2017 Legislation


The 85th Texas Legislature is finishing up its work.  The session ends May 29, 2017.  As usual, there are significant changes affecting probate, trust and guardianship law.  Most bills become effective September 1, 2017.

For a comprehensive report on bills that passed, didn't pass or are still alive, see Bill Pargaman's legislative update.

Check back later for Glenn Karisch's legislative update.

Here are some highlights:

Durable powers of attorney


For several sessions the Real Estate, Probate and Trust Law Section of the State Bar of Texas ("REPTL") has encouraged the legislature to make significant changes to the statutes governing durable powers of attorney for property.  Finally, HB 1974 has passed.  Many of these changes are derived from the Uniform Power of Attorney Act. While some of its provisions were watered down to address concerns expressed by other groups, the bill makes several changes, including: 

  • Making acceptance of a power of attorney by a third party mandatory, although there are many limitations and exceptions to this.  (Estates Code Sections 751.201 -- 751.213)
  • Changing the statutory durable power of attorney form, meaning that attorneys will need to update their forms for use beginning September 1, 2017.  (Estates Code Section 752.051)
  • Defining when and how an agent accepts appointment.  This determines when he or she owes fiduciary duties as agent. (Estates Code Section 751.022)
  • Permitting the principal to delegate to the agent or another person the authority to name successor agents. (Estates Code Section 751.023)
  • Providing that the agent is entitled to compensation and reimbursement of expenses unless the power provides otherwise. (Estates Code Section 751.024)
  • Allowing opt-in (non-default) powers to change, amend or revoke a trust, to make a gift, to create or change survivorship rights, to create or change beneficiary designations and to delegate authority. (Estates Code Section 751.031)
  • Imposing a duty to preserve the principal's estate plan. (Estates Code Section 751.122)
  • Stating who has standing to bring an action regarding a power of attorney.  Persons with standing include the principal, the agent, a guardian of the principal, a person named as a beneficiary to receive property on the principal's death, a governmental agency with authority to protect the principal, or another person who demonstrates to the court sufficient interest in the principal's welfare or estate.

Medical Powers of Attorney


HB 995 is REPTL's medical power of attorney bill.  It revokes the authority of a spouse under a medical power of attorney if the marriage is dissolved and makes the disclosure statement a part of the medical power of attorney form itself.  The statutory form must be used -- REPTL's attempt to make the form permissive rather than mandatory was rejected due to opposition from the medical industry. While the new statutory durable power of attorney form is effective September 1, 2017, the new medical power of attorney form must be used beginning January 1, 2018.

Decedents' Estates


HB 2271 is REPTL's decedents' estates bill.  As usual, it tinkers with the Estates Code provisions dealing with the estate of a deceased person.  A few of the changes are: 

  • Setting the deadline for modifying or reforming a will to four years following admission to probate. (Estates Code Section 255.451)
  • Increasing the limit for small estate affidavit proceedings from $50,000 to $75,000.  (Estates Code Section 205.001)
  • Giving independent executors the default power to make non-pro-rata distributions. (Estates Code Section 405.0015) 

Trust Code


SB 617 is REPTL's bill making changes to the Trust Code.  Among the changes are: 

  • Broadening the authority of trustees to decant (transfer principal from one trust to another) by narrowing the definition of "limited discretion" trusts.  Under the new law, if a trust is not limited by an ascertainable stanard (such as health, education, maintenance or support) or does not contain a mandatory prinicpal distribution provision, it will be considered a "full discretion" trust. (Trust Code Section 112.071)
  • Permitting reformation of trust in certain cases, including scrivener's error. (Trust Code Section 112.054)

Digital Assets

 
SB 1193 enacts the Texas Revised Uniform Fiduciary Access to Digital Assets Act.  This act attempts to balance the interests of fiduciaries with the interests of online providers.  It gives Internet users at least some ability to give their agents or exdcutors authority to deal with digital assets.

Guardianships


As usual, there were a number of bills making changes affecting guardianships, including REPTL's SB 39 (making a number of changes) and SB 511 (permitting a declaration of guardian to be executed before a notary in lieu of two witnesses if the declaration does not disqualify anyone from serving as guardian). 

 

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