In Re: Dwyer, C., Appeal of: National Indemnity
149 WDA 2016
| Pa. Super. Ct. | Jan 27, 2017Background
- Cameron Dwyer settled a LHWCA claim with Academi and its insurer Allied: lump sum and weekly structured payments of $787 for 520 weeks; DOL approved the settlement.
- Allied entered a Reinsurance Agreement with National Indemnity obligating National to make the weekly payments.
- Dwyer assigned his weekly payments to factoring company DRB in exchange for a lump sum via a Security Agreement; DRB and Dwyer petitioned the state court to approve the transfer under Pennsylvania’s Structured Settlement Protection Act (SSPA).
- National opposed, arguing the LHWCA’s anti-assignment provision (33 U.S.C. § 916) and the SSPA barred the transfer.
- Trial court approved the transfer; the Superior Court reversed, holding the structured settlement payments were “due or payable” under the LHWCA and thus not assignable, and that a transfer would contravene the SSPA.
Issues
| Issue | Plaintiff's Argument (National) | Defendant's Argument (Dwyer/DRB) | Held |
|---|---|---|---|
| Whether payments are annuity vs. reinsurance obligation | Payments derive from the Reinsurance Agreement; not an annuity | Payments may be treated as annuity but assignment question unaffected | Court: trial court erred calling it an annuity; payments stem from LHWCA settlement/reinsurance and are still covered by §916 |
| Whether LHWCA §916 bars assignment of these structured payments | §916 prohibits any assignment of compensation "due or payable" under the Act; settlement/reinsurance payments are "due or payable" | Relies on Sloma: once an annuity is purchased/payments made by a third party they are not "due or payable" under the Act, so assignment permissible | Held: §916 applies; the payments are "due or payable" under the LHWCA and assignment is invalid |
| Whether Sloma controls or is persuasive | Sloma’s narrow reading is incorrect and would undermine §916's purpose | Relies on Sloma to argue assignments of purchased annuities are allowed | Court rejects Sloma’s application here and deems it inapplicable to these facts |
| Whether the SSPA permits transfer despite federal prohibition | Transfer must not contravene other federal statutes; because §916 forbids assignment, SSPA bars transfer | SSPA permits court-approved transfers that comply with other law; argues transfer could comply | Held: Because assignment violates §916, the transfer also violates SSPA and is ineffective |
Key Cases Cited
- In re Sloma, 43 F.3d 637 (11th Cir. 1995) (majority held annuity payments purchased to satisfy LHWCA award were not "due or payable" under the Act and thus could be assigned)
- Samuel-Bassett v. Kia Motors Am., Inc., 34 A.3d 1 (Pa. 2011) (Pennsylvania court on federal statutory construction principles)
- Carcieri v. Salazar, 555 U.S. 379 (2009) (plain-meaning first rule in federal statutory interpretation)
- Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242 (2010) (enforce unambiguous statutory text)
- Griffin v. Oceanic Contractors, Inc., 458 U.S. 564 (1982) (avoid interpretations producing absurd results)
- First Colony Life Ins. Co. v. Berube, 130 F.3d 827 (8th Cir. 1997) (discussing limits on assignment when payments remain tied to underlying award)
- In re Jacobs, 936 A.2d 1156 (Pa. Super. 2007) (Pennsylvania precedent addressing structured settlement/assignment issues)