This memorandum responds to your request for our opinion regarding the ability of
a minor to hold title to certain types of property and how the property must be titled
in the State of Louisiana. Specifically, you asked us to address the following:
1. Whether Louisiana permits a minor to hold title to real or personal property?
2. Whether Louisiana restricts a minor by age and/or by the type of property a minor
3. Whether Louisiana permits title to be recorded in the minor's name?
4. Whether Louisiana has a preferred method for titling property to a minor to protect
the minor's interest in said property and satisfy SSA's regulatory requirements?
Your questions arise as a result of minors receiving retroactive benefit payments
from terminated SSI childhood disability cases. In summary, we are of the opinion
that a minor may hold title to real or personal property in Louisiana. A contract
with an unemancipated minor for the purchase of real or personal property may be rescinded
by the minor, unless the purpose of the contract is for necessaries, education, or
the minor's business. Except where emancipation of the minor occurred through administration,
an emancipated minor is capable of acquiring real property in the minor's legal name.
Title to property is recorded with the minor's full name.
The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (Act),
requires the establishment of a bank account to maintain retroactive SSI benefits
that exceed six times the Federal Benefit Rate, and smaller amounts are to be placed
in an account when established. Specifically, SSI funds are to be used for education
or job skill training, personal needs assistance, housing modifications, special equipment,
medical treatment, therapy, rehabilitation, other items or services related to the
child's impairment that SSA deems appropriate. 20 C.F.R. § 416.640(e)(2). With the
purpose of SSI and the Act in mind, a minor has legally imposed restrictions on his/her
ability to acquire property. The regulations at 20 C.F.R. § 416.640, set out the use
of benefit payments.1/
Louisiana statutory law does not specifically prohibit a minor from acquiring or selling
property. A minor2/ lacks capacity to enter into a contract. See La. Civ. Code art. 1918 (West 1997) (unemancipated minors have no capacity to contract).
As such, a contract for the purchase of real or personal property with a minor is
null and rescindable unless the minor has been fully emancipated,3 or the purpose
of the contract is to provide a necessary for his/her support, education or for his/her
business. La. Civ. Code Ann. art 2029 (West 1997) (nullity of contracts); La. Civ.
Code Ann. art 1919 (West 1997) (contract without legal capacity is relatively null);
La. Civ. Code Ann. arts. 1922-23 (West 1997) (exceptions to contracts with minors).
An emancipated minor with only power of administration cannot alienate, affect or
mortgage immovable property without authorization of the court. La. Civ. Code Ann.
art. 373 (West 1997). However, a minor may "subscribe for, hold, own, transfer, withdraw,
and surrender shares and savings accounts in associations without authorization or
intervention of their tutors, parents, or any other persons, and shall be considered
in such matters as if they were the full age of majority." La. Rev. Stat. Ann. § 763
(West 1997). This section does not apply when the property is testamentary or acquired
Similarly, Louisiana case law reveals that contracts with minors are "relatively"
null and may be rescinded at the minor's request, except if the purpose of the contract
is to provide the minor with necessities for support, education, or for the purpose
related to his/her business. See Deville v. Federal Say. Bank, 635 So. 2d 195, 196 (La. 1994); see also La. Civ. Code, art. 2031 (West 1997) (relative nullity of contracts). Minors
can also annul contracts with creditors who deal with tutors4/ without authorization
from the court. Deville, 635 So. 2d. at 198; see also Jim Walter Corp. v. Hunt, 183 So. 2d 91 (La. App.—1st Cir. 1965).
Two particular Louisiana cases offer direction regarding whether a minor may be able
to purchase real or personal property. In Harris v. Ward, the court held that the sale of an automobile to a minor, who was not emancipated,
was a relative nullity. 224 So. 2d 517, 521-22 (La. App.—2nd Cir. 1969). Although
the contract could be ratified, the right to rescind the contract belongs to the minor.
In La Porte v. Clesi. Inc., 197 So. 2d 419 (La. App.—4th Cir. 1967), two minors entered into a contract to purchase
a house, without their parents' knowledge. After being married, the minors could not
continue with the contract due to financial hardship. A suit to nullify and rescind
the contract was filed based on incapacity of the minors. Citing to La. Code Civ.
Proc. Ann., art 4501, the court stated that the parents were not authorized to purchase
property on behalf of the minors. The court held that the minors, at the time of the
contract, had no capacity to enter into the contract and, therefore, the contract
was null and void. Id.
Based on Louisiana statutes and case law, a minor is capable of holding title to property.
The ability to acquire property without complication is contingent on whether there
is an emancipated minor, the contract is for necessaries, education or business, or
an administrator is acting on behalf of the minor with court permission.
You asked whether there are any age or property restrictions in Louisiana. In light
of our research, Louisiana law does not restrict a minor per se from holding title
to real or personal property. We found no age restrictions for acquiring property.
Regarding the recordation of title for a mortgage held by a minor, a tutor has an
obligation to ensure that recordation of the mortgage record sets out the full name
of the minor and state the total value of the property consistent with the records
in the inventory filed during the tutorship proceeding. La. Code Civ. Pro. art. 4134
(West 1997). Property held in trust must identify payee in the instrument creating
the trust as the holder of the property for the beneficiary. 20 C.F.R. § 416.645.
1/A representative payee in receipt of beneficiary payments shall use the funds for
the current maintenance of the minor such as food, clothing, medical care and personal
comfort items. 20 C.F.R. § 416.640 (a). Two relevant limitations are that 1) the payee
may not be required to pay the debts of the minor, unless all current and reasonably
foreseeable needs of the minor are met; and 2) if past-due payments are required to
be placed in a dedicated account, "[d]edicated accounts may not be in the form of
certificates of deposit, mutual funds, stocks, bonds, or trusts." 20 C.F.R. § 416.640
The representative payee for the minor, who attempts to purchase real or personal
property with SSI funds, must provide an accounting to show how the purchase is consistent
with the purpose of the Act. See 20 C.F.R. § 416.665. The regulations do not prohibit the purchase of property to
conserve the funds, but the investment "must show clearly that the payee holds the
property in trust for the beneficiary." 20 C.F.R. § 416.645.
2/ La. Rev. Stat. Ann. § 751 (West 1997) defines a minor as an individual who has
not attained 18 years of age.
3/ Three ways to emancipate a minor is by 1) administration; 2) marriage; or 3) attaining
majority. La. Civ. Code Ann. art. 365 (West 1997).
4/ A tutor is "a person appointed or qualified by a court to act as guardian of a
minor's property or a person legally authorized to perform substantially the same
functions .... "La. Rev. Stat. Ann. § 751 (West 1997).