Procedural Requirements

A petition for court approval of such a compromise under this section must comply with CRC Rules 7.950, 7.951, and 7.952. (CRC Rule 3.1384.)

Rule 7.950 specifies the required content of a petition, stating that the petition “must contain a full disclosure of all information that has any bearing upon the reasonableness of the compromise, covenant, settlement or disposition.” In addition, “the petition must be prepared on a fully completed Petition to Approve Compromise...(form MC-350)” (CRC Rules 7.950.)

Rule 7.950.5 permits the use of an “Expedited petition” in authorized circumstances. Subdivision (a) of the Rule provides:

”Notwithstanding the provisions of rule 7.950, a petitioner for court approval of a compromise of or a covenant not to sue or enforce judgment on a minor's disputed claim; a compromise or settlement of a pending action or proceeding to which a minor or person with a disability is a party; or disposition of the proceeds of a judgment for a minor or person with a disability under chapter 4 of part 8 of division 4 of the Probate Code (commencing with section 3600) or Code of Civil Procedure section 372 may, in the following circumstances, satisfy the information requirements of that rule by fully completing the Expedited Petition to Approve Compromise of Disputed Claim or Pending Action or Disposition of Proceeds of Judgment for Minor or Person With a Disability (form MC-350EX):

1. The petitioner is represented by an attorney authorized to practice in the courts of this state;
2. The claim is not for damages for the wrongful death of a person;
3. No portion of the net proceeds of the compromise, settlement, or judgment in favor of the minor or disabled claimant is to be placed in a trust;
4. There are no unresolved disputes concerning liens to be satisfied from the proceeds of the compromise, settlement, or judgment;
5. The petitioner's attorney did not become involved in the matter at the direct or indirect request of a person against whom the claim is asserted or an insurance carrier for that person;
6. The petitioner's attorney is neither employed by nor associated with a defendant or insurance carrier in connection with the petition;
7. If an action has been filed on the claim:
   1. All defendants that have appeared in the action are participating in the compromise; or
   2. The court has finally determined that the settling parties entered into the settlement in good faith;
8. The judgment for the minor or disabled claimant (exclusive of interest and costs) or the total amount payable to the minor or disabled claimant and all other parties under the proposed compromise or settlement is $50,000 or less or, if greater:
   1. The total amount payable to the minor or disabled claimant represents payment of the individual-person policy limits of all liability insurance policies covering all proposed contributing parties; and
   2. All proposed contributing parties would be substantially unable to discharge an adverse judgment on the minor's or disabled person's claim from assets other than the proceeds of their liability insurance policies; and
9. The court does not otherwise order.”

Attorneys Fees Procedure

“If the petitioner has been represented or assisted by an attorney in preparing the petition to compromise the claim or in any other respect with regard to the claim, the petition must disclose the following information:

1. The name, state bar number, law firm, if any, and business address of the attorney;
2. Whether the attorney became involved with the petition, directly or indirectly, at the instance of any party against whom the claim is asserted or of any party's insurance carrier;
3. Whether the attorney represents or is employed by any other party or any insurance carrier involved in the matter;
4. Whether the attorney has received any attorney's fees or other compensation for services provided in connection with the claim giving rise to the petition or with the preparation of the petition, and, if so, the amounts and the identity of the person who paid the fees or other compensation;
5. If the attorney has not received any attorney's fees or other compensation for services provided in connection with the claim giving rise to the petition or with the preparation of the petition, whether the attorney expects to receive any fees or other compensation for these services, and, if so, the amounts and the identity of the person who is expected to pay the fees or other compensation; and
6. The terms of any agreement between the petitioner and the attorney.”

(CRC Rule 7.951.)

Reasonableness Determination

“In determining a reasonable attorney's fee, the court may consider the following nonexclusive factors:

1. The fact that a minor or person with a disability is involved and the circumstances of that minor or person with a disability.
2. The amount of the fee in proportion to the value of the services performed.
3. The novelty and difficulty of the questions involved and the skill required to perform the legal services properly.
4. The amount involved and the results obtained.
5. The time limitations or constraints imposed by the representative of the minor or person with a disability or by the circumstances.
6. The nature and length of the professional relationship between the attorney and the representative of the minor or person with a disability.
7. The experience, reputation, and ability of the attorney or attorneys performing the legal services.
8. The time and labor required.
9. The informed consent of the representative of the minor or person with a disability to the fee.
10. The relative sophistication of the attorney and the representative of the minor or person with a disability.
11. The likelihood, if apparent to the representative of the minor or person with a disability when the representation agreement was made, that the attorney's acceptance of the particular employment would preclude other employment.
12. Whether the fee is fixed, hourly, or contingent.
13. If the fee is contingent:
1. The risk of loss borne by the attorney;
2. The amount of costs advanced by the attorney; and
3. The delay in payment of fees and reimbursement of costs paid by the attorney.
14. Statutory requirements for representation agreements applicable to particular cases or claims.”

(CRC Rule 7.955(b).)

“A petition requesting court approval and allowance of an attorney's fee under (a)

1. must include a declaration from the attorney that addresses the factors listed in
2. that are applicable to the matter before the court.”

(CRC Rule 7.955(c).)

Order for Withdrawal of Funds from Blocked Account

Form

The Judicial Council of California form for this order is MC-358.

California Rules of Court: Minor or Person with a Disability

Rules 3.1384(b) requires that an order for the deposit of funds of a minor or a person with a disability and a petition for the withdrawal of such funds must comply with Rules 7.953 and 7.954. Rule 7.953 concerns deposits, and Rule 7.954 concerns withdrawals.

Rule 7.954. Petition for the withdrawal of funds deposited for a minor or a person with a disability

1. Verified petition required. A petition for the withdrawal of funds deposited for a minor or a person with a disability must be verified and must include the identity of the depository, a showing of the amounts previously withdrawn, a statement of the balance on deposit at the time of the filing of the petition, and a justification for the withdrawal.
2. Ex parte or noticed hearing. A petition for the withdrawal of funds may be considered ex parte or set for a hearing at the discretion of the court.

Judicial Review

In regard to actions that involve compromises of minors’ claims, “the protective role the court generally assumes in cases involving minors, [is] a role to assure that whatever is done is in the minor’s best interests.” (Goldberg v. Sup. Ct. (1994) 23 Cal.App.4th 1378, 1382.)

Additional Information for Withdrawal

In withdrawals that involve subaccounts, the court may want to know the subaccount’s information. A court may further want to know if there will be any financial penalties or fees due to withdrawal.

Liability of Financial Institutions

A financial institution is absolved from liability for permitting the withdrawal of money without court authorization if it did not have actual notice of the order. (Prob. Code § 2456(c).)