When Probate Court is Necessary for a Personal Injury Case

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By: Bill Henry
PublishedMay 7, 2021
3 minute read

Personal injury and probate court generally are two areas of law that you don’t think about at the same time. Personal injury and probate court do sound like an odd mix. However, there are times when a personal injury case will involve probate court.

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When Personal Injury and Probate Court Mix

You may think of probate and probate court only in terms of a will or the transfer of an estate. So why would you need probate court in a personal injury case? One of the main reasons is when a child is injured in an accident and they are awarded settlement money.

How Age Affects Personal Injury Cases

Minors & Personal Injury Settlements

In Colorado, a child under the age of 18 is considered a minor. That means if your child is awarded monetary damages for an injury in an auto accident or a slip-and-fall there could be various obstacles to collect that money on the child’s behalf.

You should be aware that there is a legal difference between the ages 18 and 21.

An experienced personal injury attorney will tell you that if you can hold off collecting your child’s settlement money until after his or her 18th birthday, your child will be able to legally collect their settlement money. When your child is under the age of 18, it’s a different story.

Restricted Accounts for Underage Persons

Why is a restricted account important? Well, let’s say your child is very young, nowhere near the age of 18, and is awarded money in a personal injury case. If this happens, the courts will your child wait until their 21st birthday before they can collect the settlement money.

You are probably wondering how waiting years and years to get settlement money is supposed to help your child who is recovering from an injury now. The good news is, there are various ways to get your child that money more quickly. 

If your child is very young you must go through probate court to have a judge approve the settlement.

Probate Court’s Role in a Minor’s Case

A probate judge will review the settlement your child received. The court will want to know about your child’s injuries and the treatment he or she received. If everything is in order, the judge will approve the settlement.

Generally speaking, the court acts like the child’s legal guardian. It’s a safeguard put in place to ensure attorneys and parents do not take advantage of a minor child.

The probate judge is just an extra pair of eyes on the process to make sure everything is proper.

The Personal Injury and Probate Court Process

Create an Account for Your Child

Once the probate court signs off on the settlement money, the next step is to locate a bank that offers a restricted account. 

The restricted account prevents a parent or guardian from withdrawing the money unless there’s a really good reason for it.

Make Annual Disclosures

After opening the account, you are required to report to the court every year on the account’s balance and demonstrate that the money has not been touched.

You are required to continue this reporting each year until your child turns 21 years old.

Exceptions to the Rule

Above, we noted that parents cannot take money out of a child’s restricted account. Well, there are exceptions, and for good reason.

The most common exception to the restriction is a parent may remove money from the child’s account to cover their expenses.

Getting Permission

Our personal injury attorneys have seen parents request to take money from the account to cover expenses like school tuition to transportation. But, you cannot just withdraw money from the account without the court’s permission. You’ll have to write a letter seeking the OK before you spend the child’s money on any of these things.

Investment & Savings Accounts

Parents often want to know if they can place a child’s settlement money from an accident into an investment account instead of a checking account.

A trust account, for instance, can accrue more interest than a regular bank account. So the answer is yes.

When you go before the probate court, you will need to have the proper documentation showing that you plan to put the money in a trust or savings account.

Judges recognize that money in those types of accounts gather more interest and are more beneficial for the child moving forward. However, the judge will want to know whether that savings or investment account will be restricted.

When Probate Court is Not Necessary

An experienced personal injury attorney will tell you, if your child is very young and the personal injury award is less than $10,000, you will not need the probate court’s approval before the money is released.

In this instance, as a parent, you would receive the money on behalf of the child and promise to use the money in the best interest of the child. You could then avoid Probate Court altogether.

Get Help with Your Child’s Personal Injury and Probate Court Case

Most people never have to go to court or see the inside of a courtroom. If you are faced with going to court, however, the process can be daunting and confusing.
An experienced attorney can provide you with the answers you need. If you need help navigating the probate system during a personal injury, we can help with that, too.

Call 303-688-0944 to schedule a case assessment.

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