H.B. No. 2238
AN ACT
relating to multiple-party accounts.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 438A(a), (c), (d), (e), (f), and (g),
Texas Probate Code, are amended to read as follows:
(a) If an account is established at a financial institution
by one or more parties [a party] in the names of the parties [party]
and one or more convenience signers [a cosigner] and the terms of
the account provide that the sums on deposit are paid or delivered
to the parties [party] or to the convenience signers [cosigner]
"for the convenience" of the parties [party], the account is a
convenience account.
(c) A [The] party to a convenience account is not considered
to have made a gift [of one-half] of the deposit or of any additions
or accruals to the deposit to a convenience signer [the cosigner].
(d) On the death of the last surviving party, a convenience
signer [the cosigner] shall have no right of survivorship in the
account and ownership of the account remains in the estate of the
last surviving party.
(e) If an addition is made to the account by anyone other
than a [the] party, the addition and accruals to the addition are
considered to have been made by a [the] party.
(f) All deposits to a convenience account and additions and
accruals to the deposits may be paid to a [the] party or to a
convenience signer [the cosigner]. The financial institution is
completely released from liability for a payment made from the
account before the financial institution receives notice in writing
signed by a [the] party not to make the payment in accordance with
the terms of the account. After receipt of the notice from a [the]
party, the financial institution may require a [the] party to
approve any further payments from the account.
(g) If the financial institution makes a payment of the sums
on deposit in a convenience account to a convenience signer [the
cosigner] after the death of the last surviving party and before the
financial institution has received written notice of the last
surviving party's death, the financial institution is completely
released from liability for the payment. If a financial
institution makes payment to the personal representative of the
deceased last surviving party's estate after the death of the last
surviving party and before service on the financial institution of
a court order prohibiting payment, the financial institution is
released to the extent of the payment from liability to any person
claiming a right to the funds. The receipt by the representative to
whom payment is made is a complete release and discharge of the
financial institution.
SECTION 2. Section 439A(b), Texas Probate Code, is amended
to read as follows:
(b) A financial institution may use the following form to
establish the type of account selected by a party:
UNIFORM SINGLE-PARTY OR MULTIPLE-PARTY ACCOUNT SELECTION
FORM NOTICE: The type of account you select may determine how
property passes on your death. Your will may not control the
disposition of funds held in some of the following accounts.
Select one of the following accounts by placing your initials next
to the account selected:
___ (1) SINGLE-PARTY ACCOUNT WITHOUT "P.O.D." (PAYABLE ON
DEATH) DESIGNATION. The party to the account owns the account. On
the death of the party, ownership of the account passes as a part of
the party's estate under the party's will or by intestacy.
Enter the name of the party:
______________________________
___ (2) SINGLE-PARTY ACCOUNT WITH "P.O.D." (PAYABLE ON DEATH)
DESIGNATION. The party to the account owns the account. On the
death of the party, ownership of the account passes to the P.O.D.
beneficiaries of the account. The account is not a part of the
party's estate.
Enter the name of the party:
______________________________
Enter the name or names of the P.O.D. beneficiaries:
______________________________
______________________________
___ (3) MULTIPLE-PARTY ACCOUNT WITHOUT RIGHT OF
SURVIVORSHIP. The parties to the account own the account in
proportion to the parties' net contributions to the account. The
financial institution may pay any sum in the account to a party at
any time. On the death of a party, the party's ownership of the
account passes as a part of the party's estate under the party's
will or by intestacy.
Enter the names of the parties:
______________________________
______________________________
______________________________
___ (4) MULTIPLE-PARTY ACCOUNT WITH RIGHT OF SURVIVORSHIP.
The parties to the account own the account in proportion to the
parties' net contributions to the account. The financial
institution may pay any sum in the account to a party at any time.
On the death of a party, the party's ownership of the account passes
to the surviving parties.
Enter the names of the parties:
______________________________
______________________________
___ (5) MULTIPLE-PARTY ACCOUNT WITH RIGHT OF SURVIVORSHIP AND
P.O.D. (PAYABLE ON DEATH) DESIGNATION. The parties to the account
own the account in proportion to the parties' net contributions to
the account. The financial institution may pay any sum in the
account to a party at any time. On the death of the last surviving
party, the ownership of the account passes to the P.O.D.
beneficiaries.
Enter the names of the parties:
______________________________
______________________________
Enter the name or names of the P.O.D. beneficiaries:
______________________________
______________________________
___ (6) CONVENIENCE ACCOUNT. The parties [party] to the
account own [owns] the account. One or more convenience signers
[The cosigner] to the account may make account transactions for a
[the] party. A convenience signer [The cosigner] does not own the
account. On the death of the last surviving party, ownership of the
account passes as a part of the last surviving party's estate under
the last surviving party's will or by intestacy. The financial
institution may pay funds in the account to a convenience signer
[the cosigner] before the financial institution receives notice of
the death of the last surviving party. The payment to a convenience
signer [the cosigner] does not affect the parties' [party's]
ownership of the account.
Enter the names [name] of the parties [party]:
______________________________
______________________________
Enter the names [name] of the convenience signers [cosigner]:
______________________________
______________________________
___ (7) TRUST ACCOUNT. The parties named as trustees to the
account own the account in proportion to the parties' net
contributions to the account. A trustee may withdraw funds from the
account. A beneficiary may not withdraw funds from the account
before all trustees are deceased. On the death of the last
surviving trustee, the ownership of the account passes to the
beneficiary. The trust account is not a part of a trustee's estate
and does not pass under the trustee's will or by intestacy, unless
the trustee survives all of the beneficiaries and all other
trustees.
Enter the name or names of the trustees:
______________________________
______________________________
Enter the name or names of the beneficiaries:
______________________________
______________________________
SECTION 3. This Act takes effect September 1, 2003, and
applies only to an account created on or after the effective date of
this Act. An account created before the effective date of this Act
is covered by the law in effect when the account was created, and
the former law is continued in effect for that purpose.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 2238 was passed by the House on April
25, 2003, by a non-record vote.
______________________________
Chief Clerk of the House
I certify that H.B. No. 2238 was passed by the Senate on May
22, 2003, by the following vote: Yeas 31, Nays 0.
______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor