Settlements for Children

As a parent, it is awful when your child is injured. And it can feel worse when the injury was preventable, and someone else’s fault.

Bringing a claim in Oregon for a child (legal term: minor – this is anyone under 18) is complicated. Because a minor is not legally allowed to enter a contract, the minor can’t hire a law firm, can’t file a lawsuit, and can’t enter a settlement with the insurance company to settle the case.

ORS 126.725 was enacted only recently to solve this problem in a way that is still complicated, but that works pretty well, if you know how to use it.

Here are the highlights:

If the total amount paid by the insurance company to the child is more than $25,000, you have to do the complicated and expensive thing, which is use a conservator. This article is about the simple case.

If the total amount paid by the insurance company to the child is $25,000 or less, then you can do it the easy and cheap way, using the provisions of ORS 126.725. Here are the rules:

The child must not already have a conservator. And the child usually shouldn’t already can i fire my divorce lawyer have a conservator, if the parents are trustworthy and the attorney is skilled.

The total amount paid to the child (this does not include amounts taken out for medical bills, attorney fees, etc; it’s just the settlement left for the child after all those payments) must be $25,000 or less.

The adult “having legal custody of the child” (usually a parent, but it doesn’t have to be) signs a settlement agreement and also signs an affidavit swearing that to the best of the person’s knowledge, the child will be fully compensated by the settlement, or the minor may not be fully compensated, but there is no practical way to obtain more money from the insurance company (or person, or company) that is paying the money.

READ  Three Considerations When Hiring a Lawyer - Cost, Experience, and Personality

The attorney has to keep the affidavit until the child turns 23.

The funds must be paid into the human rights lawyer salary attorney’s IOLTA bank account.

The lawyer (not the custodian, not the parent) must deposit the child’s share into a federally insured savings account that earns interest in the sole name of the child.

The child can also get an annuity instead of a savings account. But in that case, the funds must be paid directly to the annuity provider, with the minor as the sole beneficiary of the annuity.

I already wrote this in no. 6 – but people do it wrong all the time, so I’m going to write it again. The savings account must be solely in the name of the minor. It cannot be a joint account. A parent cannot be on the account; and neither can a lawyer.

The lawyer then has to provide notice to the child, and to the person who signed for the child (again, this is typically a parent), by first-class mail (or by personal service, if you like wasting money).

The money in the child’s account cannot be used for any reason until the child turns 18. Exception: if you can get a court order, you can withdraw the money early. This may be possible for example to pay college tuition for a 17-year-old. Or if the child has a medical emergency requiring funds. But there is no guarantee; you’ll have to convince a judge. Normally, the child gets the money when he or she turns 18, and not before.

READ  The Importance Of Family Lawyers