Lawyers for Adele, who launched the proceedings with her partner Simon Konecki, said she was emphatic that Angelo Adkins was not and must never be "public property".
"It is a matter of profound sadness that many of his milestone moments, such as his first family outing and his first trip to playgroup, were photographed and published worldwide expressly against his family's wishes. Adele and Simon never encourage such photos. Quite the opposite", solicitor Jenny Afia told Mr Justice Bean in court on Wednesday.
Corbis Images UK Limited had offered to pay damages and legal costs to Angelo and agreed not to use the photos at issue again, she added.
The action concerned certain photos of Angelo with Adele, which the photographic agency made available for publication in the English press.
"The parents' view is that these images were of routine, everyday family occasions which the paparazzi has no right to intrude upon, profit from and file away in picture libraries for future reference and use."
Ms Afia added: "Adele and Simon are pleased this matter has been resolved. They continue to do all they can to protect Angelo's rights in relation to the paparazzi, including taking legal action where necessary.
"They will be holding the damages on trust on behalf of the claimant for this purpose. They will also continue efforts to improve the laws relating to paparazzi and children generally, building on the successful campaign Adele helped fund in California resulting in far stricter harassment laws."
Ms Afia said later: "Being in the public eye doesn't mean your children are public property. Our laws provide full protection against the paparazzi and more parents should make use of them.
"The children of famous parents are not celebrities. The law can, will and should protect them."