Chapter 54

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:

54.980(1)(a) (a) Has received a final account or statement fully disclosing the matter unless an action or proceeding to assert the claim is commenced within 2 years after receipt of the final account or statement.

54.980(1)(b) (b) Who has not received a final account or statement fully disclosing the matter unless an action or proceeding to assert the claim is commenced within 3 years after the termination of the custodial trust.

54.980(2) (2) Except as provided in sub. (3), a claim for relief to recover from a custodial trustee for fraud, misrepresentation, concealment related to the final settlement of the custodial trust or concealment of the existence of the custodial trust is barred unless an action or proceeding to assert the claim is commenced within 5 years after the termination of the custodial trust.

54.980(3) (3) A claim for relief by the following claimants is not barred by this section except as follows:

54.980(3)(a) (a) For a minor, until the earlier of 2 years after the claimant becomes an adult or dies.

54.980(3)(b) (b) For an incapacitated adult, until the earliest of 2 years after the appointment of a conservator, the removal of the incapacity or the death of the claimant.

54.980(3)(c) (c) For an adult, now deceased, who was not incapacitated, until 2 years after the claimant’s death.

54.980 History History: 1991 a. 246; 2005 a. 387 s. 569; Stats. 2005 s. 54.980.

54.982 54.982 Distribution on termination.

54.982(1) (1) Upon termination of a custodial trust by the beneficiary or the beneficiary’s conservator or guardian of the estate, the custodial trustee shall transfer the unexpended custodial trust property as follows:

54.982(1)(a) (a) To the beneficiary, if not incapacitated or deceased.

54.982(1)(b) (b) To the conservator, guardian of the estate or other recipient designated by the court for an incapacitated beneficiary.

54.982(2) (2) Upon termination of a custodial trust by the beneficiary’s death, the custodial trustee shall distribute the unexpended custodial trust property in the following order:

54.982(2)(a) (a) As last directed in a writing signed by the deceased beneficiary while not incapacitated and received by the custodial trustee during the life of the deceased beneficiary.

54.982(2)(b) (b) To the survivor of multiple beneficiaries if survivorship is provided for pursuant to s. 54.960.

54.982(2)(c) (c) As designated in the instrument creating the custodial trust.

54.982(2)(d) (d) To the estate of the deceased beneficiary.

54.982(3) (3) If, when the custodial trust would otherwise terminate, the distributee is incapacitated, the custodial trust continues for the use and benefit of the distributee as beneficiary until the incapacity is removed or the custodial trust is otherwise terminated.

54.982(4) (4) Death of a beneficiary does not terminate the power of the custodial trustee to discharge obligations of the custodial trustee or beneficiary incurred before the termination of the custodial trust.

54.982 History History: 1991 a. 246; 2005 a. 387 s. 570; Stats. 2005 s. 54.982.

54.984 54.984 Methods and forms for creating custodial trusts.

54.984(1) (1) If a transaction, including a declaration with respect to or a transfer of specific property, otherwise satisfies applicable law, the criteria of s. 54.952 are satisfied by any of the following:

54.984(1)(a) (a) The execution and either delivery to the custodial trustee or recording of an instrument in substantially the following form:

Transfer under the Wisconsin

Uniform Custodial Trust Act

I, .... (name of transferor or name and representative capacity if a fiduciary), transfer to .... (name of trustee other than transferor), as custodial trustee for .... (name of beneficiary) as beneficiary and .... as distributee on termination of the trust in absence of direction by the beneficiary under the Wisconsin Uniform Custodial Trust Act, the following: (insert a description of the custodial trust property legally sufficient to identify and transfer each item of property).