By:  Cain                                              S.B. No. 911

                                A BILL TO BE ENTITLED

                                       AN ACT

 1-1     relating to the protection or release of a trustee from liability

 1-2     under certain circumstances.

 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-4           SECTION 1.  Section 114.001, Property Code, is amended by

 1-5     adding Subsection (e) to read as follows:

 1-6           (e)  The trustee has the same protection from liability

 1-7     provided for a fiduciary under 42 U.S.C. Section 9607(n).

 1-8           SECTION 2.  Section 114.005, Property Code, is amended to

 1-9     read as follows:

1-10           Sec. 114.005.  RELEASE OF LIABILITY BY BENEFICIARY.  (a)  A

1-11     beneficiary who has full legal capacity and is acting on full

1-12     information may relieve a trustee from any duty, responsibility,

1-13     restriction, or liability as to the beneficiary that would

1-14     otherwise be imposed on the trustee by this subtitle, including

1-15     liability for past violations, except as to the duties,

1-16     restrictions, and liabilities imposed on corporate trustees by

1-17     Section 113.052 or 113.053 [of this subtitle].

1-18           (b)  A beneficiary who has full legal capacity and is acting

1-19     on full information may release a trustee from liability for an

1-20     investment made or recommended by an agent retained by the trustee

1-21     for that purpose, including an agent who is an affiliate of the

1-22     trustee and whose employment is determined by the beneficiary to be

1-23     beneficial to the trust.  The release is also a release as to a

 2-1     minor or unborn or unascertained person who is not otherwise

 2-2     represented to the extent that the person's interest is adequately

 2-3     represented by another party with a substantially identical

 2-4     interest in the trust estate.

 2-5           (c)  A [The] release under this section must be in writing

 2-6     and delivered to the trustee.

 2-7           (d)  A beneficiary is not precluded from bringing an action

 2-8     for breach of contract against an agent whose conduct is the basis

 2-9     of a release under Subsection (b).  In that action, the conduct of

2-10     the agent shall be judged on the basis of the standard for trust

2-11     management and investment prescribed by Section 113.056(a).

2-12           (e)  In this section, "affiliate" has the meaning assigned by

2-13     Section 111.004.

2-14           SECTION 3.  This Act takes effect September 1, 1997.

2-15           SECTION 4.  The importance of this legislation and the

2-16     crowded condition of the calendars in both houses create an

2-17     emergency and an imperative public necessity that the

2-18     constitutional rule requiring bills to be read on three several

2-19     days in each house be suspended, and this rule is hereby suspended.