Vt. Stat. Ann. tit. 14, § 3226
Exemption of third person from liability
Redline — July 1, 2021 → current.View current text →
Current — June 1, 2022
As of July 1, 2021
A third person in good faith and without court order may act on the instructions of or otherwise deal with any person purporting to make a transfer or purporting to act in the capacity of a custodian and, in the absence of knowledge, is not responsible for determining:
A third person in good faith and without court order may act on the instructions of or otherwise deal with any person purporting to make a transfer or purporting to act in the capacity of a custodian and, in the absence of knowledge, is not responsible for determining:
(1) the validity of the purported custodian's designation;
(1) the validity of the purported custodian’s designation;
(2) the propriety of or the authority under this chapter for any act of the purported custodian;
(2) the propriety of or the authority under this chapter for any act of the purported custodian;
(3) the validity or propriety under this chapter of any instrument or instructions executed or given either by the person purporting to make a transfer or by the purported custodian; or
(3) the validity or propriety under this chapter of any instrument or instructions executed or given either by the person purporting to make a transfer or by the purported custodian; or
(4) the propriety of the application of any property of the minor delivered to the purported custodian. Added 2015, No. 7, § 1.
(4) the propriety of the application of any property of the minor delivered to the purported custodian.
OFFICIAL COMMENT
This section carries forward, but shortens and simplifies, Section 6 of the 1966 Act, with no substantive change intended. The 1966 revision permitted a 14-year old minor to appoint a successor custodian and specifically provided that third parties were entitled to rely on the appointment. Because this section refers to any custodian, and "custodian" is defined to include successor custodians (section 3211(5) of this chapter), a successor custodian appointed by the minor is included among those upon whom third parties may rely.
Similarly, because this section protects any third "person," it is not necessary to specify here or in section 3221(c) of this chapter that it extends to any "issuer, transfer agent, bank, life insurance company, broker, or other person or financial institution," as did the 1966 Act. See the definition of "person" in section 3211(12).
This section excludes from its protection persons with "knowledge" of the irregularity of a transaction, a concept not expressed but probably implied in Section 6 of the 1966 Act. See, e.g., State ex rel Paden v. Currel, 597 S.W.2d 167 (Mo. App. 1980) (disapproving the pledge of custodial property to secure a personal loan to the custodian).
Official source: Vermont General Assembly. Reproduced from public-domain Vermont statutes; confirm against the official source for the current text. Not legal advice.