While we cannot address all possible scenarios in fifty different states, we believe that in most circumstances, a minor account opened in Illinois under a deposit account agreement stating that the account is governed by Illinois law would remain subject to the Illinois Banking Act’s provisions, even if the minor moves out of state after opening the account.

If a dispute over an account or other agreement arises, Illinois courts generally will apply the laws of the state chosen in the agreement’s governing law provision, unless (1) the chosen state has no substantial relationship to the parties or the transaction, or (2) application of the chosen law would be contrary to a fundamental public policy of a state with a materially greater interest in the issue in dispute. In the case of a deposit account agreement for an account established in Illinois, we do not believe that either exception would apply, in which case an Illinois court should apply Illinois law to the agreement and any related disputes.

However, we cannot opine on whether an out-of-state court would apply the same deference to the governing law provision in your deposit account agreement. It is possible that a court in another state would consider other factors when selecting the governing law and choose a state other than Illinois (such as the state where the minor resides) over the governing law provision in the agreement, although we cannot point to any courts that have done so.

We note that the majority of states allow minors to open bank accounts, but some apply more stringent limitations than the Illinois Banking Act (which provides that state banks “may accept deposits made by a minor and may open an account in the name of such minor and the rules and regulations of such bank with respect to each such deposit and account shall be as binding upon such minor as if such minor were of full age and legal capacity”). For example, Missouri law appears to limit minor accounts to minors who are over the age of sixteen and meet several other requirements, such as being self-supporting and living independently of their parents or guardians. Although your minor customers may not meet the criteria to open a bank account in a state with restrictions like Missouri’s, we believe that your minor customers could maintain their Illinois bank accounts after moving to such a state, based on the governing law provision in your account agreements.

For resources related to our guidance, please see:

• Emigrant Mortg. v. Chicago Financial, 386 Ill.App.3d 21, 26 (1st Dist. 2007) (“[T]he agreement provides that ‘[t]his Agreement shall be governed by, and construed in accordance with the laws of the State of New York, excluding such laws’ provisions relating to choice of law.’ The language of the contract is clear . . . . So long as the provision does not contravene Illinois public policy and there is some relationship between the chosen forum and the parties to the transaction, an express choice of law provision will be given full effect.”)

• International Surplus Lines Ins. Co. v. Pioneer Life Ins. Co., 209 Ill. App. 3d 144, 153 (1st Dist. 1990) (“[T]he parties’ choice of law governs unless (1) the chosen State has no substantial relationship to the parties or the transaction or (2) application of the chosen law would be contrary to a fundamental public policy of a State with a materially greater interest in the issue in dispute.”)

• Illinois Banking Act, 205 ILCS 5/45.1 (“A state bank may accept deposits made by a minor and may open an account in the name of such minor and the rules and regulations of such bank with respect to each such deposit and account shall be as binding upon such minor as if such minor were of full age and legal capacity. The receipt, acquittance or order of payment of such minor on such account or deposit or any part thereof shall be as binding upon such minor as if such minor were of full age and legal capacity.”)

• Illinois Banking Act, 205 ILCS 5/2 (“‘State bank’ means any banking corporation that has a banking charter issued by the Commissioner under this Act.”)

• CSBS website, Laws on Minor Bank Accounts By State (October 30, 2017)

• Mo. Rev. Stat. 431.056(1), (“A minor shall be qualified and competent to contract for . . . establishing a bank account . . . if:

(1) The minor is sixteen or seventeen years of age; and

(2) The minor is homeless, as defined in subsection 1 of section 167.020, or a victim of domestic violence, as defined in section 455.010, unless the child is under the supervision of the children’s division or the jurisdiction of the juvenile court; and

(3) The minor is self-supporting, such that the minor is without the physical or financial support of a parent or legal guardian; and

(4) The minor’s parent or legal guardian has consented to the minor living independent of the parents’ or guardians’ control. . . .”)