Rule 53 - Settlements of Claims for Minors and Adults in Need of Protection(a) Court Approval.(1)When Required. Except as provided in subpart (a)(2), no settlement of a claim brought on behalf of a minor or an adult in need of protection is binding on the minor or the adult in need of protection unless it is approved by a judicial officer. If the court approves the settlement, it may authorize the execution of appropriate releases of liability.(2)When Not Required. Under A.R.S. § 14-5424(C)(19), a conservator may enter into a binding settlement of claims not involving personal injury or wrongful death without court approval.(b) Who May Approve.(1)Claims of Minors. Any superior court judge or judge pro tem may approve the settlement of a minor's claim if the settlement does not exceed $10,000. If the settlement exceeds $10,000, it must be approved by a superior court judge or judge pro tem in a probate proceeding under A.R.S. Title 14.(2)Claims of Adults in Need of Protection. Any superior court judge or judge pro tem in a probate proceeding under A.R.S. Title 14 may approve the settlement of a claim brought on behalf of an adult in need of protection.(c) Appointment of a Guardian ad Litem or Master. The court may appoint a guardian ad litem pursuant to A.R.S. § 14-1408 or a master pursuant to Civil Rule 53, with instructions to address specific items, including any of the following:(1) the reasonableness of the settlement proposal,(2) the attorney fees to be paid from the minor's or adult's settlement proceeds,(3) the costs of litigation and apportionment of those costs,(4) the effect of the settlement on eligibility for public benefits or other resources that might be available, and(5) the proper apportionment of settlement proceeds among the various litigants.(d) Permissible Orders. After considering the amount and nature of the settlement proceeds, the age and sophistication of the minor or adult in need of protection, and that person's living arrangements and ongoing needs, the court may do one or more of the following:(1) appoint a conservator;(2) order establishment of an appropriate trust, including a special needs trust, with or without continuing court supervision, as authorized by ARS § 14-5409(B);(3) authorize all or a portion of the proceeds to be placed in an account pursuant to (A)26 U.S.C. § 529 ("qualified tuition programs"),(B)26 U.S.C. § 529A ("qualified ABLE programs"),(C)42 U.S.C. § 1396p(d)(4)(C) (a pooled special needs trust),(D) A.R.S § 14-5408(C) (a "dignity account");(4) in the case of a minor claimant, order distribution of the proceeds to a custodian under A.R.S. § 14-7656(B) (the Uniform Transfers to Minors Act);(5) order distribution of the proceeds to an appropriate person under A.R.S. § 14-5103 ("facility of payment or delivery") or to a guardian under A.R.S. § 14-5312(A)(4)(b);(6) approve a structured settlement; or(7) enter any other order authorized by statute. Adopted Aug. 29, 2019, effective 1/1/2020; amended Dec. 08, 2021, effective 1/1/2022.COMMENT TO THE 2020 AMENDMENTS
This rule clarifies that any settlement on behalf of a minor or adult in need of protection must be approved by the court to be binding on the minor or adult in need of protection. The only exception is that a conservator may enter into a binding settlement of a claim other than a wrongful death or personal injury claim. See A.R.S. § 14-5424(C)(19). In comparison, A.R.S. § 14-5103 does not provide a parent the authority to compromise a minor child's claim; it deals only with who may receive limited amounts of money or property on behalf of a minor.