38-620. Same; portion of earnings to be set aside in trust fund or savings plan; appointment of trustee; requirements of trust fund; fiduciary relationship established.
38-620
38-620. Same; portion of earnings to be set aside intrust fund or savings plan; appointment of trustee; requirements of trust fund;fiduciary relationship established.(a) A parent or guardian, as the case may be, entitled tothe physical custody,care and control of a minor child who enters into a contract of a typedescribed inK.S.A. 38-618, and amendments thereto, shall provide a certified copy of theminorchild's birthcertificateindicating the minor child's minority to the other party or parties to thecontract,and in addition, in the case of a guardian, a certified copy of the courtdocument appointing the person as the minor child's legal guardian.
(b) (1) Notwithstanding any other statute, in an order approving a minorchild'scontract of a type described in K.S.A. 38-618, and amendments thereto, thecourtshall require that 15% ofthe minor child's gross earnings pursuant to the contract be set aside by theminor child'semployer and preserved for the benefit of the minor child, either in a trustfund orother savings plan approved by the district court.
(2) The district court shall require that at least one parent or legalguardianentitled to the physical custody, care and control of the minor child at thetimethe order is issued be appointed as trustee of the funds ordered to be setaside for the benefit of the minor child, unless the district court shalldetermine thatappointment of a different individual, individuals, entity or entities astrustee or trustees is required in the best interest of the minor child.
(3) The trustee or trustees of the funds ordered to be set aside shallpromptly provide the minor child's employer with the name, address andtelephonenumber of the financial institution where the funds will be held, the name ofthe account, the number of the account, the name of the minor childbeneficiary, thename of the trustee or trustees of the account and any additional informationneeded by the minor child's employer to deposit into the account the portion oftheminor child's gross earnings in accordance with the order.The trustee or trustees shall attach to the written statement a true andaccurate photocopy of any information received from the financial institutionconfirming the creation of the account, such as an account agreement, accountterms, passbook or other similar writings.
(4) The minor child's employer shall deposit or disburse the funds asrequired bythe order within 15 business days of receiving the order and receiving from thetrustee or trustees the account information required by this section.Notwithstanding any other statute, pending receipt of the trustee's statement,the minor's employer shall hold for the benefit of the minor the percentageordered by the court of the minor's gross earnings pursuant to the contract.
(5) When making the initial deposit of funds pursuant to the order, theminor child's employer shall provide the financial institution with a copy oftheorder.
(6) Once the minor child's employer deposits the set aside funds into atrustfund or other savings plan approved by the district court, the minor child'semployer shallhave no further obligation or duty to monitor or account for the funds. Thetrustee or trustees of the trust fund or other savings plan shall be the onlyindividual, individuals, entity or entities with the obligation or duty tomonitor and account for those funds once they have been deposited by theminor child's employer.The trustee or trustees shall do an annual accounting of the funds held intrust, inan account or other savings plan, in accordance with K.S.A. 59-1606, andamendments thereto.
(7) The district court shall have continuing jurisdiction over the trust fundor othersavings plan established pursuant to the order and may at any time, on goodcause shown, order that the trust fund or other savings plan be amended orterminated, notwithstanding the provisions of the declaration of trust or othersavings plan. If the beneficiary is a minor child, an order amending orterminating a trust fund or other savingsplan may be made only after reasonable notice to the beneficiary, to the parentor guardian, if any, and to the trustee or trustees of the funds, withopportunity for all parties to appear and beheard.
(8) The trustee or trustees of the funds ordered to be set aside shallpromptly notify the minor child's employer in writing of any change in factsthataffect the employer's obligation or ability to set aside the funds inaccordance with the order, including, but not limited to, a change of financialinstitution or account number or the existence of a new or amended order issuedpursuant to paragraph (b)(7) amending or terminating the employer'sobligationsunder the original order. The written notification shall include theinformationset forth in paragraph(b)(3) and shall be accompanied by a true and accurate photocopy of the new oramended order.
(9) A parent or legal guardian, as the case may be, entitled to the physicalcustody, care and control of the minor child, the minor child through aguardian ad litem or the trustee or trustees, may at any time petition thecourt torequest an increase in the percentage of gross earnings that are set aside forthe benefit of the minor child.
(c) (1) Notwithstanding any other statute, for any minor child's contractof atype described in K.S.A. 38-618, and amendments thereto, that is not beingsubmitted for approval by thedistrict court pursuant to K.S.A. 38-618, and amendments thereto, or for whichthedistrictcourt has issued a finalorderdenying approval, 15% of the minor child's gross earnings pursuant to thecontractshall be set aside by the minor child's employer either in a trust fund orothersavings plan and preserved for the benefit of the minor child in accordancewithK.S.A. 38-621, and amendments thereto.At least one parent or legal guardian, as the case may be, entitled to thephysical custody, care and control of the minor, shall be the trustee of thefunds set aside for the benefit of the minor, unless the court, upon petitionby the parent or legal guardian, the minor, through the minor child's guardianadlitem, or the trustee or trustees of the trust, shall determine thatappointment of a different individual, individuals, entity or entities astrustee or trustees is required in the best interest of the minor.
(2) A parent or guardian, as the case may be, entitled to the physicalcustody, care and control of the minor child, shall promptly provide the minorchild'semployer with a true and accurate photocopy of the trustee's statement andattachments pursuant to subsection (c) of K.S.A. 38-621, and amendmentsthereto,and in addition, in thecase of a guardian, a certified copy of the district court document appointingtheperson as the minor child's legal guardian.
(3) The minor child's employer shall deposit 15% of the minor child's grossearningspursuant to the contract within 15 business days of receiving the trustee'sstatement and attachments pursuant to subsection (c) of K.S.A. 38-621, andamendments thereto, or if thedistrict court denies approval of the contract, within 15 business days ofreceiving afinal order denying approval of the contract. Notwithstanding any otherstatute, pending receipt of the trustee's statement and attachments or thefinal district court order, the minor child's employer shall hold for thebenefit of the minor childthe 15% of the minor child's gross earnings pursuant to the contract.
(4) Once the minor child's employer deposits the set aside funds into a trustfundor other savings plan pursuant to K.S.A. 38-621, and amendments thereto, theminorchild's employer shallhave nofurther obligation or duty to monitor or account for the funds. The trustee ortrustees of the trust fund or other savings plan shall be the only individual,individuals, entity or entities with the obligation or duty to monitor andaccount for these funds once they have been deposited by the minor child'semployer.The trustee or trustees shall do an annual accounting of the funds held intrust, in an account or other savings plan, in accordance withK.S.A. 59-1606, and amendments thereto.
(5) The district court, in any county in which the minorchild resides or in which the trust fund or other savings plan is established,at any time, on good cause shown, may order that the trust fundor othersavings plan be amended or terminated, notwithstanding the provisions of thedeclaration of trust or other savings plan upon petition by the parent or legalguardian, the minor through a guardian ad litem or the trustee or trustees. Ifthe beneficiary is a minorchild,an order amending or terminating atrust fund or other savings plan may be made only after reasonable notice tothe beneficiary, to the parent or guardian, if any, and to the trustee ortrustees of the funds, with opportunity forall parties to appear and be heard.
(6) A parent or guardian, entitled to the physical custody, care and controlof the minor child, shall promptly notify the minor child's employer in writingof anychange in facts that affect the employer's obligation or ability to set asidefunds for the benefit of the minor child in accordance with this section,including,but not limited to, a change of financial institution or account number or theexistence of a new or amended order issued pursuant to paragraph (c)(5)amendingor terminating the employer's obligations under this section. The writtennotification shall be accompanied by a true and accurate photocopy of thetrustee's statement and attachments pursuant to subsection (c) of K.S.A.38-621, and amendments thereto, ora true and accurate photocopy of the new or amended order.
(d) Where a parent or guardian is entitled to the physical custody, care andcontrol of a minor child who enters into a contract of a type described inK.S.A. 38-618,and amendments thereto, the relationship between the parent or guardian and theminor child is afiduciaryrelationship that is governed by the law of trust, whether or not a districtcourt hasissued a formal order to that effect. With respect to all earnings andaccumulations of the minor child under the contract, the parent or guardianshall payall liabilities incurred by the minor child under the contract, including, butnotlimited to, payments for taxes on all earnings, including taxes on the amountsset aside under subsections (b) and (c) of this section, and payments forpersonal or professional services rendered to the minor child or the businessrelatedto the contract.Nothing in this subdivision shall be construed to alter any other existingresponsibilities of a parent or legal guardian to provide for the support of aminor child.
History: L. 2000, ch. 174, § 6; July 1.