By: Turner S.B. No. 1578
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the compensation of a corporate fiduciary serving as
1-2 trustee of a guardianship management trust.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 867, Probate Code, is amended to read as
1-5 follows:
1-6 Sec. 867. Creation of Management Trust. On application by
1-7 the guardian of a ward or the attorney ad litem for the ward, the
1-8 court in which the guardianship proceeding is pending may enter an
1-9 order that creates for the ward's benefit a trust for the
1-10 management of guardianship funds if the court finds that the
1-11 creation of the trust is in the ward's best interests. The order
1-12 shall direct the guardian to deliver all or part of the assets of
1-13 the guardianship to a trust company or a state or national bank
1-14 that has trust powers in this state. The order shall include
1-15 terms, conditions, and limitations placed on the trust.
1-16 SECTION 2. Subsection (a) of Section 868, Probate Code, is
1-17 amended to read as follows:
1-18 (a) A trust created under Section 867 of this code must
1-19 provide that:
1-20 (1) the ward is the sole beneficiary of the trust;
1-21 (2) the trustee may disburse an amount of the trust's
1-22 principal or income as the trustee determines is necessary to
1-23 expend for the health, education, support, or maintenance of the
2-1 ward, the ward's spouse and the ward's minor children;
2-2 (3) the income of the trust that the trustee does not
2-3 disburse under Subdivision (2) of this subsection must be added to
2-4 the principal of the trust;
2-5 (4) the trustee serves without giving a bond; and
2-6 (5) the trustee receives compensation in accordance with
2-7 compensation charged by corporate trustees in the same geographical
2-8 location for trusts of a similar nature and size and paid from the
2-9 trust's income, principal or both on application to and approval of
2-10 the court <the trustee, on annual application to the court and
2-11 subject to the court's approval, is entitled to receive reasonable
2-12 compensation for services that the trustee provided to the ward as
2-13 the ward's trustee that is:>
2-14 <(A) to be paid from the trust's income,
2-15 principal, or both; and>
2-16 <(B) determined in the same manner as
2-17 compensation of a guardian of an estate under Section 865 of this
2-18 code>.
2-19 SECTION 3. Section 869, Probate Code, is amended to read as
2-20 follows:
2-21 Sec. 869. Trust Amendment, Modification, or Revocation.
2-22 (a) The court may amend, modify, or revoke the trust at any
2-23 time before the date of the trust's termination.
2-24 (b) The ward or guardian of the ward's estate may not revoke
2-25 the trust.
3-1 (c) The court may appoint a successor trustee, which is a
3-2 trust company or a state or national bank that has trust powers in
3-3 this state, when the trustee resigns, becomes ineligible, or is
3-4 removed.
3-5 SECTION 4. Subsection (a), Section 871, Probate Code, is
3-6 amended to read as follows:
3-7 (a) The trustee shall <prepare and> file with the court an
3-8 annual accounting of transactions in the trust in the form of the
3-9 trustee's standard statement provided to its customers. In the
3-10 event an interested part of the court requires additional
3-11 information with regard to the trustee's accounting, the court may
3-12 require the trustee to prepare an accounting in the same manner and
3-13 form that is required of a guardian under this chapter.
3-14 SECTION 5. Section 873, Probate Code, is amended to read as
3-15 follows:
3-16 Sec. 873. Distribution of Trust Property. Unless otherwise
3-17 provided by the court, the trustee shall distribute the principal
3-18 or any undistributed income of the trust to the ward < or to the
3-19 representative of the deceased ward's estate when the trust
3-20 terminates on its own terms or on the ward's death>:
3-21 (a) upon termination of the trust during the life of the
3-22 ward, to the trustee;
3-23 (b) upon appointment of a successor trustee, to the
3-24 successor trustee; or
3-25 (c) upon the ward's death, to the representative of the
4-1 deceased ward's estate.
4-2 SECTION 6. This Act shall be effective September 1, 1995.
4-3 SECTION 7. The importance of this legislation and the
4-4 crowded condition of the calendars in both houses create an
4-5 emergency and an imperative public necessity that the
4-6 constitutional rule requiring bills to be read on three several
4-7 days in each house be suspended, and this rule is hereby suspended.