Friendly Suits and Texas Injury Claims
In Texas, settling a personal injury claim for a minor can be different than the process for adults. Depending on the settlement, the insurance company may initiate a “friendly suit” to have a judge approve the settlement before disbursing funds.
Can Minors Settle Injury Claims?
Most personal injury claims are settled by agreement. The injured party—usually through an attorney—negotiates a claim with the insurance company until the injured party is satisfied with a settlement. If the parties settle, the injured party signs a release, agrees to accept something of value (usually a sum of money), and surrenders any future claims against the at-fault driver and the driver’s insurance company.
A release is a contract, though, and minors cannot enter into contracts. Accordingly, a release signed by a minor does not bar subsequent claims against the at-fault driver and the driver’s insurance company.
What is a Friendly Suit?
To avoid paying a claim more than once, insurance companies sometimes use “friendly suits” to finalize settlements for minors. A friendly suit is “friendly” because it is not an adversarial proceeding. Instead, the parties—namely the minor’s parent or guardian and the insurance company—have already agreed to settle the claim and merely ask the judge to approve that settlement.
Theoretically, insurance companies should request friendly suits for all claims involving injuries to a minor. As a practical matter, though, insurance companies request friendly suits only when a proposed settlement is of significant value. Whether a proposed settlement is significant enough to warrant a friendly suit differs among insurance companies.
What is the Friendly Suit Process?
Once a parent is satisfied with an insurance company’s offer to settle a minor’s claim for injuries, the parties file a petition so that a judge may approve the settlement. After filing the petition, the parties file an agreed motion asking the judge to appoint a guardian ad litem.
A guardian ad litem is a neutral third party who is almost always a licensed attorney. As part of the friendly suit process, the guardian ad litem helps the judge identify any conflicts between the parent and the minor, if any, and determine whether the proposed settlement is in the minor’s best interest. To fulfill these roles, the guardian ad litem reviews the case file—including the police report, the minor’s medical bills and records, and the proposed settlement—and meets with the parent and minor to verify that they agree with the proposed settlement.
How Does a Judge Approve a Minor’s Settlement?
Judges require a hearing and testimony before finalizing friendly suits. At the hearing, the judge discusses the minor’s injuries and the proposed settlement with the minor’s parent, the minor’s attorney, the insurance company’s attorney, and the guardian ad litem.
Since the parties have already tentatively agreed to settle, friendly suit hearings are usually quick and uncontested. Barring any unforeseen circumstances, the guardian ad litem usually recommends the approval of the settlement. Likewise, the judge usually follows the guardian ad litem’s recommendation and approves the settlement.
What Happens if the Judge Approves a Minor’s Settlement?
If the judge approves the settlement, the settlement becomes binding on the minor, meaning the minor cannot assert a claim against the at-fault driver or the driver’s insurance company in the future. Additionally, the insurance company drafts and issues settlement checks based on the judge’s order.
The judge’s order approving a minor’s settlement almost always requires that the minor’s proceeds be held in the court’s registry until the minor turns 18 years old. Courts do this for various reasons, including to keep the minor from making poor financial decisions and to keep the settlement away from the minor’s parent. Once the minor turns 18, he or she may request the settlement proceeds from the court by filling out paperwork with the clerk and showing proper identification.
Speak With an Experienced Accident Attorney After a Car Wreck
If a negligent driver has injured you or a loved one, you have enough things to worry about. Do not let dealing with the insurance company be one of them. We deal with the insurance company so you can focus on getting your life back to normal. You have one chance to do this; make the right choice by choosing the right attorney. Call us at (956) 291-7870 or email us at contact@rdjlawyer.com for a free consultation and case evaluation.