1-1     By:  Reyna of Bexar (Senate Sponsor - Wentworth)       H.B. No. 881

 1-2           (In the Senate - Received from the House May 12, 1997;

 1-3     May 13, 1997, read first time and referred to Committee on

 1-4     Jurisprudence; May 18, 1997, reported favorably by the following

 1-5     vote:  Yeas 7, Nays 0; May 18, 1997, sent to printer.)

 1-6                            A BILL TO BE ENTITLED

 1-7                                   AN ACT

 1-8     relating to the priority of payment of claims against a decedent's

 1-9     estate.

1-10           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

1-11           SECTION 1.  Section 320(a), Texas Probate Code, is amended to

1-12     read as follows:

1-13           (a)  Priority of Payments.  Personal representatives, when

1-14     they have funds in their hands belonging to the estate, shall pay

1-15     in the following order:

1-16                 (1)  Funeral expenses and expenses of last sickness, in

1-17     an amount not to exceed Fifteen [Five] Thousand Dollars.

1-18                 (2)  Allowances made to the surviving spouse and

1-19     children, or to either.

1-20                 (3)  Expenses of administration and the expenses

1-21     incurred in the preservation, safekeeping, and management of the

1-22     estate.

1-23                 (4)  Other claims against the estate in the order of

1-24     their classification.

1-25           SECTION 2.  Section 322, Texas Probate Code, is amended to

1-26     read as follows:

1-27           Sec. 322.  CLASSIFICATION OF CLAIMS AGAINST ESTATES OF

1-28     DECEDENT.  Claims against an estate of a decedent shall be

1-29     classified and have priority of payment, as follows:

1-30           Class 1.  Funeral expenses and expenses of last sickness for

1-31     a reasonable amount to be approved by the court, not to exceed a

1-32     total of Fifteen Thousand Dollars [Five Thousand Dollars], with any

1-33     excess to be classified and paid as other unsecured claims.

1-34           Class 2.  Expenses of administration and expenses incurred in

1-35     the preservation, safekeeping, and management of the estate.

1-36           Class 3.  Secured claims for money under Section 306(a)(1),

1-37     including tax liens, so far as the same can be paid out of the

1-38     proceeds of the property subject to such mortgage or other lien,

1-39     and when more than one mortgage, lien, or security interest shall

1-40     exist upon the same property, they shall be paid in order of their

1-41     priority.

1-42           Class 4.  Claims for taxes, penalties, and interest due under

1-43     Title 2, Tax Code; Chapter 8, Title 132, Revised Statutes; Section

1-44     81.111, Natural Resources Code;  the Municipal Sales and Use Tax

1-45     Act (Chapter 321, Tax Code); Section 451.404, Transportation Code

1-46     [Section 11B, Chapter 141, Acts of the 63rd Legislature, Regular

1-47     Session, 1973 (Article 1118x, Vernon's Texas Civil Statutes)]; or

1-48     Subchapter I, Chapter 452, Transportation Code [Section 16, Chapter

1-49     683, Acts of the 66th Legislature, Regular Session, 1979 (Article

1-50     1118y, Vernon's Texas Civil Statutes)].

1-51           Class 5.  Claims for the cost of confinement established by

1-52     the institutional division of the Texas Department of Criminal

1-53     Justice under Section 501.017, Government Code.

1-54           Class 6.  Claims for repayment of medical assistance payments

1-55     made by the state under Chapter 32, Human Resources Code, to or for

1-56     the benefit of the decedent.

1-57           Class 7.  All other claims.

1-58           SECTION 3.  This Act takes effect September 1, 1997, and

1-59     applies only to the estate of a person who dies on or after that

1-60     date.  The estate of a person who dies before the effective date of

1-61     this Act is governed by the law in effect at the time of the

1-62     person's death and that law is continued in effect for that

1-63     purpose.

1-64           SECTION 4.  The importance of this legislation and the

 2-1     crowded condition of the calendars in both houses create an

 2-2     emergency and an imperative public necessity that the

 2-3     constitutional rule requiring bills to be read on three several

 2-4     days in each house be suspended, and this rule is hereby suspended.

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