SENATE BILL NO. 427
AS AMENDED BY HOUSE AMENDMENT NO. 1
AN ACT TO AMEND CHAPTER 45, TITLE 12, DELAWARE CODE, RELATING TO UNIFORM GIFTS TO MINORS ACT.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:
Section 1. Amend §4501, Chapter 45, Title 12, Delaware Code, by deleting subsections (5), (9), and (14) and inserting in lieu thereof new subsections (5), (9), and (14), and also by inserting new subsections (18), (19), and (20) to read as follows:
"(5) 'Custodial property' means (i) any interest in property transferred to a custodian under this Chapter and (ii) the income from and proceeds of that interest in property.
(9) 'Guardian' means a person appointed or qualified by a court to act as general, limited, or temporary guardian of a minor's property or a person legally authorized to perform substantially the same functions.
(14) 'Minor' is a person who has not attained the age of 18 years, except that if the donor shall direct that the custodianship shall terminate when a person shall attain an age greater than 18 but not more than 21, then 'minor' shall refer to such person so long as he shall not have attained the age directed by the donor.
'Benefit plan' means any employment-related plan or Individual Retirement Account for the benefit of a self-employed person, an employee, partner or spouse of such person.
'Transfer' means a transaction that creates custodial property under §4502 of this Chapter.
'Donor' means a person who makes a transfer under this Chapter, whether by gift or otherwise."
Section 2. Amend §4502, Chapter 45, Title 12, Delaware Code, by deleting subsection (b) thereof and inserting a new subsection (b) in lieu thereof to read as follows:
"(b) If, pursuant to the terms of a will or trust agreement, any property of the type described in subsection (a) of this section is required to be distributed to a minor, or if, pursuant to the terms of an insurance policy, annuity contract or benefit plan, a payment is required to be made to a minor, and if the will, trust agreement, insurance policy, annuity contract or benefit plan does not require that such property be distributed to a custodian in accordance with this Chapter, the personal representative, trustee, insurance company or payor under an annuity contract or benefit plan may, nevertheless, in his discretion (but subject to any limitations or prohibitions contained in the will, trust agreement, insurance policy, annuity contract or benefit plan), distribute such property or make such payment in accordance with this Chapter by transferring it, in the manner and form prescribed in subsection (a) of this Section, to an adult or trust company designated as custodian by the personal representative, trustee, insurance company or payor under an annuity contract or benefit plan in accordance with §4507(g) of this Title."
Section 3. Amend §4504, Chapter 45, Title 12, Delaware Code, by deleting subsections (a), (b), and (c) thereof and inserting in lieu thereof new subsections (a), (b), and (c) to read as follows:
"(a)(1) The custodian shall collect, hold, manage, invest and reinvest the custodial property.
(2) A custodian may deliver or pay to the minor or expend for the minor's benefit so much of the custodial property as the custodian considers advisable for the use and benefit of the minor, without court order and without regard to (i) the duty or ability of the custodian personally or of any other person to support the minor, or (ii) any other income or property of the minor which may be applicable or available for that purpose.
On petition of an interest person, or the minor if the minor has attained the age of 14 years, the court may order the custodian to deliver or pay to the minor or expend for the minor's benefit so much of the custodial property as the court considers advisable for the use and benefit of the minor.
A delivery, payment, or expenditure under this Section is in addition to, not in substitution for, and does not affect any obligation of a person to support the minor."
"§4509. Liability to Third Persons
(a) A claim based on (i) a contract entered into by a custodian acting in a custodial capacity, (ii) an obligation arising from the ownership or control of custodial property, or (iii) a tort committed during the custodianship. may be asserted against the custodial property by proceeding against the custodian in the custodial capacity, whether or not the custodian or the minor is personally liable therefor.
(b) A custodian is not personally liable:
on a contract properly entered into in the custodial capacity unless the custodian fails to reveal that capacity and to identify the custodianship in the contract; or
for an obligation arising from control of custodial property or for a tort committed during the custodianship unless the custodian is personally at fault.
(c) A minor is not personally liable for an obligation arising from ownership of custodial property or for a tort committed during the custodianship unless the minor is personally at fault."
Section 5. This Act shall take effect on the date of enactment but the repeal of any provision by this Act shall not affect gifts made pursuant to Chapter 45 of Title 12 as it existed prior to the date of enactment of this Act.
Section 6. If any provision of this act or the application thereof to any person or circumstances is held invalid, the invalidity shall not affect other provisions or applications of the act which can be given effect without the invalid provision or application, and to this end, the provisions of this act are severable.
Approved July 17. 1984.