SRC-AAA S.B. 620 75(R)   BILL ANALYSIS


Senate Research Center   S.B. 620
By: Harris
Jurisprudence
3-27-97
As Filed


DIGEST 

Currently, the law does not deal with the effect of divorce or annulment
on a former spouse's authority to act as an attorney in fact or agent as
designated under a durable power of attorney. While it is generally agreed
that a former spouse's right under a power of attorney should cease upon
divorce, that cessation must be balanced with the rights of third parties.
This bill modifies current law by terminating the rights of a former
spouse while protecting innocent third parties. 

PURPOSE

As proposed, S.B. 620 modifies current law regarding durable powers of
attorney by terminating the rights of a former spouse while protecting
innocent third parties. 

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 481 et seq., Probate Code (Durable Power of
Attorney Act), by adding Section 485A, as follows: 

Sec. 485A. EFFECT OF PRINCIPAL'S DIVORCE OR MARRIAGE ANNULMENT IF FORMER
SPOUSE IS ATTORNEY IN FACT OR AGENT. Provides that a durable power of
attorney between a principal and agent terminates upon divorce of the
principal and agent. 

SECTION 2. Amends Section 486, Probate Code, as follows:

Sec. 486. New heading: KNOWLEDGE OF DEATH, GUARDIAN OF ESTATE, REVOCATION,
DIVORCE, OR MARRIAGE ANNULMENT; GOOD-FAITH ACTS. Provides that an
appointment as agent for a principal before a divorce or an annulment and
a subsequent divorce does not revoke or terminate the agent's power who
without actual knowledge of the termination of the power on the divorce or
annulment, acts in good faith under or in reliance on the power.   Makes
conforming and nonsubstantive changes. 

SECTION  3. Amends Section 487, Probate Code, as follows:

Sec. 487. New heading:  AFFIDAVIT OF LACK OF KNOWLEDGE OF TERMINATION OF
POWER; RECORDING; GOOD FAITH RELIANCE.  Sets forth requirements for an
affidavit executed by the attorney or agent under a durable power of
attorney.  Provides that a third party who relies in good faith on the
acts of an attorney or agent within the scope of the power of attorney is
not liable to the principal. 

SECTION 4. Amends Section 490(a), Probate Code, to delete a provision
setting forth a third party's liability to a principal.  Sets forth a new
form for a power of attorney. 

SECTION 5. Amends Section 492, Probate Code, to authorize an agent to
manage and supervise real property. 

 SECTION 6. Amends Section 503, Probate Code,  to define " retirement
plan." 

SECTION 7. Repealer: Section 490(c), Section 481 et seq., Probate Code
(Power of attorney). 

SECTION 8. Effective date: September 1, 1997.
  Makes application of this Act prospective.

SECTION 9. Emergency clause.