S.B. No. 176
AN ACT
1-1 relating to the adoption of the Durable Power of Attorney Act.
1-2 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-3 SECTION 1. The Texas Probate Code is amended by adding
1-4 Chapter XII to read as follows:
1-5 CHAPTER XII. DURABLE POWER OF ATTORNEY ACT
1-6 Sec. 481. SHORT TITLE. This chapter may be cited as the
1-7 Durable Power of Attorney Act.
1-8 Sec. 482. DEFINITION. A "durable power of attorney" means a
1-9 written instrument that:
1-10 (1) designates another person as attorney in fact or
1-11 agent;
1-12 (2) is signed by an adult principal;
1-13 (3) contains the words "This power of attorney is not
1-14 affected by subsequent disability or incapacity of the principal,"
1-15 or "This power of attorney becomes effective on the disability or
1-16 incapacity of the principal," or similar words showing the
1-17 principal's intent that the authority conferred on the attorney in
1-18 fact or agent shall be exercised notwithstanding the principal's
1-19 subsequent disability or incapacity; and
1-20 (4) is acknowledged by the principal before an officer
1-21 authorized to take acknowledgments to deeds of conveyance and to
1-22 administer oaths under the laws of this state or any other state.
1-23 Sec. 483. DURATION. A durable power of attorney does not
1-24 lapse because of the passage of time unless the instrument creating
2-1 the power of attorney specifically states a time limitation.
2-2 Sec. 484. EFFECT OF ACTS BY ATTORNEY IN FACT OR AGENT DURING
2-3 INCAPACITY OF PRINCIPAL. All acts done by an attorney in fact or
2-4 agent pursuant to a durable power of attorney during any period of
2-5 disability or incapacity of the principal have the same effect and
2-6 inure to the benefit of and bind the principal and the principal's
2-7 successors in interest as if the principal were not disabled or
2-8 incapacitated.
2-9 Sec. 485. RELATION OF ATTORNEY IN FACT OR AGENT TO
2-10 COURT-APPOINTED GUARDIAN OF ESTATE. If, after execution of a
2-11 durable power of attorney, a court of the principal's domicile
2-12 appoints a guardian of the estate of the principal, the powers of
2-13 the attorney in fact or agent terminate on the qualification of the
2-14 guardian of the estate, and the attorney in fact or agent shall
2-15 deliver to the guardian of the estate all assets of the estate of
2-16 the ward in the attorney's or agent's possession and shall account
2-17 to the guardian of the estate as the attorney or agent would to the
2-18 principal had the principal terminated his powers.
2-19 Sec. 486. KNOWLEDGE OF DEATH, GUARDIAN OF ESTATE, OR
2-20 REVOCATION; GOOD-FAITH ACTS. The revocation by, the death of, or
2-21 the qualification of a guardian of the estate of a principal who
2-22 has executed a durable power of attorney does not revoke or
2-23 terminate the agency as to the attorney in fact, agent, or other
2-24 person who, without actual knowledge of the termination of the
2-25 power by revocation, by the principal's death, or by the
2-26 qualification of a guardian of the estate of the principal, acts in
2-27 good faith under or in reliance on the power. Any action so taken,
3-1 unless otherwise invalid or unenforceable, binds successors in
3-2 interest of the principal.
3-3 Sec. 487. AFFIDAVIT OF LACK OF KNOWLEDGE OR TERMINATION OF
3-4 POWER; RECORDING. (a) As to acts undertaken in good-faith
3-5 reliance on the durable power of attorney, an affidavit executed by
3-6 the attorney in fact or agent under a durable power of attorney
3-7 stating that the attorney in fact or agent did not have at the time
3-8 of exercise of the power actual knowledge of the termination of the
3-9 power by revocation, by the principal's death, or by the
3-10 qualification of a guardian of the estate of the principal is
3-11 conclusive proof as between the attorney in fact or agent and a
3-12 person other than the principal or the principal's personal
3-13 representative dealing with the attorney in fact or agent of the
3-14 nonrevocation or nontermination of the power at that time.
3-15 (b) As to acts undertaken in good-faith reliance on the
3-16 durable power of attorney, an affidavit executed by the attorney in
3-17 fact or agent under a durable power of attorney stating that the
3-18 principal is disabled or incapacitated, as defined by the power, is
3-19 conclusive proof as between the attorney in fact or agent and a
3-20 person other than the principal or the principal's personal
3-21 representative dealing with the attorney in fact or agent of the
3-22 disability or incapacity of the principal at that time.
3-23 (c) If the exercise of the power of attorney requires
3-24 execution and delivery of any instrument that is to be recorded, an
3-25 affidavit executed under Subsection (a) or (b) of this section,
3-26 when authenticated for record, may also be recorded.
3-27 (d) This section does not affect any provision in a durable
4-1 power of attorney for its termination by expiration of time or
4-2 occurrence of an event other than express revocation.
4-3 Sec. 488. REVOCATION OF DURABLE POWER OF ATTORNEY. Unless
4-4 otherwise provided by the durable power of attorney, a revocation
4-5 of a durable power of attorney is not effective as to a third party
4-6 relying on the power of attorney until the third party receives
4-7 actual notice of the revocation.
4-8 Sec. 489. RECORDING DURABLE POWER OF ATTORNEY FOR REAL
4-9 PROPERTY TRANSACTIONS. A durable power of attorney for a real
4-10 property transaction requiring the execution and delivery of an
4-11 instrument that is to be recorded, including a release, assignment,
4-12 satisfaction, mortgage, security agreement, deed of trust,
4-13 encumbrance, deed of conveyance, oil, gas, or other mineral lease,
4-14 memorandum of a lease, lien, or other claim or right to real
4-15 property, shall be recorded in the office of the county clerk of
4-16 the county in which the property is located.
4-17 Sec. 490. STATUTORY DURABLE POWER OF ATTORNEY. (a) The
4-18 following form is known as a "statutory durable power of attorney."
4-19 A person may use a statutory durable power of attorney to grant an
4-20 attorney in fact or agent powers with respect to a person's
4-21 property and financial matters. A power of attorney in
4-22 substantially the following form has the meaning and effect
4-23 prescribed by this chapter. The validity of a power of attorney as
4-24 meeting the requirements of a statutory durable power of attorney
4-25 is not affected by the fact that one or more of the categories of
4-26 optional powers listed in the form are struck or the form includes
4-27 specific limitations on or additions to the attorney in fact's or
5-1 agent's powers.
5-2 When a power in substantially the form set forth in this
5-3 chapter is used, third parties who rely in good faith on the acts
5-4 of the agent within the scope of the power may do so without fear
5-5 of liability to the principal.
5-6 The following form is not exclusive, and other forms of power
5-7 of attorney may be used.
5-8 STATUTORY DURABLE POWER OF ATTORNEY
5-9 NOTICE: THE POWERS GRANTED BY THIS DOCUMENT ARE BROAD AND
5-10 SWEEPING. THEY ARE EXPLAINED IN THE DURABLE POWER OF ATTORNEY ACT,
5-11 CHAPTER XII, TEXAS PROBATE CODE. IF YOU HAVE ANY QUESTIONS ABOUT
5-12 THESE POWERS, OBTAIN COMPETENT LEGAL ADVICE. THIS DOCUMENT DOES
5-13 NOT AUTHORIZE ANYONE TO MAKE MEDICAL AND OTHER HEALTH-CARE
5-14 DECISIONS FOR YOU. YOU MAY REVOKE THIS POWER OF ATTORNEY IF YOU
5-15 LATER WISH TO DO SO.
5-16 I, (insert your name and address), my
5-17 social security number being (insert your proper
5-18 SS#), appoint (insert the name and
5-19 address of the person appointed) as my agent (attorney-in-fact) to
5-20 act for me in any lawful way with respect to the following
5-21 initialed subjects:
5-22 TO GRANT ALL OF THE FOLLOWING POWERS, INITIAL THE LINE IN
5-23 FRONT OF (N) AND IGNORE THE LINES IN FRONT OF THE OTHER POWERS.
5-24 TO GRANT ONE OR MORE, BUT FEWER THAN ALL, OF THE FOLLOWING
5-25 POWERS, INITIAL THE LINE IN FRONT OF EACH POWER YOU ARE GRANTING.
5-26 TO WITHHOLD A POWER, DO NOT INITIAL THE LINE IN FRONT OF IT.
5-27 YOU MAY, BUT NEED NOT, CROSS OUT EACH POWER WITHHELD.
6-1 INITIAL
6-2 _________ (A) real property transactions;
6-3 _________ (B) tangible personal property transactions;
6-4 _________ (C) stock and bond transactions;
6-5 _________ (D) commodity and option transactions;
6-6 _________ (E) banking and other financial institution
6-7 transactions;
6-8 _________ (F) business operating transactions;
6-9 _________ (G) insurance and annuity transactions;
6-10 _________ (H) estate, trust, and other beneficiary transactions;
6-11 _________ (I) claims and litigation;
6-12 _________ (J) personal and family maintenance;
6-13 _________ (K) benefits from social security, Medicare, Medicaid,
6-14 or other governmental programs or civil or military
6-15 service;
6-16 _________ (L) retirement plan transactions;
6-17 _________ (M) tax matters;
6-18 _________ (N) ALL OF THE POWERS LISTED IN (A) THROUGH (M). YOU
6-19 NEED NOT INITIAL ANY OTHER LINES IF YOU INITIAL LINE
6-20 (N).
6-21 SPECIAL INSTRUCTIONS:
6-22 ON THE FOLLOWING LINES YOU MAY GIVE SPECIAL INSTRUCTIONS
6-23 LIMITING OR EXTENDING THE POWERS GRANTED TO YOUR AGENT.
6-24 ___________________________________________________________________
6-25 ___________________________________________________________________
6-26 ___________________________________________________________________
6-27 ___________________________________________________________________
7-1 ___________________________________________________________________
7-2 ___________________________________________________________________
7-3 ___________________________________________________________________
7-4 ___________________________________________________________________
7-5 ___________________________________________________________________
7-6 ___________________________________________________________________
7-7 UNLESS YOU DIRECT OTHERWISE ABOVE, THIS POWER OF ATTORNEY IS
7-8 EFFECTIVE IMMEDIATELY AND WILL CONTINUE UNTIL IT IS REVOKED.
7-9 CHOOSE ONE OF THE FOLLOWING ALTERNATIVES BY CROSSING OUT THE
7-10 ALTERNATIVE NOT CHOSEN:
7-11 (A) This power of attorney is not affected by my
7-12 subsequent disability or incapacity.
7-13 (B) This power of attorney becomes effective upon my
7-14 disability or incapacity.
7-15 YOU SHOULD CHOOSE ALTERNATIVE (A) IF THIS POWER OF ATTORNEY
7-16 IS TO BECOME EFFECTIVE ON THE DATE IT IS EXECUTED.
7-17 IF NEITHER (A) NOR (B) IS CROSSED OUT, IT WILL BE ASSUMED
7-18 THAT YOU CHOSE ALTERNATIVE (A).
7-19 I agree that any third party who receives a copy of this
7-20 document may act under it. Revocation of the durable power of
7-21 attorney is not effective as to a third party until the third party
7-22 receives actual notice of the revocation. I agree to indemnify the
7-23 third party for any claims that arise against the third party
7-24 because of reliance on this power of attorney.
7-25 If any agent named by me dies, becomes legally disabled,
7-26 resigns, or refuses to act, I name the following (each to act alone
7-27 and successively, in the order named) as successor(s) to that
8-1 agent: .
8-2 Signed this ____________ day of ______________________, 19___
8-3 __________________________________
8-4 (your signature)
8-5 State of ____________________
8-6 County of ___________________
8-7 This document was acknowledged before me on
8-8 _______________________ (date) by _________________________________
8-9 (name of principal)
8-10 _________________________________
8-11 (signature of notarial officer)
8-12 (Seal, if any, of
8-13 notary) _________________________________
8-14 (printed name)
8-15 My commission expires: _________
8-16 THE ATTORNEY IN FACT OR AGENT, BY ACCEPTING OR ACTING UNDER
8-17 THE APPOINTMENT, ASSUMES THE FIDUCIARY AND OTHER LEGAL
8-18 RESPONSIBILITIES OF AN AGENT.
8-19 (b) A statutory durable power of attorney is legally
8-20 sufficient under this chapter if the wording of the form complies
8-21 substantially with Subsection (a) of this section, the form is
8-22 properly completed, and the signature of the principal is
8-23 acknowledged.
8-24 (c) If the line in front of (N) of the form under Subsection
8-25 (a) of this section is initialed, an initial on the line in front
8-26 of any other power does not limit the powers granted by line (N).
8-27 Sec. 491. CONSTRUCTION OF POWERS GENERALLY. The principal,
9-1 by executing a statutory durable power of attorney that confers
9-2 authority with respect to any class of transactions, empowers the
9-3 attorney in fact or agent for that class of transactions to:
9-4 (1) demand, receive, and obtain by litigation, action,
9-5 or otherwise any money or other thing of value to which the
9-6 principal is, may become, or may claim to be entitled;
9-7 (2) conserve, invest, disburse, or use any money or
9-8 other thing of value received on behalf of the principal for the
9-9 purposes intended;
9-10 (3) contract in any manner with any person, on terms
9-11 agreeable to the attorney in fact or agent, to accomplish a purpose
9-12 of a transaction and perform, rescind, reform, release, or modify
9-13 the contract or another contract made by or on behalf of the
9-14 principal;
9-15 (4) execute, acknowledge, seal, and deliver a deed,
9-16 revocation, mortgage, lease, notice, check, release, or other
9-17 instrument the agent considers desirable to accomplish a purpose of
9-18 a transaction;
9-19 (5) prosecute, defend, submit to arbitration, settle,
9-20 and propose or accept a compromise with respect to a claim existing
9-21 in favor of or against the principal or intervene in an action or
9-22 litigation relating to the claim;
9-23 (6) seek on the principal's behalf the assistance of a
9-24 court to carry out an act authorized by the power of attorney;
9-25 (7) engage, compensate, and discharge an attorney,
9-26 accountant, expert witness, or other assistant;
9-27 (8) keep appropriate records of each transaction,
10-1 including an accounting of receipts and disbursements;
10-2 (9) prepare, execute, and file a record, report, or
10-3 other document the attorney in fact or agent considers necessary or
10-4 desirable to safeguard or promote the principal's interest under a
10-5 statute or governmental regulation;
10-6 (10) reimburse the attorney in fact or agent for
10-7 expenditures made in exercising the powers granted by the durable
10-8 power of attorney; and
10-9 (11) in general, do any other lawful act that the
10-10 principal may do with respect to a transaction.
10-11 Sec. 492. CONSTRUCTION OF POWER RELATING TO REAL PROPERTY
10-12 TRANSACTIONS. In a statutory durable power of attorney, the
10-13 language conferring authority with respect to real property
10-14 transactions empowers the attorney in fact or agent without further
10-15 reference to a specific description of the real property to:
10-16 (1) accept as a gift or as security for a loan or
10-17 reject, demand, buy, lease, receive, or otherwise acquire an
10-18 interest in real property or a right incident to real property;
10-19 (2) sell, exchange, convey with or without covenants,
10-20 quitclaim, release, surrender, mortgage, encumber, partition,
10-21 consent to partitioning, subdivide, apply for zoning, rezoning, or
10-22 other governmental permits, plat or consent to platting, develop,
10-23 grant options concerning, lease or sublet, or otherwise dispose of
10-24 an estate or interest in real property or a right incident to real
10-25 property;
10-26 (3) release, assign, satisfy, and enforce by
10-27 litigation, action, or otherwise a mortgage, deed of trust,
11-1 encumbrance, lien, or other claim to real property that exists or
11-2 is claimed to exist;
11-3 (4) do any act of management or of conservation with
11-4 respect to an interest in real property, or a right incident to
11-5 real property, owned or claimed to be owned by the principal,
11-6 including power to:
11-7 (A) insure against a casualty, liability, or
11-8 loss;
11-9 (B) obtain or regain possession or protect the
11-10 interest or right by litigation, action, or otherwise;
11-11 (C) pay, compromise, or contest taxes or
11-12 assessments or apply for and receive refunds in connection with
11-13 them; and
11-14 (D) purchase supplies, hire assistance or labor,
11-15 or make repairs or alterations in the real property;
11-16 (5) use, develop, alter, replace, remove, erect, or
11-17 install structures or other improvements on real property in which
11-18 the principal has or claims to have an estate, interest, or right;
11-19 (6) participate in a reorganization with respect to
11-20 real property or a legal entity that owns an interest in or right
11-21 incident to real property, receive and hold shares of stock or
11-22 obligations received in a plan or reorganization, and act with
11-23 respect to the shares or obligations, including:
11-24 (A) selling or otherwise disposing of the shares
11-25 or obligations;
11-26 (B) exercising or selling an option, conversion,
11-27 or similar right with respect to the shares or obligations; and
12-1 (C) voting the shares or obligations in person
12-2 or by proxy;
12-3 (7) change the form of title of an interest in or
12-4 right incident to real property; and
12-5 (8) dedicate easements or other real property in which
12-6 the principal has or claims to have an interest to public use, with
12-7 or without consideration.
12-8 Sec. 493. CONSTRUCTION OF POWER RELATING TO TANGIBLE
12-9 PERSONAL PROPERTY TRANSACTIONS. In a statutory durable power of
12-10 attorney, the language conferring general authority with respect to
12-11 tangible personal property transactions empowers the attorney in
12-12 fact or agent to:
12-13 (1) accept as a gift or as security for a loan,
12-14 reject, demand, buy, receive, or otherwise acquire ownership or
12-15 possession of tangible personal property or an interest in tangible
12-16 personal property;
12-17 (2) sell, exchange, convey with or without covenants,
12-18 release, surrender, mortgage, encumber, pledge, hypothecate, create
12-19 a security interest in, pawn, grant options concerning, lease or
12-20 sublet to others, or otherwise dispose of tangible personal
12-21 property or an interest in tangible personal property;
12-22 (3) release, assign, satisfy, or enforce by
12-23 litigation, action, or otherwise a mortgage, security interest,
12-24 encumbrance, lien, or other claim on behalf of the principal, with
12-25 respect to tangible personal property or an interest in tangible
12-26 personal property; and
12-27 (4) do an act of management or conservation with
13-1 respect to tangible personal property or an interest in tangible
13-2 personal property on behalf of the principal, including:
13-3 (A) insuring against casualty, liability, or
13-4 loss;
13-5 (B) obtaining or regaining possession or
13-6 protecting the property or interest by litigation, action, or
13-7 otherwise;
13-8 (C) paying, compromising, or contesting taxes or
13-9 assessments or applying for and receiving refunds in connection
13-10 with taxes or assessments;
13-11 (D) moving from place to place;
13-12 (E) storing for hire or on a gratuitous
13-13 bailment; and
13-14 (F) using, altering, and making repairs or
13-15 alterations.
13-16 Sec. 494. CONSTRUCTION OF POWER RELATING TO STOCK AND BOND
13-17 TRANSACTIONS. In a statutory durable power of attorney, the
13-18 language conferring authority with respect to stock and bond
13-19 transactions empowers the attorney in fact or agent to buy, sell,
13-20 and exchange stocks, bonds, mutual funds, and all other types of
13-21 securities and financial instruments other than commodity futures
13-22 contracts and call and put options on stocks and stock indexes,
13-23 receive certificates and other evidences of ownership with respect
13-24 to securities, exercise voting rights with respect to securities in
13-25 person or by proxy, enter into voting trusts, and consent to
13-26 limitations on the right to vote.
13-27 Sec. 495. CONSTRUCTION OF POWER RELATING TO COMMODITY AND
14-1 OPTION TRANSACTIONS. In a statutory durable power of attorney, the
14-2 language conferring authority with respect to commodity and option
14-3 transactions empowers the attorney in fact or agent to buy, sell,
14-4 exchange, assign, settle, and exercise commodity futures contracts
14-5 and call and put options on stocks and stock indexes traded on a
14-6 regulated options exchange and establish, continue, modify, or
14-7 terminate option accounts with a broker.
14-8 Sec. 496. CONSTRUCTION OF POWER RELATING TO BANKING AND
14-9 OTHER FINANCIAL INSTITUTION TRANSACTIONS. In a statutory durable
14-10 power of attorney, the language conferring authority with respect
14-11 to banking and other financial institution transactions empowers
14-12 the attorney in fact or agent to:
14-13 (1) continue, modify, or terminate an account or other
14-14 banking arrangement made by or on behalf of the principal;
14-15 (2) establish, modify, or terminate an account or
14-16 other banking arrangement with a bank, trust company, savings and
14-17 loan association, credit union, thrift company, brokerage firm, or
14-18 other financial institution selected by the attorney in fact or
14-19 agent;
14-20 (3) hire a safe deposit box or space in a vault;
14-21 (4) contract to procure other services available from
14-22 a financial institution as the attorney in fact or agent considers
14-23 desirable;
14-24 (5) withdraw by check, order, or otherwise money or
14-25 property of the principal deposited with or left in the custody of
14-26 a financial institution;
14-27 (6) receive bank statements, vouchers, notices, or
15-1 similar documents from a financial institution and act with respect
15-2 to them;
15-3 (7) enter a safe deposit box or vault and withdraw or
15-4 add to the contents;
15-5 (8) borrow money at an interest rate agreeable to the
15-6 attorney in fact or agent and pledge as security real or personal
15-7 property of the principal necessary to borrow, pay, renew, or
15-8 extend the time of payment of a debt of the principal;
15-9 (9) make, assign, draw, endorse, discount, guarantee,
15-10 and negotiate promissory notes, bills of exchange, checks, drafts,
15-11 or other negotiable or nonnegotiable paper of the principal, or
15-12 payable to the principal or the principal's order, to receive the
15-13 cash or other proceeds of those transactions, to accept a draft
15-14 drawn by a person on the principal, and to pay the principal when
15-15 due;
15-16 (10) receive for the principal and act on a sight
15-17 draft, warehouse receipt, or other negotiable or nonnegotiable
15-18 instrument;
15-19 (11) apply for and receive letters of credit, credit
15-20 cards, and traveler's checks from a financial institution and give
15-21 an indemnity or other agreement in connection with letters of
15-22 credit; and
15-23 (12) consent to an extension of the time of payment
15-24 with respect to commercial paper or a financial transaction with a
15-25 financial institution.
15-26 Sec. 497. CONSTRUCTION OF POWER RELATING TO BUSINESS
15-27 OPERATING TRANSACTIONS. In a statutory durable power of attorney,
16-1 the language conferring authority with respect to business
16-2 operating transactions empowers the attorney in fact or agent to:
16-3 (1) operate, buy, sell, enlarge, reduce, or terminate
16-4 a business interest;
16-5 (2) to the extent that an agent is permitted by law to
16-6 act for a principal and subject to the terms of the partnership
16-7 agreement:
16-8 (A) perform a duty or discharge a liability or
16-9 exercise a right, power, privilege, or option that the principal
16-10 has, may have, or claims to have under a partnership agreement,
16-11 whether or not the principal is a general or limited partner;
16-12 (B) enforce the terms of a partnership agreement
16-13 by litigation, action, or otherwise; and
16-14 (C) defend, submit to arbitration, settle, or
16-15 compromise litigation or an action to which the principal is a
16-16 party because of membership in the partnership;
16-17 (3) exercise in person or by proxy or enforce by
16-18 litigation, action, or otherwise a right, power, privilege, or
16-19 option the principal has or claims to have as the holder of a bond,
16-20 share, or other instrument of similar character and defend, submit
16-21 to arbitration, settle, or compromise a legal proceeding to which
16-22 the principal is a party because of a bond, share, or similar
16-23 instrument;
16-24 (4) with respect to a business owned solely by the
16-25 principal:
16-26 (A) continue, modify, renegotiate, extend, and
16-27 terminate a contract made with an individual or a legal entity,
17-1 firm, association, or corporation by or on behalf of the principal
17-2 with respect to the business before execution of the power of
17-3 attorney;
17-4 (B) determine:
17-5 (i) the location of its operation;
17-6 (ii) the nature and extent of its
17-7 business;
17-8 (iii) the methods of manufacturing,
17-9 selling, merchandising, financing, accounting, and advertising
17-10 employed in its operation;
17-11 (iv) the amount and types of insurance
17-12 carried; and
17-13 (v) the mode of engaging, compensating,
17-14 and dealing with its accountants, attorneys, and other agents and
17-15 employees;
17-16 (C) change the name or form of organization
17-17 under which the business is operated and enter into a partnership
17-18 agreement with other persons or organize a corporation to take over
17-19 all or part of the operation of the business; and
17-20 (D) demand and receive money due or claimed by
17-21 the principal or on the principal's behalf in the operation of the
17-22 business and control and disburse the money in the operation of the
17-23 business;
17-24 (5) put additional capital into a business in which
17-25 the principal has an interest;
17-26 (6) join in a plan of reorganization, consolidation,
17-27 or merger of the business;
18-1 (7) sell or liquidate a business or part of it at the
18-2 time and on the terms that the attorney in fact or agent considers
18-3 desirable;
18-4 (8) establish the value of a business under a buy-out
18-5 agreement to which the principal is a party;
18-6 (9) prepare, sign, file, and deliver reports,
18-7 compilations of information, returns, or other papers with respect
18-8 to a business that are required by a governmental agency,
18-9 department, or instrumentality or that the attorney in fact or
18-10 agent considers desirable and make related payments; and
18-11 (10) pay, compromise, or contest taxes or assessments
18-12 and do any other act that the attorney in fact or agent considers
18-13 desirable to protect the principal from illegal or unnecessary
18-14 taxation, fines, penalties, or assessments with respect to a
18-15 business, including attempts to recover, in any manner permitted by
18-16 law, money paid before or after the execution of the power of
18-17 attorney.
18-18 Sec. 498. CONSTRUCTION OF POWER RELATING TO INSURANCE
18-19 TRANSACTIONS. In a statutory durable power of attorney, the
18-20 language conferring authority with respect to insurance and annuity
18-21 transactions empowers the attorney in fact or agent to:
18-22 (1) continue, pay the premium or assessment on,
18-23 modify, rescind, release, or terminate a contract procured by or on
18-24 behalf of the principal that insures or provides an annuity to
18-25 either the principal or another person, whether or not the
18-26 principal is a beneficiary under the contract;
18-27 (2) procure new, different, or additional contracts of
19-1 insurance and annuities for the principal or the principal's
19-2 spouse, children, and other dependents and select the amount, type
19-3 of insurance or annuity, and mode of payment;
19-4 (3) pay the premium or assessment on or modify,
19-5 rescind, release, or terminate a contract of insurance or annuity
19-6 procured by the attorney in fact or agent;
19-7 (4) designate the beneficiary of the contract, except
19-8 that an attorney in fact or agent may be named a beneficiary of the
19-9 contract or an extension, renewal, or substitute for the contract
19-10 only to the extent the attorney in fact or agent was named as a
19-11 beneficiary under a contract procured by the principal before
19-12 executing the power of attorney;
19-13 (5) apply for and receive a loan on the security of
19-14 the contract of insurance or annuity;
19-15 (6) surrender and receive the cash surrender value;
19-16 (7) exercise an election;
19-17 (8) change the manner of paying premiums;
19-18 (9) change or convert the type of insurance contract
19-19 or annuity with respect to which the principal has or claims to
19-20 have a power described in this section;
19-21 (10) change the beneficiary of a contract of insurance
19-22 or annuity, except that the attorney in fact or agent may be
19-23 designated a beneficiary only to the extent authorized by
19-24 Subdivision (4) of this section;
19-25 (11) apply for and procure government aid to guarantee
19-26 or pay premiums of a contract of insurance on the life of the
19-27 principal;
20-1 (12) collect, sell, assign, hypothecate, borrow on, or
20-2 pledge the interest of the principal in a contract of insurance or
20-3 annuity; and
20-4 (13) pay from proceeds or otherwise, compromise or
20-5 contest, or apply for refunds in connection with a tax or
20-6 assessment levied by a taxing authority with respect to a contract
20-7 of insurance or annuity or its proceeds or liability accruing
20-8 because of the tax or assessment.
20-9 Sec. 499. CONSTRUCTION OF POWER RELATING TO ESTATE, TRUST,
20-10 AND OTHER BENEFICIARY TRANSACTIONS. In a statutory durable power
20-11 of attorney, the language conferring authority with respect to
20-12 estate, trust, and other beneficiary transactions empowers the
20-13 attorney in fact or agent to act for the principal in all matters
20-14 that affect a trust, probate estate, guardianship, conservatorship,
20-15 escrow, custodianship, or other fund from which the principal is,
20-16 may become, or claims to be entitled, as a beneficiary, to a share
20-17 or payment, including to:
20-18 (1) accept, reject, disclaim, receive, receipt for,
20-19 sell, assign, release, pledge, exchange, or consent to a reduction
20-20 in or modification of a share in or payment from the fund;
20-21 (2) demand or obtain by litigation, action, or
20-22 otherwise money or any other thing of value to which the principal
20-23 is, may become, or claims to be entitled because of the fund;
20-24 (3) initiate, participate in, or oppose a legal or
20-25 judicial proceeding to ascertain the meaning, validity, or effect
20-26 of a deed, will, declaration of trust, or other instrument or
20-27 transaction affecting the interest of the principal;
21-1 (4) initiate, participate in, or oppose a legal or
21-2 judicial proceeding to remove, substitute, or surcharge a
21-3 fiduciary;
21-4 (5) conserve, invest, disburse, or use anything
21-5 received for an authorized purpose; and
21-6 (6) transfer all or part of an interest of the
21-7 principal in real property, stocks, bonds, accounts with financial
21-8 institutions, insurance, and other property to the trustee of a
21-9 revocable trust created by the principal as settlor.
21-10 Sec. 500. CONSTRUCTION OF POWER RELATING TO CLAIMS AND
21-11 LITIGATION. In a statutory durable power of attorney, the language
21-12 conferring general authority with respect to claims and litigation
21-13 empowers the attorney in fact or agent to:
21-14 (1) assert and prosecute before a court or
21-15 administrative agency a claim, a claim for relief, a counterclaim,
21-16 or an offset or defend against an individual, a legal entity, or a
21-17 government, including suits to recover property or other thing of
21-18 value, to recover damages sustained by the principal, to eliminate
21-19 or modify tax liability, or to seek an injunction, specific
21-20 performance, or other relief;
21-21 (2) bring an action to determine adverse claims,
21-22 intervene in an action or litigation, and act as amicus curiae;
21-23 (3) in connection with an action or litigation,
21-24 procure an attachment, garnishment, libel, order of arrest, or
21-25 other preliminary, provisional, or intermediate relief and use an
21-26 available procedure to effect or satisfy a judgment, order, or
21-27 decree;
22-1 (4) in connection with an action or litigation,
22-2 perform any lawful act the principal could perform, including
22-3 acceptance of tender, offer of judgment, admission of facts,
22-4 submission of a controversy on an agreed statement of facts,
22-5 consent to examination before trial, and binding of the principal
22-6 in litigation;
22-7 (5) submit to arbitration, settle, and propose or
22-8 accept a compromise with respect to a claim or litigation;
22-9 (6) waive the issuance and service of process on the
22-10 principal, accept service of process, appear for the principal,
22-11 designate persons on whom process directed to the principal may be
22-12 served, execute and file or deliver stipulations on the principal's
22-13 behalf, verify pleadings, seek appellate review, procure and give
22-14 surety and indemnity bonds, contract and pay for the preparation
22-15 and printing of records and briefs, or receive and execute and file
22-16 or deliver a consent, waiver, release, confession of judgment,
22-17 satisfaction of judgment, notice, agreement, or other instrument in
22-18 connection with the prosecution, settlement, or defense of a claim
22-19 or litigation;
22-20 (7) act for the principal with respect to bankruptcy
22-21 or insolvency proceedings, whether voluntary or involuntary,
22-22 concerning the principal or some other person, with respect to a
22-23 reorganization proceeding or a receivership or application for the
22-24 appointment of a receiver or trustee that affects an interest of
22-25 the principal in real or personal property or other thing of value;
22-26 and
22-27 (8) pay a judgment against the principal or a
23-1 settlement made in connection with a claim or litigation and
23-2 receive and conserve money or other thing of value paid in
23-3 settlement of or as proceeds of a claim or litigation.
23-4 Sec. 501. CONSTRUCTION OF POWER RELATING TO PERSONAL AND
23-5 FAMILY MAINTENANCE. In a statutory durable power of attorney, the
23-6 language conferring authority with respect to personal and family
23-7 maintenance empowers the attorney in fact or agent to:
23-8 (1) perform the acts necessary to maintain the
23-9 customary standard of living of the principal, the principal's
23-10 spouse and children, and other individuals customarily or legally
23-11 entitled to be supported by the principal, including providing
23-12 living quarters by purchase, lease, or other contract, or paying
23-13 the operating costs, including interest, amortization payments,
23-14 repairs, and taxes on premises owned by the principal and occupied
23-15 by those individuals;
23-16 (2) provide for the individuals described by
23-17 Subdivision (1) of this section normal domestic help, usual
23-18 vacations and travel expenses, and funds for shelter, clothing,
23-19 food, appropriate education, and other current living costs;
23-20 (3) pay necessary medical, dental, and surgical care,
23-21 hospitalization, and custodial care for the individuals described
23-22 by Subdivision (1) of this section;
23-23 (4) continue any provision made by the principal, for
23-24 the individuals described by Subdivision (1) of this section, for
23-25 automobiles or other means of transportation, including
23-26 registering, licensing, insuring, and replacing the automobiles or
23-27 other means of transportation;
24-1 (5) maintain or open charge accounts for the
24-2 convenience of the individuals described by Subdivision (1) of this
24-3 section and open new accounts the attorney in fact or agent
24-4 considers desirable to accomplish a lawful purpose; and
24-5 (6) continue payments incidental to the membership or
24-6 affiliation of the principal in a church, club, society, order, or
24-7 other organization or to continue contributions to those
24-8 organizations.
24-9 Sec. 502. CONSTRUCTION OF POWER RELATING TO BENEFITS FROM
24-10 CERTAIN GOVERNMENTAL PROGRAMS OR CIVIL OR MILITARY SERVICE. In a
24-11 statutory durable power of attorney, the language conferring
24-12 authority with respect to benefits from social security, Medicare,
24-13 Medicaid, or other governmental programs or civil or military
24-14 service empowers the attorney in fact or agent to:
24-15 (1) execute vouchers in the name of the principal for
24-16 allowances and reimbursements payable by the United States, a
24-17 foreign government, or a state or subdivision of a state to the
24-18 principal, including allowances and reimbursements for
24-19 transportation of the individuals described by Section 501(1) of
24-20 this code, and for shipment of their household effects;
24-21 (2) take possession and order the removal and shipment
24-22 of property of the principal from a post, warehouse, depot, dock,
24-23 or other place of storage or safekeeping, either governmental or
24-24 private, and execute and deliver a release, voucher, receipt, bill
24-25 of lading, shipping ticket, certificate, or other instrument for
24-26 that purpose;
24-27 (3) prepare, file, and prosecute a claim of the
25-1 principal to a benefit or assistance, financial or otherwise, to
25-2 which the principal claims to be entitled under a statute or
25-3 governmental regulation;
25-4 (4) prosecute, defend, submit to arbitration, settle,
25-5 and propose or accept a compromise with respect to any benefits the
25-6 principal may be entitled to receive; and
25-7 (5) receive the financial proceeds of a claim of the
25-8 type described in this section and conserve, invest, disburse, or
25-9 use anything received for a lawful purpose.
25-10 Sec. 503. CONSTRUCTION OF POWER RELATING TO RETIREMENT PLAN
25-11 TRANSACTIONS. In a statutory durable power of attorney, the
25-12 language conferring authority with respect to retirement plan
25-13 transactions empowers the attorney in fact or agent to do any
25-14 lawful act the principal may do with respect to a transaction
25-15 relating to a retirement plan, including to:
25-16 (1) apply for service or disability retirement
25-17 benefits;
25-18 (2) select payment options under any retirement plan
25-19 in which the principal participates, including plans for
25-20 self-employed individuals;
25-21 (3) designate or change the designation of a
25-22 beneficiary or benefits payable by a retirement plan, except that
25-23 an attorney in fact or agent may be named a beneficiary only to the
25-24 extent the attorney in fact or agent was a named beneficiary under
25-25 the retirement plan before the durable power of attorney was
25-26 executed;
25-27 (4) make voluntary contributions to retirement plans
26-1 if authorized by the plan;
26-2 (5) exercise the investment powers available under any
26-3 self-directed retirement plan;
26-4 (6) make "rollovers" of plan benefits into other
26-5 retirement plans;
26-6 (7) borrow from, sell assets to, and purchase assets
26-7 from retirement plans if authorized by the plan;
26-8 (8) waive the right of the principal to be a
26-9 beneficiary of a joint or survivor annuity if the principal is a
26-10 spouse who is not employed;
26-11 (9) receive, endorse, and cash payments from a
26-12 retirement plan;
26-13 (10) waive the right of the principal to receive all
26-14 or a portion of benefits payable by a retirement plan; and
26-15 (11) request and receive information relating to the
26-16 principal from retirement plan records.
26-17 Sec. 504. CONSTRUCTION OF POWER RELATING TO TAX MATTERS. In
26-18 a statutory durable power of attorney, the language conferring
26-19 authority with respect to tax matters empowers the attorney in fact
26-20 or agent to:
26-21 (1) prepare, sign, and file federal, state, local, and
26-22 foreign income, gift, payroll, Federal Insurance Contributions Act,
26-23 and other tax returns, claims for refunds, requests for extension
26-24 of time, petitions regarding tax matters, and any other tax-related
26-25 documents, including receipts, offers, waivers, consents, including
26-26 consents and agreements under Section 2032A, Internal Revenue Code
26-27 of 1986 (26 U.S.C. Section 2032A), closing agreements, and any
27-1 power of attorney form required by the Internal Revenue Service or
27-2 other taxing authority with respect to a tax year on which the
27-3 statute of limitations has not run and 25 tax years following that
27-4 tax year;
27-5 (2) pay taxes due, collect refunds, post bonds,
27-6 receive confidential information, and contest deficiencies
27-7 determined by the Internal Revenue Service or other taxing
27-8 authority;
27-9 (3) exercise any election available to the principal
27-10 under federal, state, local, or foreign tax law; and
27-11 (4) act for the principal in all tax matters for all
27-12 periods before the Internal Revenue Service and any other taxing
27-13 authority.
27-14 Sec. 505. EXISTING INTEREST; FOREIGN INTERESTS. The powers
27-15 described in Sections 492 through 504 of this code may be exercised
27-16 equally with respect to an interest the principal has at the time
27-17 the durable power of attorney is executed or acquires later,
27-18 whether or not the property is located in this state and whether or
27-19 not the powers are exercised or the durable power of attorney is
27-20 executed in this state.
27-21 Sec. 506. UNIFORMITY OF APPLICATION AND CONSTRUCTION. This
27-22 chapter shall be applied and construed to effect its general
27-23 purpose to make uniform the law with respect to the subject of this
27-24 chapter among states enacting it.
27-25 SECTION 2. Section 36A, Probate Code, is repealed. A power
27-26 of attorney executed in compliance with that section before the
27-27 effective date of this Act is valid according to the terms of that
28-1 section as it existed at the time of the execution, and that
28-2 section is continued in effect for that purpose.
28-3 SECTION 3. This Act takes effect September 1, 1993.
28-4 SECTION 4. The importance of this legislation and the
28-5 crowded condition of the calendars in both houses create an
28-6 emergency and an imperative public necessity that the
28-7 constitutional rule requiring bills to be read on three several
28-8 days in each house be suspended, and this rule is hereby suspended.