BILL ANALYSIS

Senate Research Center	S.B. 1457
	By: Zaffirini
	Jurisprudence
	6/7/2023
	Enrolled

AUTHOR'S / SPONSOR'S STATEMENT OF INTENT

The Texas Real Estate and Probate Institute (T-REP) identified several issues in the Estates Code that the legislature should correct. According to T-REP attorneys, there are delivery issues and delays with traditional mail methods, confusion and delays in serving court documents to persons proposed for guardianship, lack of continuity in the persons' care and financial management, the need to establish guardianship of the estate for minimal fund access, and discrepancies in creditor notice requirements.

S.B. 1457 would clarify that an attorney ad litem may accept service on behalf of a person proposed to be under guardianship for pleadings filed after their appointment and provide alternative methods to meet notice requirements under the Estates Code. What's more, this bill would allow a surviving parent who is appointed only as guardian of the estate to appoint a successor guardian and permit a guardian of the person to manage and expend funds up to $20,000 belonging to the person with a guardian to avoid the need for a guardian of the estate for minimal fund access. The bill also would enable the court to order third-party entities to deliver assets to the guardian of the estate of a person with an incapacity and would allow for the deposit of sale proceeds for nonresident creditors without a guardian in their resident state.

By addressing these issues, S.B. 1457 would make the legal system more efficient, reduce delays and confusion, and ensure proper care of persons with a guardian.

(Original Author's/Sponsor's Statement of Intent)

S.B. 1457 amends current law relating to guardianships and the delivery of certain notices or other communications in connection with guardianship proceedings.

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 1002, Estates Code, by adding Section 1002.0265, as follows:

Sec. 1002.0265. QUALIFIED DELIVERY METHOD. Defines "qualified delivery method."

SECTION 2. Amends Section 1023.004(c), Estates Code, as follows:

(c) Requires a guardian, if a court made a motion to transfer a guardianship, to be given notice by a qualified delivery method, rather than by certified mail, to appear and show cause why the guardianship should not be transferred.

SECTION 3. Amends the heading to Section 1051.052, Estates Code, to read as follows:

Sec. 1051.052. SERVICE BY MAIL OR QUALIFIED DELIVERY METHOD.

SECTION 4. Amends Section 1051.052, Estates Code, by amending Subsections (b), (c), (d), (e), and (f) and adding Subsection (h), as follows:

(b) Requires the county clerk, except as provided by Subsection (c) (relating to requiring a guardian to issue a notice required to be given by the guardian by a qualified delivery method and to serve the notice by sending the original notice by a qualified delivery method), to issue a citation or notice required or permitted to be served by a qualified delivery method, rather than by registered or certified mail, and to serve the citation or notice by sending, rather than by mailing, the original citation or notice by a qualified delivery method. Makes a conforming change.

(d) Requires the county clerk or guardian, as applicable, to send a citation or notice under Subsection (b) or (c) with an instruction to deliver the citation or notice to the addressee only and with return receipt or other proof of delivery requiring recipient signature requested. Makes a conforming change.

(e) Requires that service by a qualified delivery method, rather than by mail, be made at least 20 days before the return day of the citation or notice, excluding the date of service. Provides that the date of service, rather than the date of service by mail, is the date of mailing, the date of deposit with the private delivery service, or the date of delivery by courier, as applicable.

(f) Requires that a copy of a citation or notice served under Subsection (a), (b), or (c) and a certificate of the person serving the citation or notice showing that the citation or notice was sent and the date of the mailing, the date of deposit with a private delivery service, or the date of delivery by courier, as applicable, be filed and recorded. Requires that a returned receipt or other proof of delivery receipt for a citation or notice served under Subsection (b) or (c) be attached to the certificate. Makes a conforming change.

(h) Requires the applicant or movant in a guardianship proceeding to pay the cost of delivery of a citation or notice under this section.

SECTION 5. Amends Sections 1051.055(a) and (b), Estates Code, as follows:

(a) Requires that a citation or notice required to be served on a party, if the party is represented by an attorney of record in a guardianship proceeding, including a proposed ward who has been personally served with notice of the proceeding and is represented by an attorney ad litem, be served instead on that attorney.

(b) Authorizes a notice served on an attorney under Section 1051.055 (Service on Party's Attorney of Record) to be served by delivery to the attorney in person or by a qualified delivery method. Deletes existing text authorizing a notice served on an attorney under this section to be served by registered or certified mail, return receipt requested, or any other form of mail that requires proof of delivery. Makes nonsubstantive changes.

SECTION 6. Amends Section 1051.056, Estates Code, as follows:

Sec. 1051.056. SERVICE ON GUARDIAN OR RECEIVER. Makes conforming changes to this section.

SECTION 7. Amends Sections 1051.104(a) and (b), Estates Code, as follows:

(a) Requires the person filing an application for guardianship to send a copy of the application and a notice containing the information required in the citation issued under Section 1051.102 (Issuance of Citation for Application for Guardianship) by a qualified delivery method, rather than by registered or certified mail, return receipt requested, or by any other form of mail that provides proof of delivery, to certain persons, if their whereabouts are known or can be reasonably ascertained. Makes a conforming change.

(b) Requires the applicant to file with the court:

(1) a copy of any notice required by Subsection (a) and the return receipts or other proofs of delivery of the notice; and

(2) makes conforming changes to this subdivision.

SECTION 8. Amends Section 1051.153(b), Estates Code, as follows:

(b) Provides that proof of service consists of:

(1)-(2) makes no changes to these subdivisions;

(3) if the service is made by mail or by a qualified delivery method:

(A) the certificate of the county clerk making the service, or the affidavit of the guardian or other person making the service that states that the citation or notice was mailed or sent by a qualified delivery method and the date of the mailing, the date of deposit with the private delivery service, or the date of delivery by courier, as applicable; and

(B) the return receipt or other proof of delivery receipt attached to the certificate or affidavit, as applicable, if the service was made by a qualified delivery method, rather than if the mailing was by a registered or certified mail and a receipt has been returned; and

(4) if the service is made by publication:

(A) a statement that:

(i)-(ii) makes no changes to these subparagraphs; and

(iii) states the date of publication on the public information Internet website maintained as required by Section 72.034 (Public Information Internet Website), Government Code, rather than as required by Section 72.034, Government Code, as added by Chapter 606 (S.B. 891), Acts of the 86th Legislature, Regular Session, 2019; and

(B) makes no changes to this paragraph.

Makes conforming changes.

SECTION 9. Amends Section 1057.002(b), Estates Code, to require the resident agent to send, by a qualified delivery method, rather than by certified mail, return receipt requested, a copy of a resignation statement filed under Subsection (a) to certain persons.

SECTION 10. Amends Section 1104.103, Estates Code, as follows:

(a) Authorizes the surviving parent of an adult individual who is an incapacitated person, if the parent is the guardian of the person or estate of the adult individual, by will or written declaration to appoint an eligible person to serve as guardian of the person or estate, as applicable, of the adult individual:

(1) after the parent dies;

(2) in the event the parent resigns as guardian of the person or estate; or

(3) in the event of the parent's incapacity.

(a-1) Authorizes the surviving parent, if the surviving parent is both the guardian of the person and estate of the adult individual, by will or written declaration to appoint different eligible persons to serve as guardian of the person and guardian of the estate.

(b) Requires the court, after the surviving parent dies or resigns as guardian, or if the court finds the surviving parent has become an incapacitated person after being appointed the adult individual's guardian, to appoint the person or persons designated in the will or declaration to serve as guardian of the person, guardian of the estate, or both, in preference to any other person otherwise entitled to serve as guardian under Title 3 (Guardianship and Related Procedures), unless the court finds that the person designated to serve as guardian meets certain criteria.

SECTION 11. Amends Section 1105.002(a), Estates Code, to make a nonsubstantive change.

SECTION 12. Amends Section 1106.001(a), Estates Code, to require the clerk, when a person who is appointed guardian has qualified under Section 1105.002 (Manner of Qualification of Guardian), to issue to the guardian a certificate under the court's seal stating certain information.

SECTION 13. Amends Section 1106.005, Estates Code, as follows:

Sec. 1106.005. New heading: EFFECT OF LETTERS. (a) Provides that letters of guardianship issued as prescribed by Section 1106.001 (Issuance of Certificate as Letters of Guardianship) under the court's seal by the clerk of the court that granted the letters are sufficient evidence of certain information. Deletes existing text providing that a certificate issued under Section 1106.001 under seal of the clerk of the court that granted the letters is sufficient evidence of certain information.

(b) Makes a conforming change to this subsection.

SECTION 14. Amends Subchapter B, Chapter 1151, Estates Code, by adding Section 1151.0525, as follows:

Sec. 1151.0525. ACCESS AND MANAGEMENT OF WARD'S FUNDS BY GUARDIAN OF PERSON. (a) Provides that this section applies only to the guardian of the person of a ward for whom the court has not appointed a guardian of the estate.

(b) Authorizes the guardian of the person of a ward, on application to and order from the court, to access, manage, and spend the ward's funds in an amount not to exceed $20,000 per year for the ward's benefit. Requires the court to require the guardian to file a new bond or a rider to an existing bond that meets the surety requirements for a guardian of the estate's bond under Section 1105.160 (Authorized Corporate or Personal Sureties).

(c) Requires a guardian of the person to include any expenditures made for the benefit of the ward if authorized by court order under Subsection (b) in the annual report required by Section 1163.101 (Annual Report Required).

(d) Requires the guardian of the person, when there is no longer a need for the guardian of the person to access, manage, or spend the ward's funds, to file a sworn affidavit of fulfillment with the court. Authorizes the court, on motion filed with the court, after the filing of the affidavit, to authorize the guardian to file a new bond or a rider to an existing bond that meets the requirements for a guardian of the person's bond under Section 1105.102 (Bond for Certain Guardians of the Person) and to discharge the guardian of the person and the guardian's sureties on a bond required by Subsection (b).

SECTION 15. Amends Section 1153.001(a), Estates Code, to make a conforming change.

SECTION 16. Amends Section 1153.003(b) and (c), Estates Code, as follows:

(b) Makes a conforming change to this subsection.

(1) a copy of each notice required by Subsection (a)(1) (relating to requiring the guardian of an estate within a certain time to give notice of the issuance of the letters to each person who has a claim for money against the ward's estate that is secured by a deed of trust, mortgage, or vendor's, mechanic's, or other contractor's lien on real estate belonging to the estate) with the return receipt or other proof of delivery, if available; and

(2) makes conforming changes to this subdivision.

SECTION 17. Amends Section 1153.005(a), Estates Code, as follows:

(a) Provides that a guardian of an estate is not required to give a notice required by Section 1153.001 (Required Notice Regarding Presentment of Claims in General) or 1153.003 (Required Notice to Certain Claimants) if another person also appointed as guardian or a former guardian has given that notice.

SECTION 18. Amends Section 1155.002(a), Estates Code, to authorize the court to set the compensation for a guardian serving as a guardian of the person alone in an amount not to exceed the greater of $3,000 per year or five percent of the ward's gross income.

SECTION 19. Amends Section 1156.052(c), Estates Code, to make conforming changes.

SECTION 20. Amends Section 1162.003, Estates Code, as follows:

Sec. 1162.003. NOTICE OF APPLICATION FOR ESTABLISHMENT OF ESTATE OR OTHER TRANSFER PLAN. Makes conforming changes to this section.

SECTION 21. Amends Section 1162.006(b), Estates Code, as follows:

(b) Deletes existing text requiring that notice required by Subsection (a) (relating to requiring a person who files an application to send a copy to certain persons) be delivered by registered or certified mail to a person described by Subsection (a)(1) (relating to requiring a person who files an application to send a copy to each person who has custody of an instrument listed in the application) and certified mail to certain persons.

SECTION 22. Amends Section 1202.054(b-2), Estates Code, to make a conforming change.

SECTION 23. Amends Sections 1203.052(a-1) and (b), Estates Code, to make conforming changes.

SECTION 24. Amends Section 1351.001(a), Estates Code, as follows:

(a) Authorizes a parent or managing conservator of a minor who is not a ward to apply to the court under Subchapter A (Sale of Minor's Interest in Property without Guardianship) for an order to sell an interest in property without being appointed guardian if the net value of the interest does not exceed $250,000, rather than $100,000.

SECTION 25. Amends Section 1351.052, Estates Code, as follows:

Sec. 1351.052. AUTHORITY TO SELL WARD'S INTEREST IN PROPERTY WITHOUT APPOINTMENT AS GUARDIAN OF THE ESTATE IN THIS STATE. Authorizes a guardian of the person of a ward or a guardian of the person or estate of a ward appointed by a foreign court to apply to the court under Subchapter B (Sale of Ward's Property without Guardian of the Estate) for an order to sell an interest in property in the ward's estate without being appointed guardian of the ward's estate in this state if the net value of the interest does not exceed $250,000, rather than $100,000.

SECTION 26. Amends Section 1352.052(a), Estates Code, as follows:

(a) Authorizes a parent, subject to Subsection (b) (relating to authorizing a parent of a minor to file an application only if the parent has a homestead interest in the property that is the subject of the application), or managing conservator of the minor, if the net value of a minor's interest in a residence homestead does not exceed $250,000, rather than $100,000, to apply to the court under Subchapter B (Mortgage of Minor's Interest without Guardianship) for an order authorizing the parent or managing conservator to receive on the minor's behalf, without being appointed guardian, an extension of credit that is secured wholly or partly by a lien on the homestead.

SECTION 27. Amends Section 1352.102, Estates Code, as follows:

Sec. 1352.102. AUTHORITY TO MORTGAGE MINOR WARD'S INTEREST WITHOUT GUARDIANSHIP OF THE ESTATE. Authorizes the guardian of the person of the ward, if the net value of a minor ward's interest in a residence homestead does not exceed $250,000, rather than $100,000, to apply to the court under Subchapter C (Mortgage of Minor Ward's Interest without Guardianship of the Estate) for an order authorizing the guardian to receive on the ward's behalf an extension of credit that is secured wholly or partly by a lien on the homestead.

SECTION 28. Amends Section 1353.004, Estates Code, by adding Subsection (c-1), as follows:

(c-1) Authorizes the court, if the court finds that the ward's spouse fails to comply with an order described by Subsection (c) (relating to authorizing the court to order the spouse who is not incapacitated to deliver to the guardian of the estate of the incapacitated spouse not more than one-half of the community property that is subject to the spouses' joint management, control, and disposition), after notice and a hearing, to order any third party or entity in possession to deliver to the incapacitated spouse's guardian of the estate the community property described by Subsection (c).

SECTION 29. Amends Section 1355.001(a), Estates Code, to make a conforming change.

SECTION 30. Amends Sections 1355.002(a) and (b), as follows:

(a) Makes a conforming change to this subsection.

(b) Deletes existing text providing that Section 1355.002 (Payment of Claims to Nonresident Creditor) applies only to a nonresident creditor who is a nonresident minor and has a nonresident guardian of the estate appointed by a foreign court or who is a nonresident person who is adjudged by a foreign court to be incapacitated and has a nonresident guardian of the estate appointed by that court.

SECTION 31. Repealer: Section 1104.103(c) (relating to providing that an eligible person appointed guardian is also entitled to be appointed guardian of the estate of the adult individual after the surviving parent dies or in the event of the surviving parent's incapacity, if the surviving parent is the guardian of the estate of the adult individual), Estates Code.

SECTION 32. (a) Provides that the changes in law made by this Act to the following provisions of the Estates Code apply only to an action filed or a guardianship proceeding commenced on or after the effective date of this Act:

(1) Sections 1023.004(c), 1051.153(b), 1057.002(b), 1153.001(a) (relating to requiring a guardian of an estate to provide notice requiring each person who has a claim against the estate to present the claim within the period prescribed by law), 1153.005(a), 1156.052(c) (relating to requiring a person who makes an application to the court to send notice of the application by a qualified delivery method to all interested persons), 1162.006(b), 1202.054(b-2) (relating to requiring the court to send the ward a letter by qualified delivery method meeting certain criteria not later than a certain date), and 1353.004;

(2) Sections 1051.052(b) (relating to requiring the county clerk to issue a citation or notice required or permitted to be served by a qualified delivery method and to serve the citation or notice by sending original citation or notice by a qualified delivery method), (c), (d), (e), (f), and (h);

(3) Sections 1051.055(a) and (b);

(4) Sections 1051.056 and 1162.003;

(5) Sections 1051.104(a) and (b);

(6) Sections 1153.003(b) (relating to requiring that notice provided meet certain criteria) and (c); and

(7) Sections 1203.052(a-1) (relating to authorizing the court to remove a guardian for certain reason on certain criteria) and (b) (relating to authorizing the court to remove a guardian who would be ineligible for appointment because of the guardian's failure to maintain a certain certification).

(b) Provides that Sections 1105.002(a), 1106.001(a), 1106.005, and 1155.002(a), Estates Code, as amended by this Act, and Section 1151.0525, Estates Code, as added by this Act, apply to a guardianship created before, on, or after the effective date of this Act.

(c) Makes application of Sections 1351.001(a), 1351.052, 1352.052(a), and 1352.102, Estates Code, as amended by this Act, prospective.

(d) Makes application of Sections 1355.001(a) (relating to the definition of "resident creditor") and 1355.002(a) (relating to the definition of "creditor") and (b), Estates Code, as amended by this Act, prospective.

SECTION 33. Effective date: September 1, 2023.