by John Darer CLU ChFC CSSC RSP CLTC
On November 27, 2013, the Illinois Supreme Court denied the Petition to Review of Peachtree Settlement Funding in the Brenston case, a decision that may leave some structured settlement factoring companies and their investors with the turkey "trots".
It remains to be seen how the Brenston decision affects JGWPT which acquired Peachtree and only went public last month, as well as other stakeholders in the structured settlement secondary market. At time of posting the shares of JGWPT Holdings were up 2.96% on the day.
The decision filed August 26, 2013 in Settlement Funding, LLC (Peachtree Settlement Funding) v Cathy Brenston, 2013 IL App (4th) 120869, the subject matter of which involved THREE prior transfer orders (June 28,2007; March 31,2008 and April 10, 2008) approved by the Circuit Court of Sangamon County and a petition by the seller, MORE THAN TWO YEARS AFTER these the transfer orders to vacate the Orders on the basis of fraud by the purchaser and the assertion of a legal disability of incompetence, the Illinois Appellate Court reversed a lower court decision denying the petition to vacate and ordered:
- that the lower court enter orders declaring the underlying transfers void ab initio ("from the beginning"), overcoming opposition that Brenston's petiton was time-barred;
- that the trial court, pursuant to its inherent equitable power, conduct a hearing to restore Brenston to the economic position she held prior to the legally ineffective transfer of her annuity payments, less any funds advanced to her to avoid a windfall.
I understand that Peachtree has another case with an appeal filed in Peoria, another district of Illinois. If that decision is different than this Brenston decision that the higher court may need to get involved to resolve conflicts between the districts.
For more information read my August 29, 2013 post Illinois Appeals Court Overturns Old Structured Settlement Transfer Orders