As a mediator, I frequently encounter global settlement conferences. For those unfamiliar, a global settlement conference is a mediation (typically pre-suit) scheduled by an insurance company when it has determined that their insured’s insurance limits should be tendered due to the number of claimants and the severity of the injuries. All potential claimants are invited to attend the settlement conference wherein the insurance limits are tendered globally and claimants vie for a portion of the available funds. This article discusses the potential impact when one or more of the claimants in a global settlement conference is a minor.
In a pre-suit setting, Florida statute allows for a parent/guardian to settle a minor’s claim without court approval if the settlement does not exceed $15,000.00. Section 744.301(2) & 744.387(2), Fla. Stat. Additionally, cases involving a gross settlement amount of $50,000.00 or more requires a guardian ad litem to be appointed to represent the minor’s interest before approving a settlement. Section 744.3035(1)(b), Fla. Stat.
When faced with a global settlement conference, Allen v. Montalvan, 201 So.3d 705 (Fla. 4th DCA 2016) provides insight on what constitutes the “gross settlement” amount that triggers Florida’s requirements to obtain court approval of minor settlements and/or the appointment of a guardian ad litem. In Allen, there was a total of six claimants (five claimed injuries and one deceased as a result of a motor vehicle collision). Before litigation commenced, the at-fault driver’s insurance company, Progressive, tendered its policy limits of $25,000.00 per person and $50,000.00 per accident. At that time, all claimants were represented by the same attorney.
Progressive sent two checks to the claimants’ attorney. One check issued in the amount of $25,000.00 earmarked for the wrongful death claim and the other check issued in the amount of $25,000.00 for the remaining claimants. Releases were enclosed with the check that left the consideration blank, to be filled in at the attorney’s discretion.
Unanticipated by Progressive, the entire $25,000.00 was allotted to the only adult – the mother of the appellant children – out of the five remaining claimants, leaving the appellant children with nothing. Subsequently, litigation commenced by the parents of three of the injured minors who had retained new counsel. Progressive intervened and moved to enforce the pre-suit settlement. The trial court ruled in favor of Progressive.
However, the parents of the three injured minors appealed the trial court’s ruling, arguing the settlement was invalid because it did not comply with the requirements set forth in Section 744, Fla. Stat. The Fourth DCA agreed and reversed the lower court, basing its decision on Section 744.3025(1)(b), which requires the appointment of a guardian ad litem when the gross settlement amount involving a minor is $50,000.00 or more. The Fourth DCA held the requirements of Section 744.3025(1)(b) were triggered in this situation because Progressive universally tendered $50,000.00 to a group of claimants that included minors.
Allen’s holding indicates that the “per accident” limit for insurance policies globally tendered when minor(s) are involved should be the litmus test for whether the requirements of Section 744 are triggered.
Allen potentially complicates global tenders involving minors for attorneys on both sides of the table. It places responsibility on plaintiffs’ attorneys for petitioning the court and assuring a guardian ad litem is appointed in order to protect the minors’ interests. It also compels defense attorneys to withhold settlement funds until the requirements of Section 744 are completed in order to protect their insureds.
Allen may also frustrate non-minor claimants (and/or their attorneys), given that it seems settlement funds cannot be dispersed to any claimant until Section 744 is satisfied and the court rules that the proposed settlement amount(s) allotted to the minor claimant(s) are found to be in his/her best interest.
While following Allen adds time and expense to resolution of any global tender involving a minor, it appears prudent to do so for attorneys on both sides to protect their clients and their own law licenses.