Goodbye Probate Code, Hello Estate Code

Effective January 1, 2014, the Texas Legislature recodified the Texas Probate Code as the Texas Estates Code.  This change came about as a part of the legislature’s ongoing project, which began in 1963, to revise and reorganize Texas statutes.  The revisions put the statutes in a more logical order and a more user-friendly format, eliminate repealed or otherwise ineffective provisions, and restate the law—using the parlance of our time—to make the law more accessible and understandable.

The 2014 codification incorporates two substantive changes of which practitioners should be aware.

House Bill 2912, or the REPTL Decedents’ Estates Bill, made the following probate-related changes:

  • For self-proving affidavits, unsworn declarations are no longer allowed.
  • The following changes were made concerning heirship proceedings: no statute of limitations applies (reversing a 2010 Supreme Court decision imposing the residual four statute); any creditor may initiate proceedings; applicants must file an attorney’s certificate proving parties were given notice; and the paternity presumption based on genetic testing, as set out in Section 160.505 of the Family Code, applies in heirship proceedings.
  • The following changes were made concerning the requirement of filing an inventory: an affidavit in lieu may be filed unless the testator specifically prohibits it, and the executor cannot be held liable for filing one over the other; remedies related to an erroneous or unjust affidavit are the same as those for inventories; failure to file an affidavit or inventory may result in a $1,000 fine; and a successor representative’s inventory should include only remaining assets if a standard inventory has already been filed.
  • The following revision was made to the notice requirements for the removal of independent executors: the executor can be removed with notice by certified mail if he fails to either qualify or file an inventory or affidavit; the executor can be removed without notice if he cannot be found, is eluding notice, is a nonresident without a resident agent, or has misapplied or embezzled estate property; otherwise, the executor must be personally served notice of removal.
  • Regarding Texas rules that govern conflicts of law: for nontestamentary transfers, Texas law determines the validity of survivorship provisions if a Texas resident contributes more than one-half of a nonprobate asset.
  • Probate and guardianship proceedings are not subject to the 2011 statutory exclusion from expedited action rules and therefore can be expedited.

 

Other changes related to decedents’ estates can be found in House Bill 2621, which disallows a child support obligor from disclaiming property, and House Bill 2380, which revises the language regarding the enforceability of forfeiture clauses to clarify the burden of proof: forfeiture clauses shall be enforceable unless the opposing party shows by a preponderance of the evidence that there is just cause and good faith.

House Bill 2080, or the REPTL Guardianship Bill, made the following changes regarding guardianship proceedings:

  • Filing fees are to be paid by the original applicant (unless indigent or a nonprofit) who may seek reimbursement from the estate.
  • Appointment of attorneys ad litem is now permissive, giving the court broader discretion in such appointments.
  • Nondisclosure orders available under the Family Code now apply and automatically carry over to guardianship proceedings where there is family violence.  Also, there is now a presumption against qualification as guardian for anyone who committed family violence or made terroristic threats.
  • A party acting in bad faith may be ordered to pay fees and costs.
  • An order appointing a guardian must detail the guardian’s rights regarding possession of the ward, the ward’s domicile, and a statement regarding officers’ ability to enforce those rights.
  • Requirements for management trusts for persons with only physical disabilities have been relaxed.

Other miscellaneous changes include:

  • House Bill 2918 provides that the principal of a power of attorney initial each granted power rather than crossing out each ungranted power.
  • Senate Bill 651, or the REPTL Medical Power of Attorney Bill, allows for acknowledgement before a notary for a medical power of attorney, no longer requiring two witnesses.
  • Senate Bill 649, or the REPTL Exempt Property Bill, includes Roth IRAs as exempt property.
  • House Bill 789 increases “in lieu” allowances as follows: allowance in lieu of homestead is raised to $45,000, and the allowance in lieu of other property is raised to $30,000.

Sources:

Tex. Estates Code Ann. (West 2014).

William D. Pargaman, Estate, Guardianship, and Trust Law, 76 Tex. B. J. 713 (2013).

Special thanks to Jamie Vaughan for her assistance in preparing this post.

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