Minor Settlements: Are They Handled Any Differently Than Adult Settlements?

Oftentimes, a minor child may be involved in a personal injury case that arises from automobile collisions, dog bites, etc. Parents often ask the following questions: Is there anything I can do when my child was injured due to someone else’s fault/negligence? Can we bring a claim for our child’s injuries against the person that hurt them?” The answer is “Yes, absolutely!

In Arizona, a person under 18 years old may have their own personal claim. A minor’s claim is handled much the same way as any other adult’s claim—medical treatment for injuries, hiring an attorney to provide representation, filing a claim against the wrongdoer’s insurance company, negotiating a monetary settlement, etc. However, there is a distinction in the way settlements work that can come into play on cases involving minors: sometimes a minor settlement has to be approved by the Court.  

Determining whether minor settlements require Court approval will vary state-by-state. Under Arizona’s probate rules, a settlement on behalf of or against a minor for a personal injury or wrongful death claim requires Court approval of the settlement. The process for approving minor settlements seems time consuming and the Court may even appoint a guardianship. The rationale for this is to protect the minor. In the long run, it also protects parents. However, not all minor’s claims require court approval.  There is an exception to the rule above.

Injury Settlements Under $10,000

According to Arizona Revised Statute 14-5103, Court approval is NOT required for a settlement under $10,000. However, the statute requires that any funds from a settlement be paid directly as follows: (1) to the minor if, the minor is married; (2) to any person having the care and custody of the minor and with whom the minor resides; (3) to the guardian of the minor; or (4) to a financial institution (i.e., a bank) by making a deposit into a federally insured savings account that is held in the sole name of the minor. Notice of the bank deposit must be given to the minor.

Injury Settlements Over $10,000

If the settlement is above $10,000, then the Court MUST approve the settlement. The Court may approve a structured settlement or an annuity paid for by the responsible party or their insurance carrier. The structured settlement may provide for monthly, yearly, or lump sum payments to the minor, granting access when he or she reaches the age of 18. Payments usually extend over several years, which vary case-by-case. Since payments are made over time, interest accrues, which may result in a significantly greater amount than the actual cost of the annuity policy or the actual amount of the settlement. Thus, structured settlements are very beneficial because they may provide payments for your child’s future education, housing, medical, or other expenses.

Get Professional Help

If your child has been injured and someone else is at fault, seeking an experienced attorney who handles minor’s claims is essential for the success of your case. Immediately give Quintana Law a call for a FREE consultation at (602) 418-0733. We can help.