Children’s Personal Injury Cases in Minnesota
Special rules apply to civil claims brought on behalf of minors in Minnesota.
Court Approval of all Minor SettlementsBy law every settlement involving a child must be approved by a judge in Minnesota. This law is in place to protect the child's best interests from influence from insurance companies, attorneys, and parents. It is also in place because minors cannot legally enter a binding contract. Court approval typically requires submission of a Petition outlining the proposed settlement, the pertinent medical information, and detailed information of how the funds will be handled.
Distribution of FundsAny funds recovered on behalf of a child in Minnesota are to placed in trust until the child turns 18. These funds cannot be accessed without a court order. Typically they will be placed in structured settlement, or a Certificate of Deposit (CD) or other conservative interest-bearing investment account at a local bank. After turning 18, the judge will order the funds be released, and they are at the child's sole disposal and discretion. If there is a structured settlement, the funds are distrubuted according to the terms of the structure.
Structured SettlementsA Structured Settlement is an agreement to make a series of partial payments over a period of years, rather than one lump sum payment. In effect, agreeing to a structured settlement is like agreeing to let the insurance company invest the settlement proceeds. Structures do have control over the proceeds after the claimant is an adult, thereby reducing the likelihood that the asset will be squandered. Structured settlements also have tax advantages not available with normal investment products.