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A BILL TO BE ENTITLED
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AN ACT
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relating to the settlement of certain claims on behalf of a minor. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Title 6, Civil Practice and Remedies Code, is |
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amended by adding Chapter 150D to read as follows: |
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CHAPTER 150D. SETTLEMENT OF CLAIMS INVOLVING MINORS |
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Sec. 150D.001. AUTHORITY TO SETTLE CLAIM; SETTLEMENT |
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REQUIREMENTS. (a) A person having legal custody of a minor may |
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enter into a settlement agreement with a person against whom the |
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minor has a claim if: |
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(1) a guardian or guardian ad litem has not been |
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appointed for the minor; |
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(2) the total amount of the settlement is $25,000 or |
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less; |
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(3) the money to be paid under the settlement |
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agreement is to be paid as provided by this chapter; and |
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(4) the person entering into the settlement agreement |
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on behalf of the minor completes an affidavit or verified statement |
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that attests that the person has made a reasonable inquiry and that: |
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(A) to the best of the person's knowledge, the |
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minor will be fully compensated by the settlement; or |
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(B) there is no practical way to obtain |
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additional amounts from the party entering into the settlement |
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agreement with the minor. |
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(b) The attorney representing the person entering into the |
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settlement agreement on behalf of the minor, if any, shall maintain |
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the affidavit or verified statement completed under Subsection |
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(a)(4) in the attorney's file until the second anniversary of the |
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date the minor attains the age of 21 years. |
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Sec. 150D.002. DEPOSIT INTO COURT REGISTRY. (a) Money |
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payable to a minor under a settlement agreement entered into under |
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this chapter shall be deposited into the registry of: |
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(1) the court in which a civil action asserting the |
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settled claim was filed; or |
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(2) if no civil action asserting the claim was filed, a |
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court in which the claim could have been filed. |
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(b) A court order is not required to make a deposit under |
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this section. |
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Sec. 150D.003. PAYMENT BY ANNUITY PURCHASE. If the money |
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payable under a settlement agreement entered into under this |
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chapter is to be paid by the payment of premium to purchase an |
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annuity, the payment must be made by direct payment to the provider |
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of the annuity with the minor designated as the sole beneficiary of |
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the annuity. |
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Sec. 150D.004. WITHDRAWAL OF MONEY. Money deposited into a |
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court registry under this chapter may not be withdrawn, removed, |
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paid out, or transferred to any person, including the minor, |
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except: |
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(1) pursuant to a court order; |
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(2) on the minor's attainment of 18 years of age; or |
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(3) on the minor's death. |
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Sec. 150D.005. BINDING EFFECT OF SETTLEMENT. If a |
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settlement agreement is entered into in compliance with Section |
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150D.001, the signature of the person entering into the settlement |
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agreement on behalf of the minor is binding on the minor without the |
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need for further court approval or review and has the same force and |
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effect as if the minor were a competent adult entering into the |
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settlement agreement. |
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Sec. 150D.006. LIABILITY FOR SETTLEMENT. (a) A person |
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acting in good faith on behalf of a minor under this chapter is not |
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liable to the minor for the money paid in settlement or for any |
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other claim arising out of the settlement. |
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(b) A person against whom a minor has a claim who settles the |
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claim with the minor in good faith under this chapter is not liable |
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to the minor for any claim arising from the settlement of the claim. |
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SECTION 2. Section 141.008, Property Code, is amended by |
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amending Subsection (a) and adding Subsection (d) to read as |
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follows: |
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(a) Subject to Subsections (b), [and] (c), and (d), a person |
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who is not subject to Section 141.006 or 141.007 and who holds |
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property, including a benefit plan of a minor who does not have a |
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guardian, or who owes a liquidated debt to a minor who does not have |
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a guardian may make an irrevocable transfer to a custodian for the |
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benefit of the minor under Section 141.010. |
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(d) This section does not apply to a debt incurred under a |
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settlement agreement governed by Chapter 150D, Civil Practice and |
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Remedies Code. |
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SECTION 3. The change in law made by this Act applies only |
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to a settlement agreement entered into on or after the effective |
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date of this Act. |
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SECTION 4. This Act takes effect September 1, 2023. |