1-1 By: Thompson of Harris (Senate Sponsor - Luna) H.B. No. 1285
1-2 (In the Senate - Received from the House April 13, 1993;
1-3 April 14, 1993, read first time and referred to Committee on
1-4 Jurisprudence; May 18, 1993, reported favorably, as amended, by the
1-5 following vote: Yeas 4, Nays 0; May 18, 1993, sent to printer.)
1-6 COMMITTEE VOTE
1-7 Yea Nay PNV Absent
1-8 Henderson x
1-9 Harris of Tarrant x
1-10 Brown x
1-11 Harris of Dallas x
1-12 Luna x
1-13 Parker x
1-14 West x
1-15 COMMITTEE AMENDMENT NO. 1 By: Luna
1-16 In HB 1285, in SECTION 2, page 2, line 31, in Section 439A (b)
1-17 delete after the word "use" and before the word "to", the words
1-18 "the following form," and insert in their stead the following: ",
1-19 but shall not be required to use the following universal account
1-20 forms with options".
1-21 COMMITTEE AMENDMENT NO. 2 By: Luna
1-22 relating to a uniform single-party or multi-party account form and
1-23 to convenience accounts.
1-24 Amend Section 2 by deleting the existing subsection (c) and
1-25 inserting therefor the following paragraph at the end of Section
1-26 439A:
1-27 (c) A financial institution shall be deemed to have
1-28 adequately disclosed the information provided in this section if
1-29 the financial institution uses the form set forth in subsection (b)
1-30 of this section. If a financial institution varies the format of
1-31 the form set forth in subsection (b) of this section, then such
1-32 financial institution may make disclosures in the account agreement
1-33 or in any other form which adequately discloses the information
1-34 provided in this section.
1-35 A BILL TO BE ENTITLED
1-36 AN ACT
1-37 relating to a uniform single-party or multiple-party account form
1-38 and to convenience accounts.
1-39 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-40 SECTION 1. Part 1, Chapter XI, Texas Probate Code, is
1-41 amended by adding Section 438A to read as follows:
1-42 Sec. 438A. CONVENIENCE ACCOUNT. (a) If an account is
1-43 established at a financial institution by a party in the names of
1-44 the party and a cosigner and the terms of the account provide that
1-45 the sums on deposit are paid or delivered to the party or to the
1-46 cosigner "for the convenience" of the party, the account is a
1-47 convenience account.
1-48 (b) The making of a deposit in a convenience account does
1-49 not affect the title to the deposit.
1-50 (c) The party to a convenience account is not considered to
1-51 have made a gift of one-half of the deposit or of any additions or
1-52 accruals to the deposit to the cosigner.
1-53 (d) On the death of the party, the cosigner shall have no
1-54 right of survivorship in the account and ownership of the account
1-55 remains in the party.
1-56 (e) If an addition is made to the account by anyone other
1-57 than the party, the addition and accruals to the addition are
1-58 considered to have been made by the party.
1-59 (f) All deposits to a convenience account and additions and
1-60 accruals to the deposits may be paid to the party or to the
1-61 cosigner. The financial institution is completely released from
1-62 liability for a payment made from the account before the financial
1-63 institution receives notice in writing signed by the party not to
1-64 make the payment in accordance with the terms of the account.
1-65 After receipt of the notice from the party, the financial
1-66 institution may require the party to approve any further payments
1-67 from the account.
1-68 (g) If the financial institution makes a payment of the sums
2-1 on deposit in a convenience account to the cosigner after the death
2-2 of the party and before the financial institution has received
2-3 written notice of the party's death, the financial institution is
2-4 completely released from liability for the payment. If a financial
2-5 institution makes payment to the personal representative of the
2-6 deceased party's estate after the death of the party and before
2-7 service on the financial institution of a court order prohibiting
2-8 payment, the financial institution is released to the extent of the
2-9 payment from liability to any person claiming a right to the funds.
2-10 The receipt by the representative to whom payment is made is a
2-11 complete release and discharge of the financial institution.
2-12 SECTION 2. Part 1, Chapter XI, Texas Probate Code, is
2-13 amended by adding Section 439A to read as follows:
2-14 Sec. 439A. UNIFORM SINGLE-PARTY OR MULTIPLE-PARTY ACCOUNT
2-15 FORM. (a) A contract of deposit that contains provisions
2-16 substantially the same as in the form provided by Subsection (b) of
2-17 this section establishes the type of account selected by a party.
2-18 The provisions of this part of Chapter XI of this code govern an
2-19 account selected under the form, other than a single-party account
2-20 without a P.O.D. designation. A contract of deposit that does not
2-21 contain provisions substantially the same as in the form provided
2-22 by Subsection (b) of this section is governed by the provisions of
2-23 this chapter applicable to the account that most nearly conforms to
2-24 the depositor's intent.
2-25 (b) A financial institution may use the following form to
2-26 establish the type of account selected by a party:
2-27 UNIFORM SINGLE-PARTY OR MULTIPLE-PARTY ACCOUNT SELECTION FORM
2-28 NOTICE: The type of account you select may determine how property
2-29 passes on your death. Your will may not control the disposition of
2-30 funds held in some of the following accounts.
2-31 Select one of the following accounts by placing your initials next
2-32 to the account selected:
2-33 ______ (1) SINGLE-PARTY ACCOUNT WITHOUT "P.O.D."
2-34 (PAYABLE ON DEATH) DESIGNATION. The party to the account owns the
2-35 account. On the death of the party, ownership of the account
2-36 passes as a part of the party's estate under the party's will or by
2-37 intestacy.
2-38 Enter the name of the party:
2-39 _________________________________
2-40 ______ (2) SINGLE-PARTY ACCOUNT WITH "P.O.D."
2-41 (PAYABLE ON DEATH) DESIGNATION. The party to the account owns the
2-42 account. On the death of the party, ownership of the account
2-43 passes to the P.O.D. beneficiaries of the account. The account is
2-44 not a part of the party's estate.
2-45 Enter the name of the party:
2-46 _________________________________
2-47 Enter the name or names of the P.O.D.
2-48 beneficiaries:
2-49 _________________________________
2-50 _________________________________
2-51 ______ (3) MULTIPLE-PARTY ACCOUNT WITHOUT RIGHT
2-52 OF SURVIVORSHIP. The parties to the account own the account in
2-53 proportion to the parties' net contributions to the account. The
2-54 financial institution may pay any sum in the account to a party at
2-55 any time. On the death of a party, the party's ownership of the
2-56 account passes as a part of the party's estate under the party's
2-57 will or by intestacy.
2-58 Enter the names of the parties:
2-59 _________________________________
2-60 _________________________________
2-61 _________________________________
2-62 ______ (4) MULTIPLE-PARTY ACCOUNT WITH RIGHT OF
2-63 SURVIVORSHIP. The parties to the account own the account in
2-64 proportion to the parties' net contributions to the account. The
2-65 financial institution may pay any sum in the account to a party at
2-66 any time. On the death of a party, the party's ownership of the
2-67 account passes to the surviving parties.
2-68 Enter the names of the parties:
2-69 _________________________________
2-70 _________________________________
3-1 ______ (5) MULTIPLE-PARTY ACCOUNT WITH RIGHT OF
3-2 SURVIVORSHIP AND P.O.D. (PAYABLE ON DEATH) DESIGNATION. The
3-3 parties to the account own the account in proportion to the
3-4 parties' net contributions to the account. The financial
3-5 institution may pay any sum in the account to a party at any time.
3-6 On the death of the last surviving party, the ownership of the
3-7 account passes to the P.O.D. beneficiaries.
3-8 Enter the names of the parties:
3-9 _________________________________
3-10 _________________________________
3-11 Enter the name or names of the P.O.D.
3-12 beneficiaries:
3-13 _________________________________
3-14 _________________________________
3-15 ______ (6) CONVENIENCE ACCOUNT. The party to the
3-16 account owns the account. The cosigner to the account may make
3-17 account transactions for the party. The cosigner does not own the
3-18 account. On the death of the party, ownership of the account
3-19 passes as a part of the party's estate under the party's will or by
3-20 intestacy. The financial institution may pay funds in the account
3-21 to the cosigner before the financial institution receives notice of
3-22 the death of the party. The payment to the cosigner does not
3-23 affect the party's ownership of the account.
3-24 Enter the name of the party:
3-25 _________________________________
3-26 Enter the name of the cosigner:
3-27 _________________________________
3-28 ______ (7) TRUST ACCOUNT. The parties named as
3-29 trustees to the account own the account in proportion to the
3-30 parties' net contributions to the account. A trustee may withdraw
3-31 funds from the account. A beneficiary may not withdraw funds from
3-32 the account before all trustees are deceased. On the death of the
3-33 last surviving trustee, the ownership of the account passes to the
3-34 beneficiary. The trust account is not a part of a trustee's estate
3-35 and does not pass under the trustee's will or by intestacy, unless
3-36 the trustee survives all of the beneficiaries and all other
3-37 trustees.
3-38 Enter the name or names of the trustees:
3-39 _________________________________
3-40 _________________________________
3-41 Enter the name or names of the beneficiaries:
3-42 _________________________________
3-43 _________________________________
3-44 (c) A financial institution may combine any of the
3-45 provisions and vary the format of the selections form and notices
3-46 described in Subsection (b) of this section, provided that the
3-47 customer receives adequate disclosure of the ownership rights and
3-48 there is appropriate indication of the names of the parties. This
3-49 may be accomplished in a universal account form with options listed
3-50 for selection and additional disclosures provided in the account
3-51 agreement, or in any other manner which adequately discloses the
3-52 information provided in this section.
3-53 SECTION 3. The importance of this legislation and the
3-54 crowded condition of the calendars in both houses create an
3-55 emergency and an imperative public necessity that the
3-56 constitutional rule requiring bills to be read on three several
3-57 days in each house be suspended, and this rule is hereby suspended,
3-58 and that this Act take effect and be in force from and after its
3-59 passage, and it is so enacted.
3-60 * * * * *
3-61 Austin,
3-62 Texas
3-63 May 18, 1993
3-64 Hon. Bob Bullock
3-65 President of the Senate
3-66 Sir:
3-67 We, your Committee on Jurisprudence to which was referred H.B. No.
3-68 1285, have had the same under consideration, and I am instructed to
3-69 report it back to the Senate with the recommendation that it do
3-70 pass, as amended, and be printed.
4-1 Henderson,
4-2 Chairman
4-3 * * * * *
4-4 WITNESSES
4-5 FOR AGAINST ON
4-6 ___________________________________________________________________
4-7 Name: Alvin J. Golden x
4-8 Representing: State Bar
4-9 City: Austin
4-10 -------------------------------------------------------------------
4-11 Name: Gayle Vickers x
4-12 Representing: Tx Bankers Assn
4-13 City: Austin
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4-15 Name: Karen M. Neeley x
4-16 Representing: Indep. Bankers Assn of Tx
4-17 City: Austin
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