Texas 2023 - 88th Regular

Texas House Bill HB3562 Compare Versions

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1	1	88R6185 EAS-F
2	2	By: Smithee H.B. No. 3562
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to durable powers of attorney and the construction of
8	8	certain powers conferred in those durable powers of attorney.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 751.002(5), Estates Code, is amended to
11	11	read as follows:
12	12	(5) "Principal" means an adult individual [person] who
13	13	signs or directs the signing of the individual's [person's] name on
14	14	a power of attorney that designates an agent to act on the
15	15	individual's [person's] behalf.
16	16	SECTION 2. Section 751.00201, Estates Code, is amended to
17	17	read as follows:
18	18	Sec. 751.00201. MEANING OF DISABLED OR INCAPACITATED FOR
19	19	PURPOSES OF DURABLE POWER OF ATTORNEY. Unless otherwise defined by
20	20	a durable power of attorney, an individual [a person] is considered
21	21	disabled or incapacitated for purposes of the durable power of
22	22	attorney if a physician certifies in writing at a date later than
23	23	the date the durable power of attorney is executed that, based on
24	24	the physician's medical examination of the individual [person], the
25	25	individual [person] is determined to be mentally incapable of
26	26	managing the individual's [person's] financial affairs.
27	27	SECTION 3. Section 751.133, Estates Code, is amended by
28	28	amending Subsection (a) and adding Subsection (a-1) to read as
29	29	follows:
30	30	(a) If, after execution of a durable power of attorney, a
31	31	court [of the principal's domicile] appoints a:
32	32	(1) permanent guardian of the estate for a ward who is
33	33	[of] the principal who executed the power of attorney, on the
34	34	qualification of the guardian the powers and authority granted to
35	35	[of] the agent named in the power of attorney are automatically
36	36	revoked unless the court enters an order that the powers of the
37	37	agent be suspended during the pendency of the guardianship of the
38	38	estate; or
39	39	(2) temporary guardian of the estate for a ward who is
40	40	the principal who executed the power of attorney, on the
41	41	qualification of the guardian the powers and authority granted to
42	42	the agent named in the power of attorney are automatically
43	43	suspended for the duration of the guardianship unless the court
44	44	enters an order that:
45	45	(A) affirms and states the effectiveness of the
46	46	power of attorney; and
47	47	(B) confirms the validity of the appointment of
48	48	the named agent [terminate on the qualification of the guardian of
49	49	the estate].
50	50	(a-1) If the powers and authority of an [The] agent are
51	51	revoked as provided by Subsection (a), the agent shall:
52	52	(1) deliver to the guardian of the estate all assets of
53	53	the ward's [incapacitated person's] estate that are in the
54	54	possession of the agent; and
55	55	(2) account to the guardian of the estate as the agent
56	56	would account to the principal if the principal had terminated the
57	57	powers of the agent.
58	58	SECTION 4. Section 751.251, Estates Code, is amended by
59	59	amending Subsection (a) and adding Subsection (d) to read as
60	60	follows:
61	61	(a) The following may bring an action requesting a court to
62	62	construe, or determine the validity or enforceability of, a durable
63	63	power of attorney, or to review an agent's conduct under a durable
64	64	power of attorney and grant appropriate relief:
65	65	(1) the principal or the agent;
66	66	(2) a guardian, conservator, or other fiduciary acting
67	67	for the principal;
68	68	(3) a person named as a beneficiary to receive
69	69	property, a benefit, or a contractual right on the principal's
70	70	death;
71	71	(4) a governmental agency with [regulatory] authority
72	72	to provide protective services to the principal [protect the
73	73	principal's welfare]; and
74	74	(5) a person who demonstrates to the court sufficient
75	75	interest in the principal's welfare or estate.
76	76	(d) In an action brought under this section, the court may
77	77	award costs and reasonable and necessary attorney's fees in an
78	78	amount the court considers equitable and just.
79	79	SECTION 5. Section 752.001(a), Estates Code, is amended to
80	80	read as follows:
81	81	(a) An individual [A person] may use a statutory durable
82	82	power of attorney to grant an [attorney in fact or] agent powers
83	83	with respect to an individual's [a person's] property and financial
84	84	matters.
85	85	SECTION 6. Section 752.107, Estates Code, is amended to
86	86	read as follows:
87	87	Sec. 752.107. BUSINESS OPERATION TRANSACTIONS. Subject to
88	88	the terms of an agreement or other document governing or relating to
89	89	an entity or entity ownership interest, to the extent the agent is
90	90	permitted by law to act for the principal and unless the power of
91	91	attorney provides otherwise, the [The] language conferring
92	92	authority with respect to business operating transactions in a
93	93	statutory durable power of attorney empowers the [attorney in fact
94	94	or] agent to:
95	95	(1) operate, buy, sell, enlarge, reduce, or terminate
96	96	an ownership [a business] interest;
97	97	(2) [do the following, to the extent that an attorney
98	98	in fact or agent is permitted by law to act for a principal and
99	99	subject to the terms of a partnership agreement:
100	100	[(A)] perform a duty or[,] discharge a liability,
101	101	or exercise in person or by proxy a right, power, privilege, or
102	102	option that the principal has, may have, or claims to have [under
103	103	the partnership agreement, whether or not the principal is a
104	104	general or limited partner];
105	105	(3) [(B)] enforce the terms of an agreement or other
106	106	document governing or relating to an entity or entity ownership
107	107	interest [the partnership agreement by litigation, action, or
108	108	otherwise]; [and]
109	109	(4) [(C)] defend, submit to arbitration, settle, or
110	110	compromise litigation or an action to which the principal is a party
111	111	because of an entity ownership interest [membership in the
112	112	partnership];
113	113	(5) [(3)] exercise in person or by proxy, or enforce
114	114	by litigation, action, or otherwise, a right, power, privilege, or
115	115	option the principal has or claims to have as the holder of a
116	116	certificated or uncertificated ownership interest;
117	117	(6) [bond, share, or other similar instrument and]
118	118	defend, submit to alternative dispute resolution [arbitration],
119	119	settle, or compromise litigation [a legal proceeding] to which the
120	120	principal is a party concerning a certificated or uncertificated
121	121	ownership interest [because of a bond, share, or similar
122	122	instrument];
123	123	(7) [(4)] with respect to a business or entity owned
124	124	solely by the principal:
125	125	(A) continue, modify, renegotiate, extend, and
126	126	terminate a contract made by or on behalf of the principal with
127	127	respect to the business or entity [before execution of the power of
128	128	attorney with an individual, legal entity, firm, association, or
129	129	corporation by or on behalf of the principal with respect to the
130	130	business];
131	131	(B) determine:
132	132	(i) the location of the business's or
133	133	entity's operation;
134	134	(ii) the nature and extent of the business;
135	135	(iii) the methods of manufacturing,
136	136	selling, merchandising, financing, accounting, and advertising
137	137	employed in the business's or entity's operation;
138	138	(iv) the amount and types of insurance
139	139	carried; and
140	140	(v) the method of engaging, compensating,
141	141	and dealing with the business's or entity's employees and
142	142	accountants, attorneys, or [and] other agents [and employees];
143	143	(C) change the name or form of organization under
144	144	which the business or entity is operated and enter into an [a
145	145	partnership] agreement with other persons [or organize a
146	146	corporation] to take over all or part of the operation of the
147	147	business or entity; and
148	148	(D) demand and receive money due or claimed by
149	149	the principal or on the principal's behalf in the operation of the
150	150	business or entity and control and disburse the money in the
151	151	operation of the business or entity;
152	152	(8) [(5)] put additional capital into a business or
153	153	entity in which the principal has an interest;
154	154	(9) [(6)] join in a plan of reorganization,
155	155	consolidation, interest exchange, conversion, or merger of the
156	156	business or entity;
157	157	(10) [(7)] sell or liquidate a business or entity or
158	158	all or part of the assets of the business or entity [at the time and
159	159	on the terms that the attorney in fact or agent considers
160	160	desirable];
161	161	(11) [(8)] establish the value of a business or entity
162	162	under a buy-out agreement to which the principal is a party;
163	163	(12) [(9) do the following:
164	164	[(A)] prepare, sign, file, and deliver reports,
165	165	compilations of information, returns, or other papers with respect
166	166	to a business or entity and[:
167	167	[(i) that are required by a governmental
168	168	agency, department, or instrumentality; or
169	169	[(ii) that the attorney in fact or agent
170	170	considers desirable; and
171	171	[(B)] make related payments; and
172	172	(13) [(10)] pay, compromise, or contest taxes or
173	173	assessments and perform any other act [that the attorney in fact or
174	174	agent considers desirable] to protect the principal from illegal or
175	175	unnecessary taxation, fines, penalties, or assessments with
176	176	respect to a business or entity, including attempts to recover, in
177	177	any manner permitted by law, money paid before or after the
178	178	execution of the power of attorney.
179	179	SECTION 7. Section 240.008, Property Code, is amended by
180	180	amending Subsection (c) and adding Subsection (c-1) to read as
181	181	follows:
182	182	(c) Except as provided by Subsection (c-1), the [The]
183	183	following disclaimers by a fiduciary acting in a fiduciary capacity
184	184	are not effective unless approved by a court of competent
185	185	jurisdiction:
186	186	(1) a disclaimer by a personal representative who is
187	187	not an independent administrator or independent executor;
188	188	(2) a disclaimer by the trustee of a management trust
189	189	created under Chapter 1301, Estates Code;
190	190	(3) a disclaimer by the trustee of a trust created
191	191	under Section 142.005; or
192	192	(4) a disclaimer that would result in an interest in or
193	193	power over property passing to the person making the disclaimer.
194	194	(c-1) A disclaimer described by Subsection (c)(4) does not
195	195	require court approval if the disclaimer is authorized under
196	196	Subtitle P, Title 2, Estates Code.
197	197	SECTION 8. The following sections of the Estates Code are
198	198	repealed:
199	199	(1) Section 751.052; and
200	200	(2) Section 751.133(b).
201	201	SECTION 9. Section 751.251, Estates Code, as amended by
202	202	this Act, applies to a proceeding concerning a durable power of
203	203	attorney pending on, or commenced on or after, the effective date of
204	204	this Act.
205	205	SECTION 10. Section 752.107, Estates Code, as amended by
206	206	this Act, applies only to a durable power of attorney, including a
207	207	statutory durable power of attorney, executed on or after the
208	208	effective date of this Act. A durable power of attorney, including a
209	209	statutory durable power of attorney, executed before the effective
210	210	date of this Act is governed by the law in effect on the date the
211	211	durable power of attorney was executed, and the former law is
212	212	continued in effect for that purpose.
213	213	SECTION 11. Section 240.008, Property Code, as amended by
214	214	this Act, applies only to a disclaimer made on or after the
215	215	effective date of this Act. A disclaimer made before the effective
216	216	date of this Act is governed by the law in effect at the time the
217	217	disclaimer was made, and the former law is continued in effect for
218	218	that purpose.
219	219	SECTION 12. This Act takes effect September 1, 2023.