I was told two different things by two different sources, one being a lawyer. Is it true that in the state of Massachusetts a settlement over $5000.00 that is awarded to a minor is frozen in an account till they turn 18, or is there an amount at all.
This question is best addressed by an attorney practicing in MA, but generally speaking the purpose of what we in CA call a "minor's compromise", is to ensure that the money paid to a minor in a settlement doesn't get spent by unscrupulous parents/guardians. (Before such minor's compromise laws were enacted, if was not uncommon for an injured minor's parents to spend the cash on household luxuries-TV's, cares, etc.- and leave the poor kid who got injured with nothing to show for it.) While I don't mean to suggest that, if you're a parent, you'd do such a thing, the laws were enacted to protect against that type of abuse. So, the accounts are "frozen" until the child turns 18, but can be released, in whole or in part, upon a court order, upon a showing of good cause. "Good cause" might be something like paying for additional care, or even paying for college tuition if the child qualifies to enter college early. (Buying a new car on the kid's 16th birthday doesn't usually qualify, though I've seen that argued...) If you're dealing with such a settlement, and you're dealing with an attorney for that settlement, discuss that with your attorney.
I agree with Marc that you need to speak with an attorney licensed in the jurisdiction where the accident took place. For example, in Arizona if a settlement is less than $10,000 no special account is needed; but if it is for $10,000 or more you will need to probate the settlement, and the court will require the funds to be placed in a restricted account. However, if the child needs the money before he/she is 18, the guardian/parent can petition the court to allow the withdrawal, which will be granted depending on whether it is a necessity or just a desire.
In general any settlement for a minor is supposed to be presented to the Court through a petition for approval of a minor's settlement.
When the Petition for Approval is heard by the Court, there is a brief hearing during which the Court is advised as to the facts and circumstances of the accident and the injuries sustained by the minor. During this hearing, the Court can inquire as to what plans are in place for the use or deposit of the settlement monies (ie. are they to be placed in a trust account, used for medical expenses.....etc.). Each Court handles these hearing differently. Likewise, when the settlement monies are a larger amount it is more likely to involve an in depth review process to make sure that the monies are being used and deposited appropriately in the minor's best interests.
Hopefully, this helps and answers your question. Good luck.
