(1) On petition of the guardian of the estate, the court, if satisfied that the action would be in the interest of the ward and his or her estate, may make an order authorizing the settlement or compromise of any claim by or against the ward or his or her estate, whether arising out of contract, tort, or otherwise, and whether arising before or after the appointment of the guardian.
(2) A settlement of a tort claim against a ward made by or in behalf of the guardian of the estate shall be binding, if otherwise valid, without authorization or approval by the court.
(3) However, a guardian shall not take credit in his or her accounts for any money or property expended by him or her in the settlement unless the guardian has first been authorized by the court to make the settlement or unless the guardian, after having made the settlement, establishes to the satisfaction of the court by clear and convincing evidence that the settlement was in the interest of the ward and his or her estate.
(4) A discharge, acquittance, or receipt given by a guardian of the estate for any claim other than one arising out of tort shall be valid in favor of any person who takes it in good faith, but the guardian shall assume the burden of establishing that any compromise not previously approved by the court was made in the interest of the ward and his or her estate and shall be liable to his or her ward if he or she or his or her estate is injured thereby.