Silliman v. Cassell
292 Ga. 464
Ga.2013Background
- Eleventh Circuit certified Georgia questions on OCGA § 44-13-100(a)(2)(E) and annuity exemption.
- Cassell inherited $220,000 in 2008 and used May 2009 funds to buy a single-premium fixed annuity at age 65.
- Annuity pays $1,389.14 monthly, guaranteed for 10 years, with restrictions on withdrawals and changes; assignable during the guaranteed period.
- Cassell filed Chapter 7 in May 2010, listing the annuity as both asset and exempt property; trustee objected to two requirements (funding source and age nexus).
- Bankruptcy court found the two challenged requirements met and remanded for the third; Eleventh Circuit certified questions due to lack of Georgia precedent.
- Georgia Supreme Court held the annuity may be exempt if it functions as income substitute for wages and the right to payments is tied to age, applying a multifactor analysis.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is the National Life annuity an annuity under OCGA § 44-13-100(a)(2)(E)? | Cassell contends it is an annuity under the statute. | Trustee contends it may not qualify as an exempt annuity. | Yes; the annuity is an annuity for § 44-13-100(a)(2)(E). |
| Is the right to receive payments on account of age under OCGA § 44-13-100(a)(2)(E)? | Cassell argues there is a causal connection to age. | Trustee argues the connection is not established or is insufficient. | Yes; there is a causal connection to age. |
| Is funding by inheritance disqualifying to exempt status under § 44-13-100(a)(2)(E)? | Cassell’s funding source should not bar exemption. | Trustee argues funding source is a relevant factor that could disqualify. | No; inheritance funding is not determinative; the exemption focuses on substitute-for-wages income. |
| Does the right to payments need to be reasonably necessary for support? | Cassell concedes reasonable necessity. | Trustee contends evidence may be insufficient. | Yes; the payments were reasonably necessary for support. |
Key Cases Cited
- Rousey v. Jacoway, 544 U.S. 320 (U.S. 2005) (establishes 'on account of' as 'because of' in bankruptcy exemptions)
- In re Bramlette, 333 BR 911 (Bankr. N.D. Ga. 2005) (limits on exemptions for assets not intended to substitute for wages)
- In re Andersen, 259 BR 687 (Bankr. N.D. Ga. 2001) (multifactor approach to determining exemption eligibility)
- In re Michael, 339 BR 798 (Bankr. N.D. Ga. 2005) (not every annuity labeled as such qualifies for exemption)
- In re Green, 2007 Bankr. LEXIS 1182 (Bankr. E.D. Tenn. 2007) (funding source not sole determinative; related to exempted income)