§ 18-7-13 - Care of custodial property. - Rhode Island Statutes

SECTION 18-7-13

   § 18-7-13  Care of custodial property.– (a) A custodian shall:

   (1) Take control of custodial property;

   (2) Register or record title to custodial property ifappropriate; and

   (3) Collect, hold, manage, invest, and reinvest custodialproperty.

   (b) In dealing with custodial property, a custodian shallobserve the standard of care that would be observed by a prudent person dealingwith property of another and is not limited by any other statute restrictinginvestments by fiduciaries. If a custodian has a special skill or expertise, oris named custodian on the basis of representations of a special skill orexpertise, the custodian shall use that skill or expertise. However, acustodian, in the custodian's discretion and without liability to the minor orthe minor's estate, may retain any custodial property received from atransferor.

   (c) A custodian may invest in or pay premiums on lifeinsurance or endowment policies on:

   (1) The life of the minor only if the minor or the minor'sestate is the sole beneficiary; or

   (2) The life of another person in whom the minor has aninsurable interest only to the extent that the minor, the minor's estate, orthe custodian in the capacity of custodian, is the irrevocable beneficiary.

   (d) A custodian at all times shall keep custodial propertyseparate and distinct from all other property in a manner sufficient toidentify it clearly as custodial property of the minor. Custodial propertyconsisting of an undivided interest is so identified if the minor's interest isheld as a tenant in common and is fixed. Custodial property subject torecordation is so identified if it is recorded, and custodial property subjectto registration is so identified if it is either registered, or held in anaccount designated, in the name of the custodian, followed in substance by thewords: "as a custodian for ]]]]]]]]]]]]]]]]]]]]]]]]]] (name of minor) under theRhode Island Uniform Transfers to Minors Act, chapter 7 of title 18".

   (e) A custodian shall keep records of all transactions withrespect to custodial property, including information necessary for thepreparation of the minor's tax returns, and shall make them available forinspection at reasonable intervals by a parent or legal representative of theminor, or by the minor if the minor has attained the age of fourteen (14) years.