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LB 341

Adopt the Nebraska Statutory Thresholds for Settlements Involving Minors Act

109th Legislature (2025-2026) Introduced by Bob Hallstrom

Allows custodians to settle a minor’s claim up to $40,000 without court approval, with safeguards and restricted funds for the minor.

Approved by Governor on April 7, 2025
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Bill Summary · LB 341

Summary — LB 341: Nebraska Statutory Thresholds for Settlements Involving Minors Act

Status: Approved by the Governor April 7, 2025 (enacted law, Sections 1–3)

Purpose

LB 341 creates a limited statutory process allowing a person with legal custody of a minor to settle certain claims on the minor’s behalf without prior court approval. The intent is to expedite and simplify smaller settlements involving minors, reduce court involvement and related costs, while preserving options for court supervision when desired.

Key provisions

  • Threshold: A custodian may settle a minor’s claim without court approval when the total claim amount is $40,000 or less. The threshold excludes reimbursement for medical expenses, liens, reasonable attorney fees, and costs of suit.
  • Who may settle: A person having legal custody of the minor may enter the settlement if no conservator or guardian ad litem has been appointed.
  • Affidavit/verified statement: The custodian must complete an affidavit/verified statement attesting that a reasonable inquiry was made and that, to the best of the custodian’s knowledge, the minor will be fully compensated or there is no practical way to obtain more. An attorney representing the custodian (if any) must keep that affidavit in the file for four years after the minor attains age 21.
  • Payment mechanics:
    • Cash/check/draft/direct deposit settlements are to be placed into an attorney trust account (if represented) and then into an account established under the Nebraska Uniform Transfers to Minors Act (UTMA) for the sole benefit of the minor; if not represented by counsel, payment is made directly into a UTMA account.
    • Annuities may be purchased by direct payment to the annuity provider, with the minor as sole beneficiary.
    • If the minor is a ward of the state, funds go into a DHHS trust/subaccount for the ward.
  • Withdrawal restrictions: Funds placed under this statute cannot be withdrawn, transferred, or paid out except (a) by court order; (b) at the direction of the UTMA custodian; (c) when the minor attains 19 years of age; or (d) upon the minor’s death.
  • Binding effect: A settlement entered in compliance with the statute is binding on the minor without further court approval; the signature of the person settling on behalf of the minor has the same force as if the minor were an adult.
  • Liability protections: Good-faith actions by custodians, insurers (who transfer funds to restricted accounts or annuities), financial institutions (who open restricted accounts), and settling defendants acting under the statute are shielded from liability related to the settlement.
  • Definition: “Minor” is defined (as amended) as a person under 19 years of age.
  • Preservation of court option: The statute does not prevent anyone acting for the minor from seeking guardianship, limited guardianship, conservatorship, or court approval/oversight of a settlement.

Who is affected

  • Minors (persons under 19), their custodians, attorneys, insurers, financial institutions, settling parties/defendants, and DHHS when minors are wards of the state. Courts may see reduced filings for smaller settlement approvals.

Legislative history & status

  • Introduced Jan 16, 2025 by Sen. Hallstrom; referred to Judiciary Committee.
  • Committee amendment AM176 increased the threshold to $40,000, removed certain notice requirements, and redefined “minor” (under 19).
  • Advanced through the Legislature and passed Final Reading (47–0–2); presented to and approved by the Governor April 7, 2025.

Practical effect

LB 341 provides a streamlined, statutory path for resolving smaller claims on behalf of minors while requiring safeguards (affidavit, restricted accounts or annuities, withdrawal limits) and preserving the option of court review where appropriate.

Compiled from official sources — confirm details with the bill’s official record.

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