An increasingly common issue faced by divorcing spouses, as well as family law attorneys, is the treatment and disposition of custodial accounts and 529 accounts for the parties' children. Questions arise as to how the accounts will be distributed and what will happen to the accounts after the parties divorce. In the recent case of Brooks v. Brooks, __ A.3d __, 2020 PA Super. 66 (March 16, 2020), the Pennsylvania Superior Court addressed the issue of 529 accounts and custodial accounts in relation to marital settlement agreements.

The pertinent facts of the Brooks matter are as follows: David Brooks (the husband) and Gail Brooks (the wife) entered into a marital settlement agreement. Contained in the agreement was the treatment of 10 college savings accounts established by the parties for their three children. Seven of the accounts "were created in accordance with the Pennsylvania Uniform Transfers to Minors Act (PUTMA accounts) and the other three are qualified tuition plans established pursuant to 26 U.S.C. Section 529 (529 accounts)." The marital settlement agreement provided: "As the custodian of these college savings accounts, in strict accordance with all applicable laws/regulations governing 'custodial accounts', in a fiduciary capacity, the husband shall have the right to manage the college savings accounts in his best, good faith, financial discretion." According to the opinion, the husband also agreed to supply the wife with complete account statements no later than Jan. 15 and July 15 of each year that the accounts existed.