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Rumbin v. Utica Mutual Insurance Co.8/15/2000
The defendant Safeco Life Insurance Company (Safeco), appeals from the judgment of the trial court approving the transfer by the plaintiff, Marco Rumbin, of payments due to him under an annuity issued pursuant to a structured settlement agreement between the plaintiff and the named defendant, Utica Mutual Insurance Company (Utica Mutual). The plaintiff proposes to sell the remaining payments to the intervening plaintiff, J. G. Wentworth. The principal issues in this appeal are: (1) whether General Statutes § 52-225f invalidates antiassignment provisions that are included in structured settlement agreements and annuities issued pursuant to such agreements; and (2) whether the antiassignment clause contained in the annuity issued by Safeco for the plaintiff beneficiary invalidates his assignment to Wentworth. We conclude that § 52-225f does not invalidate such antiassignment provisions. We further conclude that, under Connecticut common law, the antiassignment provision in the annuity contract does not invalidate the plaintiff's assignment of his right to payments under the annuity to Wentworth. In accordance with case law and § 322 of the Restatement (Second) of Contracts, an antiassignment provision that does not limit the power to assign or expressly invalidate the assignment does not render the assignment of the annuity ineffective. Safeco, however, has the right to recover damages for the plaintiff's breach of the antiassignment provision. We therefore affirm the judgment of the trial court.
The record reveals the following facts. In April, 1998, the plaintiff and Utica Mutual entered into a structured settlement agreement to resolve a personal injury claim. Pursuant to that settlement agreement, the plaintiff was to receive from Utica Mutual a lump sum payment, followed by a series of periodic payments over the next fifteen years. The structured portion of the settlement was funded by the annuity contract issued by Safeco. The annuity contract provided under its "Assignment" provision that " o payment under this annuity contract may be . . . assigned . . . in any manner by the [plaintiff] . . . ."
Approximately six months after the execution of the settlement agreement and the issuance of the annuity, the plaintiff had become unemployed and faced a mortgage foreclosure action against his home, where he lived with his family. In order to resolve his financial troubles, the plaintiff decided to sell his right to the annuity payments. In November, 1998, he filed a declaratory judgment action seeking court approval, pursuant to No. 98-238, § 1, of the 1998 Public Acts (P.A. 98-238), now codified at § 52-225f, to transfer his right to the remaining annuity payments to Wentworth in exchange for a lump sum payment and other consideration. Safeco objected to the assignment, claiming that because the annuity contract contained an antiassignment provision, P.A. 98-238 was inapplicable. Utica Mutual neither appeared at that hearing, nor provided an explanation for its failure to appear, and the trial court issued an order of default for failure to appear against Utica Mutual.
The trial court, after a hearing, concluded that P.A. 98-238 invalidated antiassignment provisions and allowed payees to transfer their rights to future payments under structured settlement agreements when the statutory requirements were met. The trial court further found that, pursuant to P.A. 98-238, the proposed sale of the annuity payments was in the best interests of the plaintiff, and was fair and reasonable to all interested parties. Accordingly, the court rejected Safeco's claim concerning the applicability of the antiassignment provision, and rendered judgment approving the transfer of the plai
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