85R14000 MTB-D     By: Murr H.B. No. 1954     Substitute the following for H.B. No. 1954:     By:  Murr C.S.H.B. No. 1954       A BILL TO BE ENTITLED   AN ACT   relating to convenience and trust accounts established at financial   institutions.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 113.002, Estates Code, is amended to   read as follows:          Sec. 113.002.  DEFINITION OF PARTY. (a) In this chapter,   "party" means a person who, by the terms of a multiple-party   account, has a present right, subject to request, to payment from   the account.  Except as otherwise required by the context, the term   includes a guardian, personal representative, or assignee,   including an attaching creditor, of a party. [The term also   includes a person identified as a trustee of an account for another   regardless of whether a beneficiary is named. The term does not   include a named beneficiary unless the beneficiary has a present   right of withdrawal.]          (b)  A P.O.D. payee, including a charitable organization,   [or beneficiary of a trust account] is a party only after the   account becomes payable to the P.O.D. payee [or beneficiary] by   reason of the P.O.D. payee [or beneficiary] surviving the original   payee [or trustee].          SECTION 2.  Section 113.004, Estates Code, is amended to   read as follows:          Sec. 113.004.  TYPES OF ACCOUNTS. In this chapter:                (1)  ["Convenience account" means an account that:                      [(A)     is established at a financial institution by   one or more parties in the names of the parties and one or more   convenience signers; and                      [(B)     has terms that provide that the sums on   deposit are paid or delivered to the parties or to the convenience   signers "for the convenience" of the parties.                [(2)]  "Joint account" means an account payable on   request to one or more of two or more parties, regardless of whether   there is a right of survivorship.                (2) [(3)]  "Multiple-party account" means a joint   account or[, a convenience account,] a P.O.D. account[, or a trust   account]. The term does not include an account established for the   deposit of funds of a partnership, joint venture, or other   association for business purposes, or an account controlled by one   or more persons as the authorized agent or trustee for a   corporation, unincorporated association, charitable or civic   organization, or a regular fiduciary or trust account in which the   relationship is established other than by deposit agreement.                (3) [(4)]  "P.O.D. account," including an account   designated as a transfer on death or T.O.D. account, means an   account payable on request to:                      (A)  one person during the person's lifetime and,   on the person's death, to one or more P.O.D. payees; or                      (B)  one or more persons during their lifetimes   and, on the death of all of those persons, to one or more P.O.D.   payees.                [(5)     "Trust account" means an account in the name of   one or more parties as trustee for one or more beneficiaries in   which the relationship is established by the form of the account and   the deposit agreement with the financial institution and in which   there is no subject of the trust other than the sums on deposit in   the account. The deposit agreement is not required to address   payment to the beneficiary. The term does not include:                      [(A)     a regular trust account under a testamentary   trust or a trust agreement that has significance apart from the   account; or                      [(B)     a fiduciary account arising from a fiduciary   relationship, such as the attorney-client relationship.]          SECTION 3.  Section 113.052, Estates Code, is amended to   read as follows:          Sec. 113.052.  FORM.  A financial institution may use the   following form to establish the type of account selected by a party:          UNIFORM SINGLE-PARTY OR MULTIPLE-PARTY ACCOUNT SELECTION   FORM NOTICE: The type of account you select may determine how   property passes on your death. Your will may not control the   disposition of funds held in some of the following accounts.          You may choose to designate one or more convenience signers   on an account[, even if the account is not a convenience account].   A designated convenience signer may make transactions on your   behalf during your lifetime, but does not own the account during   your lifetime. The designated convenience signer owns the account   on your death only if the convenience signer is also designated as a   P.O.D. payee [or trust account beneficiary].          Select one of the following accounts by placing your initials   next to the account selected:          ___ (1)  SINGLE-PARTY ACCOUNT WITHOUT "P.O.D." (PAYABLE ON   DEATH) DESIGNATION.  The party to the account owns the account. On   the death of the party, ownership of the account passes as a part of   the party's estate under the party's will or by intestacy.          Enter the name of the party:   ________________________________________________________________          Enter the name(s) of the convenience signer(s), if you want   one or more convenience signers on this account:   ________________________________________________________________   ________________________________________________________________          ___ (2)  SINGLE-PARTY ACCOUNT WITH "P.O.D." (PAYABLE ON   DEATH) DESIGNATION.  The party to the account owns the account. On   the death of the party, ownership of the account passes to the   P.O.D. beneficiaries of the account.  The account is not a part of   the party's estate.          Enter the name of the party:   ________________________________________________________________          Enter the name or names of the P.O.D. beneficiaries:   ________________________________________________________________   ________________________________________________________________          Enter the name(s) of the convenience signer(s), if you want   one or more convenience signers on this account:   ________________________________________________________________   ________________________________________________________________          ___ (3)  MULTIPLE-PARTY ACCOUNT WITHOUT RIGHT OF   SURVIVORSHIP.  The parties to the account own the account in   proportion to the parties' net contributions to the account. The   financial institution may pay any sum in the account to a party at   any time. On the death of a party, the party's ownership of the   account passes as a part of the party's estate under the party's   will or by intestacy.          Enter the names of the parties:   ________________________________________________________________   ________________________________________________________________   ________________________________________________________________          Enter the name(s) of the convenience signer(s), if you want   one or more convenience signers on this account:   ________________________________________________________________   ________________________________________________________________          ___ (4)  MULTIPLE-PARTY ACCOUNT WITH RIGHT OF   SURVIVORSHIP.  The parties to the account own the account in   proportion to the parties' net contributions to the account. The   financial institution may pay any sum in the account to a party at   any time. On the death of a party, the party's ownership of the   account passes to the surviving parties.          Enter the names of the parties:   ________________________________________________________________   ________________________________________________________________          Enter the name(s) of the convenience signer(s), if you want   one or more convenience signers on this account:   ________________________________________________________________   ________________________________________________________________          ___ (5)  MULTIPLE-PARTY ACCOUNT WITH RIGHT OF SURVIVORSHIP   AND P.O.D. (PAYABLE ON DEATH) DESIGNATION.  The parties to the   account own the account in proportion to the parties' net   contributions to the account. The financial institution may pay   any sum in the account to a party at any time. On the death of the   last surviving party, the ownership of the account passes to the   P.O.D. beneficiaries.          Enter the names of the parties:   ________________________________________________________________   ________________________________________________________________          Enter the name or names of the P.O.D. beneficiaries:   ________________________________________________________________   ________________________________________________________________          Enter the name(s) of the convenience signer(s), if you want   one or more convenience signers on this account:   ________________________________________________________________   ________________________________________________________________          [___   (6)     CONVENIENCE ACCOUNT.     The parties to the account   own the account.     One or more convenience signers to the account   may make account transactions for a party. A convenience signer   does not own the account. On the death of the last surviving party,   ownership of the account passes as a part of the last surviving   party's estate under the last surviving party's will or by   intestacy. The financial institution may pay funds in the account   to a convenience signer before the financial institution receives   notice of the death of the last surviving party. The payment to a   convenience signer does not affect the parties' ownership of the   account.          [Enter the names of the parties:   ________________________________________________________________   ________________________________________________________________          [Enter the name(s) of the convenience signer(s):   ________________________________________________________________   ________________________________________________________________          [___   (7)     TRUST ACCOUNT.     The parties named as trustees to   the account own the account in proportion to the parties' net   contributions to the account. A trustee may withdraw funds from the   account. A beneficiary may not withdraw funds from the account   before all trustees are deceased. On the death of the last   surviving trustee, the ownership of the account passes to the   beneficiary. The trust account is not a part of a trustee's estate   and does not pass under the trustee's will or by intestacy, unless   the trustee survives all of the beneficiaries and all other   trustees.          [Enter the name or names of the trustees:   ________________________________________________________________   ________________________________________________________________          [Enter the name or names of the beneficiaries:   ________________________________________________________________   ________________________________________________________________          [Enter the name(s) of the convenience signer(s), if you want   one or more convenience signers on this account:   ________________________________________________________________   _______________________________________________________________]          SECTION 4.  Section 113.101, Estates Code, is amended to   read as follows:          Sec. 113.101.  EFFECT OF CERTAIN PROVISIONS REGARDING   OWNERSHIP BETWEEN PARTIES AND OTHERS. The provisions of this   subchapter and Subchapters B and D that relate to beneficial   ownership between parties to multiple-party accounts[,] or between   parties and P.O.D. payees [or beneficiaries] of multiple-party   accounts:                (1)  are relevant only to controversies between those   persons and those persons' creditors and other successors; and                (2)  do not affect the withdrawal power of those   persons under the terms of an account contract.          SECTION 5.  Section 113.106, Estates Code, is amended to   read as follows:          Sec. 113.106.  OWNERSHIP AND OPERATION OF [OTHER] ACCOUNT   WITH CONVENIENCE SIGNER; PAYMENT; LIABILITY. (a)  One or more   convenience signers may be designated on [An account established by   one or more parties at a financial institution that is not   designated as a convenience account, but is instead designated as]   a single-party account or [another type of] multiple-party   account[, may provide that the sums on deposit may be paid or   delivered to the parties or to one or more convenience signers] "for   the convenience of the party or parties." A convenience signer is   not an owner of the account but, on behalf of the party or parties to   the account, may make deposits to and be paid or delivered sums on   deposit from the account during the lifetime of the party or   parties. A convenience signer may be designated as a P.O.D. payee   of the account.          (b)  Subsections (c)-(i) apply to an account described by   Subsection (a) except [Except] as provided by Section 113.1541[:                [(1)     the provisions of Sections 113.105, 113.206, and   113.208 apply to an account described by Subsection (a), including   provisions relating to the ownership of the account during the   lifetimes and on the deaths of the parties and provisions relating   to the powers and duties of the financial institution at which the   account is established; and                [(2)     any other law relating to a convenience signer   applies to a convenience signer designated as provided by this   section to the extent the law applies to a convenience signer on a   convenience account].          (c)  The making of a deposit in an account described by   Subsection (a) does not affect the title to the deposit.          (d)  A party to an account described by Subsection (a) is not   considered to have made a gift of the deposit, or of any additions   or accruals to the deposit, to a convenience signer.          (e)  An addition made to an account described by Subsection   (a) by anyone other than a party, and accruals to the addition, are   considered to have been made by a party.          (f)  Deposits to an account described by Subsection (a) and   additions and accruals to the deposits may be paid to a party or a   convenience signer.          (g)  A financial institution is completely released from   liability for a payment made from an account described by   Subsection (a) before the financial institution receives notice in   writing signed by a party not to make the payment in accordance with   the terms of the account. After receipt of the notice from a party,   the financial institution may require a party to approve any   further payments from the account.          (h)  A financial institution that makes a payment of the sums   on deposit in an account described by Subsection (a) to a   convenience signer after the death of the last surviving party, but   before the financial institution receives written notice of the   last surviving party's death, is completely released from liability   for the payment.          (i)  A financial institution that makes a payment of the sums   on deposit in an account described by Subsection (a) to the personal   representative of the deceased last surviving party's estate after   the death of the last surviving party, but before a court order   prohibiting payment is served on the financial institution, is, to   the extent of the payment, released from liability to any person   claiming a right to the funds. The personal representative's   receipt of the funds is a complete release and discharge of the   financial institution.          SECTION 6.  Section 113.151(d), Estates Code, is amended to   read as follows:          (d)  If there are two or more surviving parties to a joint   account that is subject to a right of survivorship agreement:                (1)  during the parties' lifetimes respective   ownerships are in proportion to the parties' previous ownership   interests under Sections 113.102 and[,] 113.103[, and 113.104], as   applicable, augmented by an equal share for each survivor of any   interest a deceased party owned in the account immediately before   that party's death; and                (2)  the right of survivorship continues between the   surviving parties if a written agreement signed by a party who dies   provides for that continuation.          SECTION 7.  Section 113.1541, Estates Code, is amended to   read as follows:          Sec. 113.1541.  OWNERSHIP OF [OTHER] ACCOUNT WITH   CONVENIENCE SIGNER ON DEATH OF LAST SURVIVING PARTY. On the death   of the last surviving party to an account that has a convenience   signer designated as provided by Section 113.106, the convenience   signer does not have a right of survivorship in the account and the   estate of the last surviving party owns the account unless the   convenience signer is also designated as a P.O.D. payee [or as a   beneficiary].          SECTION 8.  Sections 113.155, 113.156, and 113.158, Estates   Code, are amended to read as follows:          Sec. 113.155.  EFFECT OF DEATH OF PARTY ON CERTAIN ACCOUNTS   WITHOUT RIGHTS OF SURVIVORSHIP. The death of a party to a   multiple-party account to which Sections 113.151 and[,] 113.152[,   and 113.153] do not apply has no effect on the beneficial ownership   of the account, other than to transfer the rights of the deceased   party as part of the deceased party's estate.          Sec. 113.156.  APPLICABILITY OF CERTAIN PROVISIONS ON DEATH   OF PARTY. Sections 113.151, 113.152, [113.153,] and 113.155 as to   rights of survivorship are determined by the form of the account at   the death of a party.          Sec. 113.158.  NONTESTAMENTARY NATURE OF CERTAIN TRANSFERS.   Transfers resulting from the application of Sections 113.151,   113.152, [113.153,] and 113.155 are effective by reason of the   account contracts involved and this chapter and are not to be   considered testamentary transfers or subject to the testamentary   provisions of this title.          SECTION 9.  Section 113.203(b), Estates Code, is amended to   read as follows:          (b)  Payment may not be made to the personal representative   or heir of a deceased party unless:                (1)  proofs of death are presented to the financial   institution showing that the deceased party was the last surviving   party; or                (2)  there is no right of survivorship under Sections   113.151, 113.152, [113.153,] and 113.155.          SECTION 10.  Section 113.209(a), Estates Code, is amended to   read as follows:          (a)  Payment made in accordance with Section 113.202,   113.203, 113.204, [113.205,] or 113.207 discharges the financial   institution from all claims for those amounts paid regardless of   whether the payment is consistent with the beneficial ownership of   the account between parties, P.O.D. payees, [or beneficiaries,] or   their successors.          SECTION 11.  Sections 113.251(a) and (d), Estates Code, are   amended to read as follows:          (a)  A party to a multiple-party account may pledge the   account or otherwise create a security interest in the account   without the joinder of, as applicable, a P.O.D. payee, [a   beneficiary,] a convenience signer, or any other party to a joint   account, regardless of whether  a right of survivorship exists.          (d)  The financial institution is not required to provide the   notice described by Subsection (c) to a P.O.D. payee[,   beneficiary,] or convenience signer.          SECTION 12.  Section 113.252(b), Estates Code, is amended to   read as follows:          (b)  A party or[,] P.O.D. payee[, or beneficiary] who   receives payment from a multiple-party account after the death of a   deceased party is liable to account to the deceased party's   personal representative for amounts the deceased party owned   beneficially immediately before the party's death to the extent   necessary to discharge the claims and charges described by   Subsection (a) that remain unpaid after application of the deceased   party's estate. The party or[,] P.O.D. payee[, or beneficiary] is   not liable in an amount greater than the amount the party or[,]   P.O.D. payee[, or beneficiary] received from the multiple-party   account.          SECTION 13.  Section 153.001(3), Estates Code, is amended to   read as follows:                (3)  "P.O.D. account" has [and "trust account" have]   the meaning [meanings] assigned by Section 113.004.          SECTION 14.  Section 153.002, Estates Code, is amended to   read as follows:          Sec. 153.002.  INAPPLICABILITY OF CHAPTER. This chapter   does not apply to:                (1)  an account with a beneficiary designation;                (2)  a P.O.D. account; or                (3)  [a trust account; or                [(4)]  an account that provides for a right of   survivorship.          SECTION 15.  Sections 113.001(2), 113.104, 113.105,   113.153, 113.154, 113.205, 113.206, and 113.208, Estates Code, are   repealed.          SECTION 16.  (a) In this section, "convenience account" and   "trust account" have the meanings assigned by Section 113.004,   Estates Code, as that section existed on January 1, 2017.          (b)  The changes in law made by this Act, including the   repeal by this Act of certain provisions of Chapter 113, Estates   Code, apply only to:                (1)  a financial institution account opened on or after   the effective date of this Act; and                (2)  a convenience account or trust account opened   before the effective date of this Act with respect to which a   financial institution has notified the party or parties to the   account in writing that the financial institution has converted the   account to a type of account, other than a convenience account or   trust account.          (c)  A convenience account or trust account opened before the   effective date of this Act with respect to which a financial   institution has not notified the party or parties to the account in   writing that the financial institution has converted the account to   a type of account, other than a convenience account or trust   account, is governed by the law in effect on the date the account   was opened or last modified, and the former law is continued in   effect until the earliest of the date on which:                (1)  the financial institution notifies the party or   parties to the account in writing that it has converted the account   to a type of account, other than a convenience account or a trust   account;                (2)  the convenience account or trust account is   closed; or                (3)  the last surviving party to a convenience account   or trust account dies.          (d)  The repeal by this Act of provisions of Chapter 113,   Estates Code, relating to trust accounts and convenience accounts   does not affect the validity of any account or deposit agreement   between a financial institution and a depositor or other person   that is entered into before September 1, 2017.          SECTION 17.  This Act takes effect September 1, 2017.