Chapter 54

54.958(1) (1) Unless otherwise directed by an instrument designating a custodial trustee pursuant to s. 54.954, a person, including a fiduciary other than a custodial trustee, who holds property of or owes a debt to an incapacitated individual not having a conservator or guardian of the estate may make a transfer to an adult member of the beneficiary’s family or to a trust company as custodial trustee for the use and benefit of the incapacitated individual. If the value of the property or the debt exceeds $10,000, the transfer is not effective unless authorized by the court.

54.958(2) (2) A written acknowledgment of delivery, signed by a custodial trustee, is a sufficient receipt and discharge for property transferred to the custodial trustee pursuant to this section.

54.958 History History: 1991 a. 246; 2005 a. 387 s. 558; Stats. 2005 s. 54.958.

54.960 54.960 Multiple beneficiaries; separate custodial trusts; survivorship.

54.960(1) (1) Beneficial interests in a custodial trust created for multiple beneficiaries are deemed to be separate custodial trusts of equal undivided interests for each beneficiary. Except in a transfer or declaration for use and benefit of husband and wife, for whom survivorship is presumed, a right of survivorship does not exist unless the instrument creating the custodial trust specifically provides for survivorship or survivorship is required as to marital property.

54.960(2) (2) Custodial trust property held under this subchapter by the same custodial trustee for the use and benefit of the same beneficiary may be administered as a single custodial trust.

54.960(3) (3) A custodial trustee of custodial trust property held for more than one beneficiary shall separately account to each beneficiary pursuant to ss. 54.962 and 54.978 for the administration of the custodial trust.

54.960 History History: 1991 a. 246; 2005 a. 387 s. 559; Stats. 2005 s. 54.960.

54.962 54.962 General duties of custodial trustee.

54.962(1) (1) If appropriate, a custodial trustee shall register or record the instrument vesting title to custodial trust property.

54.962(2) (2) If the beneficiary is not incapacitated, a custodial trustee shall follow the directions of the beneficiary in the management, control, investment or retention of the custodial trust property. In the absence of effective contrary direction by the beneficiary while not incapacitated, the custodial trustee shall observe the standard of care that would be observed by a prudent person dealing with property of another and is not limited by any other law restricting investments by fiduciaries. However, a custodial trustee, in the custodial trustee’s discretion, may retain any custodial trust property received from the transferor. If a custodial trustee has a special skill or expertise or is named custodial trustee on the basis of representation of a special skill or expertise, the custodial trustee shall use that skill or expertise.

54.962(3) (3) Subject to sub. (2), a custodial trustee shall take control of and collect, hold, manage, invest and reinvest custodial trust property.

54.962(4) (4) A custodial trustee at all times shall keep custodial trust property of which the custodial trustee has control separate from all other property in a manner sufficient to identify it clearly as custodial trust property of the beneficiary. Custodial trust property, the title to which is subject to recordation, is so identified if an appropriate instrument so identifying the property is recorded, and custodial trust property subject to registration is so identified if it is registered or held in an account in the name of the custodial trustee designated in substance: “as custodial trustee for .... (name of beneficiary) under the Wisconsin Uniform Custodial Trust Act”.

54.962(5) (5) A custodial trustee shall keep records of all transactions with respect to custodial trust property, including information necessary for the preparation of tax returns, and shall make the records and information available at reasonable times to the beneficiary or legal representative of the beneficiary.

54.962(6) (6) The exercise of a durable power of attorney for an incapacitated beneficiary is not effective to terminate or direct the administration or distribution of a custodial trust.

54.962 History History: 1991 a. 246; 2005 a. 387 s. 560; Stats. 2005 s. 54.962.

54.964 54.964 General powers of custodial trustee.

54.964(1) (1) A custodial trustee, acting in a fiduciary capacity, has all the rights and powers over custodial trust property which an unmarried adult owner has over individually owned property, but a custodial trustee may exercise those rights and powers in a fiduciary capacity only.

54.964(2) (2) This section does not relieve a custodial trustee from liability for a violation of s. 54.962.

54.964 History History: 1991 a. 246; 2005 a. 387 s. 561; Stats. 2005 s. 54.964.

54.966 54.966 Use of custodial trust property.

54.966(1) (1) A custodial trustee shall pay to the beneficiary or expend for the beneficiary’s use and benefit so much or all of the custodial trust property as the beneficiary while not incapacitated may direct from time to time.

54.966(2) (2) If the beneficiary is incapacitated, the custodial trustee shall expend so much or all of the custodial trust property as the custodial trustee considers advisable for the use and benefit of the beneficiary and individuals who were supported by the beneficiary when the beneficiary became incapacitated or who are legally entitled to support by the beneficiary. Expenditures may be made in the manner, when and to the extent that the custodial trustee determines suitable and proper, without court order and without regard to other support, income or property of the beneficiary.

54.966(3) (3) A custodial trustee may establish checking, savings or other similar accounts of reasonable amounts from or against which either the custodial trustee or the beneficiary may withdraw funds or write checks. Funds withdrawn from, or checks written against, the account by the beneficiary are distributions of custodial trust property by the custodial trustee to the beneficiary.

54.966 History History: 1991 a. 246; 2005 a. 387 s. 562; Stats. 2005 s. 54.966.

54.968 54.968 Determination of incapacity; effect.

54.968(1) (1) The custodial trustee shall administer the custodial trust as for an incapacitated beneficiary if any of the following applies:

54.968(1)(a) (a) The custodial trust was created under s. 54.958.

54.968(1)(b) (b) The transferor has so directed in the instrument creating the custodial trust period.

54.968(1)(c) (c) The custodial trustee has determined that the beneficiary is incapacitated.

54.968(2) (2) A custodial trustee may determine that the beneficiary is incapacitated in reliance upon any of the following:

54.968(2)(a) (a) Previous direction or authority given by the beneficiary while not incapacitated, including direction or authority pursuant to a durable power of attorney.

54.968(2)(b) (b) The certificate of the beneficiary’s physician.

54.968(2)(c) (c) Other persuasive evidence.

54.968(3) (3) If a custodial trustee for an incapacitated beneficiary reasonably concludes that the beneficiary’s incapacity has ceased, or that circumstances concerning the beneficiary’s ability to manage property and business affairs have changed since the creation of a custodial trust directing administration as for an incapacitated beneficiary, the custodial trustee may administer the trust as for a beneficiary who is not incapacitated.

54.968(4) (4) On petition of the beneficiary, the custodial trustee or other person interested in the custodial trust property or the welfare of the beneficiary, the court shall determine whether the beneficiary is incapacitated.

54.968(5) (5) Absent determination of incapacity of the beneficiary under sub. (2) or (4), a custodial trustee who has reason to believe that the beneficiary is incapacitated shall administer the custodial trust in accordance with the provisions of this subchapter applicable to an incapacitated beneficiary.

54.968(6) (6) Incapacity of a beneficiary does not terminate any of the following:

54.968(6)(a) (a) The custodial trust.

54.968(6)(b) (b) Any designation of a successor custodial trustee.

54.968(6)(c) (c) Rights or powers of the custodial trustee.

54.968(6)(d) (d) Any immunities of 3rd persons acting on instructions of the custodial trustee.

54.968 History History: 1991 a. 246; 2005 a. 387 s. 563; Stats. 2005 s. 54.968.

54.970 54.970 Exemption of 3rd person from liability. A 3rd person in good faith and without a court order may act on instructions of, or otherwise deal with, a person purporting to make a transfer as, or purporting to act in the capacity of, a custodial trustee. In the absence of knowledge to the contrary, the 3rd person is not responsible for determining any of the following:

54.970(1) (1) The validity of the purported custodial trustee’s designation.

54.970(2) (2) The propriety of, or the authority under this subchapter for, any action of the purported custodial trustee.

54.970(3) (3) The validity or propriety of an instrument executed or instruction given pursuant to this subchapter either by the person purporting to make a transfer or declaration or by the purported custodial trustee.

54.970(4) (4) The propriety of the application of property vested in the purported custodial trustee.

54.970 History History: 1991 a. 246; 2005 a. 253; 2005 a. 387 s. 564; Stats. 2005 s. 54.970.

54.972 54.972 Liability to 3rd person.

54.972(1) (1) A claim based on a contract entered into by a custodial trustee acting in a fiduciary capacity, an obligation arising from the ownership or control of custodial trust property or a tort committed in the course of administering the custodial trust may be asserted by a 3rd person against the custodial trust property by proceeding against the custodial trustee in a fiduciary capacity, whether or not the custodial trustee or the beneficiary is personally liable.

54.972(2) (2) A custodial trustee is not personally liable to a 3rd person in any of the following situations:

54.972(2)(a) (a) On a contract properly entered into in a fiduciary capacity unless the custodial trustee fails to reveal that capacity or to identify the custodial trust in the contract.

54.972(2)(b) (b) For an obligation arising from control of custodial trust property or for a tort committed in the course of the administration of the custodial trust unless the custodial trustee is personally at fault.

54.972(3) (3) A beneficiary is not personally liable to a 3rd person for an obligation arising from beneficial ownership of custodial trust property or for a tort committed in the course of administration of the custodial trust unless the beneficiary is personally in possession of the custodial trust property giving rise to the liability or is personally at fault.

54.972(4) (4) Subsections (2) and (3) do not preclude actions or proceedings to establish liability of the custodial trustee or beneficiary to the extent the person sued is protected as the insured by liability insurance.

54.972 History History: 1991 a. 246; 2005 a. 253; 2005 a. 387 s. 565; Stats. 2005 s. 54.972.

54.974 54.974 Declination, resignation, incapacity, death or removal of custodial trustee, designation of successor custodial trustee.

54.974(1) (1) Before accepting the custodial trust property, a person designated as custodial trustee may decline to serve by notifying the person who made the designation, the transferor or the transferor’s legal representative. If an event giving rise to a transfer has not occurred, the substitute custodial trustee designated under s. 54.954 becomes the custodial trustee, or, if a substitute custodial trustee has not been designated, the person who made the designation may designate a substitute custodial trustee pursuant to s. 54.954. In other cases, the transferor or the transferor’s legal representative may designate a substitute custodial trustee.

54.974(2) (2) A custodial trustee who has accepted the custodial trust property may resign by doing all of the following:

54.974(2)(a) (a) Delivering written notice to a successor custodial trustee, if any, the beneficiary and, if the beneficiary is incapacitated, to the beneficiary’s conservator or guardian of the estate, if any.

54.974(2)(b) (b) Transferring or registering, or recording an appropriate instrument relating to, the custodial trust property, in the name of, and delivering the records to, the successor custodial trustee identified under sub. (3).

54.974(3) (3) If a custodial trustee or successor custodial trustee is ineligible, resigns, dies or becomes incapacitated, the successor designated under s. 54.952 (7) or 54.954 becomes custodial trustee. If there is no effective provision for a successor, the beneficiary, if not incapacitated, may designate a successor custodial trustee. If the beneficiary is incapacitated or fails to act within 90 days after the ineligibility, resignation, death or incapacity of the custodial trustee, the beneficiary’s conservator or guardian of the estate becomes successor custodial trustee. If the beneficiary does not have a conservator or a guardian of the estate, or the conservator or guardian of the estate fails to act, the resigning custodial trustee may designate a successor custodial trustee.

54.974(4) (4) If a successor custodial trustee is not designated pursuant to sub. (3), the transferor, the legal representative of the transferor or of the custodial trustee, an adult member of the beneficiary’s family, the guardian of the person of the beneficiary, a person interested in the custodial trust property or a person interested in the welfare of the beneficiary may petition the court to designate a successor custodial trustee.

54.974(5) (5) A custodial trustee who declines to serve or resigns, or the legal representative of a deceased or incapacitated custodial trustee, as soon as practicable, shall put the custodial trust property and records in the possession and control of the successor custodial trustee. The successor custodial trustee may enforce the obligation to deliver custodial trust property and records and becomes responsible for each item as received.

54.974(6) (6) A beneficiary, the beneficiary’s conservator, an adult member of the beneficiary’s family, the beneficiary’s guardian, a person interested in the custodial trust property or a person interested in the welfare of the beneficiary may petition the court to remove the custodial trustee for cause and designate a successor custodial trustee, to require the custodial trustee to furnish a bond or other security for the faithful performance of fiduciary duties or for other appropriate relief.

54.974 History History: 1991 a. 246; 2005 a. 387 s. 566; Stats. 2005 s. 54.974.

54.976 54.976 Expenses, compensation and bond of custodial trustee. Except as otherwise provided in the instrument creating the custodial trust, in an agreement with the beneficiary or by court order, all of the following apply to a custodial trustee:

54.976(1) (1) A custodial trustee is entitled to reimbursement from custodial trust property for reasonable expenses incurred in the performance of fiduciary services.

54.976(2) (2) A custodial trustee has a noncumulative election, to be made no later than 6 months after the end of each calendar year, to charge a reasonable compensation for fiduciary services performed during that year.

54.976(3) (3) A custodial trustee need not furnish a bond or other security for the faithful performance of fiduciary duties.

54.976 History History: 1991 a. 246; 2005 a. 387 s. 567; Stats. 2005 s. 54.976.

54.978 54.978 Reporting and accounting by custodial trustee; determination of liability of custodial trustee.

54.978(1) (1) 

54.978(1)(a) (a) Upon the acceptance of custodial trust property, the custodial trustee shall provide a written statement describing the custodial trust property and shall thereafter provide a written statement of the administration of the custodial trust property at all of the following times:

54.978(1)(a)1. 1. Once each year.

54.978(1)(a)2. 2. Upon request at reasonable times by the beneficiary or the beneficiary’s legal representative.

54.978(1)(a)3. 3. Upon resignation or removal of the custodial trustee.

54.978(1)(a)4. 4. Upon termination of the custodial trust.

54.978(1)(b) (b) The statements under par. (a) must be provided to the beneficiary or to the beneficiary’s legal representative, if any.

54.978(1)(c) (c) Upon termination of the beneficiary’s interest, the custodial trustee shall furnish a current statement to the person to whom the custodial trust property is to be delivered.

54.978(2) (2) A beneficiary, the beneficiary’s legal representative, an adult member of the beneficiary’s family, a person interested in the custodial trust property or a person interested in the welfare of the beneficiary may petition the court for an accounting by the custodial trustee or the custodial trustee’s legal representative.

54.978(3) (3) A successor custodial trustee may petition the court for an accounting by a predecessor custodial trustee.

54.978(4) (4) In an action or proceeding under this subchapter or in any other proceeding, the court may require or permit the custodial trustee or the custodial trustee’s legal representative to account. The custodial trustee or the custodial trustee’s legal representative may petition the court for approval of final accounts.

54.978(5) (5) If a custodial trustee is removed, the court shall require an accounting and order delivery of the custodial trust property and records to the successor custodial trustee and the execution of all instruments required for transfer of the custodial trust property.

54.978(6) (6) On petition of the custodial trustee or any person who could petition for an accounting, the court, after notice to interested persons, may issue instructions to the custodial trustee or review the propriety of the acts of a custodial trustee or the reasonableness of compensation determined by the custodial trustee for the services of the custodial trustee or others.

54.978 History History: 1991 a. 246; 2005 a. 387 s. 568; Stats. 2005 s. 54.978.

54.980 54.980 Limitations of action against custodial trustee.

54.980(1) (1) Except as provided in sub. (3), unless previously barred by adjudication, consent or limitation, a claim for relief against a custodial trustee for accounting or breach of duty is barred as to a beneficiary, a person to whom custodial trust property is to be paid or delivered or the legal representative of an incapacitated or deceased beneficiary or payee who meets one of the following conditions: