Senate Bill No. 316
(By Senators Palumbo and Kessler)
____________
[Introduced February 20, 2009; referred to the Committee on
Education; and then to the Committee on Finance.]
____________
A BILL to amend and reenact §44-10-14 of the Code of West Virginia,
1931, as amended, relating to authorizing that net settlement
proceeds held for a minor may be invested in a Smart 529
college savings plan.
Be it enacted by the Legislature of West Virginia:
That §44-10-14 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 10. GUARDIANS AND WARDS GENERALLY.
§44-10-14. Minor settlement proceedings.
This section shall be known as the "Minor Settlement
Proceedings Reform Act".
(a) If a minor suffers injury to his or her person or
property, the parent, guardian or next friend of the minor may
negotiate a settlement of the minor's claim for damages prior to or
subsequent to the filing of an action for damages.
(b)
Filing of petition or motion. -- In order to secure a
release of the party or parties allegedly responsible for the
injury or loss, the parent, next friend or guardian of the minor
shall file a verified petition in the circuit court of the county
in which the minor resides or in which an action for damages may be
filed in accordance with
the provisions of section one, article
one, chapter fifty-six of this code.
Provided, That If an action
for damages of the minor is pending in circuit court, the petition
shall be filed, verified and served as a motion in the pending
action and may be filed by a parent, guardian or next friend.
(c)
Contents of petition or motion. -- The petition or motion
shall request approval by the court of the terms of the proposed
settlement, the release of liability and the manner of distribution
of settlement proceeds. The petition or motion shall also state
the following:
(1) The name, gender and age of the minor;
(2) The facts of the injury and damages of the minor relied
upon in requesting the court to consider and approve the proposed
settlement and release;
(3) The circumstances and events leading to the injury or loss
at issue and the identities of the persons or entities alleged to
be responsible for the injury or loss;
(4) The identities of the persons or entities to be released;
(5) The circumstances of the minor at the time of the petition or motion;
(6) The relationship of the petitioner or moving party to the
minor;
(7) The nature and effect of the injury;
(8) The sum of expenses expended for the treatment and care of
the minor for the injuries at issue;
(9) An estimate of future expenses for the treatment and care
of the minor related to the injury and how such expenses would be
satisfied from the settlement proceeds;
(10) A proposal as to how the costs and expenses of processing
the settlement and release are to be satisfied;
(11) A proposal for distribution of other settlement proceeds;
and
(12) A request for such other relief as the court may
determine is appropriate in the best interests of the child.
(d)
Guardian ad litem. -- Upon the filing of a petition or
motion, the court shall appoint a guardian ad litem to:
(1) Review and confirm the facts set forth in the petition and
the facts and circumstances of the minor, including the injuries
and losses of the minor alleged to have been caused by the party or
parties to be released as alleged in the petition or motion; the
treatment and conditions past, present and in the foreseeable
future of the minor as a result of the injuries and losses at
issue; the proposed amounts and procedures for distribution of settlement proceeds; and other relevant information appearing in
the petition or motion or otherwise; and
(2) File an answer to the petition or motion on behalf of the
minor, stating the opinion of the guardian ad litem as to whether
or not the proposed settlement and release and the proposed
distribution of proceeds are in the best interest of the minor.
(e)
Hearing. -- A hearing shall be conducted on the petition
or motion, at which time the court shall take testimony and
consider arguments regarding the alleged injuries or losses and the
proposals for the settlement, release, initial payment of expenses
and the distribution of settlement proceeds.
Provided, That In
addition, the court may order that the minor appear and testify if
the court finds that his or her appearance or testimony is
appropriate for consideration by the court of the proposed
settlement.
(f)
Release form. -- If the court grants the requested relief,
a release of the claim of the minor against the persons or entities
alleged to be responsible for the injuries or losses and who are
identified in the petition or motion to be released from liability,
any other persons or entities making payment on behalf of those
persons or entities and any subsidiaries or successor persons or
entities shall be executed by a party authorized by the court to
execute the release. The release shall be in form or effect as
follows:
I, .........., the [guardian or other person authorized to
execute the release] of .........., a minor, in consideration of
the sum of $.........., and under authority of an order of the
circuit court of .......... County, entered on the .......... day
of .........., 20....., pursuant to West Virginia Code 44-10-14, do
hereby release .......... from all claims and demands on account of
injuries allegedly inflicted upon the minor and any property of the
minor on the ......... day of ............., at _________________
____________________
Signature)
[Guardian or other person authorized by the court to execute
the release] of ______________________
(g)
Order approving or rejecting settlement. -- The court
shall enter an order with findings of fact and granting or
rejecting the proposed settlement, release and distribution of
settlement proceeds. If the requested relief is granted, the court
shall provide by order that an attorney appearing in the proceeding
or other responsible person shall negotiate, satisfy and pay
initial expense payments from settlement proceeds, the costs and
fees incurred for the settlement and any bond required therefor,
expenses for treatment of the minor related to the injury at issue,
payments to satisfy any liens on settlement proceeds, if any, and
such other directives as the court finds appropriate to complete
the settlement and secure the proceeds for the minor.
(1) In allowing the payment of settlement proceeds for
attorney fees, legal expenses, court costs and other costs of
securing the settlement in such reasonable amounts as the court
finds in its discretion to be appropriate, the court shall consider
the amount to be paid as damages, the age and necessities of the
minor, the nature of the injury, the difficulties involved in
effecting the settlement, legal expenses and fees paid to attorneys
in similar cases and any other matters which the court determines
should be considered in achieving a proper and equitable
distribution of settlement proceeds.
(2) In allowing any sums to be paid to the minor or to another
person to be used for the immediate personal benefit of the minor,
the court shall state further the terms under which such payments
shall be made, including the use for which such sums may be
expended and the times on which such payments shall be made.
Provided, That However, such payments shall be made no later than
twenty-four months after entry of the order.
(3) The order shall provide that settlement proceeds remaining
after the initial payment of expenses shall be deemed net
settlement trust proceeds.
(4)
If the net settlement proceeds are less than twenty-five
thousand dollars, The court may order that the person authorized to
pay the initial expenses deposit net settlement trust proceeds into
a regulated financial institution or institutions with a principal place of business in this state, in interest bearing certificates
of deposit or accounts or securities that are fully insured by
federal deposit insurance,
in a Smart 529 college savings plan or
in any product that guarantees future periodic payments, in the
name of the minor and payable
by the financial institution only to
the minor upon presentation of proper identification after the
minor attains the age of majority
Provided, That if such person may
be authorized by the court to transfer funds to a substitute
qualified institution or institutions from the financial
institution or institutions initially selected.
Provided, however,
That However, any substitution shall be reported to any fiduciary
commissioner or supervisor of the county that the court has
designated to review of the status of the investment and security
of net settlement trust proceeds.
Provided further, That Also,
whenever net settlement trust proceeds are deposited into a bank
pursuant to
the provisions of this paragraph, such bank shall,
within ten days of receipt of such funds, file with the clerk of
the court an acknowledgment that the funds have been received and
that such funds may be withdrawn only by the minor upon his or her
reaching the age of majority or upon order of the court.
(5) The order shall provide that within sixty days of the
entry of the order, a statement of initial expense payments and an
inventory of net settlement trust proceeds and any income earned
thereon shall be filed by the person authorized to pay initial expenses with the fiduciary commissioner or supervisor of the
county commission designated by the court to review the status of
settlement proceeds for the minor.
(6) The order shall direct that a certified copy of the order
of the court approving the settlement be provided by the clerk of
the circuit court to the fiduciary commissioner or supervisor
designated by the court to review the status of settlement
proceeds.
(h)
Appointment of conservator and reports to fiduciary
officers. -- The court may appoint a conservator to serve as the
person responsible for investment and control of net settlement
trust proceeds until the minor attains the age of majority or at
such later time as the court may order upon terms the court finds
to be in the best interest of the minor, taking into consideration
any special needs of the minor at any age. The conservator may be
a guardian appointed pursuant to section three of this article or
other responsible person.
(1) Neither the corpus nor income accumulated on net
settlement trust proceeds shall be used for the maintenance or care
of the minor during his or her minority, absent unusual
circumstances or special needs of the minor specified in the order
approving the settlement. The corpus or income earned thereon may
not be invaded, revised or subjected to assignment, levy,
garnishment or other order, except as shall be first approved by order of the court approving the settlement.
(2) The court shall determine the amount and necessity for
bond of the conservator and for any surety of the bond of the
conservator, payable on behalf of the minor in an amount sufficient
to protect the principal of net settlement trust proceeds, unless
the court finds the conservator is already under bond and surety of
bond sufficient for the purpose. The bond of the conservator and
surety for the bond of the conservator shall be in form and type
acceptable to the fiduciary commissioner or supervisor of the
county commission designated by the court to review the reports of
the conservator and shall be conditioned to account for and pay
over the amount of net settlement trust proceeds as provided
for by
the order of the court. The clerk of the circuit court shall
provide to the office of such fiduciary commissioner or supervisor
a certified copy of the court's order approving the settlement and
distribution of proceeds and such fiduciary commissioner or
supervisor shall file and record the order with any bond of the
conservator that may be required by the court approving the
settlement and distribution of proceeds.
(3) A report of net settlement trust proceeds and income
earned thereon for each calendar year shall be filed by the
conservator by February 1 next following the end of the calendar
year in the order approving the settlement is entered and every
year thereafter in accordance with
the terms of the court order.
(4) If the amount of net settlement trust proceeds is less
than $25,000, the court may include in the order approving the
settlement a waiver of any or all of the requirements regarding
reference to a fiduciary officer, the filing of the order or of any
other reports or statements of accounts with a fiduciary
commissioner or supervisor of the county commission designated by
the court, the posting of bond and corporate or other surety of
bond of the conservator and any listing and publication of
accounts.
NOTE: The purpose of this bill is to authorize that net
settlement proceeds held for a minor may be invested in a Smart 529
college savings plan.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
Email
Webmaster | © 2024 West Virginia Legislature **
