## Facts

- In 1975, 21-month-old Sharon A. Reo was struck by a U.S. Postal Service truck while playing near a curb in New Jersey, crushing two fingers on her left hand.
- Reo’s parents, acting through counsel, filed an administrative tort claim under the Federal Tort Claims Act (FTCA).
- The parents accepted an administrative settlement of $2,500 and signed a release on Reo’s behalf.
- No court approval of the minor’s settlement was sought or obtained.
- Reo later underwent multiple surgeries; her fingers remained deformed.
- In 1993, after reaching adulthood under New Jersey law, Reo filed an FTCA action seeking damages against the United States (and initially against the property owner, whom she later dismissed).

## Issues

1. Under the FTCA, does a parent-executed administrative settlement and release bar a minor’s later suit when state law requires judicial approval of minor settlements?
2. Does New Jersey law render a minor’s settlement unenforceable against the minor absent judicial approval, and if so, does that rule apply to the United States in FTCA litigation?

## Decision

- The Third Circuit reversed the district court’s dismissal and remanded.
- Because New Jersey law requires judicial approval for a minor’s settlement to bind the minor, the unapproved administrative settlement did not release the United States from further liability.
- The 1976 administrative settlement and release therefore did not bar Reo’s later FTCA action filed after she reached majority.

## Legal Principles

- The FTCA makes the United States liable “in the same manner and to the same extent as a private individual under like circumstances,” so state law governs substantive tort rules and defenses, including the effect of releases.
- The “law of the place” of the tort controls the validity and binding effect of a settlement executed on behalf of a minor.
- Under New Jersey law, a settlement of a minor’s claim is not binding on the minor unless approved by a court.
- The United States may not enforce an administratively completed minor’s settlement as a complete bar where a private defendant in the same state could not do so absent judicial approval.

## Conclusion

The Third Circuit held that, in an FTCA case arising in New Jersey, a minor is not bound by a parent-executed administrative settlement lacking required judicial approval; accordingly, the prior release did not preclude Reo’s adult-filed FTCA claim, and dismissal was improper.


Reo v. U.S. Postal Serv., 98 F.3d 73 (3d Cir. 1996)