4 Differences in a Minor’s Personal Injury Claim

For a child, the inevitable will happen—injuries. But, there is a stark difference between the scrape and bruise received from horse playing in the backyard, and the traumatic experience of a car accident. Additionally, children are unique, insofar that, oftentimes, the extent of the injuries sustained—physically or emotionally—don’t become apparent until much further down the road. Therefore, below are four main differences to bear in mind when bringing a minor personal injury claim with a minor involved:

Statute of Limitations
In law, the statute of limitations refers to the timeline in which you must bring a lawsuit. If the effected party does not bring suit within the statute of limitations, the party forfeits their right to recovery. Here in Arizona, the typical personal injury case has just two years from the date of injury to bring a lawsuit.

Minors, however, are more protected under law. Thus, the law has carved out special rules to protect minors and children from the standard statute of limitations timeline. To that end, Arizona has something called “tolling” of the statute of limitations. Here, the statute of limitations for minors does not begin until the minor or child has reached 18 years old, or emancipated. Therefore, tolling of the statute of limitations usually extends the two-year timeline; however, don’t take this extended timeline as an opportunity to wait to bring your child’s personal injury claim. All claims should be brought in a timely manner to avoid facts from getting stale, and injuries developing further.

Probate Court Approval Required
In seeking the best interest of the minor, often times, parents are not permitted to bind their child(ren) to a settlement agreement. Moreover, Arizona law actively inserts courts to protect the minor in two ways: 1) personal injury claims exceeding $10,000 requires the court’s approval, and; 2) where the personal injury claim is less than $10,000 the adverse parties retain the right to require court approval of the minor’s settlement. Therefore, no matter the dollar amount of a minor’s personal injury claim, it is likely the court will be involved.

Restricted Bank Account
A common misconception is that when a settlement is reached in a minor’s personal injury claim, the parents will be able to retrieve the funds. The exact opposite is true. Instead, settlement funds resulting from a minor’s personal injury claim go into restricted bank accounts. Here, to ensure the resulting benefit reaches the child, settlement funds are deposited into a restricted bank account, which prevents the funds from being withdrawn until the minor reaches 18 years old, or is emancipated. In instances that require the funds prior to the minor reaching 18 years old, a Probate Court must be petitioned for approval of withdrawal of the funds. Only then, when the Probate Court has given approval to withdraw funds from the restricted bank account, funds will be released prior to the minor reaching 18 years old.

Structured Settlement
A unique alternative to restricted bank accounts is a structured settlement. Generally, restricted bank accounts come with extremely low interest rates, with the conditions set forth as indicated above. Oppositely, structured settlements parallel an investment for the child allowing for: 1) higher rate of returns, and; 2) court approved predetermined payout intervals. In the former, most structured settlements come with a higher interest rate given the account is slightly different than a regular restricted banking account. In the latter, court approved predetermined payout intervals, such as 18, 22, and 25 years of age as examples, can be used to support a minor as they progress through milestones in their adulthood, like college. Additionally, as a consequential benefit, court approved predetermined payout intervals also avoid dumping the proceeds of a settlement in a lump sum to an 18 year old. In the end, the decision on whether a restricted bank account or a structured settlement is more beneficial to your specific case, usually turns on the age of the minor and the amount of the settlement, as there are no additional costs to do so.

The Law Offices of Michael Cordova can help you, or a loved one, get through the traumatic experience a minor’s personal injury claim brings. The experienced personal injury attorneys at the Law Offices of Michael Cordova handles a variety of injury and accident cases, while providing a service to the client that is professional, personal, and unparalleled in the legal industry. To learn more about the cases we handle, visit our main site here. If you, or a loved one, have been injured by another party, or because of a faulty product, contact us for a free case evaluation.