2020 Georgia Code
Title 29 - Guardian and Ward
Chapter 3 - Conservators of Minors
Article 1 - Property
§ 29-3-3. "Gross Settlement" Defined; Compromise of Claim; Finality of Settlement

1. For purposes of this Code section, the term "gross settlement" means the present value of all amounts paid or to be paid in settlement of the claim, including cash, medical expenses, expenses of litigation, attorney's fees, and any amounts paid to purchase an annuity or other similar financial arrangement.
2. If the minor has a conservator, the only person who can compromise a minor's claim is the conservator.
3. Whether or not legal action has been initiated, if the proposed gross settlement of a minor's claim is $15,000.00 or less, the natural guardian of the minor may compromise the claim without becoming the conservator of the minor and without court approval. The natural guardian must qualify as the conservator of the minor in order to receive payment of the settlement if necessary to comply with Code Section 29-3-1.
4. If no legal action has been initiated and the proposed gross settlement of a minor's claim is more than $15,000.00, the settlement must be submitted for approval to the court.
5. If legal action has been initiated and the proposed gross settlement of a minor's claim is more than $15,000.00, the settlement must be submitted for approval to the court in which the action is pending. The natural guardian or conservator shall not be permitted to dismiss the action and present the settlement to the court for approval without the approval of the court in which the action is pending.
6. If the proposed gross settlement of a minor's claim is more than $15,000.00, but the gross settlement reduced by:
   1. Attorney's fees, expenses of litigation, and medical expenses which shall be paid from the settlement proceeds; and
   2. The present value of amounts to be received by the minor after reaching the age of majority

      is $15,000.00 or less, the natural guardian may seek approval of the proposed settlement from the appropriate court without becoming the conservator of the minor. The natural guardian must qualify as the conservator of the minor in order to receive payment of the settlement if necessary to comply with Code Section 29-3-1.

7. If the proposed gross settlement of a minor's claim is more than $15,000.00, but such gross settlement reduced by:
   1. Attorney's fees, expenses of litigation, and medical expenses which shall be paid from the settlement proceeds; and
   2. The present value of amounts to be received by the minor after reaching the age of majority

      is more than $15,000.00, the natural guardian may not seek approval of the proposed settlement from the appropriate court without becoming the conservator of the minor.

8. If an order of approval is obtained from the court, or a court in which the action is pending, based upon the best interest of the minor, the natural guardian or conservator shall be authorized to compromise any contested or doubtful claim in favor of the minor without receiving consideration for such compromise as a lump sum. Without limiting the foregoing, the compromise may be in exchange for an arrangement that defers receipt of part, not to exceed a total distribution of $15,000.00 prior to a minor reaching the age of majority, or all of the consideration for the compromise until after the minor reaches the age of majority and may involve a structured settlement or creation of a trust on terms which the court approves.
9. Any settlement entered consistent with the provisions of this Code section shall be final and binding upon all parties, including the minor.

(Code 1981, §29-3-3, enacted by Ga. L. 2004, p. 161, § 1; Ga. L. 2006, p. 805, § 5/SB 534; Ga. L. 2008, p. 715, § 6/SB 508.)

- For annual survey of wills, trusts, and administration of estates, see 42 Mercer L. Rev. 491 (1990). For article, "Wills, Trusts & Administration of Estates," see 53 Mercer L. Rev. 499 (2001).

ANALYSIS

• General Consideration
• Claims Subject to Compromise
• Effect of Compromise

General Consideration

Editor's notes.

- In light of the similarity of the statutory provisions, decisions under former Code 1882, §§ 2537, 2538, former Civil Code 1910, §§ 4004, 4005, former Code 1933, §§ 49-219, 49-221, and former O.C.G.A. § 29-2-16 are included in the annotations for this Code section.

- Former Code 1933, §§ 49-219 and 49-221 (former O.C.G.A. §§ 29-2-16 and29-2-18) were for purpose of distinguishing when guardian can compromise contested or doubtful claim of ward, and when the guardian can compromise a doubtful debt of ward; requirements for compromising a claim and for compromising a debt are different, and are set forth in separate sections. Campbell v. Atlanta Coach Co., 58 Ga. App. 824, 200 S.E. 203 (1938) (decided under former Code 1933, §§ 49-219 and 49-221).

Former Civil Code 1910, § 4004 (former O.C.G.A. § 29-2-16) did not authorize rescission of contracts. Jones v. Ragan, 136 Ga. 653, 71 S.E. 1098 (1911) (decided under former Civil Code 1910, § 4004).

Subject matter to be compromised is claims whose justice and legality may be questioned. Maynard v. Cleveland, 76 Ga. 52 (1885) (decided under former Code 1882, § 2537).

- Whether probate court approval was necessary for a valid settlement of the minor's claim is immaterial to a court's analysis of whether the offer of settlement was accepted. Benton v. Gailey, 334 Ga. App. 548, 779 S.E.2d 749 (2015), cert. denied, 2016 Ga. LEXIS 221 (Ga. 2016).

- There is no requirement that a compromise be approved by the ordinary (now judge of probate court), as is the case with doubtful debts under former Code 1933, § 49-221 (former O.C.G.A. § 29-2-18) referring to liquidated contractual demands. Macris v. Laughlin Insulation Co., 124 Ga. App. 573, 185 S.E.2d 413 (1971) (decided under former Code 1933, § 49-221).

A probate court clearly has jurisdiction to appoint a guardian for a minor. However, a guardian, once appointed, need not obtain the approval of the probate court to settle a contested or doubtful claim for or against the minor. Accordingly, any settlement of the tort claims of minors to which their duly appointed guardian agreed would not have to be approved by the probate court. King Cotton, Ltd. v. Powers, 200 Ga. App. 549, 409 S.E.2d 67 (1991) (decided under former O.C.G.A. § 29-2-16).

A guardian of property need not obtain prior approval of the probate court in order to compromise or settle a contested or disputed claim. Hay v. Norfolk S. Ry., 879 F. Supp. 1192 (N.D. Ga. 1994) (decided under former O.C.G.A. § 29-2-16).

- Where executor has exceeded authority in entering agreement, the executor's authority need not be revoked in order to attack such agreement. Empire Life Ins. Co. v. Mason, 140 Ga. 141, 78 S.E. 935 (1913) (decided at time when law included guardians, administrators, executors and other fiduciaries in its grant of authority to compromise claims; decided under former Civil Code 1910, § 4004).

The probate court's jurisdiction to approve the settlement of a malpractice claim and to protect the best interests of the incapacitated ward conferred upon that court the authority to require that the ward's attorneys pay into the registry of court such settlement funds as they disbursed to themselves and to hold them in contempt for their refusal to do so. Gnann v. Woodall, 270 Ga. 516, 511 S.E.2d 188 (1999) (decided under former O.C.G.A. § 29-2-16).

- Minor's exemption under O.C.G.A. § 13-5-3 from contractual liability is a personal privilege which others may not assert as a defense; binding settlement agreement was reached between an insurer and a minor injured party even though: (1) a contract of a minor is voidable under O.C.G.A. § 13-3-20(a); (2) judicial approval pursuant to former O.C.G.A. § 29-2-16(e) postdated the settlement agreement; and (3) no guardian had been appointed for the minor at the time the agreement was reached. Grange Mut. Cas. Co. v. Kay, 264 Ga. App. 139, 589 S.E.2d 711 (2003) (decided under former O.C.G.A. § 29-2-16).

For general discussion of former Code 1882, § 2538 (former O.C.G.A. § 29-2-17), see Maynard v. Cleveland, 76 Ga. 52 (1885) (decided under former Code 1882, § 2538).

On necessity of order of ordinary (now judge of probate court), see Jones v. Ragan, 136 Ga. 653, 71 S.E. 1098 (1911) (decided under former Civil Code 1910, § 4005).

Cited in Walton v. Reid, 148 Ga. 176, 96 S.E. 214 (1918); Home Mixture Guano Co. v. Woolfolk, 148 Ga. 567, 97 S.E. 637 (1918); Nix v. Monroe, 36 Ga. App. 356, 136 S.E. 806 (1927); Georgia Power Co. v. Davis, 43 Ga. App. 791, 160 S.E. 690 (1931); Tinsley v. Maddox, 176 Ga. 471, 168 S.E. 297 (1933); Tucker v. Tucker, 221 Ga. 128, 143 S.E.2d 639 (1965); Pennsylvania Threshermen & Farmers Mut. Cas. Ins. Co. v. Hill, 113 Ga. App. 283, 148 S.E.2d 83 (1966); Seaboard Constr. Co. v. Clifton, 121 Ga. App. 247, 173 S.E.2d 436 (1970); Knight v. Lowery, 124 Ga. App. 172, 183 S.E.2d 221 (1971); Bacon v. Smith, 222 Ga. App. 542, 474 S.E.2d 728 (1996).

"Claim" embraces assertion of liability to party making it to pay sum of money. Campbell v. Atlanta Coach Co., 58 Ga. App. 824, 200 S.E. 203 (1938) (decided under former Code 1933, § 49-221).

"Claims" is sufficiently broad to include a tort action. Macris v. Laughlin Insulation Co., 124 Ga. App. 573, 185 S.E.2d 413 (1971) (decided under former Code 1933, § 49-221).

- "Claims" as used in former Code 1933, § 49-219 (former O.C.G.A. § 29-2-16) had a technical meaning and implied that a right is in dispute, including a demand arising out of tort. Campbell v. Atlanta Coach Co., 58 Ga. App. 824, 200 S.E. 203 (1938) (decided under former Code 1933, § 49-221).

Wrongful death action was a property right and could be compromised or settled by a duly appointed guardian of property pursuant to former O.C.G.A. § 29-2-16. Hay v. Norfolk S. Ry., 879 F. Supp. 1192 (N.D. Ga. 1994) (decided under former O.C.G.A. § 29-2-16).

Guardian may negotiate complete settlement, which is conclusive until set aside in direct proceeding brought for that purpose. Macris v. Laughlin Insulation Co., 124 Ga. App. 573, 185 S.E.2d 413 (1971) (decided under former Code 1933, § 49-221).

- Compromise settlement of doubtful "claim" made by guardian is conclusive until set aside in direct proceeding in which guardian is a necessary party. Campbell v. Atlanta Coach Co., 58 Ga. App. 824, 200 S.E. 203 (1938) (decided under former Code 1933, § 49-221).

- Trial court's denial of a co-guardian's motion to intervene in a lawsuit involving the approval of a settlement to a minor was affirmed because the trial court lacked jurisdiction to consider the motion since the motion was filed two weeks after the defendants had voluntarily dismissed the action seeking the approval of the settlement. Barnes v. Cannon, 347 Ga. App. 517, 820 S.E.2d 155 (2018).

RESEARCH REFERENCES

Am. Jur. 2d.

- 39 Am. Jur. 2d, Guardian and Ward, § 170 et seq.

- 39 C.J.S., Guardian and Ward, § 210 et seq.

- Right of attorney, parent, guardian ad litem, or next friend to remit from verdict or judgment in favor of infant, 30 A.L.R. 1111.

Power of guardian or committee to compromise liquidated contact claim or money judgments and of courts to authorize or approve such a compromise, 155 A.L.R. 196.

Amount of attorneys' compensation in matters involving guardianship and trusts, 57 A.L.R.3d 550.