1-1     relating to the administration of decedents' estates.


 1-3           SECTION 1.  Subsection (b), Section 5A, Texas Probate Code,

 1-4     is amended to read as follows:

 1-5           (b)  In proceedings in the statutory probate courts and

 1-6     districts courts, the phrases "appertaining to estates" and

 1-7     "incident to an estate" in this Code include the probate of wills,

 1-8     the issuance of letters testamentary and of administration, and the

 1-9     determination of heirship, and also include, but are not limited

1-10     to, all claims by or against an estate, all actions for trial of

1-11     title to land and for the enforcement of liens thereon, all actions

1-12     for trial of the right of property, all actions to construe wills,

1-13     the interpretation and administration of testamentary trusts and

1-14     the applying of constructive trusts, and generally all matters

1-15     relating to the settlement, partition, and distribution of estates

1-16     of deceased persons.  All statutory probate courts may, in the

1-17     exercise of their jurisdiction, notwithstanding any other

1-18     provisions of this Code, hear all suits, actions, and applications

1-19     filed against or on behalf of any heirship proceeding or decedent's

1-20     estate, including estates administered by an independent executor;

1-21     all such suits, actions, and applications are appertaining to and

1-22     incident to an estate for the purposes of this section.  This

1-23     subsection shall be construed in conjunction with and in harmony

 2-1     with Section 145 and all other sections of this Code dealing with

 2-2     independent executors, but shall not be construed so as to increase

 2-3     permissible judicial control over independent executors.  All

 2-4     statutory probate courts shall have the same powers over

 2-5     independent executors that are exercisable by the district courts.

 2-6     In situations where the jurisdiction of a statutory probate court

 2-7     is concurrent with that of a district court, any cause of action

 2-8     appertaining to estates or incident to an estate shall be brought

 2-9     in a statutory probate court rather than in the district court.

2-10           SECTION 2.  Chapter I, Texas Probate Code, is amended by

2-11     adding Section 10B to read as follows:


2-13     CONDITION BEFORE DEATH.  Notwithstanding the Medical Practice Act

2-14     (Article 4495b, Vernon's Texas Civil Statutes), a person who is a

2-15     party to a will contest or a proceeding in which a party relies on

2-16     the mental or testamentary capacity of a decedent before the

2-17     decedent's death as part of the party's claim or defense is

2-18     entitled to production of all communications or records relevant to

2-19     the decedent's condition before the decedent's death.  On receipt

2-20     of a subpoena of communications or records under this section and

2-21     proof of filing of the will contest or proceeding, by certified

2-22     copy, the appropriate physician, hospital, medical facility,

2-23     custodian of records, or other person in possession of the

2-24     communications or records shall release the communications or

2-25     records to the party requesting the records without further

 3-1     authorization.

 3-2           SECTION 3.  Section 36, Texas Probate Code, is amended to

 3-3     read as follows:

 3-4           Sec. 36.  Duty and Responsibility of Judge.  (a)  It shall be

 3-5     the duty of each county and probate court to use reasonable

 3-6     diligence to see that personal representatives of estates being

 3-7     administered under orders of the court and other officers of the

 3-8     court perform the duty enjoined upon them by law pertaining to such

 3-9     estates.  The judge shall annually, if in his opinion the same be

3-10     necessary, examine the condition of each of said estates and the

3-11     solvency of the bonds of personal representatives of estates.  He

3-12     shall, at any time he finds that the personal representative's bond

3-13     is not sufficient to protect such estate, require such personal

3-14     representatives to execute a new bond in accordance with law.  In

3-15     each case, he shall notify the personal representative, and the

3-16     sureties on the bond, as provided by law; and should damage or loss

3-17     result to estates through the gross neglect of the judge to use

3-18     reasonable diligence in the performance of his duty, he shall be

3-19     liable on his bond to those damaged by such neglect.

3-20           (b)  The court may request an applicant or court-appointed

3-21     fiduciary to produce other information identifying an applicant,

3-22     decedent, or personal representative, including social security

3-23     numbers, in addition to identifying information the applicant or

3-24     fiduciary is required to produce under this code.  The court shall

3-25     maintain the information required under this subsection, and the

 4-1     information may not be filed with the clerk.

 4-2           SECTION 4.  Subdivision (1), Subsection (b), Section 42,

 4-3     Texas Probate Code, is amended to read as follows:

 4-4                 (1)  For the purpose of inheritance, a child is the

 4-5     child of his biological father if the child is born under

 4-6     circumstances described by Section 151.002 [12.02], Family Code, is

 4-7     adjudicated to be the child of the father by court decree as

 4-8     provided by Chapter 160 [13], Family Code, was adopted by his

 4-9     father, or if the father executed a statement of paternity as

4-10     provided by Section 160.202 [13.22], Family Code, or a like

4-11     statement properly executed in another jurisdiction, so that he and

4-12     his issue shall inherit from his father and from his paternal

4-13     kindred, both descendants, ascendants, and collaterals in all

4-14     degrees, and they may inherit from him and his issue.  A person

4-15     claiming to be a biological child of the decedent, who is not

4-16     otherwise presumed to be a child of the decedent, or claiming

4-17     inheritance through a biological child of the decedent, who is not

4-18     otherwise presumed to be a child of the decedent, may petition the

4-19     probate court for a determination of right of inheritance.  If the

4-20     court finds by clear and convincing evidence that the purported

4-21     father was the biological father of the child, the child is treated

4-22     as any other child of the decedent for the purpose of inheritance

4-23     and he and his issue may inherit from his paternal kindred, both

4-24     descendants, ascendants, and collaterals in all degrees, and they

4-25     may inherit from him and his issue.  This section does not permit

 5-1     inheritance by a purported father of a child, whether recognized or

 5-2     not, if the purported father's parental rights have been

 5-3     terminated.

 5-4           SECTION 5.  Subsection (a), Section 69, Texas Probate Code,

 5-5     is amended to read as follows:

 5-6           (a)  If, after making a will, the testator is divorced or the

 5-7     testator's marriage is annulled, all provisions in the will in

 5-8     favor of the testator's former spouse, or appointing such spouse to

 5-9     any fiduciary capacity under the will or with respect to the estate

5-10     or person of the testator's children, must be read as if the former

5-11     spouse failed to survive the testator, and shall be null and void

5-12     and of no effect unless the will expressly provides otherwise.

5-13           SECTION 6.  Subsection (a), Section 81, Texas Probate Code,

5-14     is amended to read as follows:

5-15           (a)  For Probate of a Written Will.  A written will shall, if

5-16     within the control of the applicant, be filed with the application

5-17     for its probate, and shall remain in the custody of the county

5-18     clerk unless removed therefrom by order of a proper court.  An

5-19     application for probate of a written will shall state:

5-20                 (1)  The name and domicile of each applicant.

5-21                 (2)  The name, age if known, and domicile of the

5-22     decedent, and the fact, time, and place of death.

5-23                 (3)  Facts showing that the court has venue.

5-24                 (4)  That the decedent owned real or personal property,

5-25     or both, describing the same generally, and stating its probable

 6-1     value.

 6-2                 (5)  The date of the will, the name and residence of

 6-3     the executor named therein, if any, and if none be named, then the

 6-4     name and residence of the person to whom it is desired that letters

 6-5     be issued, and also the names and residences of the subscribing

 6-6     witnesses, if any.

 6-7                 (6)  Whether a child or children born or adopted after

 6-8     the making of such will survived the decedent, and the name of each

 6-9     such survivor, if any.

6-10                 (7)  That such executor or applicant, or other person

6-11     to whom it is desired that letters be issued, is not disqualified

6-12     by law from accepting letters.

6-13                 (8)  Whether the decedent was ever divorced, and if so,

6-14     when and from whom.

6-15                 (9)  [The social security number of the applicant and

6-16     of the decedent.]

6-17                 [(10)]  Whether the state, a governmental agency of the

6-18     state, or a charitable organization is named by the will as a

6-19     devisee.

6-20           The foregoing matters shall be stated and averred in the

6-21     application to the extent that they are known to the applicant, or

6-22     can with reasonable diligence be ascertained by him, and if any of

6-23     such matters is not stated or averred in the application, the

6-24     application shall set forth the reason why such matter is not so

6-25     stated and averred.

 7-1           SECTION 7.  Section 82, Texas Probate Code, is amended to

 7-2     read as follows:


 7-4     ADMINISTRATION.  An application for letters of administration when

 7-5     no will, written or oral, is alleged to exist shall state:

 7-6                 (a)  The name and domicile of the applicant,

 7-7     relationship to the decedent, if any, and that the applicant is not

 7-8     disqualified by law to act as administrator;

 7-9                 (b)  The name and intestacy of the decedent, and the

7-10     fact, time and place of death;

7-11                 (c)  Facts necessary to show venue in the court to

7-12     which the application is made;

7-13                 (d)  Whether the decedent owned real or personal

7-14     property, with a statement of its probable value;

7-15                 (e)  The name, age, marital status and address, if

7-16     known, and the relationship, if any, of each heir to the decedent;

7-17                 (f)  If known by the applicant at the time of the

7-18     filing of the application, whether children were born to or adopted

7-19     by the decedent, with the name and the date and place of birth of

7-20     each;

7-21                 (g)  If known by the applicant at the time of the

7-22     filing of the application, whether the decedent was ever divorced,

7-23     and if so, when and from whom; and

7-24                 (h)  That a necessity exists for administration of the

7-25     estate, alleging the facts which show such necessity[; and]

 8-1                 [(i)  The social security number of the applicant and

 8-2     of the decedent if known].

 8-3           SECTION 8.  Section 146, Texas Probate Code, is amended by

 8-4     amending Subsection (b) and adding Subsections (d) and (e) to read

 8-5     as follows:

 8-6           (b)  Secured Claims for Money.  Within six months after the

 8-7     date letters are granted or within four months after the date

 8-8     notice is received under Section 295, whichever is later, a

 8-9     creditor with a claim for money secured by real or personal

8-10     property of the estate must give notice to [notify] the independent

8-11     executor [by certified or registered mail] of the creditor's

8-12     election to have the creditor's claim approved as a matured secured

8-13     claim to be paid in due course of administration.  If the election

8-14     is not made, the claim is a preferred debt and lien against the

8-15     specific property securing the indebtedness and shall be paid

8-16     according to the terms of the contract that secured the lien, and

8-17     the claim may not be asserted against other assets of the estate.

8-18     The independent executor may pay the claim before the claim matures

8-19     if paying the claim before maturity is in the best interest of the

8-20     estate.

8-21           (d)  Notice Required of Unsecured Creditor.  An unsecured

8-22     creditor who has a claim for money against an estate and receives a

8-23     notice under Section 294(d) shall give notice to the independent

8-24     executor of the nature and amount of the claim not later than the

8-25     120th day after the date on which the notice is received or the

 9-1     claim is barred.

 9-2           (e)  Placement of Notice.  Notice required by Subsections (b)

 9-3     and (d) must be contained in:

 9-4                 (1)  a written instrument that is hand-delivered with

 9-5     proof of receipt or mailed by certified mail, return receipt

 9-6     requested, to the independent executor or the executor's attorney;

 9-7                 (2)  a pleading filed in a lawsuit with respect to the

 9-8     claim; or

 9-9                 (3)  a written instrument or pleading filed in the

9-10     court in which the administration of the estate is pending.

9-11           SECTION 9.  Subsection (a), Section 234, Texas Probate Code,

9-12     is amended to read as follows:

9-13           (a)  Powers To Be Exercised Under Order of the Court.  The

9-14     personal representative of the estate of any person may, upon

9-15     application and order authorizing same, renew or extend any

9-16     obligation owing by or to such estate.  When a personal

9-17     representative deems it for the interest of the estate, he may,

9-18     upon written application to the court, and by order granting

9-19     authority:

9-20                 (1)  Purchase or exchange property;

9-21                 (2)  Take claims or property for the use and benefit of

9-22     the estate in payment of any debt due or owing to the estate;

9-23                 (3)  Compound bad or doubtful debts due or owing to the

9-24     estate;

9-25                 (4)  Make compromises or settlements in relation to

 10-1    property or claims in dispute or litigation;

 10-2                (5)  Compromise or pay in full any secured claim which

 10-3    has been allowed and approved as required by law against the estate

 10-4    by conveying to the holder of such claim the real estate or

 10-5    personalty securing the same, in full payment, liquidation, and

 10-6    satisfaction thereof, and in consideration of cancellation of

 10-7    notes, deeds of trust, mortgages, chattel mortgages, or other

 10-8    evidences of liens securing the payment of such claim;

 10-9                (6)  Abandon the administration of property of the

10-10    estate that is burdensome or worthless.  Abandoned real or personal

10-11    property may be foreclosed by a secured party, trustee, or

10-12    mortgagee without further order of the court.

10-13          SECTION 10.  Section 281, Texas Probate Code, is amended to

10-14    read as follows:


10-16    exempt property, other than the homestead or any allowance made in

10-17    lieu thereof, shall be liable for the payment of Class 1 claims

10-18    [the funeral expenses and the expenses of last sickness of the

10-19    deceased, when claims are presented within the time prescribed

10-20    therefor], but such property shall not be liable for any other

10-21    debts of the estate.

10-22          SECTION 11.  Section 290, Texas Probate Code, is amended to

10-23    read as follows:

10-24          Sec. 290.  FAMILY ALLOWANCE PREFERRED.  The family allowance

10-25    made for the support of the surviving spouse and minor children of

 11-1    the deceased shall be paid in preference to all other debts or

 11-2    charges against the estate, except Class 1 claims [expenses of the

 11-3    funeral and last sickness of the deceased].

 11-4          SECTION 12.  Section 299, Texas Probate Code, is amended to

 11-5    read as follows:


 11-7    general statutes of limitation are tolled on the date:

 11-8                (1)  a claim for money is filed or deposited with the

 11-9    clerk [(a)  By filing a claim which is legally allowed and

11-10    approved]; or

11-11                (2)  suit is brought against the personal

11-12    representative of an estate with respect to a claim of the estate

11-13    that is not required to be presented to the personal representative

11-14    [(b)  By bringing a suit upon a rejected and disapproved claim

11-15    within ninety days after such rejection or disapproval].

11-16          SECTION 13.  Subsections (e), (f), (i), and (j), Section 306,

11-17    Texas Probate Code, are amended to read as follows:

11-18          (e)  Payment of Maturities on Preferred Debt and Lien Claims.

11-19    If property securing a claim allowed, approved, and fixed under

11-20    Paragraph (2) of Subsection (a) hereof is not sold or distributed

11-21    within six months from the date letters are granted, the

11-22    representative of the estate shall promptly pay all maturities

11-23    which have accrued on the debt according to the terms thereof, and

11-24    shall perform all the terms of any contract securing same.  If the

11-25    representative defaults in such payment or performance, on

 12-1    application of the claimholder, the court shall:

 12-2                (1)  require the sale of said property subject to the

 12-3    unmatured part of such debt and apply the proceeds of the sale to

 12-4    the liquidation of the maturities;

 12-5                (2)  require the sale of the property free of the lien

 12-6    and apply the proceeds to the payment of the whole debt; or

 12-7                (3)  authorize foreclosure by the claimholder as

 12-8    provided by Subsections [under Subsection] (f) through (k) of this

 12-9    section.

12-10          (f)  Foreclosure of Preferred Liens.  An application by a

12-11    claimholder under Subsection (e) of this section [If the court

12-12    authorizes a claimholder] to foreclose the claimholder's lien or

12-13    security interest on property securing a claim that has been

12-14    allowed, approved, and fixed under Paragraph (2) of Subsection (a)

12-15    of this section shall be[, the claimholder shall file with the

12-16    court an application] supported by affidavit of the claimholder

12-17    that:

12-18                (1)  describes the property or part of the property to

12-19    be sold by foreclosure;

12-20                (2)  describes the amounts of the claimholder's

12-21    outstanding debt;

12-22                (3)  describes the maturities that have accrued on the

12-23    debt according to the terms of the debt;

12-24                (4)  describes any other debts secured by a mortgage,

12-25    lien, or security interest against the property that are known by

 13-1    the claimholder;

 13-2                (5)  contains a statement that the claimholder has no

 13-3    knowledge of the existence of any debts secured by the property

 13-4    other than those described by the application; and

 13-5                (6)  requests permission for the claimholder to

 13-6    foreclose the claimholder's mortgage, lien, or security interest.

 13-7          (i)  Hearing.  (1)  At the hearing, if the court finds that

 13-8    there is a default in payment or performance under the contract

 13-9    that secures the payment of the claim, the court shall:

13-10                      (A)  require the sale of the property subject to

13-11    the unmatured part of the debt and apply the proceeds of the sale

13-12    to the liquidation of the maturities;

13-13                      (B)  require the sale of the property free of the

13-14    lien and apply the proceeds to the payment of the whole debt; or

13-15                      (C)  authorize foreclosure by the claimholder as

13-16    provided by Subsection (f) of this section.

13-17                (2)  When the court grants a claimholder the right of

13-18    foreclosure, the court shall authorize [enter an order granting]

13-19    the claimholder [permission] to foreclose the claimholder's

13-20    mortgage, lien, or security interest in accordance with the

13-21    provisions of the document creating the mortgage, lien, or security

13-22    interest or in any other manner allowed by law.  In the discretion

13-23    of the court and based on the evidence presented at the hearing,

13-24    the court may fix a minimum price for the property to be sold by

13-25    foreclosure that does not exceed the fair market value of the

 14-1    property.  If the court fixes a minimum price, the property may not

 14-2    be sold at the foreclosure sale for a lower price.

 14-3          (j)  Appeal.  Any person interested in the estate may appeal

 14-4    an order issued under Subsection (i)(1)(C) [(i)] of this section.

 14-5          SECTION 14.  Subsection (a), Section 450, Texas Probate Code,

 14-6    is amended to read as follows:

 14-7          (a)  Any of the following provisions in an insurance policy,

 14-8    contract of employment, bond, mortgage, promissory note, deposit

 14-9    agreement, employees' trust, retirement account, deferred

14-10    compensation arrangement, custodial agreement, pension plan, trust

14-11    agreement, conveyance of real or personal property, securities,

14-12    accounts with financial institutions as defined in Part 1 of this

14-13    chapter, or any other written instrument effective as a contract,

14-14    gift, conveyance, or trust is deemed to be nontestamentary, and

14-15    this code does not invalidate the instrument or any provision:

14-16                (1)  that money or other benefits theretofore due to,

14-17    controlled, or owned by a decedent shall be paid after his death to

14-18    a person designated by the decedent in either the instrument or a

14-19    separate writing, including a will, executed at the same time as

14-20    the instrument or subsequently;

14-21                (2)  that any money due or to become due under the

14-22    instrument shall cease to be payable in event of the death of the

14-23    promisee or the promissor before payment or demand; or

14-24                (3)  that any property which is the subject of the

14-25    instrument shall pass to a person designated by the decedent in

 15-1    either the instrument or a separate writing, including a will,

 15-2    executed at the same time as the instrument or subsequently.

 15-3          SECTION 15. Part 4, Chapter XI, Texas Probate Code, as added

 15-4    by S.B. No. 504, Acts of the 75th Legislature, Regular Session,

 15-5    1997, is repealed.

 15-6          SECTION 16.  This Act takes effect September 1, 1997, and

 15-7    applies only to the estate of a person who dies on or after that

 15-8    date.  An estate of a person who dies before the effective date of

 15-9    this Act is governed by the law in effect on the date of the

15-10    person's death, and the former law is continued in effect for that

15-11    purpose.

15-12          SECTION 17.  The importance of this legislation and the

15-13    crowded condition of the calendars in both houses create an

15-14    emergency and an imperative public necessity that the

15-15    constitutional rule requiring bills to be read on three several

15-16    days in each house be suspended, and this rule is hereby suspended.

         _______________________________     _______________________________

             President of the Senate              Speaker of the House

               I hereby certify that S.B. No. 506 passed the Senate on

         March 26, 1997, by the following vote:  Yeas 31, Nays 0; and that

         the Senate concurred in House amendments on May 22, 1997, by a

         viva-voce vote.


                                                 Secretary of the Senate

               I hereby certify that S.B. No. 506 passed the House, with

         amendments, on May 20, 1997, by a non-record vote.


                                                 Chief Clerk of the House