85R18652 MTB-F
By: Farrar, Smithee, Neave H.B. No. 1753
Substitute the following for H.B. No. 1753:
By: Farrar C.S.H.B. No. 1753
A BILL TO BE ENTITLED
AN ACT
relating to authorizing a beneficiary designation that transfers a
motor vehicle at the owner's death.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle C, Title 2, Estates Code, is amended by
adding Chapter 115 to read as follows:
CHAPTER 115. BENEFICIARY DESIGNATION FOR MOTOR VEHICLES
Sec. 115.001. DEFINITIONS. In this chapter:
(1) "Beneficiary designation" means the designation
by an owner of a motor vehicle of a beneficiary of the vehicle as
provided by Section 501.0315, Transportation Code.
(2) "Designated beneficiary" means a person
designated as a beneficiary of an owner's interest in a motor
vehicle under Section 501.0315, Transportation Code.
(3) "Joint owner with right of survivorship" or "joint
owner" means a person who owns a motor vehicle concurrently with one
or more other persons with a right of survivorship. The term does
not include an owner of community property with or without a right
of survivorship.
(4) "Motor vehicle" has the meaning assigned by
Section 501.002, Transportation Code.
(5) "Person" has the meaning assigned by Section
311.005, Government Code.
Sec. 115.002. BENEFICIARY DESIGNATION AUTHORIZED. (a) An
owner of a motor vehicle may transfer the owner's interest in the
motor vehicle to a sole beneficiary effective on the owner's death
by designating a beneficiary as provided by Section 501.0315,
Transportation Code.
(b) A beneficiary designation is:
(1) subject to Section 115.003(b), revocable and may
be changed at any time without the consent of the designated
beneficiary as provided by Section 501.0315, Transportation Code;
(2) a nontestamentary instrument; and
(3) effective without:
(A) notice or delivery to or acceptance by the
designated beneficiary during the owner's life; or
(B) consideration.
(c) A will may not revoke or supersede a beneficiary
designation, regardless of when the will is made.
(d) A designated beneficiary may disclaim the designated
beneficiary's interest in the motor vehicle as provided by Chapter
240, Property Code.
Sec. 115.003. JOINT OWNERSHIP. (a) If a motor vehicle that
is the subject of a beneficiary designation is owned by joint owners
with right of survivorship, the beneficiary designation must be
made by all of the joint owners.
(b) A beneficiary designation made by joint owners with
right of survivorship:
(1) may be revoked or changed as provided by Section
501.0315, Transportation Code, only if it is revoked or changed by
all of the joint owners; and
(2) may be revoked or changed by the last surviving
joint owner as provided by Section 501.0315, Transportation Code.
Sec. 115.004. EFFECT OF BENEFICIARY DESIGNATION DURING
OWNER'S LIFE. During a motor vehicle owner's life, a beneficiary
designation does not:
(1) affect an interest or right of the owner or owners
making the designation, including the right to transfer or
encumber the motor vehicle that is the subject of the designation;
(2) create a legal or equitable interest in favor of
the designated beneficiary in the motor vehicle that is the subject
of the designation, even if the beneficiary has actual or
constructive notice of the designation;
(3) affect an interest or right of a secured or
unsecured creditor or future creditor of the owner or owners making
the designation, even if the creditor has actual or constructive
notice of the designation; or
(4) affect an owner's or the designated beneficiary's
eligibility for any form of public assistance, subject to
applicable federal law.
Sec. 115.005. EFFECT OF BENEFICIARY DESIGNATION AT OWNER'S
OR LAST SURVIVING OWNER'S DEATH. (a) On the death of the owner of a
motor vehicle that is the subject of a beneficiary designation, the
following rules apply to an interest in the motor vehicle:
(1) if the designated beneficiary survives the owner
making the designation by 120 hours, the interest in the motor
vehicle is transferred to the designated beneficiary; and
(2) if the designated beneficiary fails to survive the
owner making the designation by 120 hours, the share of the
designated beneficiary lapses, notwithstanding Section 111.052,
and is subject to and passes in accordance with Subchapter D,
Chapter 255, as if the beneficiary designation were a devise made in
a will.
(b) If an owner is a joint owner with right of survivorship
who is survived by one or more other joint owners, the motor vehicle
that is the subject of the beneficiary designation belongs to the
surviving joint owner or owners. If an owner is a joint owner with
right of survivorship who is the last surviving joint owner, the
beneficiary designation is effective.
(c) A designated beneficiary takes the motor vehicle
subject to all encumbrances, assignments, contracts, liens, and
other interests to which the vehicle is subject at the owner's or
last surviving owner's death, as applicable. The transfer to the
designated beneficiary does not affect the ability of a lienholder
to pursue an existing means of debt collection permitted under the
laws of this state.
Sec. 115.006. CREDITOR CLAIMS; ALLOWANCES IN LIEU OF EXEMPT
PROPERTY AND FAMILY ALLOWANCES. Sections 114.104(b), (c), and (d)
and Section 114.106 apply to a transfer of an owner's interest in a
motor vehicle by a beneficiary designation in the same manner and to
the same extent as a transfer of real property under a transfer on
death deed under Chapter 114.
SECTION 2. Section 122.001(1), Estates Code, is amended to
read as follows:
(1) "Beneficiary" includes a person who would have
been entitled, if the person had not made a disclaimer, to receive
property as a result of the death of another person:
(A) by inheritance;
(B) under a will;
(C) by an agreement between spouses for community
property with a right of survivorship;
(D) by a joint tenancy with a right of
survivorship;
(E) by a survivorship agreement, account, or
interest in which the interest of the decedent passes to a surviving
beneficiary;
(F) by an insurance, annuity, endowment,
employment, deferred compensation, or other contract or
arrangement;
(G) under a pension, profit sharing, thrift,
stock bonus, life insurance, survivor income, incentive, or other
plan or program providing retirement, welfare, or fringe benefits
with respect to an employee or a self-employed individual; [or]
(H) by a transfer on death deed; or
(I) by a beneficiary designation as defined by
Section 115.001.
SECTION 3. Subchapter B, Chapter 501, Transportation Code,
is amended by adding Section 501.0315 to read as follows:
Sec. 501.0315. BENEFICIARY DESIGNATION. (a) The owner of a
motor vehicle may designate a sole beneficiary to whom the owner's
interest in the vehicle transfers on the owner's death as provided
by Chapter 115, Estates Code, by submitting an application for
title under Section 501.023 with the designation. To be effective,
the designation must state that the transfer of an interest in the
vehicle to the designated beneficiary is to occur at the
transferor's death.
(b) The legal name of a beneficiary designated under this
section must be included on the title.
(c) The department shall transfer title of a motor vehicle
to a beneficiary designated under this section for the vehicle if
the beneficiary submits:
(1) an application for title under Section 501.023 not
later than the 180th day after the date of the owner's death or, if
the vehicle is owned by joint owners, the last surviving owner's
death, as applicable; and
(2) satisfactory proof of the death of the owner or
owners, as applicable.
(d) A beneficiary designation may be changed or revoked by
submitting a new application for title under Section 501.023.
(e) A beneficiary designation or a change or revocation of a
beneficiary designation made on an application for title of a motor
vehicle that has not been submitted to the department before the
death of a vehicle's owner or owners who made, changed, or revoked
the designation, as applicable, is invalid.
(f) The department may adopt rules to administer this
section.
SECTION 4. This Act takes effect September 1, 2017.