gravitynote_8729
New Member
- Jurisdiction
- Colorado
Two years ago, my wife's aunt unfortunately passed away. There was no will, but she had listed our children (ages 2 and 4 at the time) as beneficiaries to her accounts. Prior to this, we had already set up a UTMA account in a major brokerage firm for each of our children and had contributed to it.
My wife's uncle is managing the estate. Unfortunately, there was no trust set up, so her retirement accounts were dispersed as checks directly from each institution where she had saved, so cash inheritance directly to our children. The total amount was over $50k for each child.
Once we began receiving the checks, we immediately deposited them into the UTMA account respectively (again where we had already contributed). Unfortunately, the last institution, which was one of the smaller amounts, would not send a check unless we could "prove financial guardianship" of our children. They stated that even though my wife and I are the biological parents of our children, and we were the custodians of their UTMA accounts, this would not suffice - they needed "proof" and suggested we go to the local court to obtain this proof of financial guardianship.
We engaged with the probate office in early 2021 asking what we needed to do to provide this proof and they stated we needed to file for conservatorship. As we have zero experience in this matter, we went along with this recommendation, filling out a substantial amount of paperwork then having a hearing with the magistrate. This seemed very odd to us just to get the funds from the last banking institution deposited into our kids UTMA accounts. Unfortunately, our hearing was over zoom thanks to COVID - the magistrate was wearing a mask and we had two children making noise in the background, so we couldn't really hear or understand what we were getting ourselves into. When we exited the Zoom meeting, we both looked at each other and asked "what did we just agree to?"
We reached back to the probate office to ask why this was necessary, and to try to get clarity on what just happened and what we were responsible for. We were told we needed to fill out a report annually on the childrens birthday and the court would request additional information if necessary. We left our home for the summer to spend on the east coast with family, and orders from the court were sent to our home via USPS stating we needed to submit a Financial Plan to the court. We generally do not forward our mail during this time as we never receive anything important via snail mail. Anything important we sign up for electronic notifications, so we missed a court deadline because we never received the orders in time.
Once we missed the deadline, we pleaded with the probate office and were able to get the deadline extended. Next, we were reviewing the Financial Plan we had to fill out, which was for us to state any expected expenses we would be withdrawing from the kids UTMA accounts, things like tuition. The document was not clear to us (again, we have zero legal background), so again we called the probate office for clarification. Over the phone (and my father in law was sitting in with us during this call and can confirm), they informed us that this document was to be filled out right now, one time, for every expected expense until they turn 21 in annual terms. This seemed VERY odd to us, so we clarified, and again they said this was correct and that we should overestimate if we weren't sure. Reminder: our kids were 2 and 4 at the time. We followed the probate office's recommendation, only later to find out that this was grossly incorrect.
Mid 2021 we received an order that the magistrate was concerned with this filing and we were to set up another hearing, which we did. In the next hearing (a month later), the magistrate ordered us to meet with the Protective Proceedings Monitors to discuss options, this was scheduled for November 2021. From that meeting it was determined that the conservatorship was not necessary but the money needed to be placed in a restricted account with an annual report filed confirming the amount in the fund and that we are managing our children's funds appropriately and we were told we'd need to submit an account statement to the court. There was no mention of deadline to do so, so my wife assumed since it was so late in the year she should wait until year end for a comprehensive report. At this point, every time there was a change in anything we would receive multiple letters in the mail from the court (the pile of paperwork was getting overwhelming). The court sent another letter that we thought was informational, but admittedly did not read thoroughly and there was one more deadline that we missed for filling out more paperwork. This was the only order that we were actually home to receive, and did in fact miss this deadline due to fatigue in the matter (we're going on 1.5 years at this time).
Next, the magistrate of course saw this as a red flag. Due to this, and the missed deadline, the magistrate appointed a special conservator to our case (a local lawyer) to review our behavior and make sure the funds we received were all deposited into the UTMA accounts. Of course, the funds were, and we immediately provided all documentation proving this to the special conservator. Two months later, the special conservator requested the same documentation again (they lost it), and had to request an extension to the court themselves because of their delay. Ultimately, after months of waiting, the special conservator found that we were just inexperienced in legal matters and found no misconduct. The special conservator had been in contact with a low level contact from our financial institution, which informed them that they could restrict the UTMA accounts, which she then informed the magistrate. The magistrate then created a new set of orders for us to follow, which were that we needed to convert the UTMA accounts to a restricted account. We tried for 3 weeks to first find the contact the special conservator was working with (the special conservator would not respond to our request for information), and when we finally did get in touch with the primary financial contact, they informed us also that they could do this. We submitted the most recent order to the financial institution and the required form to be executed by the bank. After several more weeks and after speaking with their legal team, our contact sent us an email stating they do not restrict accounts and will not do this, despite court orders.
We sent this information to the probate office, who informed the magistrate, who created a new order stating that if our chosen institution, who we've been with for years, would not follow court orders we need to move the funds into a new institution who would. We spent more considerable time calling additional institutions, only to be told the exact same thing (they would not restrict accounts). Unfortunately, since we were not customers of the other institutions, they would not tell us in writing.
At this point, we decided that we needed legal representation ourselves. We recently hired a lawyer, who reviewed our case and said "this is overreach by the court, it should have never gotten this far." Unfortunately, because of the missed deadline and the expenses report we filled out and submitted (again at the recommendation of the probate office), the court is not willing to remove the order. The latest request from us to remove this was denied by the court, stating that our statement that we called other institutions and were told the same thing was not credible.
Finally, our lawyer requested a status conference, which was granted but no date has been set and our lawyer is now going to subpoena the financial institution to appear in court.
At this point we feel so defeated. We were not happy that our kids were listed as beneficiaries without our consent in the first place, and now nearly two years later and almost $50k in taxes and expenses out of our own retirement savings, (we paid our kids' taxes on the inheritance out of our own retirement accounts) we just feel stuck and do not know what to do. I feel that our lawyer is ok, but want to see if there are any other options for us. From our perspective, we have been chasing our tails for nearly two years trying to follow orders that we physically cannot as the court is ordering large institutions to change the way they do business. Also from our perspective, the court is stating they're doing this to "protect our kids' inheritance", but their inheritance was being managed by us just fine - until the court got involved.
My wife's uncle is managing the estate. Unfortunately, there was no trust set up, so her retirement accounts were dispersed as checks directly from each institution where she had saved, so cash inheritance directly to our children. The total amount was over $50k for each child.
Once we began receiving the checks, we immediately deposited them into the UTMA account respectively (again where we had already contributed). Unfortunately, the last institution, which was one of the smaller amounts, would not send a check unless we could "prove financial guardianship" of our children. They stated that even though my wife and I are the biological parents of our children, and we were the custodians of their UTMA accounts, this would not suffice - they needed "proof" and suggested we go to the local court to obtain this proof of financial guardianship.
We engaged with the probate office in early 2021 asking what we needed to do to provide this proof and they stated we needed to file for conservatorship. As we have zero experience in this matter, we went along with this recommendation, filling out a substantial amount of paperwork then having a hearing with the magistrate. This seemed very odd to us just to get the funds from the last banking institution deposited into our kids UTMA accounts. Unfortunately, our hearing was over zoom thanks to COVID - the magistrate was wearing a mask and we had two children making noise in the background, so we couldn't really hear or understand what we were getting ourselves into. When we exited the Zoom meeting, we both looked at each other and asked "what did we just agree to?"
We reached back to the probate office to ask why this was necessary, and to try to get clarity on what just happened and what we were responsible for. We were told we needed to fill out a report annually on the childrens birthday and the court would request additional information if necessary. We left our home for the summer to spend on the east coast with family, and orders from the court were sent to our home via USPS stating we needed to submit a Financial Plan to the court. We generally do not forward our mail during this time as we never receive anything important via snail mail. Anything important we sign up for electronic notifications, so we missed a court deadline because we never received the orders in time.
Once we missed the deadline, we pleaded with the probate office and were able to get the deadline extended. Next, we were reviewing the Financial Plan we had to fill out, which was for us to state any expected expenses we would be withdrawing from the kids UTMA accounts, things like tuition. The document was not clear to us (again, we have zero legal background), so again we called the probate office for clarification. Over the phone (and my father in law was sitting in with us during this call and can confirm), they informed us that this document was to be filled out right now, one time, for every expected expense until they turn 21 in annual terms. This seemed VERY odd to us, so we clarified, and again they said this was correct and that we should overestimate if we weren't sure. Reminder: our kids were 2 and 4 at the time. We followed the probate office's recommendation, only later to find out that this was grossly incorrect.
Mid 2021 we received an order that the magistrate was concerned with this filing and we were to set up another hearing, which we did. In the next hearing (a month later), the magistrate ordered us to meet with the Protective Proceedings Monitors to discuss options, this was scheduled for November 2021. From that meeting it was determined that the conservatorship was not necessary but the money needed to be placed in a restricted account with an annual report filed confirming the amount in the fund and that we are managing our children's funds appropriately and we were told we'd need to submit an account statement to the court. There was no mention of deadline to do so, so my wife assumed since it was so late in the year she should wait until year end for a comprehensive report. At this point, every time there was a change in anything we would receive multiple letters in the mail from the court (the pile of paperwork was getting overwhelming). The court sent another letter that we thought was informational, but admittedly did not read thoroughly and there was one more deadline that we missed for filling out more paperwork. This was the only order that we were actually home to receive, and did in fact miss this deadline due to fatigue in the matter (we're going on 1.5 years at this time).
Next, the magistrate of course saw this as a red flag. Due to this, and the missed deadline, the magistrate appointed a special conservator to our case (a local lawyer) to review our behavior and make sure the funds we received were all deposited into the UTMA accounts. Of course, the funds were, and we immediately provided all documentation proving this to the special conservator. Two months later, the special conservator requested the same documentation again (they lost it), and had to request an extension to the court themselves because of their delay. Ultimately, after months of waiting, the special conservator found that we were just inexperienced in legal matters and found no misconduct. The special conservator had been in contact with a low level contact from our financial institution, which informed them that they could restrict the UTMA accounts, which she then informed the magistrate. The magistrate then created a new set of orders for us to follow, which were that we needed to convert the UTMA accounts to a restricted account. We tried for 3 weeks to first find the contact the special conservator was working with (the special conservator would not respond to our request for information), and when we finally did get in touch with the primary financial contact, they informed us also that they could do this. We submitted the most recent order to the financial institution and the required form to be executed by the bank. After several more weeks and after speaking with their legal team, our contact sent us an email stating they do not restrict accounts and will not do this, despite court orders.
We sent this information to the probate office, who informed the magistrate, who created a new order stating that if our chosen institution, who we've been with for years, would not follow court orders we need to move the funds into a new institution who would. We spent more considerable time calling additional institutions, only to be told the exact same thing (they would not restrict accounts). Unfortunately, since we were not customers of the other institutions, they would not tell us in writing.
At this point, we decided that we needed legal representation ourselves. We recently hired a lawyer, who reviewed our case and said "this is overreach by the court, it should have never gotten this far." Unfortunately, because of the missed deadline and the expenses report we filled out and submitted (again at the recommendation of the probate office), the court is not willing to remove the order. The latest request from us to remove this was denied by the court, stating that our statement that we called other institutions and were told the same thing was not credible.
Finally, our lawyer requested a status conference, which was granted but no date has been set and our lawyer is now going to subpoena the financial institution to appear in court.
At this point we feel so defeated. We were not happy that our kids were listed as beneficiaries without our consent in the first place, and now nearly two years later and almost $50k in taxes and expenses out of our own retirement savings, (we paid our kids' taxes on the inheritance out of our own retirement accounts) we just feel stuck and do not know what to do. I feel that our lawyer is ok, but want to see if there are any other options for us. From our perspective, we have been chasing our tails for nearly two years trying to follow orders that we physically cannot as the court is ordering large institutions to change the way they do business. Also from our perspective, the court is stating they're doing this to "protect our kids' inheritance", but their inheritance was being managed by us just fine - until the court got involved.
