Children Demand Return of Custodial Funds from Parent

If you're spending your childrens' money, you are probably breaking the law.  Parents often overstep their authority when dealing with their children’s money as shown in this case:  Werner v. Werner 2016 PA Super 2210.

Mother was custodian for two accounts for the benefit of her daughters under the Pennsylvania Uniform Transfer to Minors Act, 20 Pa. C.S.A. §5301 et. seq. ("PUTMA"). The original amount in the accounts when they were created in the mid 1990’s was $125,000.   Mother withdrew the funds from the PUTMA accounts in 2010 when they were worth $252,688.90 and purchased a house which she titled in her name alone.  When the house was purchased the daughters were 15 and 16.

In 2013 the daughters began a proceeding against mother asking for an accounting and alleging that she had violated her duties as custodian by misappropriating the daughters’ property.  The daughters also sought payment of their attorneys’ fees.

The Orphans’ Court ruled that mother violated her duty as custodian under PUTMA and as damages the daughters were entitled to receive the entire proceeds from the sale of the house - $507,000.  The request for attorneys' fees was denied.  The Superior Court upheld the Orphan’s Court.

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