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Regular Session, 2010 ENROLLED
SENATE BILL NO. 361
BY SENATOR SMITH (On Recommendation of the Louisiana State Law Institute)
AN ACT1
To amend and reenact Civil Code Articles 538, 549, 553, 558, 567 through 569, 573 through2
575, 577, 580, 581, 583, 584, 586 through 594, 601, 603, 604, 608, 613, 615, 616,3
618 through 620, and 623 through 625, and to enact Civil Code Articles 568.1,4
568.2, and 568.3, relative to usufruct; to provide for the continuous revision of the5
Civil Code; to provide for the general principles; to provide for the capacity to6
receive; to provide for voting shares of stock; to provide for improvements and7
alterations; to provide for contracts affecting liability; to provide for disposition of8
nonconsumables; to provide for obligations and rights; to provide for an effective9
date; and to provide for related matters.10
Be it enacted by the Legislature of Louisiana:11
Section 1. Civil Code Articles 538, 549, 553, 558, 567 through 569, 573 through12
575, 577, 580, 581, 583, 584, 586 through 594, 601, 603, 604, 608, 613, 615, 616, 61813
through 620, and 623 through 625 are hereby amended and reenacted, and Civil Code14
Articles 568.1, 568.2, and 568.3 are hereby enacted to read as follows:15
Article 538. Usufruct of consumable things16
If the things subject to the usufruct are consumables, the usufructuary17
becomes owner of them. He may consume, alienate, or encumber them as he sees18
fit. At the termination of the usufruct he is bound either to pay to the naked owner19
either the value that the things had at the commencement of the usufruct or to deliver20
to him things of the same quantity and quality.21
* * *22
Article 549. Capacity to receive usufruct23
Usufruct may be established in favor of a natural person or legal entity a24
juridical person.25 SB NO. 361 ENROLLED
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* * *1
Article 553. Voting of shares of stock and other rights2
The usufructuary has the right to vote shares of stock in corporations and3
to vote or exercise similar rights with respect to interests in other juridical4
persons, unless otherwise provided.5
* * *6
Article 558. Improvements and alterations7
The usufructuary may make improvements and alterations on the property8
subject to the usufruct at his cost and with the written consent of the naked owner.9
If the naked owner fails or refuses to give his consent, the usufructuary may, after10
notice to the naked owner and with the approval of the proper court, make at his cost11
those improvements and alterations that a prudent administrator would make.12
* * *13
Article 567. Contracts affecting the usufructuary's liability14
The usufructuary may alienate, lease, alienate, or encumber his right. All15
such contracts cease of right at the end of the usufruct.16
If the usufructuary leases, alienates, or encumbers his right, he is responsible17
to the naked owner for the abuse that the person with whom he has contracted18
makes of the property.19
Article 568. Disposition of nonconsumable things; payment of tax20
The usufructuary does not have the right to dispose of nonconsumable things21
unless the right has been expressly granted to him. Nevertheless, he may dispose of22
corporeal movables that are gradually and substantially impaired by use, wear, or23
decay, such as equipment, appliances, and vehicles, provided that he acts as a24
prudent administrator. Upon disposition, the usufruct is converted into a usufruct of25
money, and the usufructuary is bound to pay to the naked owner at the end of the26
usufruct the value that the things had at the time of disposition.27
When the usufructuary who has been expressly granted the right to dispose28
of nonconsumable things sells property subject to usufruct, and there is any tax owed29
as a result of the sale, the tax shall be paid from the proceeds of the sale.30 SB NO. 361 ENROLLED
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The usufructuary may not dispose of nonconsumable things unless the1
right to do so has been expressly granted to him. Nevertheless, he may dispose2
of corporeal movables that are gradually and substantially impaired by use,3
wear, or decay, such as equipment, appliances, and vehicles, provided that he4
acts as a prudent administrator.5
The right to dispose of a nonconsumable thing includes the rights to6
lease, alienate, and encumber the thing. It does not include the right to alienate7
by donation inter vivos, unless that right is expressly granted.8
Article 568.1. Donation and alienation9
If a thing subject to the usufruct is donated inter vivos by the10
usufructuary, he is obligated to pay to the naked owner at the termination of the11
usufruct the value of the thing as of the time of the donation. If a thing subject12
to the usufruct is otherwise alienated by the usufructuary, the usufruct attaches13
to any money or other property received by the usufructuary. The property14
received shall be classified as consumable or nonconsumable in accordance with15
the provisions of this Title, and the usufruct shall be governed by those16
provisions subject to the terms of the act establishing the original usufruct. If,17
at the time of the alienation, the value of the property received by the18
usufructuary is less than the value of the thing alienated, the usufructuary is19
bound to pay the difference to the naked owner at the termination of the20
usufruct.21
Comments - 201022
(a) If the property received by the usufructuary is consumable, then under23
the rules of this Title, the usufructuary will be bound to pay to the naked owner at the24
termination of the usufruct the value of the consumables that he received, and under25
the regular rules governing usufruct the usufructuary will become the "owner" of the26
consumable property. See Civil Code Article 538. This will leave open the question27
of whether he may have sold the property for too low a price, and he is always28
subject to the obligation of acting as a prudent administrator. See Civil Code Article29
576 and revision comment (b). If the usufructuary receives property that is30
nonconsumable, the usufruct will always attach to it and the usufructuary will be31
bound to deliver the thing received to the naked owner at the termination of the32
usufruct. See Civil Code Article 539.33
34
(b) The rules expressed in comment (a) are the rules to which Article 568-B35
refers when it states that the usufruct "shall be governed by those rules." This Article36
expressly refers to the act of establishing the original usufruct, because if that act37
granted authority to dispose of nonconsumables, that grant would be a continuing38 SB NO. 361 ENROLLED
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grant of authority and would apply to the new nonconsumables that have been1
received.2
3
Article 568.2. Right to lease4
The right to dispose of a nonconsumable thing includes the right to lease5
the thing for a term that extends beyond the termination of the usufruct. If, at6
the termination of the usufruct, the thing remains subject to the lease, the7
usufructuary is accountable to the naked owner for any diminution in the value8
of the thing at that time attributable to the lease.9
Article 568.3. Requirement to remove encumbrance10
If, at the termination of the usufruct, the thing subject to the usufruct is11
burdened by an encumbrance established by the usufructuary to secure an12
obligation, the usufructuary is bound to remove the encumbrance.13
Comment - 201014
In accounting for any "diminution" in value of a thing attributable to an15
encumbrance placed on it by the usufructuary, it is not intended that any diminution16
in value be considered attributable to such an encumbrance if the debt secured by17
that encumbrance was incurred in connection with the refinancing of a pre-existing18
debt of an equal or greater amount that was previously secured by an encumbrance19
on the thing. In other words, the article is intended to cover new debts and not the20
refinancing of existing ones.21
Article 569. Duties with regard to things gradually or totally impaired22
If the usufructuary has not disposed of corporeal movables that are by their23
nature impaired by use, wear, or decay, he is bound to restore deliver them to the24
owner in the state in which they may be at the end of the usufruct.25
The usufructuary is relieved of this obligation if the things are entirely worn26
out by normal use, wear, or decay.27
* * *28
Article 573. Dispensation of security by operation of law29
A. Security may be dispensed with by ex operation of law when is dispensed30
with when any of the following occur:31
(1) a A person has a legal usufruct under Civil Code Article 223 or 3252.32
B. Security is dispensed with by operation of law when a (2) A surviving33
spouse has a legal usufruct under Civil Code Article 890 unless the naked owner is34
not a child of the usufructuary or unless the naked owner, although a child of the35 SB NO. 361 ENROLLED
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usufructuary, is a forced heir of the decedent. In the latter case, if the naked owner1
is a child of the usufructuary and is also a forced heir of the decedent, the naked2
owner may obtain security but only to the extent of his legitime.3
C. Security is dispensed with by operation of law when a (3) A parent has a4
legal usufruct under Civil Code Article 891 unless the naked owner is not a child of5
the usufructuary.6
D. Security is dispensed with by operation of law when a (4) A surviving7
spouse has a legal usufruct under Civil Code Article 2434 unless the naked owner8
is a child of the decedent but not a child of the usufructuary.9
B. Sellers or donors A seller or donor of property under reservation of10
usufruct is not required to give security.11
Article 574. Delay in giving security12
A delay of in giving security does not deprive the usufructuary of the fruits13
derived from the property since the commencement of the usufruct.14
Article 575. Failure to give security15
If the usufructuary does not give security, a proper the court may order that16
the property be delivered to an administrator appointed in accordance with Articles17
3111 through 3113 of the Code of Civil Procedure for administration on behalf of the18
usufructuary. The administration terminates if the usufructuary gives security.19
* * *20
Article 577. Liability for repairs21
The usufructuary is responsible for ordinary maintenance and repairs for22
keeping the property subject to the usufruct in good order, whether the need for these23
repairs arises from accident or force majeure, from the normal use of the things, or24
from his fault or neglect.25
The naked owner is responsible for extraordinary repairs, unless they have26
become necessary as a result of the usufructuary's fault or neglect in which case the27
usufructuary is bound to make them at his cost.28
* * *29
Article 580. Reimbursement for necessary repairs30 SB NO. 361 ENROLLED
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If, after the usufruct commences and before the usufructuary is put in1
possession, the naked owner incurs necessary expenses or makes repairs for which2
the usufructuary is responsible, he the naked owner has the right to claim the cost3
thereof from the usufructuary and may retain the possession of the things subject to4
the usufruct until he is paid.5
Article 581. Liability for necessary expenses6
The usufructuary is answerable for all expenses that became become7
necessary for the preservation and use of the property after the commencement of the8
usufruct.9
* * *10
Article 583. Ruin from accident, or decay force majeure, or age11
Neither the usufructuary nor the naked owner is bound to restore property12
that has been totally destroyed through accident , force majeure, or because of age.13
If the naked owner elects to restore the property or to make extraordinary14
repairs, he must shall do so within a reasonable time and in the manner least15
inconvenient and onerous for the usufructuary.16
Article 584. Annual Periodic charges17
The usufructuary is bound to pay the annual periodic charges, such as18
property taxes, that may be imposed, during his enjoyment of the usufruct on the19
property subject to the usufruct, such as property taxes.20
* * *21
Article 586. Liability for debts; usufruct inter vivos22
When the usufruct is established inter vivos, the usufructuary is not liable for23
debts of the grantor, but if the debt is secured by an encumbrance of the thing24
subject to the usufruct, the thing may be sold for the payment of the debt. When25
the property subject to the usufruct is burdened with a mortgage, pledge, or privilege,26
the usufructuary may discharge the indebtedness and may claim reimbursement only27
for the capital he has expended.28
In the case of a gratuitous usufruct, the action for reimbursement shall lie29
against the naked owner at the end of the usufruct, subject to the provisions30 SB NO. 361 ENROLLED
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contained in the title: Of donations inter vivos and mortis causa. In the case of an1
onerous usufruct, the action shall lie against the grantor, subject to the provisions2
contained in the title: Sale.3
Article 587. Liability for debts; usufruct established mortis causa4
When the usufruct is established mortis causa, the position of the5
usufructuary relative to the payment of the debts of the succession depends upon6
whether the usufruct is universal, under universal title, or under particular title. The7
usufruct of an entire succession is universal, of a fraction thereof is under universal8
title, and of individually determined things is under particular title. When the9
usufruct is established mortis causa, the usufructuary is not liable for estate10
debts, but the property subject to the usufruct may be sold for the payment of11
estate debts, in accordance with the rules provided for the payment of the debt12
of an estate in Book III of this Code.13
Article 588. Usufruct under particular title Discharge of debt on encumbered14
property; usufruct established inter vivos15
The legatee of a usufruct under particular title is not liable for the debts of the16
succession. When the property subject to the usufruct is burdened with a mortgage,17
pledge, or privilege, the usufructuary may discharge the indebtedness and may claim18
reimbursement only for the capital he has expended. The action for reimbursement19
shall lie against the naked owner at the end of the usufruct, subject to the provisions20
contained in the title: Of donations inter vivos and mortis causa. When property21
subject to a usufruct established inter vivos is encumbered to secure a debt22
before the commencement of the usufruct, the usufructuary may advance the23
funds needed to discharge the indebtedness. If he does so, the naked owner24
shall reimburse the usufructuary, without interest, at the termination of the25
usufruct, for the principal of the debt the usufructuary has discharged, and for26
any interest the usufructuary has paid that had accrued on the debt before the27
commencement of the usufruct.28
Art. 589. Universal usufruct and usufruct under universal title Discharge of debt29
on encumbered property by mortis causa usufructuary30 SB NO. 361 ENROLLED
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Neither the universal usufructuary nor the usufructuary under universal title1
is liable for the debts of the succession. Nevertheless, the property subject to their2
usufruct may be seized and sold for the payment of succession debts. If the3
usufructuary of a usufruct established mortis causa advances funds to discharge4
an estate debt charged to the property subject to the usufruct, the naked owner5
shall reimburse the usufructuary, without interest, at the termination of the6
usufruct, but only to the extent of the principal of the debt he has discharged7
and for any interest he has paid that had accrued on the debt before the8
commencement of the usufruct.9
Article 590. Sale of property to pay succession debts Encumbered property;10
discharge of debt on encumbered property by naked owner11
When it is necessary to satisfy a creditor of the succession, the succession12
representative, with the authorization of the proper court or the universal successor,13
may sell so much of the property subject to a universal usufruct or usufruct under14
universal title as may be required to yield a sum for the discharge of the15
indebtedness. The usufructuary may prevent the sale by advancing the funds needed16
in accordance with the following provisions. If the usufructuary fails or refuses17
to advance the funds needed to discharge a debt secured by property subject to18
the usufruct, or an estate debt that is charged to the property subject to the19
usufruct, the naked owner may advance the funds needed. If he does so, the20
naked owner may demand that the usufructuary pay him interest during the21
period of the usufruct. If the naked owner does not advance the funds, he may22
demand that all or part of the property be sold as needed to discharge the debt.23
Article 591. Advance of sums; measure of liability Continuation of usufruct after24
sale of property25
The universal usufructuary must advance the funds needed for the discharge26
of all the debts of the succession.27
The usufructuary under universal title must contribute to the payment of the28
debts of the succession in proportion to the value of the property subject to the29
usufruct. If property subject to the usufruct is sold to pay an estate debt, or a30 SB NO. 361 ENROLLED
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debt of the grantor, the usufruct attaches to any proceeds of the sale of the1
property that remain after payment of the debt.2
Article 592. Return of capital principal; payment of interest Multiple3
usufructuaries; contribution to payment of estate debts4
When the usufructuary advances funds needed for the discharge of the debts5
of the succession he shall be reimbursed without interest at the end of the usufruct.6
When the usufructuary does not make such an advance, the universal successor may7
make the necessary advance, for which the usufructuary shall pay interest during the8
period of the usufruct, or sell a part of the property subject to the usufruct. If there9
is more than one usufructuary of the same property, each contributes to the10
payment of estate debts that are charged to the property in proportion to his11
enjoyment of the property. If one or more of the usufructuaries fails to advance12
his share, those of them who advance the funds shall have the right to recover13
the funds they advance from those who do not advance their shares.14
Article 593. Discharge of legacy of annuity15
The legacy of an annuity must be acquitted wholly by the universal16
usufructuary. If the legacy of the usufruct is under universal title, it must be17
acquitted by the usufructuary in proportion to his enjoyment. Unless there is a18
governing testamentary disposition, the legacy of an annuity that is chargeable19
to property subject to a usufruct is payable first from the fruits and products20
of the property subject to the usufruct and then from the property itself.21
Article 594. Court costs; expenses of litigation22
Court costs in actions concerning the property subject to the usufruct are23
taxed in accordance with the rules of the Code of Civil Procedure. Expenses of24
litigation other than court costs are apportioned between usufructuaries and naked25
owners in accordance with the ensuing articles following Articles.26
* * *27
Article 601. Removal of improvements28
The usufructuary may remove all improvements he has made, subject to the29
obligation of restoring the property to its former condition. He may not claim30 SB NO. 361 ENROLLED
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compensation reimbursement from the owner for improvements that he does not1
remove or that cannot be removed.2
* * *3
Art. 603. Disposition of the naked ownership; alienation or encumbrance of the4
property.5
The naked owner may dispose of the naked ownership. , but he can not6
thereby affect the usufruct He may also alienate or encumber the property subject7
to the usufruct, but he cannot thereby affect the usufruct.8
Article 604. Servitudes9
The naked owner may establish real rights on the property subject to the10
usufruct, provided that they may be exercised without injury to the usufructuary11
impairing the usufructuary's rights.12
* * *13
Article 608. Dissolution of juridical person; thirty year limitation14
A usufruct established in favor of a legal entity other than a natural person15
terminates when the entity ceases to exist, or upon the lapse of thirty years from the16
date of the commencement of the usufruct. juridical person terminates if the17
juridical person is dissolved or liquidated, but not if the juridical person is18
converted, merged or consolidated into a successor juridical person. In any19
event, a usufruct in favor of a juridical person shall terminate upon the lapse20
of thirty years from the date of the commencement of the usufruct. This Article21
shall not apply to a juridical person in its capacity as the trustee of a trust.22
Comment - 201023
The last sentence explains that a trust is not itself a juridical person and24
therefore the Article does not apply to it. A trust is a "relationship." La. R.S.25
9:1731. Nevertheless, the trustee may be a corporate or institutional trustee which26
a juridical person and it is intended this article not affect the trust in that event.27
28
* * *29
30
Article 613. Loss, extinction, or destruction of property31
The usufruct of nonconsumables terminates by the permanent and total loss,32
extinction, or destruction through accident, force majeure or decay of the property33 SB NO. 361 ENROLLED
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subject to the usufruct.1
* * *2
3
Article 615. Change of the form of property4
When property subject to usufruct changes form without any an act of the5
usufructuary, the usufruct does not terminate even though the property can may no6
longer serve the use for which it was originally destined.7
When property subject to usufruct is converted into money or other property8
without an act of the usufructuary, as in a case of expropriation of an immovable or9
liquidation of a corporation, the usufruct does not terminate but terminates as to the10
property converted and attaches to the money or other property received by the11
usufructuary.12
Article 616. Sale or exchange of the property; taxes13
When property subject to usufruct is sold or exchanged, whether in an action14
for partition or by agreement between the usufructuary and the naked owner or by15
a usufructuary who has the power to dispose of nonconsumable property, the16
usufruct terminates as to the nonconsumable property sold or exchanged, but17
as provided in Article 568.1, the usufruct attaches to the proceeds of the sale money18
or other property received by the usufructuary, unless the parties provide agree19
otherwise. Any tax or expense incurred as the result of the sale or exchange of20
property subject to usufruct shall be paid from the proceeds of the sale or21
exchange, and shall be deducted from the amount due by the usufructuary to22
the naked owner at the termination of the usufruct.23
* * *24
Article 618. Investment of money Security for proceeds25
In cases governed by Articles 614, 615, 616, and the first sentence of Article26
617, the naked owner may demand, within one year from receipt of the proceeds by27
the usufructuary that the money be safely invested subject to the right of the28
usufructuary usufructuary give security for the proceeds. If such a demand is29
made, and the parties cannot agree, the nature of the investment security shall be30
determined by the court. This article Article does not apply to corporeal movables31 SB NO. 361 ENROLLED
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referred to in the second sentence of Article 568, or to property disposed of by the1
usufructuary pursuant to the power to dispose of nonconsumables if the grantor2
of the usufruct has dispensed with the security.3
Article 619. Changes made by the testator4
A usufruct by donation mortis causa is not considered as revoked merely5
because the testator has made changes in the property after the date of his will6
testament. The effect of the legacy is determined by application of the rules7
contained in the title: Of donations inter vivos and mortis causa.8
Article 620. Sale of the property or of the usufruct9
Usufruct terminates by the enforcement of a mortgage placed an10
encumbrance established upon the property prior to the creation of the usufruct to11
secure a debt. The usufructuary may have an action against the grantor of the12
usufruct or against the naked owner under the provisions established in the third13
section Section 3 of this chapter Chapter.14
The sale of the property by the naked owner after the usufruct has been15
created or the enforcement of a mortgage placed upon the property by the naked16
owner after the creation of the usufruct does not affect the right of the usufructuary.17
The judicial sale of the usufruct by creditors of the usufructuary deprives the18
usufructuary of his enjoyment of the property but does not terminate the usufruct.19
Comment - 201020
The elimination of Paragraph two of Article 620 is not intended to effect a21
change in the law. The subject is already covered in Article 603.22
23
* * *24
25
Article 623. Abuse of the enjoyment ; consequences26
A The usufruct may be terminated by the naked owner if the usufructuary27
commits waste, alienates things without authority, neglects to make ordinary repairs,28
or abuses his enjoyment in any other manner.29
Article 624. Consequences of abuse Security to prevent termination30
In the cases covered by the preceding article Article, the court may decree31
termination of the usufruct or decree that the property be delivered to the naked32
owner on the condition that he shall pay to the usufructuary a reasonable annuity33 SB NO. 361 ENROLLED
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until the end of the usufruct. The amount of the annuity shall be based on the value1
of the usufruct. 2
The usufructuary may prevent termination of the usufruct or delivery of the3
property to the naked owner by giving security to insure that he will take appropriate4
corrective measures within a period fixed by the court.5
Article 625. Intervention by creditors of the usufructuary6
7
A creditor of the usufructuary may intervene and may prevent termination of8
the usufruct or and delivery of the property to the naked owner by offering to repair9
the damages caused by the usufructuary and by giving security for the future.10
Section 2. This Act shall become effective upon signature by the governor or, if not11
signed by the governor, upon expiration of the time for bills to become law without signature12
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If13
vetoed by the governor and subsequently approved by the legislature, this Act shall become14
effective on the day following such approval.15
PRESIDENT OF THE SENATE
SPEAKER OF THE HOUSE OF REPRESENTATIVES
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: