Source: https://secure.ssa.gov/apps10/poms.nsf/lnx/1601820006
Timestamp: 2018-10-16 08:03:02
Document Index: 46452843

Matched Legal Cases: ['art 9', '§ 3900', '§ 3900', '§ 3901', '§ 3901', '§ 115', 'art 9']

SSA - POMS: PS 01820.006 - California - 11/24/2004
Effective Dates: 11/24/2004 - Present Previous | Next
PS 01820.006 California
A. PS 04-321 Attempt to Transfer Property Pursuant to the Uniform Transfers to Minors Act ("UTMA") for Violeta and Salvador M~, Respectively ~/~
The issue is whether a retroactive transfer of real property to two minor children to one custodian is a valid transfer of real property and sufficient to create custodial property pursuant to the Uniform Transfers to Minors Act (UTMA) under any state law.
The transfer in this case is not a valid UTMA transfer of real property because it did not comply with the legal requirements to establish a custodianship of the property. A valid custodianship must invoke the law of a particular state. The transfer documents did not invoke any particular state laws. Real property can only be transferred to one child under UTMA. The transfer of real property in this case was to two children which violated the UTMA. An additional document deficiency was the attempt to show the transfer occurred retroactively using the term "nunc pro tunc" which has no legal effect under California state law absent an order by a court of competent jurisdiction. No such court order was presented to SSA.
The transfer of property demonstrated by this case is invalid because it did not follow the requirements of the UTMA and applicable California state laws.
Violeta and Salvador M~ are children found disabled for SSI purposes. When SSA discovered in May 2003 that the children's father owned real property worth $15,000, the children's SSI benefits were suspended, retroactively to June 2001, on account of excess resources. The father subsequently submitted documents to SSA purporting a transfer of the real property to a custodian for the children pursuant to the Uniform Transfers to Minors Act ("UTMA"), "nunc pro tunc" May 1, 2001.
You requested assistance in determining the validity of the alleged property transfer under the laws of California. Specifically, you asked whether the documents submitted to SSA were sufficient to validly transfer real property and create custodial property pursuant to the UTMA. In addition, you asked if such a transfer could be made retroactive by using the words "nunc pro tunc." Finally, you asked at what age control of the property would pass to the above-named children, assuming the transfer were valid.
The documents submitted to the SSA did not invoke applicable California law, or the law of any other state; therefore, the transfer was not valid under the California Uniform Transfers to Minors Act.
The documents submitted to the SSA included a "Quitclaim Deed" apparently received by the Kern County Recorder on December 9, 2003, and two documents titled "Transfer of Property." Each of these documents purportedly transferred the interest of the transferor, Lionel M~, in certain real property to a custodian, Blanca G~, pursuant to the Uniform Transfers to Minors Act. The Quitclaim Deed stated that Ms. G~ was custodian for Violeta M~ and Salvador M~. Each Transfer of Property stated that Ms. G~ was custodian for one child or the other. The Quitclaim Deed was dated December 7, 2003, and each Transfer of Property was dated December 6, 2003; however, each of these documents also contained the words "nunc pro tunc" followed by a May 1, 2001 date.
In 1983, the Uniform Gifts to Minors Act ("UGMA") was revised and restated by the National Conference of Commissioners on Uniform State Laws as the Uniform Transfers to Minors Act. In 1984, the California Law Revision Commission recommended adoption of the UTMA. In response to the Commission's recommendation, the 1984 Legislature repealed the former UGMA and replaced it with a new Part 9 of Division 4 of the California Probate Code. See Cal. Prob. C. §§ 3900 et seq. (Stats. 1984, Chap. 243).
The law may be cited as the "California Uniform Transfers to Minors Act" (hereinafter the "California UTMA"). Cal. Prob. C. § 3900. The California UTMA establishes procedures whereby a person (the transferor) may transfer property (custodial property) to himself, an adult or a trust company (the custodian) for the benefit of a minor. See Cal. Prob. C. § 3901 (definitions). The California UTMA applies to any interest in property transferred under the Act and to the income and proceeds of that property. Cal. Prob. C. § 3901(f). The California UTMA applies to a transfer (1) if the transfer document under California Probate Code Section 3900 refers to the California UTMA, and (2) if, at the time of the transfer, the transferor, the minor or the custodian is a California resident or the custodial property is located in California. See, generally, B.E. Witkin, Summary of California Law (9th ed. 1987) § 115.
Here, the documents cited above invoked the UTMA, without specifying the California UTMA, or the law of any other state (California residents may elect application of another state's law if there is a nexus to the chosen state at the time of the transfer). However, the relevant provision of the California UTMA, Probate Code Section 3902, mandates that the transfer documents required under Probate Code Section 3909 refer to "this part" [Part 9 of Division 4 of the Probate Code], i.e. the California UTMA. For example, Probate Code Section 3909(a)(5) states that:
Custodial property is created and a transfer is made whenever . . . 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 California Uniform Transfers to Minors Act.'
Here, the Quitclaim Deed was apparently recorded, as required by California Probate Code Section 3909(a)(5). It is not apparent whether either of the documents titled "Transfer of Property" was recorded. The Law Revision Commission's Comment to Section 3909 states that paragraph 5 of subdivision (a) is the exclusive method for transfer of real property, and that the transfer must be recorded in the name of the custodian in order for the transfer to be an effective transfer.
Regardless, the California Law Revision Commission's Comment to Probate Code Section 3902 states that the creation of a custodianship must invoke the law of a particular state because of the form of the transfer required under subdivision (a) of Section 3909. This interpretation is consistent with the Comment accompanying the annotated edition of the UTMA, which indicates that the creation of a custodianship must invoke the law of a particular state. The purpose was to resolve uncertainties and conflicts-of-laws questions arising under UGMA because of nonuniformity in various states, which could also arise under the UTMA.
There are no published court decisions interpreting California Probate Code Section 3902. However, the California Law Revision Commission's Comment is persuasive authority that the transfer attempted here is invalid. Further, California Probate Code Section 3911, respecting the validity and effect of California UTMA transfers, makes no exception for failure to comply with section 3902.
Note that there appear to be other defects in the documents submitted to SSA which could also affect the validity of the transfer. Section 3910 of the California Probate Code provides that:
A transfer may be made only for one minor, and only one person may be the custodian. All custodial property held under this part by the same custodian for the benefit of the same minor constitutes a single custodianship.
Here, the Quitclaim Deed purportedly transferred the transferor's interest in real property in question to the custodian for both of the children. However, there are no published court decisions respecting California Probate Code Section 3910. Further, the Comment by the California Law Revision Commission respecting this provision of the California UTMA, and the Comment accompanying the annotated edition of the UTMA, merely emphasize the importance of a single custodian (rather than multiple custodians) for a single minor.
For the reasons stated above, it is our opinion that the attempted transfer is invalid because of failure to comply with the requirements of California Probate Code Sections 3902(a) and 3909(a)(5).
Because the attempted transfer is invalid, your questions about use of the words "nunc pro tunc" and age of majority are moot. However, you may wish to consider the following:
California Evidence Code Section 640 provides that a writing is presumed to have been truly dated. The phrase "nunc pro tunc" (lit., "now for then") is used in reference to an act to show that it has retroactive legal effect. Courts have inherent power to enter judgments and orders "nunc pro tunc." See, e.g., In re Estate of Pillsbury, 175 Cal. 454, 463, 166 P. 11 (1917). The use of the words "nunc pro tunc" has no legal effect absent an order by a court of competent jurisdiction.
Finally, California Probate Code Section 3920 provides that:
The custodian shall transfer in an appropriate manner the custodial property to the minor or to the minor's estate upon the earlier of the following:
(a) The minor's attainment of 18 years of age unless the time of transfer of the custodial property to the minor is delayed under Section 3920.5 to a time after the time the minor attains the age of 18 years.
(b) The time specified in the transfer pursuant to Section 3909 if the time of transfer of the custodial property to the minor is delayed under Section 3920.5 to a time after the time the minor attains the age of 18 years.
(c) The minor's death.
In this case, there was no indication that transfer was to be delayed until after each minor child's attainment of age 18. If the transfer were valid, the first child to attain age 18 could claim the entire property.
The attempted transfer is invalid because of failure to comply with the requirements of California Probate Code Sections 3902(a) and 3909(a)(5). If the transfers were valid, the first child to attain age 18 could claim the entire property. The use of the words "nunc pro tunc" has no legal effect absent an order by a court of competent jurisdiction.
http://policy.ssa.gov/poms.nsf/lnx/1601820006
PS 01820.006 - California - 11/24/2004
Rev:11/24/2004