Why a Court Must Approve a Minor's Settlement in North Carolina

By the FigureMyTax Editorial Team · How we calculate

According to court decisions summarized by the UNC School of Government, a minor's settlement is not enforceable against the minor unless a court has first investigated and approved it, even if a parent, guardian, guardian ad litem or attorney arranged it, and even before a lawsuit is filed. We found no statute setting a dollar threshold.

What the summary says

A UNC School of Government summary of North Carolina court decisions says the court's review protects the minor and focuses on fairness to the minor. If there is no lawsuit, the parties file a friendly civil action with a complaint and summons followed by a petition for approval. The minor must be represented by a general or testamentary guardian or a court-appointed guardian ad litem.

What the court asks

The summary lists the net amount the minor will receive, payments made out of the settlement, whether adequate funds remain, how the funds will be protected until majority, whether the clerk or a guardian of the estate will hold them, and the fee. The minor is not bound by the fee agreement. We read the summary, not the opinions.

Small claims

We found no statute or court decision in the sources we read that exempts small settlements from approval, so do not assume a small claim can be settled without a court.

Money held for a child

A person holding $50,000 or less for a minor with no guardian may pay it to the clerk of superior court or public guardian (G.S. 7A-111), and the clerk may appoint a guardian of the estate for any minor (35A-1224). See how the money may be held.

Deadlines

A person within the age of 18 is under a disability and may bring the action within the time limited after it ends (G.S. 1-17); the injury period is 3 years (1-52(16)). Ask an attorney before assuming you have time. Run your numbers in the North Carolina minor's settlement calculator.

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