404.051. Powers of custodian, limitation--termination of custodianship, when, procedure--degree of care required for custodial property.

MISSOURI STATUTES AND CODES

404.051. Powers of custodian, limitation--termination of custodianship, when, procedure--degree of care required for custodial property.

Powers of custodian, limitation--termination of custodianship, when,procedure--degree of care required for custodial property.

404.051. 1. The custodian shall collect, hold, maintain, manage,invest and reinvest the custodial property. The custodian may accept atransfer of additional property for the same minor into the custodianshipand may consolidate into a single custodianship custodial property receivedfor the same minor from multiple transfers or transferors.

2. The custodian may deliver, pay over to the minor for expenditureby the minor, or expend for the minor's benefit, so much of the custodialproperty as the custodian determines advisable for the use and benefit ofthe minor, without court order and without regard to the duty or ability ofthe custodian in the custodian's individual capacity or of any other personto support the minor, or any other income or property of the minor.

3. Upon the petition of a parent, guardian or conservator of a minor,an adult member of the minor's family, any person interested in the welfareof the minor, or of the minor if the minor has attained the age of fourteenyears, the court may order the custodian to expend or to pay over to theminor or the minor's parent, guardian or conservator so much of thecustodial property as the court determines advisable for the use andbenefit of the minor.

4. Any delivery, payment or expenditure pursuant to subsections 2 and3 of this section is in addition to, not in substitution for, and does notaffect, the obligation of any person to support the minor.

5. (1) To the extent that the custodial property has not beenexpended, the custodian shall deliver the custodial property in anappropriate manner, free of the custodianship, as follows:

(a) To the minor on attaining the age of twenty-one years, or onattaining the age of eighteen years for custodial property created by atransfer of property from a person other than a donor and the minorrequests the property; or

(b) On the minor's death, to the minor's estate.

(2) If the custodian does not deliver the custodial property to theminor or the minor's estate as prescribed in subdivision (1) of thissubsection, the minor or the minor's personal representative may petitionthe court to declare the custodianship terminated and to order delivery ofthe custodial property to the minor or to the minor's estate free of thecustodianship.

(3) To the extent the custodial property is real property, aconveyance and delivery of the real property by the minor after attainingthe age at which the minor is entitled to the property free of thecustodianship, or by the minor's heirs, or by the minor's personalrepresentative, shall terminate the custodian's powers, duties and rightswith respect to the real property.

(4) If the minor is an incapacitated person at the time the minorwould otherwise be entitled to receive the custodial property free of thecustodianship, the custodian shall deliver the custodial property to theincapacitated person's conservator. If the incapacitated person has noconservator, the custodian may transfer the custodial property to any adultperson or financial institution, including the custodian, as personalcustodian for the incapacitated person under any law providing forcustodianship of property for incapacitated adult persons.

6. The custodian is under a duty to act in the interest of the minorand to avoid conflicts of interest that impair the custodian's ability toso act. In dealing with the custodial property, the custodian shallobserve the degree of care that would be observed by a prudent persondealing with the property and conducting the affairs of another, exceptthat all investments made on or after August 28, 1998, shall be inaccordance with the provisions of the Missouri prudent investor act,sections 469.900 to 469.913, RSMo. The custodian is not limited by anyother statute restricting investments or expenditures by fiduciaries. Ifthe custodian has special skills or is named custodian on the basis ofrepresentations of special skills or expertise, the custodian is under aduty to use those skills. The custodian, in the custodian's discretion andwithout liability to the minor or the minor's estate, may retain anycustodial property received under sections 404.005 to 404.094, and may holdmoney or securities in the financial institution or brokerage company towhich the property was delivered by the transferor.

7. The custodian may invest in and pay premiums out of custodialproperty for life or endowment insurance policies on the life of the minoror the life of another person in whom the minor has an insurable interest,provided the insurance proceeds will be distributed on the death of theinsured life to the minor, the minor's estate or the custodian in thecustodian's representative capacity.

8. Subject to the degree of care prescribed in subsection 6 of thissection, the custodian, acting in the capacity of custodian for the benefitof the minor, has all rights, power and authority over the custodialproperty that unmarried, nonincapacitated adult owners have over their ownproperty, except the power to make a gift of the minor's property unlessthe gift to be made is approved by a court.

9. The custodian at all times shall keep custodial property separateand distinct from all other property in a manner to identify it clearly ascustodial property of the minor. Custodial property consisting of anundivided interest in property is sufficiently separate and distinct if thecustodian's interest in the property is held as a tenant in common with theother owners of the property and the minor's proportional interest in theproperty is fixed. Custodial property is sufficiently so identified if itis held in the name of the custodian in the manner prescribed in section404.707.

10. The custodian may establish checking, savings or other similaraccounts with financial institutions and brokers whereby both the custodianand the minor may withdraw money from the account or draw checks againstthe account. Money withdrawn from an account or checks written against anaccount by the minor shall be treated as a delivery of custodial propertyfrom the custodian to the minor.

11. Subject to the degree of care prescribed in subsection 6 of thissection, the custodian, acting in the capacity of custodian and for thebenefit of the minor, may borrow money, lend money, acquire by lease theuse of property for the minor, lease custodial property and enter intocontracts under which the performance required by such agreements mayextend beyond the date the custodianship terminates. The custodian shallhold property that is borrowed or leased for the minor as custodialproperty in the name of the custodian in the manner prescribed in section404.047.

12. The custodian shall keep records of all transactions with respectto the custodial property, including information necessary for preparationof the minor's tax returns, and make them available for inspection atreasonable intervals by a parent, the minor if the minor has attained theage of fourteen years, an adult member of the minor's family if the minorhas no living parent, and a legal representative of the minor.

13. The minor's custodian may comply with an agreement with atransferor of property to the minor, including an agreement respectinginvestment objectives, expenses, compensation, resignation and naming ofsuccessor custodians, to the extent that such agreement does not conflictwith the custodian's obligations to the minor under sections 404.005 to404.094.