When a Court Gets Involved in a Minor's Settlement in Maryland

By the FigureMyTax Editorial Team · How we calculate

When a Maryland child recovers a net sum of $5,000 or more in tort, the payer makes the check out to a statutory trustee for the child. The court's role is over the money: it may appoint a guardian of the property instead and it must order any withdrawal. We found no statute in these sections that requires a judge to approve the settlement itself.

Public policy

Estates and Trusts 13-402 says any substantial sum paid to a minor because of a tort claim, action or judgment should be preserved for the minor.

The $5,000 rule

Section 13-403 says that unless the court appoints a guardian of the property, if a minor, or anyone in whose name a tort claim is made on behalf of the minor, recovers a net sum of $5,000 or more, the person responsible for the payment must make the check payable to a named trustee "under Title 13 of the Estates and Trusts Article" for the minor. No other act is needed to make that person a trustee. The "net sum" is the net amount due after the attorney's fee and expenses, and the person responsible for payment is the attorney if the minor is represented (13-401).

A guardian instead of a trustee

The court may appoint a guardian of the property of a minor on whose behalf a tort recovery is sought or obtained if it finds the appointment in the minor's best interest, on a petition by an interested person or a trustee, and payment is then made to the guardian.

What we did not find

We did not find in these sections a rule that a judge must approve the settlement of a minor's tort claim, a procedure for a net sum under $5,000, or a dollar threshold for a petition. Ask the court or an attorney what applies in your case before you sign a release.

Deadlines

A person who is a minor when a claim accrues must file within the lesser of three years or the applicable period after the disability is removed, unless more than three years remain (Courts 5-201). Ask an attorney before assuming you have time. See how the statutory trust works and run your numbers in the Maryland minor's settlement calculator.

This is general information, not legal advice, and the state comparisons above are illustrative, not an exhaustive survey. Confirm how Maryland's rules apply to your specific case with a licensed Maryland attorney.