Source: http://www.kubickidraper.com/a-painless-guide-to-settling-the-claims-of-minors-in-florida
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A Painless Guide to Settling the Claims of Minors in Florida | Kubicki Draper | Florida Defense Litigation Lawyers
Eric V. Tourian | March 15, 2018
Whenever a minor child receives an insurance settlement, the settlement must comply with Florida Statutes and Probate Rules. Many times, the settlement will need to be placed into a guardianship supervised by a circuit court.
If statutes and probate rules are not closely followed, the settlement is subject to being voided[1] as seen in Allen v. Montalvan, where Florida’s Fourth District Court of Appeal recently set aside a $50,000.00 minor settlement. 201 So. 3d 705 (Fla. 4th DCA 2016).
Before settling any minor claims, be sure to retain experienced counsel to determine if it is necessary to petition a circuit court to approve the minor’s settlement, to petition the court to appoint a guardian of the minor’s property, to select a guardian ad litem, and/or to make certain that the settlement monies are properly placed in a guardianship.
When Does A Minor Settlement Have To Be Approved By A Court?
Natural guardians can – if they choose to – petition the Court for approval of pre-suit settlements where the minor receives a net settlement up to $15,000.00. If the Court approves such a settlement, the natural guardian will be absolved from all further liability in connection with the settlement.[3]
In no instance can a guardian use a minor’s settlement proceeds for the guardian’s own benefit, nor can a guardian use the settlement money to pay for their usual support obligations for the minor.[4]
If a minor receives a settlement in a court case where the minor is a party, then the settlement must be approved by the Court, even if the settlement amount is less than or equal to $15,000.00.[5]
If a minor receives any settlement amount in a wrongful death action, then the settlement must be approved by the Court, even if the settlement amount is less than or equal to $15,000.00 and the minor is not a party.[6]
In almost all other cases, when a minor settlement exceeds a net amount of $15,000.00, the settlement must be approved by a Circuit Court,[7] and a minor guardianship established.[8]
Any person under the age of 18 who has never been married or legally emancipated.[9]
Who Is A Natural Guardian/Guardian Of The Property?
Parents are the natural guardians of their minor children. Guardians of the Property are appointed by the Court. Once appointed, the Court will have personal jurisdiction over the Guardian(s) of the Property for the duration of the guardianship.[10]
If a minor receives a settlement in connection with a wrongful death action, the personal representative of the decedent’s estate will still need to seek and receive a separate appointment as the Guardian of the Property of the Minor because the powers of the personal representative do not extend the settlement of minor settlements which are over $15,000.00.[11]
Which Court Administers The Minor’s Settlement And/Or Guardianship?
The minor settlement and/or guardianship will be superintended by a Florida Circuit Court.[12]
If a minor settlement is reached in a case which has already been filed with the Court, then the settlement and/or guardianship will be handled by the Judge before whom the case is pending.[13]
If the minor settlement/guardianship is an original action, then it is filed in the Probate Division of the County in which the minor is domiciled.[14]
When Does A Guardian Ad Litem Need To Be Appointed For The Minor?
The appointment of a Guardian Ad Litem for a Minor is a matter for the Court’s discretion when the gross amount of the settlement payable to all parties is less than $50,000.[15]
However, a Guardian Ad Litem must be appointed by the Court when the gross amount of the settlement payable to all parties is more than $50,000 and 1) there is no court-appointed guardian of the minor; 2) the court-appointed guardian may have an interest adverse to the minor OR 3) if the court determines that representation of the minor’s interest is otherwise inadequate.[16]
General Considerations To Keep In Mind.
The guardian of a minor must be represented by an attorney throughout the entire guardianship process.[17] Any attorney undertaking a guardianship should understand that by agreeing to such representation the Court may require the attorney to represent the guardian throughout the life of the guardianship. This can be problematic if the guardianship is filed on behalf of a young child who will not reach the age of 18 for several years.
Knowing what motions to file when, and in what order to file them, in a Minor Guardianship action can sometimes be tricky. For this reason the following procedural checklist is provided. Hopefully, the checklist will help guide you through the minor guardianship process. However, If you still have questions then please contact Eric V. Tourian at evt@kubickidaper.com or (407)419-3815. Your local Clerk of Probate Court is also a great resource.
Procedural Checklist For Filing, Maintaining And Successfully Completing A Minor Guardianship In Florida
File Application of Guardian (filed and served prior to hearing on petition to appoint guardian of the property).[18]
File completed credit history investigation and level 2 background check for all prospective guardians of the property (this is at the applicant’s expense and requires fingerprints).[19]
File address designation of guardian.[20]
File Designation of Resident Agent.[21]
File Acceptance of Designation of Resident Agent.[22]
File Verified Petition to Appoint Guardian of the Property.[23]
File Notices of Confidential Information Within Court Filing as appropriate.[24]
Serve Verified Petition to Appoint Guardian of the Property on a parent who is not a petitioner; if there is no parent, then serve Verified Petition on the person(s) with whom the minor resides and any other persons as directed by the Court.[25]
Set hearing on Petition to Appoint Guardian of the Property of the Minor.
The hearing must be recorded.[26]
All guardianship hearings are open to the public unless the minor elects to have the hearing closed.[27]
The minor does not need to attend the hearing.[28]
Court enters Order appointing Guardian(s) of the Property of the minor.
Court issues Letters of Guardianship.[29]
Complete a “Tort Information Form” for Florida’s Medicaid Casualty Recovery Program http://flmedicaidtplrecovery.com/tortcasualty/ and submit along with signed Letters of Guardianship in order to determine if there are any Medicaid liens that need to be satisfied.
File a Petition to Appoint Guardian Ad Litem.[30]
Guardian Ad Litem is discretionary when the gross amount of the settlement payable to all parties is less than $50,000.
A Guardian Ad Litem is required if the gross amount of the settlement payable to all parties is more than $50,000 and 1) there is no court-appointed guardian of the minor; 2) the court-appointed guardian may have an interest adverse to the minor or 3) if the court determines that representation of the minor’s interest is otherwise inadequate. [31]
The Court awards reasonable fees and costs to the Guardian Ad Litem out of the gross proceeds of the settlement.[32]
Court enters Order appointing Guardian Ad Litem.
The Guardian Ad Litem may help with the settlement negotiations if necessary.[33]
Guardian Ad Litem must file his/her report no later than 5 days prior to the hearing on the Petition to Authorize Settlement.[34]
Guardian Ad Litem’s report must be served on 1) the court-appointed guardian(s) of the minor, 2) the natural guardians of the minor, 3) other person(s) with legal custody of the minor, 4) the minor, if the minor is age 14 or older, and 5) the minor’s next of kin if required by the Court.[35]
The Guardian Ad Litem should justify the amount of the settlement or else the Court may reject the settlement.[36]
File Verified Inventory within 60 days of the date that the Letters of Guardianship are issued.[37]
Requires payment of a “Verified Inventory Audit Fee” to the Clerk of Court when the value of the minor’s property exceeds $25,000. The Clerk may charge up to $85.00 for this fee. If the value of the property is less than $25,000, then no audit fee is chargeable.[38]
The Court can waive the Verified Inventory Audit Fee.[39]
The Guardian of the Property must maintain (for 3 years) records which support the initial verified inventory. These records must also identify by name, address and occupation any witnesses who were present during the initial inventory of the minor’s property.[40]
A supplemental verified inventory must be filed within 30 days of the discovery of additional property that was not accounted in a prior inventory.[41]
File Petition To Waive Guardian Education Requirements or otherwise fulfill educational requirements.[42]
Guardian Education Requirements must be completed within 4 months of the date that the Guardian of the Property is appointed.[43]
File Verified Notice of Completion of Guardian Education Requirement.[44]
Guardian must purchase a bond unless this requirement is waived by the court.[45]
If Guardianship assets are liquid (i.e. money) then file a Petition to Designate Depository in Lieu of Bond in order to place guardianship assets in a restricted bank account that bears market rate interest and from which no withdrawals are allowed without a court order.[46]
If liquid guardianship assets are over $250,000.00, then divide assets among financial institutions to make certain that FDIC insurance will cover in case of a bank failure.[47]
File Acceptance of Designation As Depository for bank or financial institution.[48]
File Petition To Approve Minor Settlement. Proposed Settlement Agreements and/or Releases should also be attached to the Petition.[49]
Serve Notice of Hearing Re: Petition To Approve Minor Settlement on 1) the court-appointed Guardian(s) of the Property of the minor, 2) the natural guardian(s) of the minor, 3) other person(s) with legal custody of the minor, 4) the minor (if the minor is age 14 or older) and 5) the minor’s next of kin if required by the court.[50]
Entrance of Order approving Minor settlement.
After the Order approving Minor settlement is entered, disburse the settlement monies to the Guardian.
File Motion to Discharge Guardian Ad Litem.
Deposit liquid assets in a restricted bank account.
File Second Verified Inventory/Alternatively First Annual Accounting with a receipt from financial institution or bank showing that guardianship monies were deposited in a restricted account.[51]
Guardian of the Property files a Verified Annual Accounting, on or before, April 1 of each year for the life of the guardianship.[52]
In some cases, a Simplified Annual Accounting may be filed.[53] A Simplified Annual Accounting does not need to be prepared or submitted by an attorney.[54]
All annual accountings must be served on the minor ward.[55]
All annual accounting are reviewed by the Clerk of Court.[56]
All annual accountings are reviewed by the Judge.[57]
The Court may require the guardian of the property to appear before it when the annual accounting is filed.[58]
Annual accountings also include the payment of audit fees, but these fees may be waived by the Court.[59]
File a Motion To Transfer Guardianship if minor moves to another county within Florida. (However, Court approval is required before the minor actually moves to a domicile in another county.)[60]
File Petition for Discharge and Final Report when 1) the minor turns 18, 2) the property subject to guardianship is exhausted, 3) the minor dies, or 4) the minor moves to another state.[61]
If the guardianship assets are held in an account at a financial institution, then upon reaching the age of 18, the minor will have full access. However, structured settlements that provide for periodic payments after the minor reaches the age of 18 are also allowed.[62]
[1] Savage v. Rowell Distributing Corp., 95 So. 2d 415 (Fla. 1957); Shuster v. South Broward Hosp. Dist. Physicians’ Professional Liability Ins. Trust, 570 So. 2d 1362 (Fla. 4th DCA 1990); Lopez v. Variety Children’s Hospital, 600 So. 2d 506 (Fla. 3d DCA 1992); Monique Raiford Small v. Palm Beach County School District, CL00-3985-AB, Palm Beach County Court, Judge Peter D. Blanc, April 14, 2004.
[2] Fla. Stat. §744.301(2).
[3] Fla. Stat. §744.387(1).
[4] Fla. Stat. §§744.301(4), 744.397(3); Ash v. Coconut Grove Bank, 443 So. 2d 437 (Fla. 3d DCA 1984).
[5] Fla. Stat. §744.387(3)(a).
[6] Nixon v. Bryson, 488 So. 2d 607 (Fla. 3d DCA 1986).
[7] Bookman v. Davidson, 136 So. 3d 1276 (Fla. 1st DCA 2014)(holding that all circuit courts can hear and rule on probate matters).
[8] Fla. Stat. §744.387(2); See generally Global Travel Marketing Inc. v. Shea, 908 So. 2d 392 (Fla. 2005). Of course, there are exceptions. If the minor’s guardianship monies are placed into an annuity, then the court would still need to approve a settlement over $15,000.00, but the Court may find that the annuity is not subject to guardianship. See Part III, Sec. B., Subsection (a) of Orange County Administrative Order 07-93-43-02, “Amended Administrative Order Re: Standards And Procedures For The Protection Of Minors In The Settlement Of Personal Injury, Wrongful Death and Medical Malpractice Claims” at https://www.ninthcircuit.org/sites/default/files/07-93-43-02%20Minors%20settlements.pdf
[9]Fla. Stat. §§744.102(13) & 743.015
[10] Burden v. Dickman, 547 So. 2d 170 (Fla. 3d DCA 1989).
[11] Wisekal v. Laboratory Corporation of America Holdings, 182 F. Supp. 3d 1296 (S.D. Fla. 2016).
[12] Cone v. Cone, 62 So. 2d 907 (Fla. 1953); Phillips v. Nationwide Mut. Ins. Co., 347 So. 2d 465 (Fla. 2d DCA 1977); Groover v. Groover, 383 So. 2d 280 (Fla. 5th DCA 1980); State, Dept. of Health & Rehabilitative Services v. Hollis, 439 So. 2d 947 (Fla. 1st DCA 1983); Comas v. Southern Bell Tel. & Tel. Co, 657 F. Supp. 117 (S.D. Fla. 1987); Waters v. Waters, 578 So. 2d 874 (Fla. 2d DCA 1991).
[13] Maugeri v. Plourde, 396 So. 2d 1215 (Fla. 3d DCA 1981).
[14] See Committee Notes to Fla. Prob. R. 5.636 and e.g., Part I of “Amended Administrative Order, Re: Standards And Procedures For The Protection Of Minors In The Settlement Of Personal Injury, Wrongful Death And Medical Malpractice Lawsuits And Claims,” supra.
[15] Fla. Prob. R. 5.636(d), (e) and the Committee Notes to Fla. Prob. R. 5.636.
[16] Fla. Prob. R. 5.636(d), (e).
[17] Fla. Prob. R. 5.030.
[18] Fla. Prob. R. 5.590; Fla. Stat. §§744.3125, 744.309, 744.342.
[19] Fla. Stat. §§435.04, 744.3135.
[20] Fla. Prob. R. 5.110(a).
[21] Fla. Prob. R. 5.110(b).
[22] Fla. Prob. R. 5.110(c).
[23] Fla. Prob. R. 5.555(b); Fla. Stat. §744.344(1).
[24] Fla. R. Jud. Admin. 2.2420.
[25] Fla. Prob. R. 5.555(d); Fla. Stat. §744.3371(2).
[26] Fla. Prob. R. 5.541; Fla. Stat. §744.109.
[27] Fla. Prob. R. 5.540; Fla. Stat. §744.1095(6).
[28] Fla. Stat. §744.3021(2).
[29] Fla. Stat. §744.345.
[30] Fla. Prob. R. 5.120 & 5.636; Fla. Stat. §733.308.
[31] Fla. Prob. R. 5.636(d), (e).
[32] Fla. Stat. §744.3025(2).
[33] John Shahbas, et. al. v. Morton Plant Hospital, et. al., 15 Fla. L. Weekly Supp. 697a (6th Cir. Ct., Judge Karen E. Terry, March 3, 2008).
[34] Fla. Prob. R. 5.636(f).
[35] Fla. Prob. R. 5.636(c), (f).
[36] Falco v. Bridgestone/Firestone North America Tire, LLC, 935 So. 2d 53 (Fla. 1st DCA 2006).
[37] Fla. Prob. R. 5.620; Fla. Stat. §§744.362(1), 744.365.
[38] Fla. Stat. §744.365(6)(a).
[39] Fla. Stat. §744.365(6)(a).
[40] Fla. Prob. R. 5.620(c); Fla. Stat. §744.365(5)(a), (b).
[41] Fla. Prob. R. 5.620(b); Fla. Stat. §744.384.
[42] Fla. Prob. R. 5.625; Fla. Stat. §744.3145(6).
[43] Fla. Stat. §744.3145(4).
[44] Fla. Prob. R. 5.625.
[45] Fla. Stat. §744.351(1).
[46] Fla. Stat. §§69.031, 744.351(1)&(6), 744.402(4).
[47] “Deposit Insurance FAQs” at http://www.fdic.gov/deposit/deposits/faq.html; See also, “Florida Guardianship Law And Information, Eighteenth Judicial Circuit Seminole County FL” 1/2007 at
https://umshare.miami.edu/web/wda/ethics/gurardianship_rev1-07.pdf.
[48] Fla. Stat. §69.031(4).
[49] Fla. Prob. R. 5.636; Fla. Stat. §744.387; See e.g., Lincoln Nat. Ins. Co. v. Ragan, 2015WL4756747 (M.D. Fla. 2015).
[50] Fla. Prob. R. 5.636(c).
[51] Fla. Prob. R. 5.150, 5.555(e)(1).
[52] Fla. Prob. R. 5.695(2), 5.696; Fla. Stat. §§744.367(2), 744.3678.
[53] Fla. Stat. §744.3679.
[54] Fla. Stat. §744.3679(3).
[55] Fla. Prob. R. 5.695(b).
[56] Fla. Stat. §744.368(2)-(6).
[57] Fla. Stat. §744.369.
[58] Fla. Stat. §744.3735.
[59] Fla. Stat. §744.3678(4).
[60] Fla. Prob. R. 5.050; Fla. Stat. §744.1098.
[61] Fla. Prob. R. 5.670, 5.680; Fla. Stat. §§744.521, 744.524744.527, 744.528, 744.531, 744.534.
[62] Hancock v. Share, 67 So. 3d 1075 (Fla. 5thDCA 2011).