Judge: Michael P. Linfield, Case: 23STCV19092, Date: 2024-03-07 Tentative Ruling

Case Number: 23STCV19092    Hearing Date: March 7, 2024    Dept: 34

SUBJECT:        Petition for Approval of Compromise of Claim or Action or Disposition of Proceeds of Judgment for Minor or Person with a Disability

Moving Party: Allen Ray White II

Resp. Party:    None

SUBJECT:        Petition for Approval of Compromise of Claim or Action or Disposition of Proceeds of Judgment for Minor or Person with a Disability

Moving Party: Allen Ray White II

Resp. Party:    None

The Petitions are GRANTED, with the one change indicated below — i.e., that no attorney’s fees or costs are to be subtracted from amounts awarded to the minors.

The funds are PERMITTED to be placed in blocked accounts that will not allow withdrawals of principal or interest without prior court order until the date at which each minor becomes eighteen years old, at which point that minor may withdraw the principal and interest without a court order.

        Plaintiff/Guardian ad Litem is ORDERED to deliver to the manager at the financial institution where the funds are to be deposited a certified or filed copy of this Order.

Plaintiff/Guardian ad Litem is ORDERED to promptly file with the Court a receipt from the financial institution, acknowledging receipt of both the funds deposited and the order for deposit of funds.

BACKGROUND:

On August 10, 2023, Allen White II, Lynda Terry, Allen White III, and Alivia White filed their Complaint against Rosaig, LLC and Realty Holdings PSJC LLC on causes of action arising from Plaintiffs’ tenancy with Defendants.

On August 24 and 28, 2023, the Court appointed Allen White II as the guardian ad litem for Allen White III and Alivia White, respectively.

On October 18, 2023, Rosaig, LLC filed: (1) Cross-Complaint; and (2) Answer to the Complaint.

On January 9, 2024, Realty Holdings PSJC, LLC filed its Answer to the Complaint.

On February 22, 2024, on behalf of Allen White III and Alivia White, Allen White II filed (separately for each of them) the following three items: (1) Judicial Council Form MC-350, Petition for Approval of Compromise of Claim or Action or Disposition of Proceeds of Judgment for Minor or Person with a Disability; (2) Judicial Council Form MC-351, Order Approving Compromise of Claim or Action or Disposition of Proceeds of Judgment for Minor or Person with a Disability; and (3) Judicial Council Form MC-355, Order to Deposit Funds in Blocked Account.

ANALYSIS:

I.          Legal Standard

“The guardian or conservator of the estate or guardian ad litem so appearing for any minor, person who lacks legal capacity to make decisions, or person for whom a conservator has been appointed shall have power, with the approval of the court in which the action or proceeding is pending, to compromise the same, to agree to the order or judgment to be entered therein for or against the ward or conservatee, and to satisfy any judgment or order in favor of the ward or conservatee or release or discharge any claim of the ward or conservatee pursuant to that compromise. . . .” (Code Civ. Proc., § 372, subd. (a)(3).)

“A petition for court approval of a compromise or covenant not to sue under Code of Civil Procedure section 372 must comply with rules 7.950 or 7.950.5, 7.951, and 7.952.” (Cal. Rules of Court, rule 3.1384(a).)

“A petition for court approval of a compromise of, or a covenant not to sue or enforce judgment on, a minor's disputed claim; a compromise or settlement of a pending action or proceeding to which a minor or person with a disability is a party; or the disposition of the proceeds of a judgment for a minor or person with a disability under Probate Code sections 3500 and 3600-3613 or Code of Civil Procedure section 372 must be verified by the petitioner and must contain a full disclosure of all information that has any bearing upon the reasonableness of the compromise, covenant, settlement, or disposition. Except as provided in rule 7.950.5, the petition must be submitted on a completed Petition for Approval of Compromise of Claim or Action or Disposition of Proceeds of Judgment for Minor or Person With a Disability (form MC-350).” (Cal. Rules of Court, rule 7.950.)

“In all cases under Code of Civil Procedure section 372 or Probate Code sections 3600-3601, unless the court has approved the fee agreement in advance, the court must use a reasonable fee standard when approving and allowing the amount of attorney's fees payable from money or property paid or to be paid for the benefit of a minor or a person with a disability.” (Cal. Rules of Court, rule 7.955(a)(1).)

“The court must give consideration to the terms of any representation agreement made between the attorney and the representative of the minor or person with a disability and must evaluate the agreement based on the facts and circumstances existing at the time the agreement was made, except where the attorney and the representative of the minor or person with a disability contemplated that the attorney's fee would be affected by later events.” (Cal. Rules of Court, rule 7.955(a)(2).)

“A petition requesting court approval and allowance of an attorney's fee under (a) must include a declaration from the attorney that addresses the factors listed in (b) that are applicable to the matter before the court.” (Cal. Rules of Court, rule 7.955(c).)

II.       Discussion

A.      Approval of the Petitions

Allen White II petitions the Court for approval of a compromise that includes: (1) Allen White III, who is a four-year-old minor; and (2) Alivia White, who is a two-year-old minor.

        Among other things, the Gross Settlement Amount is $240,000.00, which consists of a $115,000.00 payment to Allen White II, a $115,000.00 payment to Lynda Terry, a $5,000.00 payment to Allen White III, and a $5,000.00 payment to Alivia White. (Petitions, Attachment 11.) According to the Petitions, the differences in the amounts per plaintiff is because the adults are also being compensated for other claims and losses not suffered by the minors. (Petitions, Attachment 13a, ¶ 3.)

        According to paragraph 4 of Attachment 13a, the percentage of attorney’s fees to be assessed from each of the minor plaintiffs is 25% of their respective awards. According to Item 16 of the Petitions, this the total amount of fees requested is $1,230.01, as well as $79.97 in costs (for each of the minor plaintiffs). (Petitions, Item 16.)

        Pursuant to Code of Civil Procedure section 372 and California Rules of Court, rules 7.950 and 7.955, the Court finds that the Compromise is generally reasonable and that the applicable procedures have been followed.

        The Court will grant the petitions with the following change: the attorneys are not to assess any attorney’s fees or costs against the funds allotted to the minors. In other words, each of the minors is to receive the full $5,000.00 awarded to each of them.

        With the above change, the Court GRANTS the Petitions.

B.      Order to Deposit Funds in Blocked Account

1.      Legal Standard

“In any case in which the court orders that funds to be received by a minor or a person with a disability must be deposited in a financial institution and not disbursed without further order of the court, the order must include a provision that a certified or filed endorsed copy of the order must be delivered to a manager at the financial institution where the funds are to be deposited, and that a receipt from the financial institution must be promptly filed with the court, acknowledging receipt of both the funds deposited and the order for deposit of funds.” (Cal. Rules of Court, rule 7.953, subd. (a).)

“If, in the order approving the compromise of a minor's claim, there is a finding that the minor will attain the age of majority on a definite date, the order for deposit may require that the depository permit the withdrawal of funds by the former minor after that date, without further order of the court.” (Cal. Rules of Court, rule 7.953, subd. (a).)

2.      Discussion

For each of the minor children, Plaintiff/Guardian ad Litem filed Judicial Council Form MC-355, Order to Deposit Funds in Blocked Account. Each of the forms submitted lists the minor’s birthday, requests that no withdrawal of interest or principal be allowed without court order prior to the minor’s 18th birthday, and requests that such withdrawals can be made by the minor without court order once they reach 18 years of age.

The Court PERMITS the funds to be placed in blocked accounts that will not allow withdrawals of principal or interest without prior court order until the date at which each minor becomes eighteen years old, at which point that minor may withdraw the principal and interest without a court order.

        The Court ORDERS Plaintiff/Guardian ad Litem to deliver to the manager at the financial institution where the funds are to be deposited a certified or filed copy of this Order.

        The Court ORDERS Plaintiff/Guardian ad Litem to promptly file with the Court a receipt from the financial institution, acknowledging receipt of both the funds deposited and the order for deposit of funds.

III.     Conclusion

 The Petitions are GRANTED, with the one change indicated above — i.e., that no attorney’s fees or costs are to be subtracted from amounts awarded to the minors.

The funds are PERMITTED to be placed in blocked accounts that will not allow withdrawals of principal or interest without prior court order until the date at which each minor becomes eighteen years old, at which point that minor may withdraw the principal and interest without a court order.

        Plaintiff/Guardian ad Litem is ORDERED to deliver to the manager at the financial institution where the funds are to be deposited a certified or filed copy of this Order.

Plaintiff/Guardian ad Litem is ORDERED to promptly file with the Court a receipt from the financial institution, acknowledging receipt of both the funds deposited and the order for deposit of funds.