[WSBARP] Creating a custodianship under UTMA

[Peter Crocker]

Greetings, Listmates.

Does anyone have experience with creating a custodianship under UTMA for
making gifts pursuant to a trust? I'm wondering about the necessity of
court.

A trust has been administered without opening a case or cause of action.
The trust became irrevocable upon the death earlier this year of the
trustor. The only remaining actions to be done are residuary bequests to
minors (referenced as "distributed to surviving lineal descendants of [the
decedent's child] by right of representation"). The trust doesn't expressly
reference UTMA.

I read UTMA as having two different potential points of entry that would
authorize the trustee to transfer funds to a bank under a custodianship,
but I'm not sure which one applies. One applies when the transfer of funds
on behalf of a minor is "authorized in the governing will or trust," (RCW
11.114.050) and the other applies when the "will or trust ... does not
contain an authorization" (RCW 11.114.060) to transfer the funds. The
latter requires a court order when the funds exceed $30,000. The funds in
this case do exceed that threshold.

While the trust does not expressly reference UTMA, it seems to me that the
trust, nonetheless, authorizes the trustee to make this transfer by the
language regarding the distribution of residuary. It seems simple enough to
file a TEDRA petition and get the custodianship, but, for various reasons,
avoiding court is desirable. Of course, avoiding bar complaints or worse is
also desirable. What are your thoughts?

Sincerely,
Peter

Law Office of Peter Crocker, PLLC
210 Polk St., Ste. 6A
Port Townsend, WA 98368
peter at petercrockerlaw.com
360-344-8474

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