AN ACT Relating to payment of judgments for personal injury and wrongful death actions; and adding a new chapter to Title 4 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. (1) In an action for personal injuries or wrongful death in which a verdict or award of future damages in excess of one hundred thousand dollars is made, the court shall, at the request of a party, enter a judgment for periodic installments of such future damages as provided in this chapter.

(2) The court shall enter judgment in lump sum for past damages, attorney fees, costs, and litigation expenses of the plaintiff.

(3) A judgment entered under this section for the payment of future damages in periodic installments shall specify the recipient or recipients of the payments, the dollar amount of the payment, the interval between payments, and the number of payments or the period of time over which payments shall be made.

NEW SECTION. Sec. 2. (1) As a condition of entering a judgment for periodic installments of future damages under section 1 of this act, the court may require a judgment debtor who has not made adequate provision for payment of periodic installments to post security sufficient to assure full payment of such future damages.

(2) If the court determines that a judgment debtor has not made adequate provision for payment of periodic installments and is unable to post security sufficient to assure full payment of the future damages, then the court may enter a judgment for the lump sum of the damages, past and future, incurred by the plaintiff against the judgment debtor.

(3) Upon satisfaction of the judgment for periodic installments, the security, or so much as remains, shall be ordered returned to the judgment debtor.

NEW SECTION. Sec. 3. If at any time following entry of judgment for periodic installments under section 1 of this act, a judgment debtor fails for any reason to make a payment in a timely fashion according to the terms of the judgment, the judgment creditor may petition the court which rendered the original judgment for an order requiring payment by the judgment debtor of the outstanding payments in a lump sum. In calculating the amount of the lump sum judgment, the court shall total the remaining periodic payments due and owing to the judgment creditor, and shall not convert these amounts to their present value. The court may also require the payment of interest on the outstanding judgment.

NEW SECTION. Sec. 4. In cases in which future damages are payable in periodic installments under this chapter:

(1) Unless otherwise agreed between the parties, the liability for payment of any installments for medical or other costs of health care or noneconomic loss not yet due at the death of the judgment creditor terminates upon the death of the person; and

(2) The portion of any periodic payment allocatable to loss of future earnings shall not be reduced or terminated by reason of the death of the judgment creditor, but shall be considered part of the estate of the judgment creditor. In such cases, the court which rendered the original judgment may, upon petition of any party in interest, convert those portions of such periodic payments allocatable to the loss of future earnings to a lump sum by calculating the present value of such payments in order to assist in the settlement of the estate of the judgment creditor.

NEW SECTION. Sec. 5. (1) If, at any time after entry of judgment, a judgment creditor or successor in interest can establish that the continued payment of the judgment in periodic installments will impose a severe hardship, the court may, in its discretion, order that the remaining payments or a portion thereof shall be made to the judgment creditor in a lump sum. The court shall, before entering such an order, consider the following: (a) Whether unanticipated and substantial medical or other needs have arisen that warrant the payment of the remaining payments, or a portion thereof, in a lump sum; (b) whether ordering such a lump sum payment would impose an unreasonable financial burden on the judgment debtor or debtors; (c) whether ordering such a lump sum payment will accommodate the future medical and other needs of the judgment creditor; and (d) whether ordering such a lump sum payment would further the interests of justice.

(2) If a lump sum payment is ordered by the court, such lump sum shall be calculated on the basis of the present value of remaining periodic payments, or portions thereof, that are converted into a lump sum payment. The remaining future periodic payments, if any, shall be reduced accordingly.

NEW SECTION. Sec. 6. Nothing in this chapter shall be construed to limit the right of a plaintiff, defendant or defendants, and any insurer to settle medical malpractice claims as they consider appropriate and in their complete discretion.

NEW SECTION. Sec. 7. Sections 1 through 6 of this act shall constitute a new chapter in Title 4 RCW.