H.B. No. 1285
1-1 AN ACT
1-2 relating to a uniform single-party or multiple-party account form
1-3 and to convenience accounts.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Part 1, Chapter XI, Texas Probate Code, is
1-6 amended by adding Section 438A to read as follows:
1-7 Sec. 438A. CONVENIENCE ACCOUNT. (a) If an account is
1-8 established at a financial institution by a party in the names of
1-9 the party and a cosigner and the terms of the account provide that
1-10 the sums on deposit are paid or delivered to the party or to the
1-11 cosigner "for the convenience" of the party, the account is a
1-12 convenience account.
1-13 (b) The making of a deposit in a convenience account does
1-14 not affect the title to the deposit.
1-15 (c) The party to a convenience account is not considered to
1-16 have made a gift of one-half of the deposit or of any additions or
1-17 accruals to the deposit to the cosigner.
1-18 (d) On the death of the party, the cosigner shall have no
1-19 right of survivorship in the account and ownership of the account
1-20 remains in the party.
1-21 (e) If an addition is made to the account by anyone other
1-22 than the party, the addition and accruals to the addition are
1-23 considered to have been made by the party.
1-24 (f) All deposits to a convenience account and additions and
2-1 accruals to the deposits may be paid to the party or to the
2-2 cosigner. The financial institution is completely released from
2-3 liability for a payment made from the account before the financial
2-4 institution receives notice in writing signed by the party not to
2-5 make the payment in accordance with the terms of the account.
2-6 After receipt of the notice from the party, the financial
2-7 institution may require the party to approve any further payments
2-8 from the account.
2-9 (g) If the financial institution makes a payment of the sums
2-10 on deposit in a convenience account to the cosigner after the death
2-11 of the party and before the financial institution has received
2-12 written notice of the party's death, the financial institution is
2-13 completely released from liability for the payment. If a financial
2-14 institution makes payment to the personal representative of the
2-15 deceased party's estate after the death of the party and before
2-16 service on the financial institution of a court order prohibiting
2-17 payment, the financial institution is released to the extent of the
2-18 payment from liability to any person claiming a right to the funds.
2-19 The receipt by the representative to whom payment is made is a
2-20 complete release and discharge of the financial institution.
2-21 SECTION 2. Part 1, Chapter XI, Texas Probate Code, is
2-22 amended by adding Section 439A to read as follows:
2-23 Sec. 439A. UNIFORM SINGLE-PARTY OR MULTIPLE-PARTY ACCOUNT
2-24 FORM. (a) A contract of deposit that contains provisions
2-25 substantially the same as in the form provided by Subsection (b) of
2-26 this section establishes the type of account selected by a party.
2-27 The provisions of this part of Chapter XI of this code govern an
3-1 account selected under the form, other than a single-party account
3-2 without a P.O.D. designation. A contract of deposit that does not
3-3 contain provisions substantially the same as in the form provided
3-4 by Subsection (b) of this section is governed by the provisions of
3-5 this chapter applicable to the account that most nearly conforms to
3-6 the depositor's intent.
3-7 (b) A financial institution may use the following form to
3-8 establish the type of account selected by a party:
3-9 UNIFORM SINGLE-PARTY OR MULTIPLE-PARTY ACCOUNT SELECTION FORM
3-10 NOTICE: The type of account you select may determine how property
3-11 passes on your death. Your will may not control the disposition of
3-12 funds held in some of the following accounts.
3-13 Select one of the following accounts by placing your initials next
3-14 to the account selected:
3-15 ______ (1) SINGLE-PARTY ACCOUNT WITHOUT "P.O.D."
3-16 (PAYABLE ON DEATH) DESIGNATION. The party to the account owns the
3-17 account. On the death of the party, ownership of the account
3-18 passes as a part of the party's estate under the party's will or by
3-19 intestacy.
3-20 Enter the name of the party:
3-21 _________________________________
3-22 ______ (2) SINGLE-PARTY ACCOUNT WITH "P.O.D."
3-23 (PAYABLE ON DEATH) DESIGNATION. The party to the account owns the
3-24 account. On the death of the party, ownership of the account
3-25 passes to the P.O.D. beneficiaries of the account. The account is
3-26 not a part of the party's estate.
3-27 Enter the name of the party:
4-1 _________________________________
4-2 Enter the name or names of the P.O.D.
4-3 beneficiaries:
4-4 _________________________________
4-5 _________________________________
4-6 ______ (3) MULTIPLE-PARTY ACCOUNT WITHOUT RIGHT
4-7 OF SURVIVORSHIP. The parties to the account own the account in
4-8 proportion to the parties' net contributions to the account. The
4-9 financial institution may pay any sum in the account to a party at
4-10 any time. On the death of a party, the party's ownership of the
4-11 account passes as a part of the party's estate under the party's
4-12 will or by intestacy.
4-13 Enter the names of the parties:
4-14 _________________________________
4-15 _________________________________
4-16 _________________________________
4-17 ______ (4) MULTIPLE-PARTY ACCOUNT WITH RIGHT OF
4-18 SURVIVORSHIP. The parties to the account own the account in
4-19 proportion to the parties' net contributions to the account. The
4-20 financial institution may pay any sum in the account to a party at
4-21 any time. On the death of a party, the party's ownership of the
4-22 account passes to the surviving parties.
4-23 Enter the names of the parties:
4-24 _________________________________
4-25 _________________________________
4-26 ______ (5) MULTIPLE-PARTY ACCOUNT WITH RIGHT OF
4-27 SURVIVORSHIP AND P.O.D. (PAYABLE ON DEATH) DESIGNATION. The
5-1 parties to the account own the account in proportion to the
5-2 parties' net contributions to the account. The financial
5-3 institution may pay any sum in the account to a party at any time.
5-4 On the death of the last surviving party, the ownership of the
5-5 account passes to the P.O.D. beneficiaries.
5-6 Enter the names of the parties:
5-7 _________________________________
5-8 _________________________________
5-9 Enter the name or names of the P.O.D.
5-10 beneficiaries:
5-11 _________________________________
5-12 _________________________________
5-13 ______ (6) CONVENIENCE ACCOUNT. The party to the
5-14 account owns the account. The cosigner to the account may make
5-15 account transactions for the party. The cosigner does not own the
5-16 account. On the death of the party, ownership of the account
5-17 passes as a part of the party's estate under the party's will or by
5-18 intestacy. The financial institution may pay funds in the account
5-19 to the cosigner before the financial institution receives notice of
5-20 the death of the party. The payment to the cosigner does not
5-21 affect the party's ownership of the account.
5-22 Enter the name of the party:
5-23 _________________________________
5-24 Enter the name of the cosigner:
5-25 _________________________________
5-26 ______ (7) TRUST ACCOUNT. The parties named as
5-27 trustees to the account own the account in proportion to the
6-1 parties' net contributions to the account. A trustee may withdraw
6-2 funds from the account. A beneficiary may not withdraw funds from
6-3 the account before all trustees are deceased. On the death of the
6-4 last surviving trustee, the ownership of the account passes to the
6-5 beneficiary. The trust account is not a part of a trustee's estate
6-6 and does not pass under the trustee's will or by intestacy, unless
6-7 the trustee survives all of the beneficiaries and all other
6-8 trustees.
6-9 Enter the name or names of the trustees:
6-10 _________________________________
6-11 _________________________________
6-12 Enter the name or names of the beneficiaries:
6-13 _________________________________
6-14 _________________________________
6-15 (c) A financial institution shall be deemed to have
6-16 adequately disclosed the information provided in this section if
6-17 the financial institution uses the form set forth in Subsection (b)
6-18 of this section. If a financial institution varies the format of
6-19 the form set forth in Subsection (b) of this section, then such
6-20 financial institution may make disclosures in the account agreement
6-21 or in any other form which adequately discloses the information
6-22 provided in this section.
6-23 (d) A financial institution may combine any of the
6-24 provisions and vary the format of the selections form and notices
6-25 described in Subsection (b) of this section provided that the
6-26 customer receives adequate disclosure of the ownership rights and
6-27 there is appropriate indication of the names of the parties. This
7-1 may be accomplished in a universal account form with options listed
7-2 for selection and additional disclosures provided in the account
7-3 agreement, or in any other manner which adequately discloses the
7-4 information provided in this section.
7-5 SECTION 3. The importance of this legislation and the
7-6 crowded condition of the calendars in both houses create an
7-7 emergency and an imperative public necessity that the
7-8 constitutional rule requiring bills to be read on three several
7-9 days in each house be suspended, and this rule is hereby suspended,
7-10 and that this Act take effect and be in force from and after its
7-11 passage, and it is so enacted.