An Arkansas appeals court on Wednesday reversed a lower court ruling that allowed a worker injured in Afghanistan to transfer structured annuity payments in a workers’ compensation case to take advantage of a lump-sum payment discount, ruling that the transfer was prohibited.
IN Metropolitan Tower Life Insurance Co. v. Roosevelt Land Partners Corp., the Arkansas Court of Appeals determined that a lower judge erred in allowing Donald Hill’s attempt to transfer his structured settlement payments because it would violate the Longshore and Harbor Workers’ Compensation Act.
Mr. Hill had reached a settlement with his employer, the private military contractor Dyncorp International, and Dyncorp̵7;s insurer, Continental Insurance Co., which resulted in a structured annuity agreement with MetLife Assignment Company Inc.
Mr. Hill attempted to transfer his payments to Genex Capital Corp. for a discounted one-time payment. Genex assigned its interest to Roosevelt Land Partners.
MetLife objected to Roosevelt’s transfer application, arguing that it was prohibited under the LHWCA, Mr. Hill’s 2019 settlement agreement and MetLife’s annuity, while Roosevelt argued that the transfer was not prohibited because payments were not “due or payable” under the LHWCA.
In August 2020, a trial judge approved the transfer to Roosevelt, finding that it did not violate federal law because the payments from MetLife were not “due or payable” under the LHWCA.
MetLife argued that the LHWCA prohibits the award of payments or benefits, but its request to vacate the decision was denied and MetLife appealed.
The Court of Appeals held that the settlement arose out of claims under the LHWCA due to work injuries, and the settlement specifically gave MetLife as an entity “the obligation to make future payments” to Mr. Hill.
It reversed the lower court’s approval of the transfer and remanded the case for further proceedings.