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Warren's Heaton on Surrogate's Court Practice
Copyright 2017, Matthew Bender & Company, Inc., a member of the LexisNexis Group.

4-51 Warren's Heaton on Surrogate's Court Practice 51.syn


Transfers to Minors


Linda B. Hirschon, Greenberg Traurig, New York;Andrew L. Martin, Esq. Chief Court Attorney--Referee, Surrogate's Court, Nassau County;Eugene E. Peckham, Surrogate, Broome County;C. Raymond Radigan, Chairman, EPTL-SCPA Legislative Advisory Committee;Joshua S. Rubenstein;Peter N. Wells, former Surrogate, Onondaga County;* Chapter 51 was revised by R. Mark Davis, Esq., Engel & Davis, LLP, New York.

Chapter Summary


New York adopted the Uniform Transfers to Minors Act (UTMA) as part of the EPTL; the UTMA replaced the Uniform Gifts to Minors Act (UGMA). The UTMA allows any kind of property to be made the subject of a gift to a minor under a custodianship. Unlike a trust, the custodial property remains vested in the minor. This chapter, from Warren's Heaton on Surrogate's Court Practice (Matthew Bender), covers the purpose of the UTMA, differences between provisions of the UTMA and the former UGMA, jurisdiction and procedures in Surrogate's Court for transfers of gifts, the duties of a custodian under the UTMA, and types of property to which the UTMA applies.

Under the UTMA, both the New York Supreme Court and the Surrogate's Court have jurisdiction over all proceedings involving gifts. This chapter covers EPTL provisions governing methods for transferring assets into a custodianship, as well as statutory requirements for registration and recording, or delivering, the property. The chapter further analyzes jurisdiction over the transfer, analogizing it to court appointment of a guardian of an infant's property. If the infant is a domiciliary or resident of New York, the court exercises jurisdiction based on domicile; if the infant is not a domiciliary or resident, jurisdiction is held by the county where the property is located. A custodian under the UTMA is also subject to personal jurisdiction in New York.

The basic objective of the former UGMA was to provide a simple, inexpensive method of making small gifts to minors other than outright gifts, without the inflexibility and expense of a guardianship or trust. Outright gifts were problematic because minors could disaffirm transactions and demand return of property sold; third parties dealt with minors at their own peril, often making the minor unable to sell any property. The UGMA alternative of custodianship initially applied to securities, and was later expanded to apply to limited partnerships, real property, and tangible personal property. The UTMA was enacted as a revision and expansion of the UGMA, and this chapter outlines differences between the UTMA and the UGMA as to age of majority and termination of custodianship, transfers of money owed to a minor, type of property which can be transferred, performance and discretion of the custodian, use of custodial funds for other than support, maintenance, education and benefit, entitlement to reasonable compensation, and liability of the custodian. The chapter also reviews case law distinguishing a UTMA gift from a Totten trust. A Totten trust is a tentative trust effective during the grantor's lifetime, under which the beneficiary does not have the right to income or accounting.

Under the UTMA, custodians have the duty to collect the custodial property, register title if appropriate, and hold, manage, invest and reinvest the property. This property may include transfers from trusts and estates, as well as debts. Custodians also have a duty to not comingle assets, and to keep records. The chapter reviews cases holding that custodians must observe the "prudent person" standard of care, although custodians aren't defined as fiduciaries or trustees and aren't subject to New York's Prudent Investor Act. Professional fiduciaries are held to a slightly higher standard of care for special skill or expertise. The chapter also covers the powers of custodians over property, including the power to sell, lease, mortgage, execute instruments, vote shares of stock, and consent to reorganization or merger. Additionally, the chapter reviews case law discussing the custodian's broad authority to expend funds for the minor's benefit.

Warren's Heaton on Surrogate's Court Practice (Matthew Bender) provides comprehensive coverage and analysis of New York Probate and Estates practice issues. Accepted by the courts as the leading authority on practice in Surrogate's Court, topics include jurisdiction, intestacy, probate, appointment of representatives and guardians, estate administration, fiduciary duties, accounting, commissions and fees, litigation, Federal and New York estate tax, and construction of wills and trusts. The treatise covers case law affecting substance and procedure; analysis of SCPA, EPTL, and related statutes; procedural guidance; and over 1,000 forms including official New York Surrogate's Court Forms and current Federal and New York estate tax forms with explanations. The treatise also covers Reformation and Trust-splitting issues, Supplemental Needs Trusts, Uniform Transfers to Minors, and Revocable Living Trusts.


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For a complete discussion of jurisdiction and procedural matters, see Chapter 2, Jurisdiction; Powers of the Surrogate. For discussion of proceedings related to guardianship proceedings for minors, see Chapter 48, Guardians of Infants.


For forms of pleadings see Bender's Forms for the Civil Practice: Estate & Probate (Volumes 30 to 40) covering the Surrogate's Court Procedure Act (SCPA) and Estates, Powers and Trusts Law (EPTL) (Matthew Bender).

For substantive law statutes, see New York Civil Practice: EPTL (Matthew Bender).

For statutes relating to procedure, see New York Civil Practice: SCPA (Matthew Bender).

LexisNexis Answer Guide New York Surrogate's Court cites seminal cases and references to codes and court rules, and provides checklists and practice pointers (Matthew Bender).
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