What Constitutes a "Dependent" During a Structured Settlement Transfer in Court, and Why is it so Important?


California's Structured Settlement Protection Act, or the California Insurance Code Section 10134-10139.5 has nine clauses that mention "dependents".  Let's walk through all nine, in the order as listed in the actual code.


Number 1, Definition.  Number 2, Disclosure Notice.  Numbers 3 and 4, Welfare of Dependents.  Number 5 goes on to talk about the totality of your circumstances/mental capacity of the payee; it was a massive sentence, shortened for the scope of this article.


Number 6 talks about child support and maintenance, regarding dependents, and having other sources of income.  Number 7, facing hardship.  Number 8, Other Factors, demographics.  Number 9, Separate listing/age.


We really recommend seeking independent professional advice, especially if you have dependents.


  1. Definition of Dependents

10134(b)  " "Dependents" include the payee's (person selling their structured settlement payment rights) spouse and minor children and all other family members and other persons for whom the payee is legally obligated to provide support, including alimony."


Remember, "other persons" can be businesses too.


  1. "Dependents" in the Disclosure Notice

10136(b)  "You should get independent professional advice about whether selling your structured settlement payments is a good idea for you and for your dependents."


  1. "Dependents " in the "What Makes the Transfer Void" Clause

10137(a)  "The transfer of the structured settlement payment rights is fair and reasonable and in the best interest of the payee, taking into account the welfare and support of his or her dependents".


  1. "Dependents" in the "What Effectuates the Transfer to GET COURT APPROVAL" Clause

10139.5(a)(1) "The transfer is in the best interest of the payee, taking into account the welfare and support of the payee's dependents."



  1. "Dependents" for Court Approval
    10139.5(a)(6)(b) "When 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, ....."


  1. "Dependents" regarding Child Support and Maintenance-Full Disclosure for Court Consideration

10139.5(a)(6)(b)(8)  "Whether the payee has other means of income or support, aside from the structured settlement payments that are the subject of the proposed transfer sufficient to meet the payee's future financial obligations for maintenance and support of the payee's dependents, specifically including, but not limited to, the payee's child support obligations, if any.  The payee shall disclose to the transferee and the court his or her court-ordered child support of maintenance obligations for the court's consideration."


  1. "Dependents" in the "Hardship" clause

10139.5(a)(6)(b)(13) "Whether the payee, or his or her family or dependents, are in or facing a hardship situation.


  1. "Dependents" in the "Other Factors" "Demographics" clause

10139.5(a)(6)(b)(15)(c)(3) "The names, ages, and place or places of residence of the payee's minor children or other dependents, if any.


  1. "Dependents" Separate Listing/Age

10139.5(a)(6)(b)(15)(c)(6)(f)(2)(C) A listing of each of the payee's dependents, together with each dependent's age


The independent professional adviser can help coach you along and prepare you throughout the entire process, with or without dependents.

Structured Settlement Attorney