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How Are Settlements Approved for Minors in Texas Personal Injury Cases?

How Judges Approve Settlements For Minors In Texas Personal Injury Cases

In personal injury cases---as well as wrongful death cases---the parties often reach a settlement. That is, rather than take a case all the way to a jury, the plaintiff and defendant mutually agree to end the case in exchange for the defendant paying the plaintiff some measurement of money. Courts are not involved in this process, since the law presumes that adults are capable of making their own decisions. Once the settlement is reached, all the court knows is that the case was dismissed.

However, courts are very much involved when settlements concern minors. In order to make sure that the minor's parents, the attorneys, the insurance carrier, and all other parties involved have treated the child fairly, a special attorney called a "guardian ad litem" is appointed. This attorneys job is to review all the documents and the case files to make sure everything is on the up-and-up. Once everything gets their stamp of approval, then the matter is presented before the judge in a hearing called a "minor prove-up."

In this article, Texas personal injury attorney Michael Grossman explains what a minor prove-up is and how it works.

Questions answered on this page

  • What is a minor prove-up?
  • If a minor child receives a settlement, where does the money go?
  • Does a minor's compensation go to the parents or does it get put in the court's registry?
  • Do the parents get to use any of a minors settlement money to pay for expenses?

Courts have an obligation to ensure that all minors are treated fairly.

Children cannot make financial decisions on their own, so their parents or legal guardians do it for them. When a child has suffered an injury or lost a parent, a lawsuit is filed on their behalf by the parent or guardian to try to recover money for them. Texas law mandates that anytime a settlement is entered that effects a child's interests, a judge approve or deny it. Judges are to hold a hearing in which they learn what the case was about, what dollar amount the settlement concerned, and how the monies are to be distributed to the children. Judges generally don't question the lawyers' individual decisions about how they prosecuted the case or how the judge would have done this or that differently.

Instead, the judge will make sure of three main things:

  • The money is going to a safe source: Many parents naturally assume that if a court approves a settlement where their kids are awarded money, the court will make them custodian over the money. Further, many parents think they know their children best and will know how the money can be best be used for their needs. But courts hardly ever hand the money over to a parent. Instead, the money will be set aside for the child until they reach the age of 18. Small amounts of money will go into the court's "registry," which is essentially the court's bank account. But generally, the money will be put into a financial instrument called an "annuity." The annuity is a guaranteed amount of money that a financial institution promises to pay the child in the form of payments every year once the child reaches 18. The terms of payment are negotiable, but courts generally approve settlements of payments made through college-age years to help young people pay for an education.
  • The attorneys' fees and expenses are reasonable: Courts understand that attorneys aren't free and that there are some expenses associated with your case. However, a judge will not approve fees that are not in line with what attorneys normally charge a grownup. A judge can refuse to allow your child's settlement to go through unless the attorney justifies his or her fees.
  • The parent knows that the case is forever over: These hearings are important because of their finality. Your child will not be allowed to come back someday and sue the defendant again. Your attorney should have already made you aware of this, but the court will want it "on the record." Therefore, you will be called as a witness.

As noted above, the parent/guardian of the child will be called as a witness. You're not "on trial" here---no one's going to call you a liar or anything like you've seen on TV. Instead, you'll simply be asked some standard questions about the case and whether you want the judge to approve the settlement for the child. Your lawyer will do all the heavy-lifting for you. The process takes about 30 minutes at the most, and then you're on your way.

Our Attorneys Have Handled Hundreds of Minor Prove-ups

When your children's future is at stake, you need to choose a lawyer with your child's best interests at heart. Grossman Law Offices in Dallas, TX have been honored to represent countless children before Texas courts for 25 years. Let us put that experience to work for your family. Call us today at (855) 326-0000 for a free consultation on how we can help you.

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