PR 07215.007 Colorado
A. PR 00-025 Purchase of Property by Representative Payees On Behalf of Minor Children
DATE: January 8, 1999
In Region VIII (Denver), the States of Colorado, North Dakota, South Dakota, Montana, Wyoming, and Utah do not prohibit a minor from holding title to real or personal property, or restrict a minor's ability to do so.
Per your request, this memorandum addresses whether the laws of Colorado, North Dakota, South Dakota, Montana, Wyoming, and Utah:
(1) permit a minor to hold title to real property or personal property, such as an automobile;
(2) restrict a minor's ability to hold title to property, based on age of the minor or the type of property;
(3) impose requirements on how the property of a minor must be titled; and
(4) state how property should be titled to reflect a minor's interest if the property cannot be titled in the minor's name.
Based on our review of the Colorado Revised Statutes, Colorado law does not prohibit a minor from holding title to real or personal property, nor does it restrict a minor's ability to do so. We note, in this regard, that Colorado law permits "any minor of the age of sixteen years or over" to "contract for insurance upon his own property or liabilities," C.R.S.A. § 10-4104 (emphasis added), even though the age of majority in Colorado is eighteen. C.R.S.A. § 13-22-101.
"Custodial property" may be created under Colorado law by titling the property in the name of an adult "as custodian for (name of minor) under the 'Colorado Uniform Transfers to Minors Act.'" C.R.S.A. § 11-50-110. More specifically, C.R.S.A. § 1150-110 provides that:
An interest in real property is recorded in the name of the transferor, an adult other than the transferor, or a trust company, followed in substance by the words: "as custodian for (name of minor) under the 'Colorado Uniform Transfers to Minors Act;' or
A certificate of title issued by a department or agency of a state or of the United States which evidences title to tangible personal property is either:
(I) Issued in the name of the transferor, an adult other than the transferor, or a trust company, followed in substance by the words: "as custodian for (name of minor) under the 'Colorado Uniform Transfers to Minors Act;' or
(II) Delivered to an adult other than the transferor or to a trust company, endorsed to that person, followed in substance by the words: "as custodian for (name of minor) under the 'Colorado Uniform Transfers to Minors Act.
C.R.S.A. §§ 11-50-110(1)(e), (f).
In caring for custodial property, a custodian is required to do the following: to take control of custodial property; to register or record title to custodial property, if appropriate; and, to collect hold, manage, invest, and reinvest custodial property. C.R.S.A. § 11-50-113. A custodian is also required to keep custodial property separate and distinct from all other property "in a manner sufficient to identify it clearly as custodial property of the minor;" to keep records of all transactions with respect to custodial property; to make those records available for inspection at reasonable intervals by a parent or legal representative of the minor, or by the minor if the minor has attained the age of fourteen. Id. "In dealing with custodial property, a custodian shall observe the standard of care that would be observed by a prudent person dealing with the property of another." Id. "If a custodian has a special skill or expertise or is named custodian on the basis of representations of a special skill or expertise, the custodian shall use that skill or expertise." Id. A custodian has "all the rights, powers, and authority over custodial property that unmarried adult owners have over their own property, but a custodian may exercise those rights, powers, and authority in that capacity only." C.R.S.A. § 11-50-113. A custodian must transfer the custodial property to the minor when the minor attains the age of twenty-one, or to the minor's estate upon the death of the minor. C.R.S.A. § 11-50-121.