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WHAT IS A MINOR’S COMPROMISE?

A Minor's Compromise is when an adult signs on behalf of a child so the child can receive money. The law doesn’t allow the child to sign for him or herself until s/he becomes an adult.


IS THE PROCESS FOR AN INCOMPETENT PERSON’S COMPROMISE THE SAME AS A MINOR’S COMPROMISE?

Basically, yes. An Incompetent Person’s Compromise, is when another adult, who is appointed by the court, signs and receives money on behalf of the incompetent person. (An incompetent person is an adult who is unable to make decisions for him or herself.)


WHAT IF MY CHILD IS INJURED AND RECEIVES A SETTLEMENT?

Under the law, a minor child cannot sign a contract or other legally binding agreement. But if your child has a claim for injuries caused by an accident, then you or the child’s guardian of the estate, can sign a settlement agreement on behalf of the child.

CAN EITHER PARENT SIGN A SETTLEMENT AGREEMENT ON BEHALF OF THE CHILD?

Yes, if you both parents live with the child. If not, only the custodial parent or legal guardian can sign.


WHAT IF THE CHILD HAS A LEGAL GUARDIAN OF THE ESTATE?

The guardian, conservator, or the guardian ad litem can petition the court to transfer the funds using one of these methods:

  • To an insured account in a financial institution or into a single premium deferred annuity, subject to withdrawal only on court order;
  • To a custodian under the Uniform Transfers to Minors Act;
  • To the trustee of a trust that the minor can revoke when the minor turns 18;
  • To the trustee of a special needs trust for the benefit of the minor as described in Probate Code Section 3604 . (This type of special needs trust is only for minors who receive public benefits because of disability and high medical expense. When the trustee dies, the trust must reimburse the state for the state’s expenses for the individual's medical costs, up to the full amount left in the trust at the time of the trustee’s death.)

If there is no guardianship of the estate, the court that makes the order for settlement of the child's claim can make an order to do any of the following:

  • Establish a guardianship of the estate and transfer the funds to a guardian;
  • Deposit of the funds into an insured account in a financial institution, subject to withdrawal only on court order;
  • Purchase of a single-premium deferred annuity, subject to withdrawal only on court order;
  • Transfer to the trustee of a special needs trust as described in Probate Code Section 3604 ;
  • Transfer to the trustee of a trust that the minor can revoke when the minor attains age 18.

If the settlement is $20,000 or less, the court will make whatever order is in the best interests of the child. If the settlement is $5,000 or less, the court will order funds deposited into a blocked account.


FORMS FOR PETITION FOR MINOR'S COMPROMISE

  • MC-350  Petition to Approve Compromise of Claim
  • CIV-010  CIV-010 Application and Order for Appointing Guardian Ad Litem
  • MC-351  MC-351 Order Approving Compromise of Claim
  • MC-355  Order to Deposit Money Into Blocked Account
  • MC-355  Receipt and Acknowledgment of Order for the Deposit of Money Into Blocked Account

WHAT DO I DO WITH THE COURT FORMS?

Step 1

Fill out and file these forms and submit to the probate clerk at the Central Justice Center or you may eFile.

  • MC-350 
  • CIV-010  (Only if the Court has not yet appointed a guardian ad litem for the minor or incompetent.)
  • MC-351 
  • MC-355 

An original or a photocopy of all doctor’s reports containing a diagnosis of a prognosis for the claimant’s injuries, and a report of the claimant’s present condition, must be attached to petition as attachment #9. A new report is not necessary so long as a previous report accurately describes the claimant’s current condition.

Step 2

Pay the filing fee. (If you have a civil case, there is only a Court Reporter fee due.) On the Orange County Superior Court fee schedule, look on the Probate fee schedule to see the fees to file a "Petition to compromise claim of minor".

Step 3

When you file your forms, the clerk will tell you the date of your hearing. Note: If the money (settlement) to be received on behalf of the child is less than $5,000, there will not be a hearing. Just submit all needed forms to the Probate clerk with a self-addressed stamped envelope. The clerk will use the envelope to mail you endorsed filed copy of the judge’s decision.

Step 4 If the judge approves your petition, file the orders MC-351  and MC-355 .
Step 5

Take a copy of the Order MC-355  to the bank along with form MC-356. The bank clerk must sign the Receipt (MC-356). Then, you file the Receipt with the Probate clerk.


WHERE CAN I READ MORE ON THE LAWS FOR A MINOR’S COMPROMISE?

Read Probate Code Section 3600  and the following sections.



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