By: Thompson, Senfronia H.B. No. 1285 73R3359 NSC-D A BILL TO BE ENTITLED 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 SECTION 3. The importance of this legislation and the 6-16 crowded condition of the calendars in both houses create an 6-17 emergency and an imperative public necessity that the 6-18 constitutional rule requiring bills to be read on three several 6-19 days in each house be suspended, and this rule is hereby suspended, 6-20 and that this Act take effect and be in force from and after its 6-21 passage, and it is so enacted.