By: Hartnett (Senate Sponsor - Watson) H.B. No. 1969
(In the Senate - Received from the House April 29, 2009;
May 4, 2009, read first time and referred to Committee on
Jurisprudence; May 18, 2009, reported adversely, with favorable
Committee Substitute by the following vote: Yeas 5, Nays 0;
May 18, 2009, sent to printer.)
COMMITTEE SUBSTITUTE FOR H.B. No. 1969 By: Watson
A BILL TO BE ENTITLED
AN ACT
relating to the enforcement of certain provisions in a will or trust
that forfeit or void devises or interests.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter IV, Texas Probate Code, is amended by
adding Section 64 to read as follows:
Sec. 64. FORFEITURE CLAUSE. A provision in a will that
would cause a forfeiture of a devise or void a devise or provision
in favor of a person for bringing any court action, including
contesting a will, is unenforceable if:
(1) probable cause exists for bringing the action; and
(2) the action was brought in good faith.
SECTION 2. Section 111.0035(b), Property Code, is amended
to read as follows:
(b) The terms of a trust prevail over any provision of this
subtitle, except that the terms of a trust may not limit:
(1) the requirements imposed under Section 112.031;
(2) the applicability of Section 114.007 to an
exculpation term of a trust;
(3) the periods of limitation for commencing a
judicial proceeding regarding a trust;
(4) a trustee's duty:
(A) with regard to an irrevocable trust, to
respond to a demand for accounting made under Section 113.151 if the
demand is from a beneficiary who, at the time of the demand:
(i) is entitled or permitted to receive
distributions from the trust; or
(ii) would receive a distribution from the
trust if the trust terminated at the time of the demand; and
(B) to act in good faith and in accordance with
the purposes of the trust; [or]
(5) the power of a court, in the interest of justice,
to take action or exercise jurisdiction, including the power to:
(A) modify or terminate a trust or take other
action under Section 112.054;
(B) remove a trustee under Section 113.082;
(C) exercise jurisdiction under Section 115.001;
(D) require, dispense with, modify, or terminate
a trustee's bond; or
(E) adjust or deny a trustee's compensation if
the trustee commits a breach of trust; or
(6) the applicability of Section 112.038.
SECTION 3. Subchapter B, Chapter 112, Property Code, is
amended by adding Section 112.038 to read as follows:
Sec. 112.038. FORFEITURE CLAUSE. A provision in a trust
that would cause a forfeiture of or void an interest for bringing
any court action, including contesting a trust, is unenforceable
if:
(1) probable cause exists for bringing the action; and
(2) the action was brought in good faith.
SECTION 4. (a) Section 64, Texas Probate Code, as added by
this Act, applies only to the estate of a decedent who dies on or
after the effective date of this Act. The estate of a decedent who
dies before the effective date of this Act is governed by the law in
effect on the date of the decedent's death, and the former law is
continued in effect for that purpose.
(b) Section 112.038, Property Code, as added by this Act,
and Section 111.0035(b), Property Code, as amended by this Act,
apply to a trust existing on or created on or after the effective
date of this Act.
(c) The intent of this Act is to clarify existing law.
SECTION 5. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2009.
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