October 3, 2006


ADM File No. 2006-15

Amendment of 
Rule 2.420 of the
Michigan Court Rules
                    
     On order of the Court, notice of the proposed changes and an opportunity for comment
in writing and at a public hearing having been provided, and consideration having been given to
the comments received, the following amendment of Rule 2.420 of the Michigan Court Rules
is adopted, effective January 1, 2007.
                  

ICLE Editor's Note:
                                
                                
[Italicized, bracketed text] indicates text that has been deleted.
                                
             Bold text  indicates new text.
                            

                                
Rule 2.420  Settlements and Judgments for Minors and Legally Incapacitated Individuals

     (A)  [Unchanged.]
     
     (B)  Procedure.  In actions covered by this rule, a proposed consent judgment,
     settlement, or dismissal pursuant to settlement must be brought before the judge
     to whom the action is assigned and the judge shall pass on the fairness of the
     proposal.
     
          (1)  [Unchanged.]
          
          (2)  [Unchanged.]
          
          (3)  If a [next friend,] guardian[,] or conservator for the minor
          or legally incapacitated individual has been appointed by a probate court,
          the terms of the proposed settlement or judgment may be approved by
          the court in which the action is pending upon a finding that the payment
          arrangement is in the best interests of the minor or legally incapacitated
          individual, but no judgment or dismissal may enter until the court
          receives written verification from the probate court, on a form
          substantially in the form approved by the state court administrator,
          that it has passed on the sufficiency of the bond and the bond, if any, has
          been filed with the probate court.
          
          (4)  The following additional provisions apply to settlements for
          minors.
          
               (a)  If the settlement or judgment requires payment of more than
               $5,000 to the minor either immediately, or if the settlement or
               judgment is payable in installments that exceed $5,000
               in any single year during minority, a conservator must be
               appointed by the probate court before the entry of the judgment
               or dismissal. The judgment or dismissal must require that
               payment be made payable to the minor's conservator on behalf of
               the minor.  The court shall not enter the judgment or dismissal
               until it receives written verification, on a form substantially in the
               form approved by the state court administrator, that the probate
               court has passed on the sufficiency of the bond of the
               conservator. 
               
               (b)  If the settlement or judgment does not require payment of more
               than $5,000 to the minor in any single year, the money may be
               paid in accordance with the provisions of MCL 700.5102.
               
          (5)   [Unchanged.]
                    
 Staff Comment:  The amendment of MCR 2.420 clarifies the requirement that
the payment of proceeds may be made only to a conservator on behalf of a legally incapacitated
adult or a minor entitled to more than $5,000 in any one year during minority.
     The staff comment is published only for the benefit of the bench and bar and is not an
authoritative construction by the Court.