Section 2. (a) 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 a payment directly or indirectly to a 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 responsible administrative authority, such as an administrative law judge, based on the court's or responsible administrative authority's written express findings that:
(1) the transfer complies with the requirements of this chapter and will not contravene other applicable law;
(2) not less than ten days before the date on which the payee first incurred an obligation with respect to the transfer, the transferee has provided to the payee a disclosure statement in bold type, no smaller than 14 points, specifying:
(i) the amounts and due dates of the structures settlement payments to be transferred;
(ii) the aggregate amount of the payments;
(iii) the discounted present value of the payments, together with the discount rate used in determining the discounted present value;
(iv) the gross amount payable to the payee in exchange for the payments;
(v) an itemized listing of all brokers' commissions, service charges, application fees, processing fees, closing costs, filing fees, referral fees, administrative fees, legal fees, notary fees, and other commissions, fees, costs, expenses and charges payable by the payee or deductible from the gross amount otherwise payable to the payee;
(vi) the net amount payable to the payee after deduction of all commissions, fees, costs, expenses and charges described in clause (v);
(vii) the quotient, expressed as a percentage, obtained by dividing the net payment amount by the discounted present value of the payments, which shall be disclosed in the statement as follows: ''The net amount that you will receive from us in exchange for your future structured settlement payments represent ___% of the estimated current value of the payments'';
(viii) the effective annual interest rate, which rate shall be disclosed in the statement as follows: ''Based on the net amount that you receive from us and the amounts and timing of the structured settlement payments that you are turning over to us, you will, in effect, be paying interest to us at a rate of ___% per year''; and
(ix) the amount of any penalty and the aggregate amount of any liquidated damages, including penalties payable by the payee in the event of a breach of the transfer agreement by the payee;
(3) the payee has established that the transfer is in the best interests of the payee and the payee's dependents;
(4) the payee has received, or waived the right to receive independent professional advice regarding the legal, tax and financial implications of the transfer;
(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 the notice with the court or responsible administrative authority;
(6) the transfer agreement provides that if the payee is domiciled in the commonwealth, any disputes between the parties shall be governed, interpreted, construed, and enforced in accordance with the laws of the commonwealth and that the domicile state of the payee is the proper place of venue to bring any cause of action arising out of a breach of the agreement; and
(7) the court or responsible administrative agency has made a determination that the net amount payable to the payee is fair, just and reasonable under the circumstances then existing.
(b) The transfer agreement shall also provide that the parties agree to the jurisdiction of any court of competent jurisdiction located in the commonwealth. If the transfer would contravene the terms of the structured settlement, upon the filing of a written objection by any interested party and after considering the objection and any response to it, the court or responsible administrative authority may grant, deny or impose conditions upon the proposed transfer as the court or responsible administrative authority deems just and proper under the facts and circumstances in accordance with established principles of law. Any order approving the transfer shall require that the transferee indemnify the annuity issuer and the structured settlement obligor for any liability including reasonable costs and attorney's fees arising from compliance by the issuer or obligor with the order of the court or responsible administrative authority.
(c) A provision in a transfer agreement giving a transferee power to confess judgment against a payee shall be unenforceable to the extent the amount of the judgment would exceed the amount paid by the transferee to the payee, less any payments received from the structured settlement obligor or the payee.
(d) In negotiating a structured settlement of claims brought by or on behalf of a claimant who is domiciled in the commonwealth, the structured settlement obligor shall disclose in writing to the claimant or the claimant's legal representative all of the following information that is not otherwise specified in the structured settlement agreement:
(1) the amounts and due dates of the periodic payments to be made under the structured settlement agreement; in the case of payments that will be subject to periodic percentage increases, the amounts of future payments may be disclosed by identifying the base payment amount, the amount and timing of scheduled increases, and the manner in which increases will be compounded;
(2) the amount of the premium payable to the annuity issuer;
(3) the discounted present value of all periodic payments that are not life-contingent, together with the discount rate used in determining the discounted present value;
(4) the nature and amount of any cost that may be deducted from any of the periodic payments;
(5) where applicable, that any transfer of the periodic payments is prohibited by the terms of the structured settlement and may otherwise be prohibited or restricted under applicable law; and
(6) that any transfer of the periodic payments by the claimant may subject the claimant to serious adverse tax consequences.
(e) The district court shall have nonexclusive jurisdiction over an application for authorization of a transfer of structured settlement payment rights.
(f) Not less than 20 days before the scheduled hearing on an application for authorization of a transfer of structured settlement payment rights, the transferee shall file with the court or responsible administrative authority, any other government authority that previously approved the structured settlement, and all interested parties a notice of the proposed transfer and the application for its authorization. The notice shall include:
(1) a copy of the transferee's application to the court or responsible administrative authority;
(2) a copy of the transfer agreement;
(3) a copy of the disclosure statement required under this section;
(4) notification that an interested party is entitled to support, oppose, or otherwise respond to the transferee's application, either in person or by counsel, by submitting written comments to the court or responsible administrative authority or by participating in the hearing; and
(5) 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 application shall be filed, in order to be considered by the court or responsible administrative authority.
Written responses to the application shall be filed within 15 days after service of the transferee's notice.