Suffering an injury as an adult can be a traumatic experience. But when your child is hurt by the negligence of another, the experience can be even worse. Not only is your child suffering, but parents may be burdened with substantial medical bills and may miss time from work to take care of an injured child. In Alabama, when a child is injured by the negligence of another person or business, there are several legal issues you should be aware of when you consider whether to pursue legal action.
Who has the authority to bring legal action on behalf of injured children?
Pursuant to Alabama Code § 6-5-390, a father or a mother who are married shall have an equal right to commence an action for an injury to a minor child. When the parents of an injured child are unmarried (whether by divorce or otherwise), both parents may want to pursue the child’s claim. Alabama Code § 6-5-390 states that in the event the parents of the child are not married, the parent having “legal custody” of the child shall have the “exclusive right” to pursue the child’s personal injury claim. In Miller v. Dismukes, 624 So. 2d 1038 (Ala. 1993), the Supreme Court of Alabama affirmed the dismissal of a lawsuit because the father who filed the claim did not have authority to bring the lawsuit under 6-5-390. A divorce decree provided that that child’s mother had legal custody of the child, therefore, the father did not have the authority to file a claim.
Can someone other than a child’s natural parents pursue a claim on the child’s behalf?
In the event that a child’s parents are unable or unwilling to pursue a claim arising out of an injury and a minor does not have a legal guardian or another representative, Alabama Rule of Civil Procedure 17(a) allows a claim to be brought by a person designated as “next friend.” When a claim is brought by a “next friend,” the court shall appoint an independent attorney to serve as guardian ad litem to be certain the “next friend” is acting in the best interest of the minor. If a minor is fatally injured and the parents are unable or unwilling to pursue a claim, Alabama Code § 6-5-391 allows the personal representative of the minor’s estate to commence an action for Wrongful Death.
Who has the authority to settle a claim on behalf of a minor?
Although the custodial parent or legal guardian has the right to pursue a minor’s personal injury claim and may agree to a proposed settlement on the minor’s behalf, the parent or guardian does not have authority to settle a minor’s claim. Claims brought on behalf of minors can only be settled by a court-ordered judgment. When a settlement is proposed on behalf of a minor, the court will often appoint an independent attorney as “guardian ad litem” to represent the best interests of the child and make sure that the settlement is truly in the child’s best interest. A guardian ad litem will meet with the child and the parents or legal guardian, review the medical records and bills, and review any other relevant documentation to ensure that the settlement is in the best interests of the child. The court will listen to testimony from the parents, the minor, and the guardian ad litem at a “Pro Ami” hearing. At the hearing, the judge will ask questions and review documents to be certain that the proposed settlement is reasonable and in the best interests of the child. A claim will only be settled if the court approves and enters a judgment in favor of the minor for the agreed upon amount.
Who receives the proceeds of a settlement for a minor?
All the proceeds from any settlement must be maintained and expended for the benefit of the minor. If the settlement includes compensation for medical expenses incurred by the parents, they will be reimbursed for this expense. However, even if the parents demonstrate that they are upstanding and responsible parents, they will not be allowed to receive the entire settlement. In some instances, the court will allow parents to receive some portion of the proceeds pursuant to Alabama Code § 26-2A-6 that concerns Facility of Payments to minors or the Uniform Transfers to Minors Act, Alabama Code § 35-5A-8. Any payments to parents from a settlement are subject to the judge’s discretion and the judge can deny the parents any right to receive any money from the settlement.
Proceeds from a settlement on behalf of a minor may be placed into an interest-bearing account with the Circuit Court Clerk to be held until the child reaches the age of majority, which is nineteen in the state of Alabama. Once a child is nineteen years old, the proceeds will be disbursed to them as an adult. In many cases, proceeds from a settlement are paid to purchase a structured annuity for the benefit of the minor. These are financial agreements backed by secure life insurance companies that pay out designated amounts at certain dates in the future, typically after the minor has reached the age of majority. The primary benefit of a structured annuity is that the interest earned on the settlement proceeds is not subject to income taxes. Internal Revenue Code § 130(c). In limited situations, a conservatorship can be established through the probate court where the settlement funds are paid to a court-appointed conservator (which can be a parent or guardian). However, the cost of establishing a conservatorship and the annual bond premium, as well as the reporting requirements of the conservator, make this a rarely utilized option.
At Siniard, Timberlake & League, our attorneys have experience with pursuing injury claims on behalf of children. We are familiar with both the applicable law and with the important family issues that must be considered when children are involved in a case. If you know a child who has been injured due to someone else’s negligence, we can help.