75th OREGON LEGISLATIVE ASSEMBLY--2009 Regular Session
 
NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .
 
LC 2398
 
                           A-Engrossed
 
                         House Bill 2687
                  Ordered by the House April 20
            Including House Amendments dated April 20
 
Sponsored by COMMITTEE ON JUDICIARY (at the request of Oregon
  Trial Lawyers Association)
 
 
                             SUMMARY
 
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.
 
  Specifies how moneys payable under settlement agreement entered
into on behalf of minor or judgment in favor of minor shall be
paid. { +  Allows minor to enter into contract with bank or
financial institution that cannot be voided or disaffirmed
because of minor's age for purpose of depositing moneys paid for
benefit of minor or under settlement agreement. + }
 
                        A BILL FOR AN ACT
Relating to receipt of moneys on behalf of a minor; creating new
  provisions; and amending ORS 126.725.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. ORS 126.725 is amended to read:
  126.725. (1) A person having legal custody of a minor may enter
into a settlement agreement with a person against whom the minor
has a claim if:
  (a) A conservator has not been appointed for a minor;
  (b) The total amount of the claim { + , not including
reimbursement of medical expenses, liens, reasonable attorney
fees and costs of suit,  + }is $25,000 or less  { + if paid in
cash or if paid by the purchase of a premium for an annuity + };
  (c) The moneys paid under the settlement agreement will be
  { - deposited directly into a federally insured savings account
in the sole name of the minor with notice of the deposit to the
minor - }   { + paid as set forth in subsections (3) and (4) of
this section + }; and
  (d) The person entering into the settlement agreement on behalf
of the minor completes an affidavit or verified statement that
attests that the person has made a reasonable inquiry and that:
  (A) To the best of the person's knowledge, the minor will be
fully compensated by the settlement; or
  (B) There is no practical way to obtain additional amounts from
the party entering into the settlement agreement with the minor.
   { +  (2) The attorney representing the person entering into
the settlement agreement on behalf of the minor, if any, shall
maintain the affidavit or verified statement completed under
subsection (1)(d) of this section in the attorney's file for two
years after the minor attains the age of 21 years.
  (3) The moneys payable under the settlement agreement must be
paid as follows:
  (a) If the minor or person entering into the settlement
agreement on behalf of the minor is represented by an attorney
and the settlement is paid in cash, by direct deposit into the
attorney's trust account maintained pursuant to rules of
professional conduct adopted under ORS 9.490 to be held for the
benefit of the minor. The attorney shall deposit the moneys
received on behalf of the minor directly into a federally insured
savings account that earns interest in the sole name of the
minor, and provide notice of the deposit to the minor and the
person entering into the settlement agreement on behalf of the
minor.  Notice shall be delivered by personal service or first
class mail.
  (b) If the minor or person entering into the settlement
agreement on behalf of the minor is not represented by an
attorney and the settlement is paid in cash, directly into a
federally insured savings account that earns interest in the sole
name of the minor. Notice of the deposit to the minor shall be
delivered by personal service or first class mail.
  (c) If paid by purchase of an annuity, by direct payment to the
provider of the annuity with the minor designated as the sole
beneficiary of the annuity.
  (4) The moneys in the minor's savings account established under
subsection (3) of this section may not be withdrawn, removed,
paid out or transferred to any person, including the minor,
except as follows:
  (a) Pursuant to court order;
  (b) Upon the minor's attainment of 18 years of age; or
  (c) Upon the minor's death. + }
    { - (2) - }  { +  (5) + } If a settlement agreement is
entered into in compliance with subsection (1) of this section,
the signature of the person entering into the settlement
agreement on behalf of the minor is binding on the minor without
the need for further court approval or review and has the same
force and effect as if the minor were a competent adult entering
into the settlement agreement.
    { - (3) - }  { +  (6) + } A person acting in good faith on
behalf of a minor under this section is not liable to the minor
for the moneys paid in settlement or for any other claim arising
out of the settlement.
  SECTION 2.  { + (1) Except as provided in subsection (4) of
this section, a person under a duty to pay moneys to a minor
pursuant to a judgment of the court in an amount not exceeding
$25,000 may pay the moneys to a person having legal custody of
the minor with whom the minor resides or to a guardian of the
minor.
  (2) The moneys paid under subsection (1) of this section must
be paid as follows:
  (a) If the minor or person to whom payment is made is
represented by an attorney and the judgment is paid in cash, by
direct deposit into the attorney's trust account maintained
pursuant to rules of professional conduct adopted under ORS 9.490
to be held for the benefit of the minor. The attorney shall
deposit the moneys received on behalf of the minor directly into
a federally insured savings account that earns interest in the
sole name of the minor, and provide notice of the deposit to the
minor and the person to whom payment is made. Notice shall be
delivered by personal service or first class mail.
  (b) If the minor or person to whom payment is made is not
represented by an attorney and the judgment is paid in cash,
directly into a federally insured savings account that earns
interest in the sole name of the minor. Notice of the deposit
shall be delivered to the minor by personal service or first
class mail.
 
  (c) If the judgment is paid by purchase of an annuity, by
direct payment to the provider of the annuity with the minor
designated as the sole beneficiary of the annuity.
  (3) The moneys in the minor's savings account established under
subsection (2) of this section may not be withdrawn, removed,
paid out or transferred to any person, including the minor,
except as follows:
  (a) Pursuant to court order;
  (b) Upon the minor's attainment of 18 years of age; or
  (c) Upon the minor's death.
  (4) This section does not apply if the person making payment
has actual knowledge that a conservator has been appointed or
proceedings for appointment of a conservator of the estate of the
minor are pending. + }
  SECTION 3.  { + (1) The Legislative Assembly finds that there
are in the State of Oregon unemancipated minors entitled to
payment or delivery of moneys under ORS 126.700 or 126.725 or
section 2 of this 2009 Act who are capable of establishing and
maintaining a bank account in their sole name for their sole use
and administration but who cannot contract to establish a bank
account due to perceived legal limitations affecting contracts
with minors. The purpose of this section is to address those
limitations.
  (2) For purposes of this section, 'minor' means an
unemancipated and unmarried person who is under 18 years of age
and entitled to payment or delivery of moneys under ORS 126.700
or 126.725 or section 2 of this 2009 Act.
  (3) Notwithstanding any other provision of law, a minor may
contract with a bank or financial institution to establish a bank
account for the purpose of depositing payments or deliveries of
moneys under ORS 126.700 or 126.725 or section 2 of this 2009
Act.  Such contract is binding upon the minor and cannot be
voided or disaffirmed by the minor based upon the minor's age or
status as a minor.
  (4) The consent of the minor's parent or legal guardian, or of
the person having legal custody of the minor, is not necessary to
contract to establish a bank account under this section. The
parent, legal guardian or person having legal custody of the
minor shall not be liable under a contract by the minor for a
bank account unless the parent, legal guardian or person having
legal custody of the minor is a party to the minor's
contract. + }
  SECTION 4.  { + Section 2 of this 2009 Act and the amendments
to ORS 126.725 by section 1 of this 2009 Act apply to amounts
paid to minors, settlements made and judgments entered on or
after the effective date of this 2009 Act. + }
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