The Lemanski Case: A Case Review (Part 1)
The Lemanski case seeks court approval of a proposed transfer of structured settlement payments from the payee, Jenny Lemanski (“Lemanski”), to the transferee, 321 Henderson Receivables, L.P. (“321 Henderson”).
Payee Background and History of her Structured Settlement
Lemanski got injured when she was two years old. On Lemanski’s behalf, her mother instituted a lawsuit against the responsible party which was settled in May of 1989. The payments required under that structured settlement are as follows:
a. $15,000.00 on January 2, 2003;
b. $15,000.00 on January 2, 2004;
c. $15,000.00 on January 2, 2005;
d. $15,000.00 on January 2, 2006;
e. $135,000.00 due on January 2, 2010;
f. $200,000.00 due on January 2, 2015;
g. $250,000.00 due on January 2, 2025;
h. $350,000.00 due on January 2, 2035.
History of Requests for Transfers
The court requires that all past attempts to sell structured settlement rights, successful of otherwise, be documented and submitted to the courts. Lemanski received approval from the court in December of 2005 to sell a portion of the payment due on January 10, 2010. At that time, the Court granted approval for the sale of the payment of $85,000.00 due on that date so she can pay for a house.
Motive For Selling
Lemanski claimed that she will use the money so she and her fiancee, Jamie Dombrowski, can purchase more equipment for their recently-inaugurated landscaping and snow plowing business. She said she already purchased several pieces of equipment in December of 2005 so that she could take over some contracts from her sister’s landscaping/snow plowing business. They claimed to have 37 contracts for lawn service. However, they said that the truck they bought was a mistake because it had too many miles and needs too many repairs. Thus, she needs money to buy a better truck and operate the business more efficiently.
Dependents and Present Condition
Lemanski is 21 years old and is the single mother of two (2) minors under the age of three (3). Jamie Dombrowski is her fiancee and father of her children.
Structured Settlement Present Value
Lemanski wants to sell $125,000.00 in future payments due on January 2, 2010 ($50,000.00) and January 2, 2015 ($75,000.00). In exchange for the sale of those two payments, Lemanski would receive the net amount of $51,500.00.
The present value of the payments to be sold (5.60% discount rate at the time of the application) is $87,467.19. Lemanski would receive 58.94% of this present value, that is an equivalent of an annual discount rate for the transaction of 15.16%. A Prudential Insurance Company America quote showed that purchasing a comparable annuity for the aggregate amount of payments to be transferred would be $94,395.00. Lemanski would receive only 54.55% of this amount with her current quote.
Related posts:
- Settlement Funding, L.L.C. v. Prudential Assigned Settlement Services Corp.: A Review
- How to Ensure the Court that the Future of Minors will not be Compromised in the Sale of a Structured Settlement
- Defining “Best Interest” in CA SSPA
- Structured Settlement Investment Period
- Legal Considerations in Selling Structured Settlements of Children
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[...] After all basic facts have been forwarded to the court, the judge started reviewing all information to determine if the sale promotes the best interest of the payee and her dependents. You can read part 1 here. [...]