In Part I we discussed getting the court’s consent to a settlement. This and future posts will discuss issues that arise during the settlement.
Often parents ask “can the court allow me to receive some money out of the settlement so that I can buy a computer for my son?” Or “can some money be spent to furnish my child’s room?”
Generally the court will order that the net settlement proceeds be deposited into a savings account for the child and that only the child can withdraw or close the account after he turns 18 years of age. The court wants to keep the settlement in a “lock box” to prevent the parents from either stealing or wasting the infant’s money.
Generally, the court will deny the immediate payment of the child’s living expenses, especially discretionary expenses, such as computers and furniture. The reasoning is that the settlement is the child’s money and that the parents have the obligation to provide for the child until he turns 18 years of age.
However, the court does have the discretion to allow such expenditure, and we have had situations where the court will allow it.
In order to obtain such funds, we have to show the following:
- the parent and infant state the need for the computer or other item in their affidavits supporting the settlement;
- the parent must state and sometimes prove that he is poor and cannot affort the expense;
- the parent provide an itemized bill from a reputable store to show the cost;
- the court will order that the insurance company cut a separate check to the store for the purchase; and
- the proposed purchase represents a small part of the net settlement, such as no more than 20%.
In a settlement of $475,000, the court allowed the parent to take $1,500 for the computer and printer. The court had a brief inquiry on the record with the parent as to the parent’s modest income. Also, the child was learning disabled, and the computer would help the child keep-up with his school work.
Of course, the court can deny a request. I recall once a judge flatly refusing to even consider the request. She said “the parent has the obligation to pay for these things.”
I would say that there is a 60% likelihood that the court will deny the request. Nonetheless, it is worth making the request if it is reasonable under the circumstances.
Sometimes, years later the parents might want to ask the court to allow an expenditure. At this stage the money has been “locked away” in the savings account, and the court’s order is necessary in order to invade the account. Generally, such requests are less successful, and we discourage the request.
If your child has been injured in an accident, please feel free to call me for a free consultation at 800-581-1534 or write to me at email@example.com.
Mark E. Seitelman, 2/4/10, www.seitelman.com.