Amended in Senate June 3, 2013

Amended in Assembly April 18, 2013

California Legislature—2013–14 Regular Session

Assembly Bill No. 533

Introduced by Assembly Member Ian Calderon

February 20, 2013

An act to amend begin delete Sections end delete begin insert Section end insert 6752 begin delete and 6753 end delete of the Family Code, relating to minors.

LEGISLATIVE COUNSEL’S DIGEST

AB 533, as amended, Ian Calderon. Artistic employment contracts: minors.

Existing law regulates certain contracts for artistic employment between an unemancipated minor and 3rd parties, including employment as an actor, dancer, musician, comedian, singer, stunt-person, voice-over artist, or sports player. Existing law requires the minor’s employer under one of these contracts to set aside 15% of the minor’s gross earnings, as specified, and provides for the establishment of a trust for the purpose of preserving for the minor a portion of the minor’s gross earnings, as defined.

This bill would exempt an employer of a minor under a contract as described above for services as an extra, background performer, or in a similar capacity from the requirement that the employer set aside 15% of the minor’s gross earnings in trust for the benefit of the minor. begin delete The bill would also correct related obsolete cross-references. end delete

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 6752 of the Family Code is amended to
read:

6752.  

(a) A parent or guardian entitled to the physical custody,
care, and control of a minor who enters into a contract of a type
described in Section 6750 shall provide a certified copy of the
minor’s birth certificate indicating the minor’s minority to the
other party or parties to the contract and in addition, in the case of
a guardian, a certified copy of the court document appointing the
person as the minor’s legal guardian.

(b) (1) Notwithstanding any other statute, in an order approving
a minor’s contract of a type described in Section 6750, the court
shall require that 15 percent of the minor’s gross earnings pursuant
to the contract be set aside by the minor’s employer, except an
employer of a minor for services as an extra, background
performer, or in a similar capacity, as described in paragraph (3)
of subdivision (b) of Section 6750. These amounts shall be held
in trust, in an account or other savings plan, and preserved for the
benefit of the minor in accordance with Section 6753.

(2) The court shall require that at least one parent or legal
guardian, as the case may be, entitled to the physical custody, care,
and control of the minor at the time the order is issued be appointed
as trustee of the funds ordered to be set aside in trust for the benefit
of the minor, unless the court shall determine that appointment of
a different individual, individuals, entity, or entities as trustee or
trustees is required in the best interest of the minor.

(3) Within 10 business days after commencement of
employment, the trustee or trustees of the funds ordered to be set
aside in trust shall provide the minor’s employer with a true and
accurate photocopy of the trustee’s statement pursuant to Section
6753. Upon presentation of the trustee’s statement offered pursuant
to this subdivision, the employer shall provide the parent or
guardian with a written acknowledgment of receipt of the
statement.

(4) The minor’s employer shall deposit or disburse the 15
percent of the minor’s gross earnings pursuant to the contract
within 15 business days after receiving a true and accurate copy
of the trustee’s statement pursuant to subdivision (c) of Section
6753, a certified copy of the minor’s birth certificate, and, in the
case of a guardian, a certified copy of the court document
appointing the person as the minor’s guardian. Notwithstanding
any other law, pending receipt of these documents, the minor’s
employer shall hold, for the benefit of the minor, the 15 percent
of the minor’s gross earnings pursuant to the contract. This
paragraph does not apply to an employer of a minor for services
as an extra, background performer, or in a similar capacity, as
described in paragraph (3) of subdivision (b) of Section 6750.

(5) When making the initial deposit of funds, the minor’s
employer shall provide written notification to the financial
institution or company that the funds are subject to Section 6753.
Upon receipt of the court order, the minor’s employer shall provide
the financial institution with a copy of the order.

(6) Once the minor’s employer deposits the set-aside funds
pursuant to Section 6753, in trust, in an account or other savings
plan, the minor’s employer shall have no further obligation or duty
to monitor or account for the funds. The trustee or trustees of the
trust shall be the only individual, individuals, entity, or entities
with the obligation or duty to monitor and account for those funds
once they have been deposited by the minor’s employer. The
trustee or trustees shall do an annual accounting of the funds held
in trust, in an account or other savings plan, in accordance with
Sections 16062 and 16063 of the Probate Code.

(7) The court shall have continuing jurisdiction over the trust
established pursuant to the order and may at any time, upon petition
of the parent or legal guardian, the minor, through his or her
guardian ad litem, or the trustee or trustees, on good cause shown,
order that the trust be amended or terminated, notwithstanding the
provisions of the declaration of trust. An order amending or
terminating a trust may be made only after reasonable notice to
the beneficiary and, if the beneficiary is then a minor, to the parent
or guardian, if any, and to the trustee or trustees of the funds with
opportunity for all parties to appear and be heard.

(8) A parent or guardian entitled to the physical custody, care,
and control of the minor shall promptly notify the minor’s employer
in writing of any change in facts that affect the employer’s
obligation or ability to set aside the funds in accordance with the
order, including, but not limited to, a change of financial institution
or account number, or the existence of a new or amended order
issued pursuant to paragraph (7) amending or terminating the
employer’s obligations under this section. The written notification
shall be accompanied by a true and accurate photocopy of the
trustee’s statement pursuant to Section 6753 and, if applicable, a
true and accurate photocopy of the new or amended order.

(9) (A) If a parent, guardian, or trustee fails to provide the
minor’s employer with a true and accurate photocopy of the
trustee’s statement pursuant to Section 6753 within 180 days after
the commencement of employment, the employer shall forward
to The Actors’ Fund of America 15 percent of the minor’s gross
earnings pursuant to the contract, together with the minor’s name
and, if known, the minor’s social security number, birth date, last
known address, telephone number, email address, dates of
employment, and title of the project on which the minor was
employed, and shall notify the parent, guardian, or trustee of that
transfer by certified mail to the last known address. Upon receipt
of those forwarded funds, The Actors’ Fund of America shall
become the trustee of those funds and the minor’s employer shall
have no further obligation or duty to monitor or account for the
funds.

(B) The Actors’ Fund of America shall make its best efforts to
notify the parent, guardian, or trustee of their responsibilities to
provide a true and accurate photocopy of the trustee’s statement
pursuant to Section 6753, and in the case of a guardian, a certified
copy of the court document appointing the person as the minor’s
legal guardian. Within 15 business days after receiving those
documents, The Actors’ Fund of America shall deposit or disburse
the funds as directed by the trustee’s statement. When making that
deposit or disbursal of the funds, The Actors’ Fund of America
shall provide to the financial institution notice that the funds are
subject to Section 6753 and a copy of each applicable order, and
shall thereafter have no further obligation or duty to monitor or
account for the funds.

begin delete

(c)

end delete

begin insert (C) end insert  The Actors’ Fund of America shall notify each beneficiary
of his or her entitlement to the funds that it holds for the beneficiary
within 60 days after the date on which its records indicated that
the beneficiary has attained 18 years of age or the date on which
it received notice that the minor has been emancipated, by sending
that notice to the last known address for the beneficiary or, if it
has no specific separate address for the beneficiary, to the
beneficiary’s parent or guardian.

begin delete

(d)

end delete

begin insert (c) end insert  (1) Notwithstanding any other statute, for any minor’s
contract of a type described in Section 6750 that is not being
submitted for approval by the court pursuant to Section 6751, or
for which the court has issued a final order denying approval, 15
percent of the minor’s gross earnings pursuant to the contract shall
be set aside by the minor’s employer, except an employer of a
minor for services as an extra, background performer, or in a
similar capacity, as described in paragraph (3) of subdivision (b)
of Section 6750. These amounts shall be held in trust, in an account
or other savings plan, and preserved for the benefit of the minor
in accordance with Section 6753. At least one parent or legal
guardian, as the case may be, entitled to the physical custody, care,
and control of the minor, shall be the trustee of the funds set aside
for the benefit of the minor, unless the court, upon petition by the
parent or legal guardian, the minor, through his or her guardian ad
litem, or the trustee or trustees of the trust, shall determine that
appointment of a different individual, individuals, entity, or entities
as trustee or trustees is required in the best interest of the minor.

(2) Within 10 business days of commencement after
employment, a parent or guardian, as the case may be, entitled to
the physical custody, care, and control of the minor shall provide
the minor’s employer with a true and accurate photocopy of the
trustee’s statement pursuant to Section 6753 and in addition, in
the case of a guardian, a certified copy of the court document
appointing the person as the minor’s legal guardian. Upon
presentation of the trustee’s statement offered pursuant to this
subdivision, the employer shall provide the parent or guardian with
a written acknowledgment of receipt of the statement.

(3) The minor’s employer shall deposit 15 percent of the minor’s
gross earnings pursuant to the contract within 15 business days of
receiving the trustee’s statement pursuant to Section 6753, or if
the court denies approval of the contract, within 15 business days
of receiving a final order denying approval of the contract.
Notwithstanding any other statute, pending receipt of the trustee’s
statement or the final court order, the minor’s employer shall hold
for the benefit of the minor the 15 percent of the minor’s gross
earnings pursuant to the contract. When making the initial deposit
of funds, the minor’s employer shall provide written notification
to the financial institution or company that the funds are subject
to Section 6753. This paragraph does not apply to an employer of
a minor for services as an extra, background performer, or in a
similar capacity, as described in paragraph (3) of subdivision (b)
of Section 6750.

(4) Once the minor’s employer deposits the set-aside funds in
trust, in an account or other savings plan pursuant to Section 6753,
the minor’s employer shall have no further obligation or duty to
monitor or account for the funds. The trustee or trustees of the
trust shall be the only individual, individuals, entity, or entities
with the obligation or duty to monitor and account for those funds
once they have been deposited by the minor’s employer. The
trustee or trustees shall do an annual accounting of the funds held
in trust, in an account or other savings plan, in accordance with
Sections 16062 and 16063 of the Probate Code.

(5) Upon petition of the parent or legal guardian, the minor,
through his or her guardian ad litem, or the trustee or trustees of
the trust, to the superior court in any county in which the minor
resides or in which the trust is established, the court may at any
time, on good cause shown, order that the trust be amended or
terminated, notwithstanding the provisions of the declaration of
trust. An order amending or terminating a trust may be made only
after reasonable notice to the beneficiary and, if the beneficiary is
then a minor, to the parent or guardian, if any, and to the trustee
or trustees of the funds with opportunity for all parties to appear
and be heard.

(6) A parent or guardian entitled to the physical custody, care,
and control of the minor shall promptly notify the minor’s employer
in writing of any change in facts that affect the employer’s
obligation or ability to set aside funds for the benefit of the minor
in accordance with this section, including, but not limited to, a
change of financial institution or account number, or the existence
of a new or amended order issued pursuant to paragraph (5)
amending or terminating the employer’s obligations under this
section. The written notification shall be accompanied by a true
and accurate photocopy of the trustee’s statement and attachments
pursuant to Section 6753 and, if applicable, a true and accurate
photocopy of the new or amended order.

(7) (A) If a parent, guardian, or trustee fails to provide the
minor’s employer with a true and accurate photocopy of the
trustee’s statement pursuant to Section 6753, within 180 days after
commencement of employment, the employer shall forward to
The Actors’ Fund of America the 15 percent of the minor’s gross
earnings pursuant to the contract, together with the minor’s name
and, if known, the minor’s social security number, birth date, last
known address, telephone number, email address, dates of
employment, and the title of the project on which the minor was
employed, and shall notify the parent, guardian, or trustee of that
transfer by certified mail to the last known address. Upon receipt
of those forwarded funds, The Actors’ Fund of America shall
become the trustee of those funds and the minor’s employer shall
have no further obligation or duty to monitor or account for the
funds.

(B) The Actors’ Fund of America shall make best efforts to
notify the parent, guardian, or trustee of their responsibilities to
provide a true and accurate photocopy of the trustee’s statement
pursuant to Section 6753 and in the case of a guardian, a certified
copy of the court document appointing the person as the minor’s
legal guardian. After receiving those documents, The Actors’ Fund
of America shall deposit or disburse the funds as directed by the
trustee’s statement, and in accordance with Section 6753, within
15 business days. When making that deposit or disbursal of the
funds, The Actors’ Fund of America shall provide notice to the
financial institution that the funds are subject to Section 6753, and
shall thereafter have no further obligation or duty to monitor or
account for the funds.

(C) The Actors’ Fund of America shall notify each beneficiary
of his or her entitlement to the funds that it holds for the
beneficiary, within 60 days after the date on which its records
indicate that the beneficiary has attained 18 years of age or the
date on which it received notice that the minor has been
emancipated, by sending that notice to the last known address that
it has for the beneficiary, or to the beneficiary’s parent or guardian,
where it has no specific separate address for the beneficiary.

begin delete

(e)

end delete

begin insert (d) end insert  Where a parent or guardian is entitled to the physical
custody, care, and control of a minor who enters into a contract of
a type described in Section 6750, the relationship between the
parent or guardian and the minor is a fiduciary relationship that is
governed by the law of trusts, whether or not a court has issued a
formal order to that effect. The parent or guardian acting in his or
her fiduciary relationship, shall, with the earnings and
accumulations of the minor under the contract, pay all liabilities
incurred by the minor under the contract, including, but not limited
to, payments for taxes on all earnings, including taxes on the
amounts set aside under subdivisions (b) and (c) of this section,
and payments for personal or professional services rendered to the
minor or the business related to the contract. Nothing in this
subdivision shall be construed to alter any other existing
responsibilities of a parent or legal guardian to provide for the
support of a minor child.

begin delete

(f)

end delete

begin insert (e) end insert  (1) Except as otherwise provided in this subdivision, The
Actors’ Fund of America, as trustee of unclaimed set-aside funds,
shall manage and administer those funds in the same manner as a
trustee under the Probate Code. Notwithstanding the foregoing,
The Actors’ Fund of America is not required to open separate,
segregated individual trust accounts for each beneficiary but may
hold the set-aside funds in a single, segregated master account for
all beneficiaries, provided it maintains accounting records for each
beneficiary’s interest in the master account.

(2) The Actors’ Fund of America shall have the right to transfer
funds from the master account, or from a beneficiary’s segregated
account to its general account in an amount equal to the
beneficiary’s balance. The Actors’ Fund of America shall have
the right to use those funds transferred to its general account to
provide programs and services for young performers. This use of
the funds does not limit or alter The Actors’ Fund of America’s
obligation to disburse the set-aside funds to the beneficiary, or the
beneficiary’s parent, guardian, trustee, or estate pursuant to this
chapter.

(3) (A) Upon receiving a certified copy of the beneficiary’s
birth certificate, or United States passport, and a true and accurate
photocopy of the trustee’s statement pursuant to Section 6753, The
Actors’ Fund of America shall transfer the beneficiary’s balance
to the trust account established for the beneficiary.

(B) The Actors’ Fund of America shall disburse the set-aside
funds to a beneficiary who has attained 18 years of age, after
receiving proof of the beneficiary’s identity and a certified copy
of the beneficiary’s birth certificate or United States passport, or
to a beneficiary who has been emancipated, after receiving proof
of the beneficiary’s identity and appropriate documentation
evidencing the beneficiary’s emancipation.

(C) The Actors’ Fund of America shall disburse the set-aside
funds to the estate of a deceased beneficiary after receiving
appropriate documentation evidencing the death of the beneficiary
and the claimant’s authority to collect those funds on behalf of the
beneficiary.

begin delete

(g)

end delete

begin insert (f) end insert  (1) The beneficiary of an account held by The Actors’ Fund
of America pursuant to this section shall be entitled to receive
imputed interest on the balance in his or her account for the entire
period during which the account is held at a rate equal to the lesser
of the federal reserve rate in effect on the last business day of the
prior calendar quarter or the national average money market rate
as published in the New York Times on the last Sunday of the
prior calendar quarter, adjusted quarterly.

(2) The Actors’ Fund of America may assess and deduct from
the balance in the beneficiary’s account reasonable management,
administrative, and investment expenses, including
beneficiary-specific fees for initial setup, account notifications and
account disbursements, and a reasonably allocable share of
management, administrative, and investment expenses of the master
account. No fees may be charged to any beneficiary’s account
during the first year that the account is held by The Actors’ Fund
of America.

(3) Notwithstanding paragraph (2), the amount paid on any
claim made by a beneficiary or the beneficiary’s parent or guardian
after The Actors’ Fund of America receives and holds funds
pursuant to this section may not be less than the amount of the
funds received plus the imputed interest.

begin delete

(h)

end delete

begin insert (g) end insert  Notwithstanding any provision of this chapter to the contrary,
any minor’s employer holding set-aside funds under this chapter,
which funds remain unclaimed 180 days after the effective date
hereof, shall forward those unclaimed funds to The Actors’ Fund
of America, along with the minor’s name and, if known, the
minor’s social security number, birth date, last known address,
telephone number, email address, dates of employment, and the
title of the project on which the minor was employed, and shall
notify the parent, guardian, or trustee of that transfer by certified
mail to the last known address. Upon receipt of those forwarded
funds by The Actors’ Fund of America, the minor’s employer shall
have no further obligation or duty to monitor or account for the
funds.

begin delete

(i)

end delete

begin insert (h) end insert  All funds received by The Actors’ Fund of America pursuant
to this section shall be exempt from the application of the
Unclaimed Property Law (Title 10 (commencing with Section
1300) of Part 3 of the Code of Civil Procedure), including, but not
limited to, Section 1510 of the Code of Civil Procedure.

begin delete

SEC. 2.  

Section 6753 of the Family Code is amended to read:

6753.  

(a) The trustee or trustees shall establish a trust account,
that shall be known as a Coogan Trust Account, pursuant to this
section at a bank, savings and loan institution, credit union,
brokerage firm, or company registered under the Investment
Company Act of 1940, that is located in the State of California,
unless a similar trust has been previously established, for the
purpose of preserving for the benefit of the minor the portion of
the minor’s gross earnings pursuant to paragraph (1) of subdivision
(b) of Section 6752 or pursuant to paragraph (1) of subdivision (d)
of Section 6752. The trustee or trustees shall establish the trust
pursuant to this section within seven business days after the minor’s
contract is signed by the minor, the third-party individual or
personal services corporation (loan-out company), and the
employer.

(b) Except as otherwise provided in this section, prior to the
date on which the beneficiary of the trust attains the age of 18
years or the issuance of a declaration of emancipation of the minor
under Section 7122, no withdrawal by the beneficiary or any other
individual, individuals, entity, or entities may be made of funds
on deposit in trust without written order of the superior court
pursuant to paragraph (7) of subdivision (b) or paragraph (5) of
subdivision (d) of Section 6752. Upon reaching the age of 18 years,
the beneficiary may withdraw the funds on deposit in trust only
after providing a certified copy of the beneficiary’s birth certificate
to the financial institution where the trust is located.

(c) The trustee or trustees shall, within 10 business days after
the minor’s contract is signed by the minor, the third-party
individual or personal services corporation (loan-out company),
and the employer, prepare a written statement under penalty of
perjury that shall include the name, address, and telephone number
of the financial institution, the name of the account, the number
of the account, the name of the minor beneficiary, the name of the
trustee or trustees of the account, and any additional information
needed by the minor’s employer to deposit into the account the
portion of the minor’s gross earnings prescribed by paragraph (1)
of subdivision (b) or paragraph (1) of subdivision (d) of Section
6752. The trustee or trustees shall attach to the written statement
a true and accurate photocopy of any information received from
the financial institution confirming the creation of the account,
such as an account agreement, account terms, passbook, or other
similar writings.

(d) The trust shall be established in California either with a
financial institution that is and remains insured at all times by the
Federal Deposit Insurance Corporation (FDIC), the Securities
Investor Protection Corporation (SIPC), or the National Credit
Union Share Insurance Fund (NCUSIF) or their respective
successors, or with a company that is and remains registered under
the Investment Company Act of 1940. The trustee or trustees of
the trust shall be the only individual, individuals, entity, or entities
with the obligation or duty to ensure that the funds remain in trust,
in an account or other savings plan insured in accordance with this
section, or with a company that is and remains registered under
the Investment Company Act of 1940 as authorized by this section.

(e) Upon application by the trustee or trustees to the financial
institution or company in which the trust is held, the trust funds
shall be handled by the financial institution or company in one or
more of the following methods:

(1) The financial institution or company may transfer funds to
another account or other savings plan at the same financial
institution or company, provided that the funds transferred shall
continue to be held in trust, and subject to this chapter.

(2) The financial institution or company may transfer funds to
another financial institution or company, provided that the funds
transferred shall continue to be held in trust, and subject to this
chapter and that the transferring financial institution or company
has provided written notification to the financial institution or
company to which the funds will be transferred that the funds are
subject to this section and written notice of the requirements of
this chapter.

(3) The financial institution or company may use all or a part
of the funds to purchase, in the name of and for the benefit of the
minor, (A) investment funds offered by a company registered under
the Investment Company Act of 1940, provided that if the
underlying investments are equity securities, the investment fund
is a broad-based index fund or invests broadly across the domestic
or a foreign regional economy, is not a sector fund, and has assets
under management of at least two hundred fifty million dollars
($250,000,000); or (B) government securities and bonds,
certificates of deposit, money market instruments, money market
accounts, or mutual funds investing solely in those government
securities and bonds, certificates, instruments, and accounts, that
are available at the financial institution where the trust fund or
other savings plan is held, provided that the funds shall continue
to be held in trust and subject to this chapter, those purchases shall
have a maturity date on or before the date upon which the minor
will attain the age of 18 years, and any proceeds accruing from
those purchases shall be redeposited into that account or accounts
or used to further purchase any of those or similar securities, bonds,
certificates, instruments, funds, or accounts.

end delete