UTMA Custodian

The Virginia Supreme Court recently clarified in Carson v. Wells, 281 Va. 173, 705 S.E.2d101 (2011) the statutory standard of care to be observed by a Uniform Transfer to Minor Act or UTMA custodian. 
  • The Court ordered the UTMA custodian to pay attorney's fees for both parties in the litigation and enumerated the high level of care required by fiduciaries in the handling of investments in "... effectively imposing the common law
duties of trustees on UTMA custodians.” Carlson vs Wells, 281 Va. at 182, 705 S.E.2d at 105. See the Virginia State Bar's Spring 2011 Trust and Estates Newsletter for excellent case summary. 
  • Carlson v. Wells shows bad facts may make bad law. UTMA accounts, attractive for their simplicity in, for one example, funding your grand children's college tuition, now bears some of the legal complexities of using a "trust."