HLS 10RS-1343 ENGROSSED
Page 1 of 4
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Regular Session, 2010
HOUSE BILL NO. 432
BY REPRESENTATIVE PEARSON
SECURITIES: Authorizes a surviving spouse to access funds in a securities account prior
to the naming of an executor
AN ACT1
To enact R.S. 9:1421, relative to successions; to authorize access to certain assets; to provide2
for definitions; to provide for the sale or transfer of securities under certain3
circumstances; to provide for payment to the surviving spouse pending the4
appointment of an executor or administrator; to provide for limitations; to provide5
a limitation of liability for brokers; to provide for the preservation of certain claims;6
to provide for applicability pending actions for divorce; and to provide for related7
matters.8
Be it enacted by the Legislature of Louisiana:9
Section 1. R.S. 9:1421 is hereby enacted to read as follows: 10
ยง1421. Joint securities accounts; surviving account holder; definitions11
A. For purposes of this Section, the following terms shall have the following12
meanings:13
(1) "Broker or securities firm" means a person defined as a broker or dealer14
under the federal securities laws but without excluding a bank acting in that capacity.15
(2) "Joint securities or brokerage account" means an account which is titled16
in the name of a husband and wife, which is registered as a community property17
account, and which requires the endorsement of both husband and wife in order to18
assign, transfer, or redeem a security, or to grant the power to assign, transfer, or19
redeem a security.20 HLS 10RS-1343 ENGROSSED
HB NO. 432
Page 2 of 4
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
(3) "Security" means a security as defined by R.S. 10:8-102.1
(4) "Securities or brokerage account" means an account to which a financial2
asset is or may be credited in accordance with an agreement in which the person3
maintaining the account undertakes to treat the person for whom the account is4
maintained as entitled to exercise the rights that comprise the financial asset.5
B. Upon the death of a joint securities or brokerage account holder and with6
the authorization and direction of the surviving account holder, a broker or securities7
firm may sell or transfer securities held in the account not to exceed fifty percent of8
the value of each security held in the joint securities account. The value of the9
securities shall be determined as of the date of the death of the decedent.10
C. The surviving account holder shall have the right to withdraw the funds11
or assets generated pursuant to the provisions of Subsection B of this Section;12
however, the right of withdrawal shall terminate upon the delivery of written notice13
to the broker or securities firm of the appointment of an executor or administrator of14
the estate of the decedent.15
D. A broker or securities firm paying a surviving joint securities or16
brokerage account holder in accordance with the provisions of this Section shall not17
be liable to the estate or any heir of the decedent nor shall the securities or brokerage18
account holder be liable for any estate, inheritance, or succession taxes which may19
be due the state, and delivery of the funds shall constitute a full and complete20
discharge of the broker or securities firm for the payment or delivery so made and21
shall relieve the broker or securities firm from all adverse claims by a person22
claiming as a surviving or former spouse or a successor to such a spouse.23
E. The provisions of this Section shall not prohibit any right of forced24
heirship or the collation or collection of funds due any spouse, heir, legatee, creditor,25
or other person having rights or claims to funds of the deceased account holder.26
F. The provisions of this Section shall not be applicable if a petition for the27
divorce of the joint securities or brokerage account holders has been filed and the28
final settlement of the community property is pending at the time of the death of the29 HLS 10RS-1343 ENGROSSED
HB NO. 432
Page 3 of 4
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
account holder, and written notice of the filing of the petition for divorce has been1
delivered to the broker or securities firm.2
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Pearson HB No. 432
Abstract: Authorizes a surviving spouse to sell up to 50% of a joint securities or brokerage
account, until an executor or administrator can be appointed.
Proposed law defines "broker or securities firm" as a person defined as a broker or dealer
under the federal securities laws but without excluding a bank acting in that capacity.
Proposed law defines "joint securities or brokerage account" as an account which is titled
in the name of a husband and wife which is registered as a community property account, and
which requires the endorsement of both husband and wife in order to assign, transfer, or
redeem a security, or to grant the power to assign, transfer, or redeem a security.
Present law (R.S. 10:8-102(15)) defines "security" as an obligation of an issuer or a share,
participation, or other interest in an issuer or in property or an enterprise of an issuer which
is any of the following:
(1)Represented by a security certificate in bearer or registered form, or the transfer of
which may be registered upon books maintained for that purpose by or on behalf of
the issuer.
(2)One of a class or series or by its terms is divisible into a class or series of shares,
participations, interests, or obligations.
(3)(a) Is, or is of a type, dealt in or traded on securities exchanges or securities markets
or (b) Is a medium for investment and by its terms expressly provides that it is a
security governed by the Uniform Commercial Code - Investment Securities (R.S.
10:8-102-8-511).
Proposed law defines "security" as it is defined by present law (R.S. 10:8-102(15)).
Proposed law defines "securities or brokerage account" as an account to which a financial
asset is or may be credited in accordance with an agreement under which the person
maintaining the account undertakes to treat the person for whom the account is maintained
as entitled to exercise the rights that comprise the financial asset.
Proposed law provides that upon the death of a joint securities or brokerage account holder
and with the authorization and direction of the surviving account holder, a broker or
securities firm may sell or transfer securities held in the account not to exceed 50% of the
value of each security held in the joint securities account. The value of the securities shall
be determined as of the date of the death of the decedent.
Proposed law provides that the surviving account holder shall have the right to withdraw the
funds or assets generated pursuant to the provisions of proposed law; however, the right of
withdrawal shall terminate upon written notice of the appointment of an executor or
administrator of the estate of the decedent being delivered to the broker or securities firm. HLS 10RS-1343 ENGROSSED
HB NO. 432
Page 4 of 4
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Proposed law exempts from liability a broker who pays the surviving spouse in accordance
with the provisions of proposed law.
Proposed law provides that the provisions of proposed law shall not prohibit any right of
forced heirship or the collation or collection of funds due any spouse, heir, legatee, creditor,
or other person having rights or claims to funds of the deceased account holder.
Proposed law provides that the provisions of proposed law shall not be applicable upon
delivery to the broker or securities firm of a written notice of a petition for the divorce of the
account holders and final settlement of the community property has been filed and is pending
at the time of the death of the account holder.
(Adds R.S. 9:1421)