| Passed by the House February 7, 2006 Yeas 97 FRANK CHOPP ________________________________________ Speaker of the House of Representatives Passed by the Senate March 2, 2006 Yeas 44 BRAD OWEN ________________________________________ President of the Senate | I, Richard Nafziger, Chief Clerk of the House of Representatives of the State of Washington, do hereby certify that the attached is HOUSE BILL 2380 as passed by the House of Representatives and the Senate on the dates hereon set forth. RICHARD NAFZIGER ________________________________________ Chief Clerk | |
| Approved March 24, 2006. CHRISTINE GREGOIRE ________________________________________ Governor of the State of Washington | March 24, 2006 - 2:14 p.m. Secretary of State State of Washington |
| State of Washington | 59th Legislature | 2006 Regular Session |
Prefiled 12/29/2005. Read first time 01/09/2006. Referred to Committee on Judiciary.
AN ACT Relating to the uniform transfers to minors act; amending RCW 11.114.010, 11.114.020, 11.114.090, 11.114.120, 11.114.140, 11.114.180, 11.114.190, and 11.114.200; and providing an effective date.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1 RCW 11.114.010 and 1991 c 193 s 1 are each amended to read
as follows:
Unless the context clearly requires otherwise, the definitions in
this section apply throughout this chapter.
(1) "Adult" means an individual other than the minor who has
attained the age of twenty-one years and is older than the minor.
(2) "Benefit plan" means an employer's plan for the benefit of an
employee or partner.
(3) "Broker" means a person lawfully engaged in the business of
effecting transactions in securities or commodities for the person's
own account or for the account of others.
(4) "Guardian" means a person appointed or qualified by a court to
act as general, limited, or temporary guardian of a minor's property or
a person legally authorized to perform substantially the same
functions. Conservator means guardian for transfers made under another
state's law but enforceable in this state's courts.
(5) "Court" means a superior court of the state of Washington.
(6) "Custodial property" means (a) any interest in property
transferred to a custodian under this chapter and (b) the income from
and proceeds of that interest in property.
(7) "Custodian" means a person so designated under RCW 11.114.090
or a successor or substitute custodian designated under RCW 11.114.180.
(8) "Financial institution" means a bank, trust company, savings
institution, or credit union, chartered and supervised under state or
federal law.
(9) "Legal representative" means an individual's personal
representative or guardian.
(10) "Member of the minor's family" means the minor's parent,
stepparent, spouse, grandparent, brother, sister, uncle, or aunt,
whether of the whole or half blood or by adoption.
(11) "Minor" means an individual who has not attained the age of
((twenty-one)) twenty-five years.
(12) "Person" means an individual, corporation, organization, or
other legal entity.
(13) "State" includes any state of the United States, the District
of Columbia, the Commonwealth of Puerto Rico, and any territory or
possession subject to the legislative authority of the United States.
(14) "Transfer" means a transaction that creates custodial property
under RCW 11.114.090.
(15) "Transferor" means a person who makes a transfer under this
chapter.
(16) "Trust company" means a financial institution, corporation, or
other legal entity, authorized to exercise general trust powers.
Sec. 2 RCW 11.114.020 and 1999 c 42 s 633 are each amended to
read as follows:
(1) This chapter applies to a transfer that refers to this chapter
in the designation under RCW 11.114.090(1) by which the transfer is
made if at the time of the transfer, the transferor, the minor, or the
custodian is a resident of this state or the custodial property is
located in this state. The custodianship so created remains subject to
this chapter despite a subsequent change in residence of a transferor,
the minor, or the custodian, or the removal of custodial property from
this state.
(2) A person designated as custodian under this chapter is subject
to personal jurisdiction in this state with respect to any matter
relating to the custodianship.
(3) A transfer that purports to be made and which is valid under
the uniform transfers to minors act, the uniform gifts to minors act,
or a substantially similar act of another state is governed by the law
of the designated state and may be executed and is enforceable in this
state if at the time of the transfer, the transferor, the minor, or the
custodian is a resident of the designated state or the custodial
property is located in the designated state.
(4) A matter under this chapter subject to court determination is
governed by the procedures provided in RCW 11.96A.080 through
11.96A.200. However, no guardian ad litem is required for the minor,
except under RCW 11.114.190(1), in the case of a petition by ((a [an]))
an unrepresented minor under the age of ((fourteen)) eighteen years.
Sec. 3 RCW 11.114.090 and 1991 c 193 s 9 are each amended to read
as follows:
(1) Custodial property is created and a transfer is made if:
(a) An uncertificated security or a certificated security in
registered form is either:
(i) Registered in the name of the transferor, an adult other than
the transferor, or a trust company, followed in substance by the words:
". . . . . . as custodian for . . . . . . (name of minor) under the
Washington uniform transfers to minors act"; or
(ii) Delivered if in certificated form, or any document necessary
for the transfer of an uncertificated security is delivered, together
with any necessary endorsement to an adult other than the transferor or
to a trust company as custodian, accompanied by an instrument in
substantially the form set forth in subsection (2) of this section;
(b) Money is paid or delivered, or a security held in the name of
a broker, financial institution, or its nominee is transferred, to a
broker or financial institution for credit to an account in the name of
the transferor, an adult other than the transferor, or a trust company,
followed in substance by the words: ". . . . . . as custodian for
. . . . . . (name of minor) under the Washington uniform transfers to
minors act";
(c) The ownership of a life or endowment insurance policy or
annuity contract is either:
(i) Registered with the issuer in the name of the transferor, an
adult other than the transferor, or a trust company, followed in
substance by the words: ". . . . . . as custodian for . . . . . .
(name of minor) under the Washington uniform transfers to minors act";
or
(ii) Assigned in a writing delivered to an adult other than the
transferor or to a trust company whose name in the assignment is
followed in substance by the words: ". . . . . . as custodian for
. . . . . . (name of minor) under the Washington uniform transfers to
minors act";
(d) An irrevocable exercise of a power of appointment or an
irrevocable present right to future payment under a contract is the
subject of a written notification delivered to the payor, issuer, or
other obligor that the right is transferred to the transferor, an adult
other than the transferor, or a trust company, whose name in the
notification is followed in substance by the words: ". . . . . . as
custodian for . . . . . . (name of minor) under the Washington uniform
transfers to minors act";
(e) An interest in real property is recorded in the name of the
transferor, an adult other than the transferor, or a trust company,
followed in substance by the words: ". . . . . . as custodian for
. . . . . . (name of minor) under the Washington uniform transfers to
minors act";
(f) A certificate of title issued by a department or agency of a
state or of the United States which evidences title to tangible
personal property is either:
(i) Issued in the name of the transferor, an adult other than the
transferor, or a trust company, followed in substance by the words:
". . . . . . as custodian for . . . . . . (name of minor) under the
Washington uniform transfers to minors act"; or
(ii) Delivered to an adult other than the transferor or to a trust
company, endorsed to that person followed in substance by the words:
". . . . . . as custodian for . . . . . . (name of minor) under the
Washington uniform transfers to minors act"; or
(g) An interest in any property not described in (a) through (f) of
this subsection is transferred to an adult other than the transferor or
to a trust company by a written instrument in substantially the form
set forth in subsection (2) of this section.
(2) An instrument in the following form satisfies the requirements
of subsection (1)(a)(ii) and (g) of this section:
Sec. 4 RCW 11.114.120 and 1991 c 193 s 12 are each amended to
read as follows:
(1) A custodian shall, as soon as custodial property is made
available to the custodian:
(a) Take control of custodial property;
(b) Register or record title to custodial property if appropriate;
and
(c) Collect, hold, manage, invest, and reinvest custodial property.
(2) In dealing with custodial property, a custodian shall observe
the standard of care applicable to fiduciaries under chapter 11.100
RCW. If a custodian has a special skill or expertise or is named
custodian on the basis of representations of a special skill or
expertise, the custodian shall use that skill or expertise. A
custodian, in the custodian's discretion and without liability to the
minor or the minor's estate, may retain any custodial property received
from a transferor according to the same standards as apply to a
fiduciary holding trust funds under RCW 11.100.060. However, the
provisions of RCW 11.100.025, 11.100.040, and 11.100.140 shall not
apply to a custodian.
(3) A custodian may invest in or pay premiums on life insurance or
endowment policies on (a) the life of the minor only if the minor or
the minor's estate is the sole beneficiary, or (b) the life of another
person in whom the minor has an insurable interest only to the extent
that the minor, the minor's estate, or the custodian in the capacity of
custodian, is the irrevocable beneficiary.
(4) A custodian at all times shall keep custodial property separate
and distinct from all other property in a manner sufficient to identify
it clearly as custodial property of the minor. Custodial property
consisting of an undivided interest is so identified if the minor's
interest is held as a tenant in common and is fixed. Custodial
property subject to recordation is so identified if it is recorded, and
custodial property subject to registration is so identified if it is
either registered, or held in an account designated, in the name of the
custodian, followed in substance by the words: ". . . . . . as
custodian for . . . . . . (name of minor) under the Washington uniform
transfers to minors act."
(5) A custodian shall keep records of all transactions with respect
to custodial property, including information necessary for the
preparation of the minor's tax returns, and shall make them available
upon request for inspection by a parent or legal representative of the
minor or by the minor if the minor has attained the age of ((fourteen))
eighteen years.
Sec. 5 RCW 11.114.140 and 1991 c 193 s 14 are each amended to
read as follows:
(1) A custodian may deliver or pay to the minor or expend for the
minor's benefit so much of the custodial property as the custodian
considers advisable for the use and benefit of the minor, without court
order and without regard to (a) the duty or ability of the custodian
personally or of any other person to support the minor, or (b) any
other income or property of the minor which may be applicable or
available for that purpose.
(2) On petition of an interested person or the minor if the minor
has attained the age of ((fourteen)) eighteen years, the court may
order the custodian to deliver or pay to the minor or expend for the
minor's benefit so much of the custodial property as the court
considers advisable for the use and benefit of the minor.
(3) A delivery, payment, or expenditure under this section is in
addition to, not in substitution for, and does not affect any
obligation of a person to support the minor.
Sec. 6 RCW 11.114.180 and 1991 c 193 s 18 are each amended to
read as follows:
(1) A person nominated under RCW 11.114.030 or designated under RCW
11.114.090 as custodian may decline to serve. If the event giving rise
to a transfer has not occurred and no substitute custodian able,
willing, and eligible to serve was nominated under RCW 11.114.030, the
person who made the nomination may nominate a substitute custodian
under RCW 11.114.030; otherwise the transferor or the transferor's
legal representative shall designate a substitute custodian at the time
of the transfer, in either case from among the persons eligible to
serve as custodian for that kind of property under RCW 11.114.090(1).
The custodian so designated has the rights of a successor custodian.
(2) A custodian at any time may designate a trust company or an
adult other than a transferor under RCW 11.114.040 as successor
custodian by executing and dating an instrument of designation. If the
instrument of designation does not contain or is not accompanied by the
resignation of the custodian, the designation of the successor does not
take effect until the custodian resigns, dies, becomes incapacitated,
or is removed, and custodial property is transferred to the successor
custodian.
(3) A custodian may resign at any time by delivering written notice
to the minor, if the minor has attained the age of ((fourteen))
eighteen years, and to the successor custodian, and by delivering the
custodial property to the successor custodian.
(4) If a custodian is ineligible, dies, or becomes incapacitated
and no successor custodian has been designated as provided in this
chapter, and the minor has attained the age of ((fourteen)) eighteen
years, the minor may designate as successor custodian, in the manner
prescribed in subsection (2) of this section, an adult member of the
minor's family, a guardian of the minor, or a trust company. If the
minor has not attained the age of ((fourteen)) eighteen years or fails
to act within sixty days after the ineligibility, death, or incapacity,
the guardian of the minor becomes successor custodian. If the minor
has no guardian or the guardian declines to act, the transferor, the
legal representative of the transferor or of the custodian, an adult
member of the minor's family, or any other interested person may
petition the court to designate a successor custodian.
(5) A custodian who declines to serve under subsection (1) of this
section or resigns under subsection (3) of this section, or the legal
representative of a deceased or incapacitated custodian, as soon as
practicable, shall put the custodial property and records in the
possession and control of the successor custodian. The successor
custodian by action may enforce the obligation to deliver custodial
property and records and becomes responsible for each item as received.
(6) A transferor, the legal representative of a transferor, an
adult member of the minor's family, a guardian of the minor, or the
minor if the minor has attained the age of ((fourteen)) eighteen years
may petition the court to remove the custodian for cause and to
designate a successor custodian other than a transferor under RCW
11.114.040 or to require the custodian to give appropriate bond.
Sec. 7 RCW 11.114.190 and 1991 c 193 s 19 are each amended to
read as follows:
(1) A minor who has attained the age of ((fourteen)) eighteen
years, the minor's legal representative, an adult member of the minor's
family, a transferor, or a transferor's legal representative may
petition the court (a) for an accounting by the custodian or the
custodian's legal representative; or (b) for a determination of
responsibility, as between the custodial property and the custodian
personally, for claims against the custodial property unless the
responsibility has been adjudicated in an action under RCW 11.114.170
to which the minor or the minor's legal representative was a party.
(2) A successor custodian may petition the court for an accounting
by the predecessor custodian.
(3) The court, in a proceeding under this chapter or in any other
proceeding, may require or permit the custodian or the custodian's
legal representative to account.
(4) If a custodian is removed under RCW 11.114.180(6), the court
shall require an accounting and order delivery of the custodial
property and records to the successor custodian and the execution of
all instruments required for transfer of the custodial property.
Sec. 8 RCW 11.114.200 and 1991 c 193 s 20 are each amended to
read as follows:
(1) Subject to RCW 11.114.220, the custodian shall transfer in an
appropriate manner the custodial property to the minor or to the
minor's estate upon the earlier of:
(((1))) (a) The minor's attainment of twenty-one years of age with
respect to custodial property transferred under RCW 11.114.040 or
11.114.050;
(((2))) (b) The minor's attainment of eighteen years of age with
respect to custodial property transferred under RCW 11.114.060 or
11.114.070; or
(((3))) (c) The minor's death.
(2) The transferor may, in the initial nomination of custodian,
extend the custodianship to the earlier of the minor's attainment of
twenty-five years of age or the minor's death unless:
(a) The governing will, trust, or instrument creating the power of
appointment specifically provides otherwise if the custodian property
is transferred under RCW 11.114.040, 11.114.050, or 11.114.060; or
(b) The custodial property is transferred under RCW 11.114.070. In
that case, the person nominating the custodian under RCW 11.114.030 may
elect to extend the custodianship. If no custodian has been nominated
under RCW 11.114.030, the court establishing the custodianship under
RCW 11.114.070(4) may extend the custodianship if it determines that
doing so would not be contrary to the interest of the minor.
(3) An extension of the custodianship under subsection (2) of this
section will be valid only if the transfer creating the custodianship
is made on or after July 1, 2007.
(4) Any bank, trust company, insurance company, registered broker-dealer, investment company regulated under the federal Investment
Company Act of 1940, investment advisor regulated under the federal
Investment Advisors Act of 1940, or other person who makes
custodianship forms available for adoption in contemplation of selling
assets to or managing assets for a custodianship shall include, in any
form made available on or after July 1, 2007, an option to extend the
custodianship under subsection (2) of this section and a warning to the
transferor that exercising the option to extend may result in the
transfer not qualifying for annual exclusion from federal gift tax. An
instrument in the form described in RCW 11.114.090(2) will satisfy the
requirements of this subsection.
NEW SECTION. Sec. 9 This act takes effect July 1, 2007.