Approval hearings( children & protected parties): overview, CPR and notes from hearing

28 Jan

Approval hearings exist to ensure that any settlement reached on behalf of a protected party (including adults lacking capacity or children) is genuinely in their best interests. The court acts as a safeguard because these individuals cannot make binding litigation decisions on their own.

1. Who is a Protected Party?

A protected party is someone who, due to age or mental capacity, cannot conduct litigation themselves. Litigation must be conducted by a litigation friend. Commonly this includes:

Children under 18
Adults lacking capacity under the Mental Capacity Act 2005

2. Why Court Approval Is Required

A settlement is not binding unless the court approves it. This prevents unfair, premature, or inappropriate settlements. The court examines:

Whether the settlement sufficiently compensates for injuries/losses
Whether funds are adequately protected (e.g., Court Funds Office or deputy/trust)
Whether costs and deductions, including legal fees, are reasonable
Overall fairness and long‑term welfare of the claimant

3. Steps in an Approval Hearing Process

(a) Application to Court

The claimant’s solicitor files the application, which must include:

Medical evidence
Financial assessments
A barrister’s opinion on the settlement’s suitability
Draft orders and schedules of loss for scrutiny

(b) Hearing Itself

At the hearing:

The judge reviews whether the terms are in the claimant’s best interests
The litigation friend confirms approval of the settlement
Judge may ask questions about prognosis, capacity, and how damages will be managed
The judge may approve, request more information, or decline the settlement
In children’s cases the child may attend, but attendance is not always required.

(c) Judicial Decision

The judge either:

Approves the settlement
Requests further evidence/clarification
Directs renegotiation of certain elements

4. Management of Settlement Funds

Post‑approval, the court determines how funds are held or invested.

For protected adults, this may involve a Court‑appointed deputy
For children, funds are generally placed with the Court Funds Office until age 18

Relevant CPR Provisions (Part 21)

Approval hearings are governed by CPR Part 21 – Children and Protected Parties.

1. Requirement for a Litigation Friend – CPR 21.2

A protected party must have a litigation friend. A child must also have one unless the court orders otherwise. No steps in proceedings (beyond issuing/serving) may be taken until a litigation friend is appointed.

2. Compromise or Settlement – CPR 21.10

This is the core rule governing approval hearings. It states:

No settlement, compromise, or payment in a claim by, on behalf of, or against a child or protected party is valid without the court’s approval.
Approval applications must follow the Part 8 procedure.
The application must include:
- A draft consent order
- Details of liability
- Age/occupation of the child or protected party
- Confirmation that the litigation friend approves the settlement
- Medical, financial, and other expert evidence
- A specialist barrister’s legal opinion on merits (in almost all cases)

3. Control of Money – CPR 21.11

Court controls how funds are invested or managed on behalf of the child/protected party.

4. Costs – CPR 21.12

The court also reviews and approves the litigation friend's costs and any expenses.

Notes from a recent personal injury AH at MCJC, courtroom 38, His Honour Judge Malek.

The Court reviewed the settlement’s suitability for a protected party (claimant with lifelong epilepsy).

Consideration was given to Article 8 and 10 balancing for anonymity — common in significant‑value protected‑party claims.
Judge ensured there was appropriate provision for a financial deputy, consistent with CPR 21’s control‑of‑funds framework.
The settlement could only become valid once formally approved, as CPR 21.10 requires.

Laurie Noah