When a child suffers an injury due to someone else’s negligence—whether from a car accident, a dog bite, a playground incident, or medical malpractice—it can be a devastating experience for families. These cases often lead to legal claims, where families pursue compensation for medical bills, emotional trauma, and long-term care needs. While many cases end in a settlement, resolving a lawsuit involving a minor is far from straightforward. The legal system requires an extra layer of protection for children, and that’s where the courts come in. A child injury lawyer plays a key role in navigating this complex process, but ultimately, it’s the court that must approve and oversee the final settlement.
This article explains how courts handle settlements in child injury lawsuits, and why judicial involvement is so critical in these sensitive cases.
Why Do Courts Need to Approve Child Injury Settlements?
Unlike adults, children cannot legally enter into contracts or make binding decisions in lawsuits. Because of this, even if the parties in a lawsuit reach a private agreement, a judge must review and approve any settlement involving a minor. The purpose is to ensure that the outcome truly serves the best interest of the child—not just what’s convenient for the parents, insurance companies, or attorneys.
The court’s oversight acts as a safeguard against unfair or inadequate settlements, improper distribution of funds, or misuse of the compensation meant for the child’s care and future.
The Role of the Petition for Settlement Approval
Once a settlement has been negotiated, the child’s parent or legal guardian—often with the help of their attorney—must file a legal request for court approval. This request is typically called a Petition for Approval of Minor’s Compromise or something similar, depending on the jurisdiction.
This petition usually includes:
- A detailed account of how the injury occurred
- The child’s current medical condition and prognosis
- The total settlement amount
- A breakdown of legal fees, costs, and medical bills
- The proposed plan for how the money will be used or held
- Any agreements with medical providers or lienholders
The petition must clearly explain how the settlement benefits the child and why it should be approved.
What Happens at the Court Hearing?
Once the petition is filed, the court schedules a hearing. This is a formal proceeding, although it’s often less adversarial than a trial. The judge’s primary goal is to review the settlement terms and ask questions if anything is unclear or concerning.
Some common issues the judge may examine include:
- Is the settlement amount fair and reasonable, considering the severity of the injury and potential future needs?
- Are the attorney’s fees and litigation expenses appropriate?
- Are the parents requesting any reimbursement, and if so, is it justified and documented?
- What is the proposed method for safeguarding the child’s funds?
In some cases—particularly if the child is older—the judge may ask the child to attend the hearing to confirm they understand the terms or feel satisfied with the outcome.
Managing the Child’s Settlement Funds
A critical part of the court’s role is ensuring the child’s compensation is protected. There are several common ways that courts handle this:
1. Blocked Accounts
This is one of the simplest methods. The settlement funds are placed into a restricted bank account that cannot be accessed until the child turns 18 (or another specified age). Any withdrawals require court approval.
2. Structured Settlements
A structured settlement spreads the payments over a set period of time, such as monthly or yearly installments. This can provide the child with ongoing financial support during adolescence or adulthood. It’s also less likely to be mismanaged than a lump sum.
3. Trusts (e.g., Special Needs Trust)
For children with disabilities or ongoing medical needs, the court may direct the funds into a trust, such as a Special Needs Trust. This ensures that the money can be used for qualified expenses without disqualifying the child from government aid programs like Medicaid or SSI.
Parental Reimbursement and Medical Liens
In many cases, parents will have already paid out-of-pocket for medical care or transportation during treatment. The court may approve reimbursement for these expenses, but they must be reasonable and supported with receipts. Courts will also review any medical liens—claims by hospitals or insurers to be repaid from the settlement—to ensure they are valid and fairly negotiated.
Ongoing Court Oversight
In some jurisdictions, the court’s involvement doesn’t end with the approval. Judges may require periodic reporting on how the funds are being used or invested. If there are signs of mismanagement or if family circumstances change, the court can intervene to protect the child’s financial interests.
Final Thoughts
Child injury settlements involve more than just a legal agreement—they involve the future of a young person whose life may have been permanently changed. That’s why the court system imposes strict oversight: to ensure the resolution is just, the funds are secure, and the child’s welfare is fully protected.
If your child has been injured and you’re considering a legal claim, working with an experienced child injury lawyer is essential. They can help you navigate not just the lawsuit, but also the approval and financial planning process that follows. While it may feel like a lengthy or complex path, these safeguards are in place for one important reason: to ensure justice and security for your child.
