Section 25 of The Public Guardian and Trustee Act provides the authority for the Public Guardian and Trustee to approve a settlement reached on behalf of a child, to release a defendant, and to receive the net settlement proceeds on behalf of a child. This authority is limited to claims for injuries suffered by the child and claims made under The Fatal Accidents Act. Other types of claims require the approval of the court.
The Public Guardian and Trustee will accept a request to approve a settlement from the child, the child’s parent and/or litigation guardian, or the child’s solicitor.
Unless there are extremely unusual circumstances, the Public Guardian and Trustee will not accept a request to approve a settlement if that request is from the defendant, the defendant’s solicitor or the defendant’s insurer. In these rare circumstances, the Public Guardian and Trustee will contact the parents, the child, and/or their solicitor to ensure that they are aware of and in agreement with the proposed settlement.
The Public Guardian and Trustee has developed forms that outline the information required when asked to approve a settlement. These forms are available on request, and can also be obtained from the Public Guardian and Trustee web page.
In order to approve the settlement of an injury claim, the Public Guardian and Trustee must be satisfied that the settlement is fair, reasonable and in the best interest of the child. Consideration is given to a number of factors, including the following:
- the nature and extent of the injury;
- the type of treatment required;
- the activities curtailed or losses suffered during the period of disability;
- the extent of permanent impairment, if any;
- the effect on lifestyle and earning capacity;
- the cost of future care or treatment;
- contributory negligence.
The Public Guardian and Trustee may be asked to approve an arrangement where the net settlement proceeds are used to purchase an annuity that will provide periodic payments, rather than being paid in one lump sum to the Public Guardian and Trustee.
Consideration will be given to a request for a structured settlement if it can be shown that the nature of the injuries are such that the child will require care for the rest of his or her life, and that there will be a cost for the care, i.e. a severe head injury or an injury resulting in quadriplegia or paraplegia. In these circumstances, a structured settlement provides the best guarantee that the ongoing costs of the child’s care will be met and also has income tax advantages.
The Public Guardian and Trustee must approve of the proposed structure, including the amount and frequency of the payments, the details of any lump sum payments and the length of time that the payments are guaranteed to continue.
If a request is received to approved a structured settlement for a child whose injuries do not result in the need for life long care, and the purpose of the structured settlement is simply to delay payment of the settlement proceeds to the child, the Public Guardian and Trustee will not approve the request.
In some cases, the plaintiff's solicitor may ask the Public Guardian and Trustee to approve a settlement of a matter that has already gone to pre-trial. In these cases, it is the Public Guardian and Trustee's position that, since the pre-trial judge would have already reviewed the materials and heard from the parties, it would likely be more expeditious for the approval of the settlement to be dealt with by way of an application to the pre-trial judge.
In these cases, the Public Guardian and Trustee will not approve the settlement and the plaintiff’s solicitor should seek the approval of the court, pursuant to section 25(3) of The Public Guardian and Trustee Act. This section directs that the Public Guardian and Trustee is to be served with the application.
Section 26 of The Public Guardian and Trustee Act provides the authority for the Public Guardian and Trustee to approve solicitor's fees in connection with the approval of an injury or Fatal Accident claim on behalf of a child.
It is the policy of the office to approve fees at 20% of the settlement amount if the matter is settled prior to pre-trial, 25% if the matter is settled at pre-trial and 30% if the matter goes to trial. Fees at these rates will be approved on request. If the Public Guardian and Trustee is asked to approve fees at rates higher than outlined above, consideration will be given to the following:
- the nature and complexity of the case, (i.e. medical malpractice or multiple defendants);
- the actual time spent by the lawyer;
- the skill and ability displayed by the lawyer;
- whether the lawyer carried the disbursements or spent a lot of time on the file with a minimal possibility of success; and
- the results achieved.
The fee must be both fair and reasonable, and the actual compensation must be commensurate with the work done. It would be exceptional for the fees to exceed 35%, and 20% to 30% is most common.
Contingency fee arrangements entered into by a parent or litigation guardian are not binding on the child, and the Public Guardian and Trustee can not pre-approve them or enter into a binding agreement on behalf of a child.
The Public Guardian and Trustee may be asked to approve fees for legal services performed to obtain benefits such as SGI Death Benefits or Permanent Impairment Benefits for a child. As these benefits are statutory, the Public Guardian and Trustee would not normally approve payment of these legal fees, unless there are special circumstances.
Consideration will be given to the following:
- were there special circumstances that would indicate that legal assistance was required, i.e. are there communication or literacy problems, did SGI fail to assist the parent with the application, deny paternity, fail to accept the stated income of the deceased, etc.;
- was there an added value as a result of the engagement of a solicitor, i.e. did the solicitor's work result in the payment of a benefit that would not have otherwise been paid, or a larger benefit that would have been paid;
- are the parents in agreement with the proposed account; and/or
- is the child (if fourteen or older) in agreement with the proposed account?
Consideration will not be given to approval of an account that is represented as a percentage of the amount paid to the child, but consideration may be given to approval of an account that is for a reasonable amount of time. A detailed breakdown of the work performed, the time spent and the solicitor’s hourly rate should be provided to The Public Guardian and Trustee.
Further information can be obtained from the Public Guardian and Trustee’s office at (306) 787-5424.