set forth in this order.

. . .

It is further ORDERED that the portion of the Periodic Payments

which are the Wentworth Serviced Payments, as described below, due

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beginning on July 1, 2015 through and including July 1, 2019 shall be

forwarded by Wentworth, when, as and if received by Wentworth from Liberty

Life within five (5) business days of their receipt, to Extended Holdings, Ltd.

at [address], and no person other than Extended Holdings, Ltd.shall be entitled

to receipt of the Wentworth Serviced Payments, such being:

• Two (2) annual payments each in the amount of $6250

beginning on July 1, 2015 through and including July 1,

2016;

• one (1) lump sum payment in the amount of $12,500 due

and payable on July 1, 2017;

• one (1) lump sum payment in the amount of $15,000 due

and payable on July 1, 2018; and

• one (1) lump sum payment in the amount of $20,000 due

and payable on July 1, 2019.

It is further ORDERED that in the event that Assignee changes its

physical address or is merged with or acquired by another individual or entity,

such that Assignee ceases to exist, the Wentworth Serviced Payments shall be

sent directly to that person or entity by Wentworth, after providing proper,

advance, written notice to Wentworth. Further, notwithstanding the foregoing,

Wentworth or Assignee are permitted to mutually agree to alter the payment

method (including, but not limited to, ACH or wire transfer) or Designated

Address without further order of the Court.

. . .

It is further ORDERED that RSL Funding or Assignee shall send a

signed copy of this Order to Liberty Life, Sun Life, to counsel for Wentworth

and directly to Wentworth at the address set forth below. Upon receipt thereof,

Wentworth shall issue a formal acknowledgment letter to RSL Funding and

Assignee of the transfer within ten (10) business days of the date of receipt of

this Order of Transfer that the Wentworth Serviced Payments from July 1,

2015 through and including July 1, 2019 shall be made to Extended Holdings,

Ltd. at [address] (unless a change of address has been provided to Wentworth

in writing at least 30 days in advance of the effective date of such change of

address by RSL Funding or Assignee). The formal acknowledgment letter to

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be issued by Wentworth shall be delivered to Extended Holdings, Ltd. at the

address set forth above, Attn: President.

(Paragraph numbering omitted.)

We note first that the trial court certainly did not “ignore” the terms of the two prior

court orders, as demonstrated by the court’s painstaking explanation of Wentworth’s role as

to the payment portions not transferred to it by the previous orders. Under the prior transfer

orders, Wentworth was obligated to accept the full amount of each structured settlement

payment, retain the amount Ms. Shanks had transferred to Wentworth, and remit the

unassigned portion to Ms. Shanks. Pursuant to the SSPA, “[n]either the annuity issuer nor

the structured settlement obligor may be required to divide any structured settlement payment

between the payee and any transferee or assignee or between two (2) or more transferees or

assignees.” Tenn. Code Ann. § 47-18-2604(f). As Wentworth points out, it would be a

violation of this provision to require Liberty (the annuity issuer) or Keyport (the structured

settlement obligor) to divide periodic payments. The payments, therefore, must be sent to

the transferee before they may be divided. Contrary to Wentworth’s argument, however, we

find that this statutory provision anticipates that there may be more than one transferee or

assignee. See Tenn. Code Ann. § 47-18-2604(f). Thisstatutory provision prohibits a transfer

order from requiring the annuity issuer or structured settlement obligor to divide any periodic

payments and does not apply to the transferee. See id.

According to the Order of Transfer at issue, Wentworth is obligated to accept the full

amount of each structured settlement payment, retain the amount Ms. Shanks had previously

transferred to Wentworth, and remit the remaining portion, now transferred to RSL by Ms.

Shanks, to RSL’s assignee, Extended Holdings. Thus, the only change in this obligation for

Wentworth is that it must remit the remaining payment portions to Extended Holdings rather

than to Ms. Shanks. In addition, the trial court directed Wentworth to remit the payments

within five business days of receipt, a deadline not contained within the prior orders. The

court also directed Wentworth to write one letter to the president of Extended Holdings,

formally acknowledging receipt of the transfer order within ten days of receiving a copy of

the order from RSL or its assignee. We determine that the trial court’s addition of a

reasonable deadline for processing the payment portions and the requirement of one

acknowledgment letter are not overly burdensome.

Wentworth particularly objects to the trial court’s characterization of Wentworth’s

responsibilities toward what the court described as the “Wentworth Serviced Payments” as

a “custodial relationship.” The trial court expressly stated that it did not intend by the Order

of Transfer to “create a fiduciary, trust, principal-agent, or partnership relationship by and

between Wentworth and RSL Funding, Assignee, or Ms. Shanks.” Wentworth did, however,

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already have a fiduciary relationship in place with Ms. Shanks in terms of its obligation to

accept her total periodic payments, retain its assigned portion, and remit the remainder to her.

We determine that this Order of Transfer did not create a fiduciary relationship between

Wentworth and Ms. Shanks beyond the one previously in place.

Wentworth correctly notes that “[c]ourts cannot make contracts for parties but can

only enforce the contract which the parties themselves have made.” Hafeman v. Protein

Discovery, 344 S.W.3d 889, 900 (Tenn. Ct. App. 2011). We do not, however, find this to

be an instance of the trial court’s creating a contract between Wentworth and RSL. Under

the prior orders, Wentworth did not acquire an ownership interest in the payment portions

not transferred to it. Instead, Wentworth serviced those portions by forwarding them to Ms.

Shanks. Through her application for approval of the transfer to RSL, Ms. Shanks requested

that RSL or its assignee receive the previously unassigned payment portions she would have

received. The plain meaning of “custody” is the “care and control of a thing or person for

inspection, preservation, or security.” BLACK’S LAW DICTIONARY 412 (8th ed. 2004). We

discern no error in the trial court’s characterization of Wentworth’s role in forwarding the

previously unassigned payment portions to RSL’s assignee rather than Ms. Shanks as

“custodial.” We conclude that the trial court’s Order of Transfer did not violate the previous

orders entered by the Anderson County and Cocke County Circuit Courts.

5

Finally, as RSL correctly posits, an underlying public policy consideration supporting

enactment of state SSPAs is the need for structured settlement transfers to be in the best

interest of payees. See, e.g., Symetra Life Ins. Co. v. Rapid Settlements, Ltd., 599 F. Supp.

2d 809 (S.D. Tex. 2008) (“Symetra I”) (applying the Texas SSPA, which is similar to

Tennessee’s SSPA, and explaining that “[t]he purpose of the ‘best interests’ finding is to

make sure that the payee does not give up his or her right to the future-income stream in

exchange for a much smaller present payment, unless there is good reason for the

transaction.”), affirmed by Symetra Life Ins. Co. v. Rapid Settlements, Ltd., 567 F.3d 754 (5th

Cir. 2009) (incorporating rationale of district court decision); see generally Zitter, 27 A.L.R.

6th at 323 (noting several cases in other jurisdictions in which trial courts have denied

transfer applications after finding that the transfers were not in the payees’ best interest).

On appeal, Wentworth also contends that RSL collaterally attacked the prior court orders by filing 5

the application of transfer. RSL argues that Wentworth is barred from raising this argument for the first time

on appeal. See Fayne v. Vincent, 301 S.W.3d 162, 170-71 (Tenn. 2009) (noting that “[t]he jurisprudential

restriction against permitting parties to raise issues on appeal that were not first raised in the trial court is

premised on the doctrine of waiver.”). We determine Wentworth’s contention in this regard to be a restated

argument that the Order of Transfer contravened the prior orders, and while not barred, the argument is moot

in light of our conclusion that the Order of Transfer did not contravene the prior orders. 

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In the case at bar, Wentworth does not dispute the trial court’s express finding that the

Order of Transfer was in Ms. Shanks’s best interest. See Tennessee Code Annotated §§ 47-

18-2603(3), 47-18-2604(c) (delineating factors for the trial court to consider when

determining the best interest of the payee). Upon our careful and thorough review of the

record, we determine that the evidence does not preponderate against the trial court’s finding

that the Transfer Agreement met the requirements of the SSPA, including that it did not

contravene applicable law and was in Ms. Shanks’s best interest. The trial court did not err

by entering the Order of Transfer.

V. Conclusion

For the reasons stated above, we affirm the Order of Transfer entered by the trial

court. The costs on appeal are assessed against the Appellant, JG Wentworth Originations,

LLC. This case is remanded to the trial court, pursuant to applicable law, for enforcement

of the judgment and collection of costs assessed below.

_________________________________

THOMAS R. FRIERSON, II, JUDGE

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