Justification of Early Release of Settlement Funds from a Minor’s Blocked Bank Account in California

If you have a child that was injured due to the negligence of another and the settlement funds are safely deposited in a blocked bank account, at times there will be a legitimate need to petition the court to release some of settlement funds that directly benefit the minor child. Nonetheless, the courts will scrutinize the request, because their main goal is to make sure the funds, if they are partially released early (before the minor child turns eighteen years old), will directly benefit the injured minor child.

How do they do this? The guardian ad litem named in the court papers has to file a petition under the same case number of the original paperwork filed with the court that originally approved the minor’s bodily injury settlement. The judge can hear the matter in open court or in chambers. The petition must be verified and must include the identity of the depository (bank) and the following items:

1. How much withdrawal is being requested

2. How and why the withdrawal will directly benefit the minor child (“justification of the early withdrawal”)

3. A balance sheet at the time of filing the petition for early withdrawal151

The judge will review closely the reasons, or justification, for the early release of settlement funds. You, if you are the guardian ad litem, must be prepared to show how and why early release of the funds will directly benefit the minor child. For example, I have had a family approach me asking for a new couch for the family room, the logic being that the child would benefit from the new furniture. Unfortunately, this example does not rise to the level of justification a judge is looking for in order to release the funds early. Another time, a family approached me to request $6,000 from their minor child’s blocked account only three months after the blocked account was opened because the husband had lost his job. Again, this example does not rise to the level of justification a judge is looking for in order to release early settlement funds.

The early release of settlement funds request must directly benefit the minor child. A good example of this is school tuition, a new computer for homework and school, tuition for a computer summer camp program, or money for a new uniform for the minor child as a condition of employment. There are other factors that are reviewed by the judge before making his or her decision in releasing the settlement funds early too. For example, depending on how old the child is, a down payment for a new car may be justifiable; or if the minor child displays any exceptionable talent in any area, and the early release of settlement funds would benefit him or her, then an early release of funds may be considered justifiable.