§ 141.007.General Provisions; Construction

Six general provisions closing the chapter, and each addresses a way the protection could be evaded.

Subsection (a): the provisions may not be waived by any payee. Without that, a waiver clause in the transfer agreement would end the matter.

Subsection (b) fixes forum and law and forbids one clause outright. A transfer agreement with a Texas-resident payee must provide that disputes be determined in and under the laws of this state. And it may not authorize the transferee or any other party to confess judgment or consent to entry of judgment against the payee.

The confession of judgment prohibition matters, because such a clause would let a transferee obtain judgment without the payee appearing. Texas voids these instruments generally, and the section says so again here.

Subsection (c) conditions life-contingent transfers. Payments that stop on death may not be transferred unless, before signing, the transferee has established and agreed to maintain procedures reasonably satisfactory to the obligor and issuer for periodically confirming the payee’s survival and giving prompt written notice of death.

Without that, an issuer would be paying a stranger with no way of knowing the annuitant had died.

Subsection (d) protects the payee whose deal is not approved: no penalty, forfeited application fee or other payment, or any liability to the proposed transferee based on any failure of the transfer to satisfy the conditions of this chapter.

So a payee cannot be charged for a court’s refusal to approve, which would otherwise deter anyone from applying.

Subsection (f) places compliance squarely on the transferee, and relieves the obligor and annuity issuer of responsibility or liability for the transferee’s non-compliance. Subsection (e) confirms the chapter authorises nothing unlawful and implies nothing about pre-enactment transfers.