In Re: CBC Settlement Funding, LLC

Additionally, the parties did not lodge courtesy copies of the briefs. If the demurrer and motion to strike are continued, the parties must lodge the courtesy copies five days prior to the new hearing date. Plaintiffs are ordered to give notice of this Order. DATED: August 26, 2026 ________________________________ Hon. Teresa A. Beaudet Judge, Los Angeles Superior Court

Superior Court of California County of Los Angeles Department 508 In Re: CBC SETTLEMENT FUNDING, LLC | Case No.: |

| Hearing Date: | August 26, 2026 | Hearing Time: | 8:30 a.m. | [TENTATIVE] ORDER RE: PETITION FOR APPROVAL OF TRANSFER OF STRUCTURED SETTLEMENT PAYMENT RIGHTS | Background On April 17, 2026, Petitioner CBC Settlement Funding, LLC ("Petitioner") filed the instant petition for approval of transfer of structured settlement payment rights.

Petitioner now moves for an order approving the transfer of structured settlement payment rights pursuant to California Insurance Code Sec.10134 et seq. No parties responded to the instant petition.

Discussion

The payee of the structured settlement payments is Shawn Becerrada ("Payee"). (Pet., Ex. 1, p. 1.) Payee is the recipient of structured settlement payments from Assignor, Eastern Point Trust Company as Fund Administrator of SMPAL 2023 Settlement Fund. (Ibid.) The structured settlement commenced on November 1, 2023, and provides Payee with $1,719.00 per month for the lifetime of Payee, "with the first 40 years guaranteed; (final guaranteed payment on 10/01/2063)." (Ibid.)

A. Transfer Agreement Payee entered into a transfer agreement to transfer structured settlement payment rights to Petitioner. Under the transfer agreement entered into on April 13, 2026, Payee agreed to transfer 180 monthly payments in the amount of $1,000.00 beginning March 1, 2044 through and including February 1, 2059. (Pet., Ex. 2, p. 2.) The aggregate amount of the future payments equals $180,000.00, but the gross amount payable to Payee is $20,000. (Ibid.) The disclosure notice states, "[t] hose future payments have a discounted present value equal to $58,594.90, calculated by applying the discount rate of 4.6% utilized by the Internal Revenue Service to value annuities in probate proceedings. This is the value of your structured settlement in current dollars." (Ibid.) The purchase price is the equivalent of an interest rate of 9.38% per year. (Pet., Ex. 2, p. 3.)

Pursuant to Insurance Code section 10136, subdivision (c), " [t] he transfer agreement shall be written in at least 12-point type and shall be complete and without blank spaces to be completed after the payee's signature. The transfer agreement shall set forth clear and conspicuously, and in no less than 12-point type" certain information specified in Insurance Code section 10136, subdivision (c) . The agreement complies with this requirement. Insurance Code section 10138 prohibits certain provisions. The transfer agreement does not contain the prohibited provisions.

B. Fairness of the Proposed Transfer Under Insurance Code section 10139.5, subdivision (b), "[w]hen determining whether the proposed transfer should be approved, including whether the transfer is fair, reasonable, and in the payee's best interest, taking into account the welfare and support of the payee's dependents, the court shall consider the totality of the circumstances." Some key factors the Court may consider are " (1) The reasonable preference and desire of the payee to complete the proposed transaction, taking into account the payee's age, mental capacity, legal knowledge, and apparent maturity level. (2) The stated purpose of the transfer. (3) The payee's financial and economic situation. (4) The terms of the transaction, including whether the payee is transferring monthly or lump sum payments or all or a portion of his or her future payments."

Petitioner submits the Declaration of Shawn Becerrada, Payee, in support of the petition. Payee states that he is " an interested party to this action pursuant to Insurance Code Sec.10134(g), and this declaration is made in support of the petition to approve a transfer of certain of my rights to future structured settlement payment rights to CBC Settlement Funding, LLC, pursuant to Insurance Code Sec. 10139.5(b)." (Pet., Ex. 4, Becerrada Decl., P. 1.) Payee is single, has no minor children, is currently employed at Veoride and makes roughly $2,600 per month, and "live[s] at 1834 14th Street, Santa Monica, CA 90404." (Id., at P.P. 2-6.)

Payee explains that he receives " the structured settlement as a result of personal injury case where I was assaulted. I do not receive disability payments and this policy was not set up to handle any future medical expenses. I will still receive the following payments from my annuity: 180 MONTHLY PAYMENTS IN THE AMOUNT OF $1,000.00 BEGINNING [sic] MARCH 1, 2044 THROUGH AND INCLUDING FEBUARY [sic] 1, 2059. I am receiving the annuity from Pacific Life Insurance Company. The entity initially obligated to fund, design/structure and assign an issuing entity (the aforementioned 'Annuity Issuer' or 'Issuer') to payout the structured settlement annuity (the 'Settlement Obligor' or 'Obligor') payment rights Pacific Life and Annuity Services Incorporated." (Id., at P. 7.)

Payee explains that he "previously pursued the sale of a portion of my future payments on five separate occasions: 1. 24STCP04079 -- March 2025 -- Approved -- 236 monthly payments of $719.00, March 1, 2044 - October 1, 2063, for $16,000 2. 24STCP02550 -- October 2024 -- Dismissed 3. 23STCP04324 -- September 2024 -- Approved -- Monthly payments March 1, 2024 - February 1, 2044 4. 24STCP01148 -- June 2024 -- Dismissed 5. 24STCP00623 -- April 2024 -- Dismissed" (Id., at P. 8.)

Payee further explains that he "agreed to transfer and assign to CBC Settlement Funding, LLC my rights to the following structured settlement payment(s): 180 MONTHLY PAYMENTS IN THE AMOUNT OF $1,000.00 BEGINING MARCH 1, 2044 THROUGH AND INCLUDING FEBUARY 1, 2059," and "[i]n exchange for these payment(s), CBC Settlement Funding, LLC has agreed to pay me $20,000.00." (Id., at P.P. 10-11.)

Payee attests that "[t]he funds from this transaction, totaling $20,000, will be used to address two important financial priorities. First, a portion of the proceeds will be used to pay off existing outstanding debts, which currently carry high interest and place a strain on my monthly budget. By eliminating these obligations, I will be able to improve my financial stability and better manage my ongoing expenses. The remaining funds will be used to assist my son with college tuition and related educational expenses, allowing him to continue his education without interruption.

Supporting his education is a significant priority for me, and this contribution will help reduce the need for additional student loan debt. This transaction will allow me to both strengthen my current financial position and invest in my son's future in a responsible and meaningful way." (Pet., Ex. 4, Becerrada Decl., P. 12.)

Payee's declaration complies with most of the requirements of Insurance Code section 10139.5, subdivision (c); however, Payee does not state his age, as required by Insurance Code section 10139.5, subdivision (c)(1).

C. Proper Notification and Domicile of Payee Under Insurance Code section 10139.5, subdivision (f)(1), "[a] petition under this article for approval of a transfer of structured settlement payment rights shall be made by the transferee and brought in the county in which the payee resides at the time the transfer agreement is signed by the payee, or, if the payee is not domiciled in California, in the county in which the payee resides or in the county where the structured settlement obligor or annuity issuer is domiciled."

Here, the petition states that "[t]he payee of the structured settlement payment (the 'Payee'), resides in the County of Orange, in the State of California. Venue is proper in this Court pursuant to Insurance Code, section 10139.5(f)(1), because the Payee resides in the County of Los Angeles." (Pet., P. 1.) This statement is contradictory, as the County of Orange is a different county than the County of Los Angeles. In Payee's declaration, he attests to living in Santa Monica, California, located in Los Angeles County, so it appears the county is proper. However, the error in the Petition should be corrected.

Additionally, pursuant to Insurance Code section 10139.5, subdivision (f)(2), "[n]ot less than 20 days prior to the scheduled hearing on any petition for approval of a transfer of structured settlement payment rights under this article, the transferee shall file with the court and serve on all interested parties a notice of the proposed transfer and the petition for its authorization, and shall include the following with that notice: (A) A copy of the transferee's current petition and any other prior petition, whether approved or withdrawn, that was filed with the court in accordance with paragraph (6) of subdivision (c). (B) A copy of the proposed transfer agreement and disclosure form required by paragraph (3) of subdivision (a). (C) A listing of each of the payee's dependents, together with each dependent's age. (D) A copy of the disclosure required in subdivision (b) of Section 10136. (E) A copy of the annuity contract, if available. (F) A copy of any qualified assignment agreement, if available. (G) A copy of the underlying structured settlement agreement, if available. (H) If a copy of a document described in subparagraph (E), (F), or (G) is unavailable or cannot be located, then the transferee is not required to attach a copy of that document to the petition or notice of the proposed transfer if the transferee satisfies the court that reasonable efforts to locate and secure a copy of the document have been made, including making inquiry with the payee. If the documents are available, but contain a confidentiality or nondisclosure provision, then the transferee shall summarize in the petition the payments due and owing to the payee, and, if requested by the court, shall provide copies of the documents to the court at a scheduled hearing. (I) Proof of service showing compliance with the notification requirements of this section. (J) Notification that any interested party is entitled to support, oppose, or otherwise respond to the transferee's petition, either in person or by counsel, by submitting written comments to the court or by participating in the hearing. (K) Notification of the time and place of the hearing and notification of the manner in which and the time by which written responses to the petition must be filed, which may not be less than 15 days after service of the transferee's notice, in order to be considered by the court. (L) If the payee entered into the structured settlement at issue within five years prior to the date of the transfer agreement, then the transferee shall provide the following notice to the payee's attorney of record at the time the structured settlement was created, if the attorney is licensed to practice in California, at the attorney's address on file with the State Bar of California."

Here, the notice filed on July 17, 2026 is improper. First, in the caption of the notice, it identifies the Court's department as 518, rather than 508. Additionally, the body of the notice states that the hearing will take place "on August 26, 2026, at 10:00 A.M. in Department 28..." The department number for this Court is improperly listed twice in the notice. Thus, notice is insufficient.

Additionally, Petitioner does not comply with Insurance Code section 10139.5, subdivision (f)(2)(A) because Payee attests to previous applications and approvals for transfer, but Petitioner does not attach these petitions. Moreover, according to the fund distribution agreement, it appears that Payee entered into the structured settlement on August 13, 2023, fewer than five years from the instant request. However, Petitioner does not indicate that it provided notice to Payee's attorney of record at the time the structured settlement was entered into, pursuant to Insurance Code section 10139.5, subdivision (f)(2)(L).

D. Timely Written Disclosure Under Insurance Code section 10136, subdivision (b), "[t]en or more days before the payee executes a transfer agreement, the transferee shall provide the payee with a separate written disclosure statement, accurately completed with the information that applies to the transfer agreement ... in at least 12-point type." Petitioner complied, as Payee's signature on the disclosure notice is dated April 1, 2026, whereas he signed the Transfer Agreement on April 13, 2026. (Pet., Ex. 3.)

Additionally, Payee attests that "[t]hat at least 10 days prior to the effective date of the Transfer Agreement, I received and read the separate written disclosure required by California Insurance Code section 10136(b). I understand the terms of the transaction as described in that Disclosure. " (Pet., Ex. 4, Becerrada Decl., P. 14.) Additionally, Payee attests that he was "advised by CBC Settlement Funding, LLC of my right to seek independent counsel and financial advice in connection with the petition for court approval of the transfer agreement.

I have been further advised that if I retain counsel, a licensed certified public accountant, or a licensed actuary in connection with a petition for an order approving the transfer agreement, that CBC Settlement Funding, LLC will pay the fees of said counsel, accountant, or actuary, regardless of whether the transfer agreement is approved, and regardless of whether the attorney, accountant, or actuary files any document or appears at the hearing on the application for transfer, in an aggregate amount not to exceed one thousand five hundred dollars ($1,500.00).

I hereby waive that advice and do not wish to retain such an independent advisor." (Id., at P. 15.) The disclosure complies with Insurance Code section 10136, subdivision (b), by stating all the information and other disclosures required by this section.

Based on the foregoing, the Court denies the instant petition without prejudice. Petitioner failed to comply with all the requisite provisions of Insurance Code sections 10134 to 10139.5. Accordingly, if Petitioner so wishes, it must correct the identified mistakes and submit an amended petition for approval.

Conclusion

Based on the foregoing, the petition is DENIED without prejudice. Petitioner is ordered to provide notice of this Order. DATED: August 26, 2026 ________________________________ Hon. Teresa A. Beaudet Judge, Los Angeles Superior Court | Home -->