|
|
A BILL TO BE ENTITLED
|
|
AN ACT
|
|
|
relating to the independent administration of a decedent's estate. |
|
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|
ARTICLE 1. INDEPENDENT ADMINISTRATION: TEXAS PROBATE CODE |
|
SECTION 1.01. The Texas Probate Code is amended by adding |
|
Chapter VI-1 to read as follows: |
|
CHAPTER VI-1. INDEPENDENT ADMINISTRATION |
|
PART 1. CREATION |
|
Sec. 177A. EXPRESSION OF TESTATOR'S INTENT IN WILL. (a) |
|
Any person capable of making a will may provide in the person's will |
|
that no other action shall be had in the probate court in relation |
|
to the settlement of the person's estate than the probating and |
|
recording of the will and the return of an inventory, appraisement, |
|
and list of claims of the person's estate. |
|
(b) Any person capable of making a will may provide in the |
|
person's will that no independent administration of his or her |
|
estate may be allowed. In such case the person's estate, if |
|
administered, shall be administered and settled under the direction |
|
of the probate court as other estates are required to be settled and |
|
not as an independent administration. |
|
Sec. 177B. CREATION IN TESTATE ESTATE BY AGREEMENT. (a) |
|
Except as provided in Section 177A(b) of this code, if a decedent's |
|
will names an executor but the will does not provide for independent |
|
administration as provided in Section 177A(a) of this code, all of |
|
the distributees of the decedent may agree on the advisability of |
|
having an independent administration and collectively designate in |
|
the application for probate of the decedent's will the executor |
|
named in the will to serve as independent executor and request in |
|
the application that no other action shall be had in the probate |
|
court in relation to the settlement of the decedent's estate other |
|
than the probating and recording of the decedent's will and the |
|
return of an inventory, appraisement, and list of claims of the |
|
decedent's estate. In such case the probate court shall enter an |
|
order granting independent administration and appointing the |
|
person, firm, or corporation designated in the application as |
|
independent executor, unless the court finds that it would not be in |
|
the best interest of the estate to do so. |
|
(b) Except as provided in Section 177A(b) of this code, in |
|
situations where no executor is named in the decedent's will, or in |
|
situations where each executor named in the will is deceased or is |
|
disqualified to serve as executor or indicates by affidavit filed |
|
with the application for administration of the decedent's estate |
|
the executor's inability or unwillingness to serve as executor, all |
|
of the distributees of the decedent may agree on the advisability of |
|
having an independent administration and collectively designate in |
|
the application for probate of the decedent's will a qualified |
|
person, firm, or corporation to serve as independent administrator |
|
and request in the application that no other action shall be had in |
|
the probate court in relation to the settlement of the decedent's |
|
estate other than the probating and recording of the decedent's |
|
will and the return of an inventory, appraisement, and list of |
|
claims of the decedent's estate. In such case the probate court |
|
shall enter an order granting independent administration and |
|
appointing the person, firm, or corporation designated in the |
|
application as independent administrator, unless the court finds |
|
that it would not be in the best interest of the estate to do so. |
|
Sec. 177C. CREATION IN INTESTATE ESTATE BY AGREEMENT. (a) |
|
All of the distributees of a decedent dying intestate may agree on |
|
the advisability of having an independent administration and |
|
collectively designate in the application for administration of the |
|
decedent's estate a qualified person, firm, or corporation to serve |
|
as independent administrator and request in the application that no |
|
other action shall be had in the probate court in relation to the |
|
settlement of the decedent's estate other than the return of an |
|
inventory, appraisement, and list of claims of the decedent's |
|
estate. In such case the probate court shall enter an order |
|
granting independent administration and appointing the person, |
|
firm, or corporation designated in the application as independent |
|
administrator, unless the court finds that it would not be in the |
|
best interest of the estate to do so. |
|
(b) The court shall not appoint an independent |
|
administrator to serve in an intestate administration unless and |
|
until the parties seeking appointment of the independent |
|
administrator have been determined, through a proceeding to declare |
|
heirship under Chapter III of this code, to constitute all of the |
|
decedent's heirs. |
|
Sec. 177D. MEANS OF ESTABLISHING DISTRIBUTEE CONSENT. (a) |
|
This section applies to the creation of an independent |
|
administration under Section 177B or 177C of this code. |
|
(b) All distributees shall be served with citation and |
|
notice of the application for independent administration unless the |
|
distributee waives the issuance or service of citation or enters an |
|
appearance in court. |
|
(c) If a distributee is an incapacitated person, the |
|
guardian of the person of the distributee may sign the application |
|
on behalf of the distributee. If the probate court finds that |
|
either the granting of independent administration or the |
|
appointment of the person, firm, or corporation designated in the |
|
application as independent executor would not be in the best |
|
interest of the incapacitated person, then, notwithstanding |
|
anything to the contrary in Section 177B or 177C of this code, the |
|
court shall not enter an order granting independent administration |
|
of the estate. If a distributee who is an incapacitated person has |
|
no guardian of the person, the probate court may appoint a guardian |
|
ad litem to make application on behalf of the incapacitated person |
|
if the court considers such an appointment necessary to protect the |
|
interest of the distributees. Alternatively, if the distributee who |
|
is an incapacitated person is a minor and has no guardian of the |
|
person, the natural guardian or guardians of such minor may consent |
|
on behalf of such incapacitated person if there is no conflict of |
|
interest between the minor and such natural guardian or guardians. |
|
(d) If a trust is created in the decedent's will, the person |
|
or class of persons first eligible to receive the income from the |
|
trust, when determined as if the trust were to be in existence on |
|
the date of the decedent's death, shall, for the purposes of Section |
|
177B of this code, be considered to be the distributee or |
|
distributees on behalf of such trust, and any other trust or trusts |
|
coming into existence on the termination of such trust, and are |
|
authorized to apply for independent administration on behalf of the |
|
trusts without the consent or agreement of the trustee or any other |
|
beneficiary of the trust, or the trustee or any beneficiary of any |
|
other trust which may come into existence on the termination of such |
|
trust. If a person who is a trust beneficiary and who is considered |
|
to be a distributee under this subsection is an incapacitated |
|
person, then such trustee or cotrustee may file the application or |
|
give the consent, provided that such trustee or cotrustee is not the |
|
person proposed to serve as the independent executor. |
|
(e) If a life estate is created either in the decedent's |
|
will or by law, the life tenant or life tenants, when determined as |
|
if the life estate were to commence on the date of the decedent's |
|
death, shall, for the purposes of Section 177B or 177C of this code, |
|
be considered to be the distributee or distributees on behalf of the |
|
entire estate created, and are authorized to apply for independent |
|
administration on behalf of the estate without the consent or |
|
approval of any remainderman. |
|
(f) If a decedent's will contains a provision that a |
|
distributee must survive the decedent by a prescribed period of |
|
time in order to take under the decedent's will, then, for the |
|
purposes of determining who shall be the distributee under Section |
|
177B of this code and under Subsection (c) of this section, it shall |
|
be presumed that the distributees living at the time of the filing |
|
of the application for probate of the decedent's will survived the |
|
decedent by the prescribed period. |
|
(g) In the case of all decedents, whether dying testate or |
|
intestate, for the purposes of determining who shall be the |
|
distributees under Section 177B or 177C of this code and under |
|
Subsection (c) of this section, it shall be presumed that no |
|
distributee living at the time the application for independent |
|
administration is filed shall subsequently disclaim any portion of |
|
such distributee's interest in the decedent's estate. |
|
(h) If a distributee of a decedent's estate should die and |
|
if by virtue of such distributee's death such distributee's share of |
|
the decedent's estate shall become payable to such distributee's |
|
estate, then the deceased distributee's personal representative |
|
may sign the application for independent administration of the |
|
decedent's estate under Section 177B or 177C of this code and under |
|
Subsection (c) of this section. |
|
Sec. 177E. BOND; WAIVER OF BOND. If an independent |
|
administration of a decedent's estate is created under Section 177B |
|
or 177C of this code, then, unless the probate court waives bond on |
|
application for waiver, the independent executor shall be required |
|
to enter into bond payable to and to be approved by the judge and the |
|
judge's successors in a sum that is found by the judge to be |
|
adequate under all circumstances, or a bond with one surety in a sum |
|
that is found by the judge to be adequate under all circumstances, |
|
if the surety is an authorized corporate surety. This section does |
|
not repeal any other section of this code. |
|
Sec. 177F. GRANTING POWER OF SALE BY AGREEMENT. In a |
|
situation in which a decedent does not have a will or the will does |
|
not contain or insufficiently contains language authorizing the |
|
personal representative to sell real property, the court may |
|
include in an order appointing an independent executor under |
|
Section 177B or 177C of this code such general or specific authority |
|
regarding the power of the independent executor to sell real |
|
property as may be consented to by the beneficiaries who are to |
|
receive any such real property in their consents to the independent |
|
administration. The independent executor, in such event, may sell |
|
the real property under the authority granted in the court order |
|
without the further consent of those beneficiaries. |
|
Sec. 177G. NO LIABILITY OF JUDGE. Absent proof of fraud or |
|
collusion on the part of a judge, no judge may be held civilly |
|
liable for the commission of misdeeds or the omission of any |
|
required act of any person, firm, or corporation designated as an |
|
independent executor under Section 177B or 177C of this code. |
|
Section 36 of this code does not apply to the appointment of an |
|
independent executor under Section 177B or 177C of this code. |
|
Sec. 177H. PERSON DECLINING TO SERVE. A person who declines |
|
to serve or resigns as independent executor of a decedent's estate |
|
may be appointed an executor or administrator of the estate if the |
|
estate will be administered and settled under the direction of the |
|
court. |
|
PART 2. ADMINISTRATION |
|
Sec. 177I. GENERAL SCOPE AND EXERCISE OF POWERS. When an |
|
independent administration has been created, and the order |
|
appointing an independent executor has been entered by the probate |
|
court, and the inventory, appraisement, and list of claims has been |
|
filed by the independent executor and approved by the court, as long |
|
as the estate is represented by an independent executor, further |
|
action of any nature shall not be had in the probate court except |
|
where this code specifically and explicitly provides for some |
|
action in such court. |
|
Sec. 177J. INDEPENDENT EXECUTORS MAY ACT WITHOUT COURT |
|
APPROVAL. Unless this code specifically provides otherwise, any |
|
action that a personal representative subject to court supervision |
|
may do with or without a court order may be taken by an independent |
|
executor without a court order. The other provisions of this |
|
chapter are designed to provide additional guidance regarding |
|
independent administrations in specified situations, and are not |
|
designed to limit by omission or otherwise the application of the |
|
general principles set forth in this part. |
|
Sec. 177K. POWER OF SALE. (a) General. (1) An independent |
|
executor has the power of sale set forth in the will, if applicable, |
|
exercisable without court approval as otherwise provided for |
|
independent administrations. |
|
(2) Unless limited by the terms of a will, an |
|
independent executor has, in addition to any power of sale given in |
|
the will, the same power of sale for the same purposes as personal |
|
representatives have in a supervised administration, but without |
|
the requirement of court approval. The procedural requirements |
|
applicable to a supervised administration do not apply. |
|
(b) Protection of Person Purchasing Estate Property. (1) A |
|
person who is not a devisee or heir is not required to inquire into |
|
the independent executor's power of sale or the propriety of the |
|
exercise of the power of sale if the person deals with the |
|
independent executor in good faith and: |
|
(A) a power of sale is granted to the independent |
|
executor in the will or in the court order appointing the |
|
independent executor; or |
|
(B) the independent executor provides an |
|
affidavit, sworn to under oath and recorded in the deed records of |
|
the county where the property is located, that the sale is necessary |
|
or advisable for any of the purposes described in Section 341(1) of |
|
this code. |
|
(2) As to acts undertaken in good faith reliance, the |
|
affidavit executed by the independent executor and described by |
|
Subsection (b)(1)(B)of this section is conclusive proof, as between |
|
a purchaser of property from an estate, and the personal |
|
representative of an estate or the heirs and distributees of the |
|
estate, with respect to the authority of the independent executor |
|
to sell the property. The signature or joinder of any person who is |
|
a devisee or heir and who has an interest in the property being sold |
|
as described in this section is not necessary for the purchaser to |
|
obtain all right, title, and interest of the estate in the property |
|
being sold. |
|
(3) This section does not relieve the independent |
|
executor of any duty owing to a devisee or heir related directly or |
|
indirectly to the sale. |
|
(c) No Limitations. This section does not limit the |
|
authority of an independent executor to take other actions without |
|
court supervision or approval with respect to estate assets that |
|
may take place in a supervised administration, for purposes and |
|
within the scope otherwise authorized by this code, including |
|
leases and borrowing money. |
|
PART 3. CLAIMS; EXEMPTIONS AND ALLOWANCES |
|
Sec. 177L. SETTING ASIDE EXEMPT PROPERTY AND ALLOWANCES. |
|
The independent executor shall set aside and deliver to those |
|
entitled exempt property and allowances for support, and allowances |
|
in lieu of exempt property, as prescribed in this code, to the same |
|
extent and result as if the independent executor's actions had been |
|
accomplished in, and under orders of, the court. |
|
Sec. 177M. CLAIMS. (a) Duty of the Independent Executor. |
|
An independent executor, in the administration of an estate, |
|
independently of and without application to, or any action in or by |
|
the court: |
|
(1) shall give the notices required under Sections 294 |
|
and 295 of this code; |
|
(2) may give the notice to an unsecured creditor with a |
|
claim for money permitted under Section 294(d) of this code and bar |
|
a claim under Subsection (e) of this section; and |
|
(3) may approve or reject any claim, or take no action |
|
on a claim, and shall classify and pay claims approved or |
|
established by suit against the estate in the same order of |
|
priority, classification, and proration prescribed in this code. |
|
(a-1) Statement in Notice of Claim. In order to be |
|
effective, the notice described by Subsection (a)(2) of this |
|
section must include, in addition to the other information required |
|
by Section 294(d) of this code, a statement that a claim may be |
|
effectively presented only by one of the methods described in this |
|
section. |
|
(b) Secured Claims for Money. Within six months after the |
|
date letters are granted or within four months after the date notice |
|
is received under Section 295 of this code, whichever is later, a |
|
creditor with a claim for money secured by real or personal property |
|
of the estate must give notice to the independent executor of the |
|
creditor's election to have the creditor's claim approved as a |
|
matured secured claim to be paid in due course of administration. |
|
In addition to such notice, such creditor whose claim is secured by |
|
real property shall record a notice of such election in the deed |
|
records of the county in which such real property is located. If no |
|
election to be a matured secured creditor is made, or is made but |
|
not within the required period, or is made within the required |
|
period but the creditor has a lien against real property and fails |
|
to record notice of the claim in the deed records as described above |
|
within the required period, the claim shall be a preferred debt and |
|
lien against the specific property securing the indebtedness and |
|
shall be paid according to the terms of the contract that secured |
|
the lien, and the claim may not be asserted against other assets of |
|
the estate. The independent executor may pay the claim prior to |
|
maturity if it is determined to be in the best interest of the |
|
estate to do so. |
|
(c) Matured Secured Claims. (1) A claim approved as a |
|
matured secured claim under Subsection (b) of this section shall |
|
remain secured by any lien or security interest against the |
|
specific property securing its payment but subordinated to the |
|
payment from the property of claims having a higher classification |
|
under Section 322 of this code. However, the secured creditor: |
|
(A) shall not be entitled to exercise any |
|
remedies in a manner that prevents the payment of such higher |
|
priority claims and allowances; and |
|
(B) during the administration of the estate, |
|
shall not be entitled to exercise any contractual collection |
|
rights, including the power to foreclose, without either the prior |
|
written approval of the independent executor or court approval. |
|
(1-a) Nothing in Subdivision (1) of this subsection |
|
shall be construed to suspend or otherwise prevent a creditor with a |
|
matured secured claim from seeking judicial relief of any kind or |
|
executing on any judgment against an independent executor. Except |
|
with respect to real property, any third party acting in good faith |
|
may obtain good title with respect to an estate asset acquired |
|
through a secured creditor's extrajudicial collection rights, |
|
without regard to whether such creditor had the right to collect or |
|
whether the creditor acted improperly in exercising such rights |
|
during an estate administration due to having elected matured |
|
secured status. |
|
(2) If a claim approved or established by suit as a |
|
matured secured claim is secured by property passing to one or more |
|
devisees in accordance with Section 71A of this code, the |
|
independent executor shall collect from the devisees the amount of |
|
the debt and pay that amount to the claimant or sell the property |
|
and pay out of the sale proceeds the claim and associated expenses |
|
of sale consistent with the provisions of Section 306(c-1) of this |
|
code applicable in court supervised administrations. |
|
(d) Preferred Debt and Lien Claims. During an independent |
|
administration, a secured creditor whose claim is a preferred debt |
|
and lien against property securing the indebtedness under |
|
Subsection (b) of this section is free to exercise any and all |
|
judicial or extrajudicial collection rights, including foreclosure |
|
and execution; provided, however, that such creditor shall not have |
|
the right to conduct a nonjudicial foreclosure sale within a period |
|
of six months after letters are granted. |
|
(e) Certain Unsecured Claims; Barring of Claims. An |
|
unsecured creditor who has a claim for money against an estate and |
|
who receives a notice under Section 294(d) of this code shall give |
|
notice to the independent executor of the nature and amount of the |
|
claim not later than the 120th day after the date on which the |
|
notice is received or the claim is barred. |
|
(f) Notices Required by Creditors. Notice to the personal |
|
representative required by Subsections (b) and (e) of this section |
|
must be contained in: |
|
(1) a written instrument that is hand-delivered with |
|
proof of receipt, or mailed by certified mail, return receipt |
|
requested with proof of receipt, to the independent executor or the |
|
executor's attorney; |
|
(2) a pleading filed in a lawsuit with respect to the |
|
claim; or |
|
(3) a written instrument or pleading filed in the |
|
court in which the administration of the estate is pending. |
|
(f-1) Filing Requirements Applicable. Nothing in |
|
Subsection (f) of this section shall relieve a creditor who elects |
|
matured secured status from the filing requirements in Subsection |
|
(b) of this section, to the extent applicable. |
|
(g) Statute of Limitations. Except as otherwise provided in |
|
Section 16.062, Civil Practice and Remedies Code, the running of |
|
the statute of limitations shall be tolled only by a written |
|
approval of a claim signed by an independent executor, a pleading |
|
filed in a suit pending at the time of the decedent's death, or a |
|
suit brought by the creditor against the independent executor. In |
|
particular, the presentation of a statement or claim, or a notice |
|
with respect to a claim, to an independent executor shall not toll |
|
the running of the statute of limitations with respect to that |
|
claim. |
|
(h) Other Claim Procedures of Code Generally Do Not Apply. |
|
Except as otherwise provided in this section, the procedural |
|
provisions of this code governing creditor claims in supervised |
|
administrations do not apply in independent administrations. By way |
|
of example only and not of limitation: |
|
(1) Section 313 of this code does not apply in |
|
independent administrations, and consequently a creditor's claim |
|
shall not be barred solely because the creditor failed to file a |
|
suit within 90 days after a claim has been rejected by an |
|
independent executor or with respect to which the independent |
|
executor takes no action; and |
|
(2) Sections 306(f)-(k) of this code do not apply in |
|
independent administrations. |
|
(i) Liability of Independent Executor. An independent |
|
executor, in the administration of an estate, may pay at any time |
|
and without personal liability a claim for money against the estate |
|
to the extent approved and classified by the personal |
|
representative if: |
|
(1) the claim is not barred by limitations; and |
|
(2) at the time of payment, the independent executor |
|
reasonably believes the estate will have sufficient assets to pay |
|
all claims against the estate. |
|
Sec. 177N. ENFORCEMENT OF CLAIMS BY SUIT. Any person having |
|
a debt or claim against the estate may enforce the payment of the |
|
same by suit against the independent executor; and, when judgment |
|
is recovered against the independent executor, the execution shall |
|
run against the estate of the decedent in the possession of the |
|
independent executor that is subject to such debt. The independent |
|
executor shall not be required to plead to any suit brought against |
|
the executor for money until after six months after the date that an |
|
independent administration was created and the order appointing the |
|
executor was entered by the probate court. |
|
Sec. 177O. REQUIRING HEIRS TO GIVE BOND. When an |
|
independent administration is created and the order appointing an |
|
independent executor is entered by the probate court, any person |
|
having a debt against such estate may, by written complaint filed in |
|
the probate court in which such order was entered, cause all |
|
distributees of the estate, heirs at law, and other persons |
|
entitled to any portion of such estate under the will, if any, to be |
|
cited by personal service to appear before such probate court and |
|
execute a bond for an amount equal to the amount of the creditor's |
|
claim or the full value of such estate, as shown by the inventory |
|
and list of claims, whichever is the smaller, such bond to be |
|
payable to the judge, and the judge's successors, and to be approved |
|
by the judge, and conditioned that all obligors shall pay all debts |
|
that shall be established against such estate in the manner |
|
provided by law. On the return of the citation served, unless such |
|
person so entitled to any portion of the estate, or some of them, or |
|
some other person for them, shall execute such bond to the |
|
satisfaction of the probate court, such estate shall be |
|
administered and settled under the direction of the probate court |
|
as other estates are required to be settled. If the bond is |
|
executed and approved, the independent administration shall |
|
proceed. Creditors of the estate may sue on such bond, and shall be |
|
entitled to judgment on the bond for the amount of their debt, or |
|
they may have their action against those in possession of the |
|
estate. |
|
PART 4. ACCOUNTINGS, SUCCESSORS, AND OTHER REMEDIES |
|
Sec. 177P. ACCOUNTING. (a) Interested Person May Demand |
|
Accounting. At any time after the expiration of 15 months after the |
|
date that an independent administration was created and the order |
|
appointing an independent executor was entered by the probate |
|
court, any person interested in the estate may demand an accounting |
|
from the independent executor. The independent executor shall |
|
furnish to the person or persons making the demand an exhibit in |
|
writing, sworn and subscribed by the independent executor, setting |
|
forth in detail: |
|
(1) the property belonging to the estate that has come |
|
into the executor's possession as executor; |
|
(2) the disposition that has been made of such |
|
property; |
|
(3) the debts that have been paid; |
|
(4) the debts and expenses, if any, still owing by the |
|
estate; |
|
(5) the property of the estate, if any, still |
|
remaining in the executor's possession; |
|
(6) such other facts as may be necessary to a full and |
|
definite understanding of the exact condition of the estate; and |
|
(7) such facts, if any, that show why the |
|
administration should not be closed and the estate distributed. |
|
(a-1) Copy of Exhibit or Accounting. Any other interested |
|
person shall, on demand, be entitled to a copy of any exhibit or |
|
accounting that has been made by an independent executor in |
|
compliance with this section. |
|
(b) Enforcement of Demand. Should the independent executor |
|
not comply with a demand for an accounting authorized by this |
|
section within 60 days after receipt of the demand, the person |
|
making the demand may compel compliance by an action in the probate |
|
court. After a hearing, the court shall enter an order requiring the |
|
accounting to be made at such time as it considers proper under the |
|
circumstances. |
|
(c) Subsequent Demands. After an initial accounting has |
|
been given by an independent executor, any person interested in an |
|
estate may demand subsequent periodic accountings at intervals of |
|
not less than 12 months, and such subsequent demands may be enforced |
|
in the same manner as an initial demand. |
|
(d) Remedies Cumulative. The right to an accounting |
|
accorded by this section is cumulative of any other remedies which |
|
persons interested in an estate may have against the independent |
|
executor of the estate. |
|
Sec. 177Q. REQUIRING INDEPENDENT EXECUTOR TO GIVE BOND. |
|
When it has been provided by will, regularly probated, that an |
|
independent executor appointed by such will shall not be required |
|
to give bond for the management of the estate devised by such will, |
|
or the independent executor is not required to give bond because |
|
bond has been waived by court order as authorized under Section 177E |
|
of this code, then such independent executor may be required to give |
|
bond, on proper proceedings had for that purpose as in the case of |
|
personal representatives in a supervised administration, if it be |
|
made to appear at any time that such independent executor is |
|
mismanaging the property, or has betrayed or is about to betray the |
|
independent executor's trust, or has in some other way become |
|
disqualified. |
|
Sec. 177R. REMOVAL OF INDEPENDENT EXECUTOR. (a) The |
|
probate court, on its own motion or on motion of any interested |
|
person, after the independent executor has been cited by personal |
|
service to answer at a time and place fixed in the notice, may |
|
remove an independent executor when: |
|
(1) the independent executor fails to return within 90 |
|
days after qualification, unless such time is extended by order of |
|
the court, an inventory of the property of the estate and list of |
|
claims that have come to the independent executor's knowledge; |
|
(2) sufficient grounds appear to support belief that |
|
the independent executor has misapplied or embezzled, or that the |
|
independent executor is about to misapply or embezzle, all or any |
|
part of the property committed to the independent executor's care; |
|
(3) the independent executor fails to make an |
|
accounting which is required by law to be made; |
|
(4) the independent executor fails to timely file the |
|
affidavit or certificate required by Section 128A of this code; |
|
(5) the independent executor is proved to have been |
|
guilty of gross misconduct or gross mismanagement in the |
|
performance of the independent executor's duties; or |
|
(6) the independent executor becomes an incapacitated |
|
person, or is sentenced to the penitentiary, or from any other cause |
|
becomes legally incapacitated from properly performing the |
|
independent executor's fiduciary duties. |
|
(b) The order of removal shall state the cause of removal |
|
and shall direct by order the disposition of the assets remaining in |
|
the name or under the control of the removed executor. The order of |
|
removal shall require that letters issued to the removed executor |
|
shall be surrendered and that all letters shall be canceled of |
|
record. If an independent executor is removed by the court under |
|
this section, the court may, on application, appoint a successor |
|
independent executor as provided by Section 177T of this code. |
|
(c) An independent executor who defends an action for the |
|
independent executor's removal in good faith, whether successful or |
|
not, shall be allowed out of the estate the independent executor's |
|
necessary expenses and disbursements, including reasonable |
|
attorney's fees, in the removal proceedings. |
|
(d) Costs and expenses incurred by the party seeking removal |
|
that are incident to removal of an independent executor appointed |
|
without bond, including reasonable attorney's fees and expenses, |
|
may be paid out of the estate. |
|
Sec. 177S. POWERS OF AN ADMINISTRATOR WHO SUCCEEDS AN |
|
INDEPENDENT EXECUTOR. (a) Grant of Powers by Court. Whenever a |
|
person has died, or shall die, testate, owning property in this |
|
state, and such person's will has been or shall be admitted to |
|
probate by the court, and such probated will names an independent |
|
executor or executors, or trustees acting in the capacity of |
|
independent executors, to execute the terms and provisions of said |
|
will, and such will grants to such independent executor, or |
|
executors, or trustees acting in the capacity of independent |
|
executors, the power to raise or borrow money and to mortgage, and |
|
such independent executor, or executors, or trustees, have died or |
|
shall die, resign, fail to qualify, or be removed from office, |
|
leaving unexecuted parts or portions of the will of the testator, |
|
and an administrator with the will annexed is appointed by the |
|
probate court, and an administrator's bond is filed and approved by |
|
the court, then in all such cases, the court may, in addition to the |
|
powers conferred on such administrator under other provisions of |
|
the laws of this state, authorize, direct, and empower such |
|
administrator to do and perform the acts and deeds, clothed with the |
|
rights, powers, authorities, and privileges, and subject to the |
|
limitations, set forth in the subsequent provisions of this |
|
section. |
|
(b) Power to Borrow Money and Mortgage or Pledge Property. |
|
The court, on application, citation, and hearing, may, by its |
|
order, authorize, direct, and empower such administrator to raise |
|
or borrow such sums of money and incur such obligations and debts as |
|
the court shall, in its said order, direct, and to renew and extend |
|
same from time to time, as the court, on application and order, |
|
shall provide; and, if authorized by the court's order, to secure |
|
such loans, obligations, and debts, by pledge or mortgage on |
|
property or assets of the estate, real, personal, or mixed, on such |
|
terms and conditions, and for such duration of time, as the court |
|
shall consider to be in the best interests of the estate, and by its |
|
order shall prescribe; and all such loans, obligations, debts, |
|
pledges, and mortgages shall be valid and enforceable against the |
|
estate and against such administrator in the administrator's |
|
official capacity. |
|
(c) Powers Limited to Those Granted by the Will. The court |
|
may order and authorize such administrator to have and exercise the |
|
powers and privileges set forth in Subsection (a) or (b) of this |
|
section only to the extent that same are granted to or possessed by |
|
the independent executor, or executors, or trustees acting in the |
|
capacity of independent executors, under the terms of the probated |
|
will of such deceased person, and then only in such cases as it |
|
appears, at the hearing of the application, that at the time of the |
|
appointment of such administrator, there are outstanding and unpaid |
|
obligations and debts of the estate, or of the independent |
|
executor, or executors, or trustees, chargeable against the estate, |
|
or unpaid expenses of administration, or when the court appointing |
|
such administrator orders the business of such estate to be carried |
|
on and it becomes necessary, from time to time, under orders of the |
|
court, for such administrator to borrow money and incur obligations |
|
and indebtedness in order to protect and preserve the estate. |
|
(d) Powers Other Than Those Relating to Borrowing Money and |
|
Mortgaging or Pledging Property. The court, in addition, may, on |
|
application, citation, and hearing, order, authorize, and empower |
|
such administrator to assume, exercise, and discharge, under the |
|
orders and directions of said court, made from time to time, all or |
|
such part of the rights, powers, and authorities vested in and |
|
delegated to, or possessed by, the independent executor, or |
|
executors, or trustees acting in the capacity of independent |
|
executors, under the terms of the will of such deceased person, as |
|
the court finds to be in the best interests of the estate and shall, |
|
from time to time, order and direct. |
|
(e) Application for Grant of Powers. The granting to such |
|
administrator by the court of some, or all, of the powers and |
|
authorities set forth in this section shall be on application filed |
|
by such administrator with the county clerk, setting forth such |
|
facts as, in the judgment of the administrator, require the |
|
granting of the power or authority requested. |
|
(f) Citation. On the filing of such application, the clerk |
|
shall issue citation to all persons interested in the estate, |
|
stating the nature of the application, and requiring such persons |
|
to appear on the return day named in such citation and show cause |
|
why such application should not be granted, should they choose to do |
|
so. Such citation shall be served by posting. |
|
(g) Hearing and Order. The court shall hear such |
|
application and evidence on the application, on or after the return |
|
day named in the citation, and, if satisfied a necessity exists and |
|
that it would be in the best interests of the estate to grant said |
|
application in whole or in part, the court shall so order; |
|
otherwise, the court shall refuse said application. |
|
Sec. 177T. COURT-APPOINTED SUCCESSOR INDEPENDENT EXECUTOR. |
|
(a) If the will of a person who dies testate names an independent |
|
executor who, having qualified, fails for any reason to continue to |
|
serve, or is removed for cause by the court, and the will does not |
|
name a successor independent executor or if each successor executor |
|
named in the will fails for any reason to qualify as executor or |
|
indicates by affidavit filed with the application for an order |
|
continuing independent administration the successor executor's |
|
inability or unwillingness to serve as successor independent |
|
executor, all of the distributees of the decedent as of the filing |
|
of the application for an order continuing independent |
|
administration may apply to the probate court for the appointment |
|
of a qualified person, firm, or corporation to serve as successor |
|
independent executor. If the probate court finds that continued |
|
administration of the estate is necessary, the probate court shall |
|
enter an order continuing independent administration and |
|
appointing the person, firm, or corporation designated in the |
|
application as successor independent executor, unless the probate |
|
court finds that it would not be in the best interests of the estate |
|
to do so. Such successor shall serve with all of the powers and |
|
privileges granted to the successor's predecessor independent |
|
executor. |
|
(b) If a distributee described in this section is an |
|
incapacitated person, the guardian of the person of the distributee |
|
may sign the application on behalf of the distributee. If the |
|
probate court finds that either the continuing of independent |
|
administration or the appointment of the person, firm, or |
|
corporation designated in the application as successor independent |
|
executor would not be in the best interest of the incapacitated |
|
person, then, notwithstanding Subsection (a) of this section, the |
|
probate court may not enter an order continuing independent |
|
administration of the estate. If the distributee is an |
|
incapacitated person and has no guardian of the person, the court |
|
may appoint a guardian ad litem to make application on behalf of the |
|
incapacitated person if the probate court considers such an |
|
appointment necessary to protect the interest of such distributee. |
|
(c) If a trust is created in the decedent's will, the person |
|
or class of persons first eligible to receive the income from the |
|
trust, determined as if the trust were to be in existence on the |
|
date of the filing of the application for an order continuing |
|
independent administration, shall, for the purposes of this |
|
section, be considered to be the distributee or distributees on |
|
behalf of such trust, and any other trust or trusts coming into |
|
existence on the termination of such trust, and are authorized to |
|
apply for an order continuing independent administration on behalf |
|
of the trust without the consent or agreement of the trustee or any |
|
other beneficiary of the trust, or the trustee or any beneficiary of |
|
any other trust which may come into existence on the termination of |
|
such trust. |
|
(d) If a life estate is created either in the decedent's |
|
will or by law, and if a life tenant is living at the time of the |
|
filing of the application for an order continuing independent |
|
administration, then the life tenant or life tenants, determined as |
|
if the life estate were to commence on the date of the filing of the |
|
application for an order continuing independent administration, |
|
shall, for the purposes of this section, be considered to be the |
|
distributee or distributees on behalf of the entire estate created, |
|
and are authorized to apply for an order continuing independent |
|
administration on behalf of the estate without the consent or |
|
approval of any remainderman. |
|
(e) If a decedent's will contains a provision that a |
|
distributee must survive the decedent by a prescribed period of |
|
time in order to take under the decedent's will, for the purposes of |
|
determining who shall be the distributee under this section, it |
|
shall be presumed that the distributees living at the time of the |
|
filing of the application for an order continuing independent |
|
administration of the decedent's estate survived the decedent for |
|
the prescribed period. |
|
(f) In the case of all decedents, for the purposes of |
|
determining who shall be the distributees under this section, it |
|
shall be presumed that no distributee living at the time the |
|
application for an order continuing independent administration of |
|
the decedent's estate is filed shall subsequently disclaim any |
|
portion of such distributee's interest in the decedent's estate. |
|
(g) If a distributee of a decedent's estate should die, and |
|
if by virtue of such distributee's death such distributee's share of |
|
the decedent's estate shall become payable to such distributee's |
|
estate, then the deceased distributee's personal representative |
|
may sign the application for an order continuing independent |
|
administration of the decedent's estate under this section. |
|
(h) If a successor independent executor is appointed under |
|
this section, then, unless the probate court shall waive bond on |
|
application for waiver, the successor independent executor shall be |
|
required to enter into bond payable to and to be approved by the |
|
judge and the judge's successors in a sum that is found by the judge |
|
to be adequate under all circumstances, or a bond with one surety in |
|
an amount that is found by the judge to be adequate under all |
|
circumstances, if the surety is an authorized corporate surety. |
|
(i) Absent proof of fraud or collusion on the part of a |
|
judge, the judge may not be held civilly liable for the commission |
|
of misdeeds or the omission of any required act of any person, firm, |
|
or corporation designated as a successor independent executor under |
|
this section. Section 36 of this code does not apply to an |
|
appointment of a successor independent executor under this section. |
|
PART 5. CLOSING AND DISTRIBUTIONS |
|
Sec. 177U. ACCOUNTING AND DISTRIBUTION. (a) In addition to |
|
or in lieu of the right to an accounting provided by Section 177P of |
|
this code, at any time after the expiration of two years after the |
|
date that an independent administration was created and the order |
|
appointing an independent executor was entered, a person interested |
|
in the estate may petition the court for an accounting and |
|
distribution. The court may order an accounting to be made with the |
|
court by the independent executor at such time as the court |
|
considers proper. The accounting shall include the information that |
|
the court considers necessary to determine whether any part of the |
|
estate should be distributed. |
|
(b) On receipt of the accounting and, after notice to the |
|
independent executor and a hearing, unless the court finds a |
|
continued necessity for administration of the estate, the court |
|
shall order its distribution by the independent executor to the |
|
distributees entitled to the property. If the court finds there is |
|
a continued necessity for administration of the estate, the court |
|
shall order the distribution of any portion of the estate that the |
|
court finds should not be subject to further administration by the |
|
independent executor. If any portion of the estate that is ordered |
|
to be distributed is incapable of distribution without prior |
|
partition or sale, the court shall order partition and |
|
distribution, or sale, in the manner provided for the partition and |
|
distribution of property incapable of division in supervised |
|
estates. |
|
(c) If all the property in the estate is ordered distributed |
|
by the court and the estate is fully administered, the court may |
|
also order the independent executor to file a final account with the |
|
court and may enter an order closing the administration and |
|
terminating the power of the independent executor to act as |
|
executor. |
|
Sec. 177V. RECEIPTS AND RELEASES FOR DISTRIBUTIONS BY |
|
INDEPENDENT EXECUTOR. (a) An independent executor may not be |
|
required to deliver tangible or intangible personal property to a |
|
distributee unless the independent executor shall receive, at or |
|
before the time of delivery of the property, a signed receipt or |
|
other proof of delivery of the property to the distributee. |
|
(b) An independent executor may not require a waiver or |
|
release from the distributee as a condition of delivery of property |
|
to a distributee. |
|
Sec. 177W. JUDICIAL DISCHARGE OF INDEPENDENT EXECUTOR. (a) |
|
After an estate has been administered and if there is no further |
|
need for an independent administration of the estate, the |
|
independent executor of the estate may file an action for |
|
declaratory judgment under Chapter 37, Civil Practice and Remedies |
|
Code, seeking to discharge the independent executor from any |
|
liability involving matters relating to the past administration of |
|
the estate that have been fully and fairly disclosed. |
|
(b) On the filing of an action under this section, each |
|
beneficiary of the estate shall be personally served with citation, |
|
except for a beneficiary who has waived the issuance and service of |
|
citation. |
|
(c) In a proceeding under this section, the court may |
|
require the independent executor to file a final account that |
|
includes any information the court considers necessary to |
|
adjudicate the independent executor's request for a discharge of |
|
liability. The court may audit, settle, or approve a final account |
|
filed under this subsection. |
|
(d) On or before filing an action under this section, the |
|
independent executor must distribute to the beneficiaries of the |
|
estate any of the remaining assets or property of the estate that |
|
remains in the independent executor's possession after all of the |
|
estate's debts have been paid, except for a reasonable reserve of |
|
assets that the independent executor may retain in a fiduciary |
|
capacity pending court approval of the final account. The court may |
|
review the amount of assets on reserve and may order the independent |
|
executor to make further distributions under this section. |
|
(e) Except as ordered by the court, the independent executor |
|
is entitled to pay from the estate legal fees, expenses, or other |
|
costs incurred in relation to a proceeding for judicial discharge |
|
filed under this section. The independent executor shall be |
|
personally liable to refund any amount of such fees, expenses, or |
|
other costs not approved by the court as a proper charge against the |
|
estate. |
|
Sec. 177X. CLOSING INDEPENDENT ADMINISTRATION BY CLOSING |
|
REPORT OR NOTICE OF CLOSING ESTATE. When all of the debts known to |
|
exist against the estate have been paid, or when they have been paid |
|
so far as the assets in the independent executor's possession will |
|
permit, when there is no pending litigation, and when the |
|
independent executor has distributed to the distributees entitled |
|
to the estate all assets of the estate, if any, remaining after |
|
payment of debts, the independent executor may file with the court a |
|
closing report or a notice of closing of the estate. |
|
(a) Closing Report. An independent executor may file a |
|
closing report verified by affidavit that: |
|
(1) shows: |
|
(A) the property of the estate that came into the |
|
independent executor's possession; |
|
(B) the debts that have been paid; |
|
(C) the debts, if any, still owing by the estate; |
|
(D) the property of the estate, if any, remaining |
|
on hand after payment of debts; and |
|
(E) the names and addresses of the distributees |
|
to whom the property of the estate, if any, remaining on hand after |
|
payment of debts has been distributed; and |
|
(2) includes signed receipts or other proof of |
|
delivery of property to the distributees named in the closing |
|
report if the closing report reflects that there was property |
|
remaining on hand after payment of debts. |
|
(b) Notice of Closing Estate. (1) An independent executor |
|
is not required to but may file a notice of closing estate verified |
|
by affidavit that states: |
|
(A) that all debts known to exist against the |
|
estate have been paid or that the debts have been paid so far as the |
|
assets in the possession of the independent executor will permit; |
|
(B) that all remaining assets of the estate, if |
|
any, have been distributed; and |
|
(C) the names and addresses of the distributees |
|
to whom the property of the estate, if any, remaining on hand after |
|
payment of debts has been distributed. |
|
(2) Before filing the notice, the independent executor |
|
shall provide all distributees of the estate with a copy of the |
|
notice of closing estate. The notice of closing estate filed by the |
|
independent executor shall include signed receipts or other proof |
|
that all distributees have received a copy of the notice of closing |
|
estate. |
|
(c) Effect of Filing Closing Report or Notice of Closing |
|
Estate. (1) The independent administration of an estate shall be |
|
considered closed 30 days after the filing of a closing report or |
|
notice of closing estate unless an interested person files an |
|
objection within the 30-day period. If an interested person files |
|
an objection, the independent administration of the estate shall be |
|
closed when the objection has been disposed of or the court signs an |
|
order closing the estate. |
|
(2) The closing of an independent administration by |
|
filing of a closing report or notice of closing estate terminates |
|
the power and authority of the independent executor, but does not |
|
relieve the independent executor from liability for any |
|
mismanagement of the estate or from liability for any false |
|
statements contained in the report or notice. |
|
(3) When a closing report or notice of closing estate |
|
has been filed, persons dealing with properties of the estate, or |
|
with claims against the estate, shall deal directly with the |
|
distributees of the estate; and the acts of such distributees with |
|
respect to such properties or claims shall in all ways be valid and |
|
binding as regards the persons with whom they deal, notwithstanding |
|
any false statements made by the independent executor in such |
|
report or notice. |
|
(4) If the independent executor is required to give |
|
bond, the independent executor's filing of the closing report and |
|
proof of delivery, if required, automatically releases the sureties |
|
on the bond from all liability for the future acts of the principal. |
|
The filing of a notice of closing estate does not release the |
|
sureties on the bond of an independent executor. |
|
(5) An independent executor's closing report or notice |
|
of closing estate shall constitute sufficient legal authority to |
|
all persons owing any money, having custody of any property, or |
|
acting as registrar or transfer agent or trustee of any evidence of |
|
interest, indebtedness, property, or right that belongs to the |
|
estate, for payment or transfer without additional administration |
|
to the distributees described in the will as entitled to receive the |
|
particular asset or who as heirs at law are entitled to receive the |
|
asset. The distributees described in the will as entitled to |
|
receive the particular asset or the heirs at law entitled to receive |
|
the asset may enforce their right to the payment or transfer by |
|
suit. |
|
Sec. 177Y. PARTITION AND DISTRIBUTION OR SALE OF PROPERTY |
|
INCAPABLE OF DIVISION. If the will does not distribute the entire |
|
estate of the testator or provide a means for partition of the |
|
estate, or if no will was probated, the independent executor may, |
|
but may not be required to, petition the probate court for either a |
|
partition and distribution of the estate or an order of sale of any |
|
portion of the estate alleged by the independent executor and found |
|
by the court to be incapable of a fair and equal partition and |
|
distribution, or both. The estate or portion of the estate shall |
|
either be partitioned and distributed or sold, or both, in the |
|
manner provided for the partition and distribution of property and |
|
the sale of property incapable of division in supervised estates. |
|
Sec. 177Z. CLOSING INDEPENDENT ADMINISTRATION ON |
|
APPLICATION BY DISTRIBUTEE. (a) At any time after an estate has |
|
been fully administered and there is no further need for an |
|
independent administration of such estate, any distributee may file |
|
an application to close the administration; and, after citation on |
|
the independent executor, and on hearing, the court may enter an |
|
order: |
|
(1) requiring the independent executor to file a |
|
closing report meeting the requirements of Section 177X of this |
|
code; |
|
(2) closing the administration; |
|
(3) terminating the power of the independent executor |
|
to act as such; and |
|
(4) releasing the sureties on any bond the independent |
|
executor was required to give from all liability for the future acts |
|
of the principal. |
|
(b) The order of the court closing the independent |
|
administration shall constitute sufficient legal authority to all |
|
persons owing any money, having custody of any property, or acting |
|
as registrar or transfer agent or trustee of any evidence of |
|
interest, indebtedness, property, or right that belongs to the |
|
estate, for payment or transfer without additional administration |
|
to the distributees described in the will as entitled to receive the |
|
particular asset or who as heirs at law are entitled to receive the |
|
asset. The distributees described in the will as entitled to |
|
receive the particular asset or the heirs at law entitled to receive |
|
the asset may enforce their right to the payment or transfer by |
|
suit. |
|
Sec. 177AA. ISSUANCE OF LETTERS. At any time before the |
|
authority of an independent executor has been terminated in the |
|
manner set forth in this chapter, the clerk shall issue such number |
|
of letters testamentary as the independent executor shall request. |
|
Sec. 177BB. RIGHTS AND REMEDIES CUMULATIVE. The rights and |
|
remedies conferred by this part are cumulative of other rights and |
|
remedies to which a person interested in the estate may be entitled |
|
under law. |
|
Sec. 177CC. CLOSING PROCEDURES NOT REQUIRED. An independent |
|
executor is not required to close the independent administration of |
|
an estate under Section 177W or 177X of this code. |
|
SECTION 1.02. Section 3(q), Texas Probate Code, is amended |
|
to read as follows: |
|
(q) "Independent executor" means the personal |
|
representative of an estate under independent administration as |
|
provided in Chapter VI-1 [Section 145] of this Code. The term |
|
"independent executor" includes the term "independent |
|
administrator." |
|
SECTION 1.03. Section 5A(b), Texas Probate Code, is amended |
|
to read as follows: |
|
(b) In proceedings in the statutory probate courts, the |
|
phrases "appertaining to estates" and "incident to an estate" in |
|
this Code include the probate of wills, the issuance of letters |
|
testamentary and of administration, and the determination of |
|
heirship, and also include, but are not limited to, all claims by or |
|
against an estate, all actions for trial of title to land and for |
|
the enforcement of liens thereon, all actions for trial of the right |
|
of property, all actions to construe wills, the interpretation and |
|
administration of testamentary trusts and the applying of |
|
constructive trusts, and generally all matters relating to the |
|
collection, settlement, partition, and distribution of estates of |
|
deceased persons. All statutory probate courts may, in the |
|
exercise of their jurisdiction, notwithstanding any other |
|
provisions of this Code, hear all suits, actions, and applications |
|
filed against or on behalf of any heirship proceeding or decedent's |
|
estate, including estates administered by an independent executor; |
|
all such suits, actions, and applications are appertaining to and |
|
incident to an estate. This subsection shall be construed in |
|
conjunction with and in harmony with Chapter VI-1 of this Code |
|
[Section 145] and all other sections of this Code dealing with |
|
independent executors, but shall not be construed so as to increase |
|
permissible judicial control over independent executors. Except |
|
for situations in which the jurisdiction of a statutory probate |
|
court is concurrent with that of a district court as provided by |
|
Section 5(e) of this Code or any other court, any cause of action |
|
appertaining to estates or incident to an estate shall be brought in |
|
a statutory probate court. |
|
SECTION 1.04. Section 5C(a), Texas Probate Code, is amended |
|
to read as follows: |
|
(a) This section applies only to a decedent's estate that: |
|
(1) is being administered in a pending probate |
|
proceeding; |
|
(2) owns or claims an interest in property against |
|
which a taxing unit has imposed ad valorem taxes that are |
|
delinquent; and |
|
(3) is not being administered as an independent |
|
administration under Chapter VI-1 [Section 145] of this code. |
|
SECTION 1.05. Section 110, Texas Probate Code, is amended |
|
to read as follows: |
|
Sec. 110. REQUIREMENTS FOR EMERGENCY INTERVENTION. An |
|
applicant may file an emergency application with the court under |
|
Section 108 of this code only if an application has not been filed |
|
and is not pending under Section 81, 82, or 137 of this code[,] or |
|
Part 1, Chapter VI-1 [145] of this code and the applicant: |
|
(1) needs to obtain funds for the funeral and burial of |
|
the decedent; or |
|
(2) needs to gain access to rental accommodations in |
|
which the decedent's personal property is located and the applicant |
|
has been denied access to those accommodations. |
|
SECTION 1.06. Section 241(a), Texas Probate Code, is |
|
amended to read as follows: |
|
(a) Executors, administrators, and temporary |
|
administrators shall be entitled to receive a commission of five |
|
per cent (5%) on all sums they may actually receive in cash, and the |
|
same per cent on all sums they may actually pay out in cash, in the |
|
administration of the estate on a finding by the court that the |
|
executor or administrator has taken care of and managed the estate |
|
in compliance with the standards of this code; provided, no |
|
commission shall be allowed for receiving funds belonging to the |
|
testator or intestate which were on hand or were held for the |
|
testator or intestate at the time of his death in a financial |
|
institution or a brokerage firm, including cash or a cash |
|
equivalent held in a checking account, savings account, certificate |
|
of deposit, or money market account; nor for collecting the |
|
proceeds of any life insurance policy; nor for paying out cash to |
|
the heirs or legatees as such; provided, further, however, that in |
|
no event shall the executor or administrator be entitled in the |
|
aggregate to more than five per cent (5%) of the gross fair market |
|
value of the estate subject to administration. If the executor or |
|
administrator manages a farm, ranch, factory, or other business of |
|
the estate, or if the compensation as calculated above is |
|
unreasonably low, the court may allow him reasonable compensation |
|
for his services, including unusual effort to collect funds or life |
|
insurance. For this purpose, the county court shall have |
|
jurisdiction to receive, consider, and act on applications from |
|
independent executors. The court may, on application of an |
|
interested person or on its own motion, deny a commission allowed by |
|
this subsection in whole or in part if: |
|
(1) the court finds that the executor or administrator |
|
has not taken care of and managed estate property prudently; or |
|
(2) the executor or administrator has been removed |
|
under Section [149C or] 222 of this code or Part 4, Chapter VI-1 of |
|
this code. |
|
SECTION 1.07. Notwithstanding the transfer of Sections 145, |
|
146, 147, 148, 149, 149A, 149B, 149C, 149D, 149E, 149F, 149G, 150, |
|
151, 152, 153, 154, and 154A, Texas Probate Code, to the Estates and |
|
Guardianships Code, as adopted by H.B. No. 2502 or S.B. No. 2071, |
|
Acts of the 81st Legislature, Regular Session, 2009, by one of those |
|
Acts, Sections 145, 146, 147, 148, 149, 149A, 149B, 149C, 149D, |
|
149E, 149F, 149G, 150, 151, 152, 153, 154, and 154A, Texas Probate |
|
Code, are repealed. |
|
SECTION 1.08. The changes in law made by this article apply |
|
only to the estate of a decedent who dies on or after the effective |
|
date of this Act. The estate of a decedent who dies before the |
|
effective date of this Act is governed by the law in effect on the |
|
date of the decedent's death, and the former law is continued in |
|
effect for that purpose. |
|
ARTICLE 2. INDEPENDENT ADMINISTRATION: ESTATES AND GUARDIANSHIPS |
|
CODE |
|
SECTION 2.01. Effective January 1, 2014, Subtitle I, Title |
|
2, Estates and Guardianships Code, as adopted by H.B. 2502 or S.B. |
|
2071, Acts of the 81st Legislature, Regular Session, 2009, is |
|
amended by adding Chapters 401, 402, 403, 404, and 405 to read as |
|
follows: |
|
CHAPTER 401. CREATION |
|
Sec. 401.001. EXPRESSION OF TESTATOR'S INTENT IN WILL. (a) |
|
Any person capable of making a will may provide in the person's will |
|
that no other action shall be had in the probate court in relation |
|
to the settlement of the person's estate than the probating and |
|
recording of the will and the return of an inventory, appraisement, |
|
and list of claims of the person's estate. |
|
(b) Any person capable of making a will may provide in the |
|
person's will that no independent administration of his or her |
|
estate may be allowed. In such case the person's estate, if |
|
administered, shall be administered and settled under the direction |
|
of the probate court as other estates are required to be settled and |
|
not as an independent administration. |
|
Sec. 401.002. CREATION IN TESTATE ESTATE BY AGREEMENT. (a) |
|
Except as provided in Section 401.001(b), if a decedent's will |
|
names an executor but the will does not provide for independent |
|
administration as provided in Section 401.001(a), all of the |
|
distributees of the decedent may agree on the advisability of |
|
having an independent administration and collectively designate in |
|
the application for probate of the decedent's will the executor |
|
named in the will to serve as independent executor and request in |
|
the application that no other action shall be had in the probate |
|
court in relation to the settlement of the decedent's estate other |
|
than the probating and recording of the decedent's will and the |
|
return of an inventory, appraisement, and list of claims of the |
|
decedent's estate. In such case the probate court shall enter an |
|
order granting independent administration and appointing the |
|
person, firm, or corporation designated in the application as |
|
independent executor, unless the court finds that it would not be in |
|
the best interest of the estate to do so. |
|
(b) Except as provided in Section 401.001(b), in situations |
|
where no executor is named in the decedent's will, or in situations |
|
where each executor named in the will is deceased or is disqualified |
|
to serve as executor or indicates by affidavit filed with the |
|
application for administration of the decedent's estate the |
|
executor's inability or unwillingness to serve as executor, all of |
|
the distributees of the decedent may agree on the advisability of |
|
having an independent administration and collectively designate in |
|
the application for probate of the decedent's will a qualified |
|
person, firm, or corporation to serve as independent administrator |
|
and request in the application that no other action shall be had in |
|
the probate court in relation to the settlement of the decedent's |
|
estate other than the probating and recording of the decedent's |
|
will and the return of an inventory, appraisement, and list of |
|
claims of the decedent's estate. In such case the probate court |
|
shall enter an order granting independent administration and |
|
appointing the person, firm, or corporation designated in the |
|
application as independent administrator, unless the court finds |
|
that it would not be in the best interest of the estate to do so. |
|
Sec. 401.003. CREATION IN INTESTATE ESTATE BY AGREEMENT. |
|
(a) All of the distributees of a decedent dying intestate may agree |
|
on the advisability of having an independent administration and |
|
collectively designate in the application for administration of the |
|
decedent's estate a qualified person, firm, or corporation to serve |
|
as independent administrator and request in the application that no |
|
other action shall be had in the probate court in relation to the |
|
settlement of the decedent's estate other than the return of an |
|
inventory, appraisement, and list of claims of the decedent's |
|
estate. In such case the probate court shall enter an order |
|
granting independent administration and appointing the person, |
|
firm, or corporation designated in the application as independent |
|
administrator, unless the court finds that it would not be in the |
|
best interest of the estate to do so. |
|
(b) The court shall not appoint an independent |
|
administrator to serve in an intestate administration unless and |
|
until the parties seeking appointment of the independent |
|
administrator have been determined, through a proceeding to declare |
|
heirship under Chapter 202, to constitute all of the decedent's |
|
heirs. |
|
Sec. 401.004. MEANS OF ESTABLISHING DISTRIBUTEE CONSENT. |
|
(a) This section applies to the creation of an independent |
|
administration under Section 401.002 or 401.003. |
|
(b) All distributees shall be served with citation and |
|
notice of the application for independent administration unless the |
|
distributee waives the issuance or service of citation or enters an |
|
appearance in court. |
|
(c) If a distributee is an incapacitated person, the |
|
guardian of the person of the distributee may sign the application |
|
on behalf of the distributee. If the probate court finds that |
|
either the granting of independent administration or the |
|
appointment of the person, firm, or corporation designated in the |
|
application as independent executor would not be in the best |
|
interest of the incapacitated person, then, notwithstanding |
|
anything to the contrary in Section 401.002 or 401.003, the court |
|
shall not enter an order granting independent administration of the |
|
estate. If a distributee who is an incapacitated person has no |
|
guardian of the person, the probate court may appoint a guardian ad |
|
litem to make application on behalf of the incapacitated person if |
|
the court considers such an appointment necessary to protect the |
|
interest of the distributees. Alternatively, if the distributee who |
|
is an incapacitated person is a minor and has no guardian of the |
|
person, the natural guardian or guardians of such minor may consent |
|
on behalf of such incapacitated person if there is no conflict of |
|
interest between the minor and such natural guardian or guardians. |
|
(d) If a trust is created in the decedent's will, the person |
|
or class of persons first eligible to receive the income from the |
|
trust, when determined as if the trust were to be in existence on |
|
the date of the decedent's death, shall, for the purposes of Section |
|
401.002, be considered to be the distributee or distributees on |
|
behalf of such trust, and any other trust or trusts coming into |
|
existence on the termination of such trust, and are authorized to |
|
apply for independent administration on behalf of the trusts |
|
without the consent or agreement of the trustee or any other |
|
beneficiary of the trust, or the trustee or any beneficiary of any |
|
other trust which may come into existence on the termination of such |
|
trust. If a person who is a trust beneficiary and who is considered |
|
to be a distributee under this subsection is an incapacitated |
|
person, then such trustee or cotrustee may file the application or |
|
give the consent, provided that such trustee or cotrustee is not the |
|
person proposed to serve as the independent executor. |
|
(e) If a life estate is created either in the decedent's |
|
will or by law, the life tenant or life tenants, when determined as |
|
if the life estate were to commence on the date of the decedent's |
|
death, shall, for the purposes of Section 401.002 or 401.003, be |
|
considered to be the distributee or distributees on behalf of the |
|
entire estate created, and are authorized to apply for independent |
|
administration on behalf of the estate without the consent or |
|
approval of any remainderman. |
|
(f) If a decedent's will contains a provision that a |
|
distributee must survive the decedent by a prescribed period of |
|
time in order to take under the decedent's will, then, for the |
|
purposes of determining who shall be the distributee under Section |
|
401.002 and under Subsection (c), it shall be presumed that the |
|
distributees living at the time of the filing of the application for |
|
probate of the decedent's will survived the decedent by the |
|
prescribed period. |
|
(g) In the case of all decedents, whether dying testate or |
|
intestate, for the purposes of determining who shall be the |
|
distributees under Section 401.002 or 401.003 and under Subsection |
|
(c), it shall be presumed that no distributee living at the time the |
|
application for independent administration is filed shall |
|
subsequently disclaim any portion of such distributee's interest in |
|
the decedent's estate. |
|
(h) If a distributee of a decedent's estate should die and |
|
if by virtue of such distributee's death such distributee's share of |
|
the decedent's estate shall become payable to such distributee's |
|
estate, then the deceased distributee's personal representative |
|
may sign the application for independent administration of the |
|
decedent's estate under Section 401.002 or 401.003 and under |
|
Subsection (c). |
|
Sec. 401.005. BOND; WAIVER OF BOND. If an independent |
|
administration of a decedent's estate is created under Section |
|
401.002 or 401.003, then, unless the probate court waives bond on |
|
application for waiver, the independent executor shall be required |
|
to enter into bond payable to and to be approved by the judge and the |
|
judge's successors in a sum that is found by the judge to be |
|
adequate under all circumstances, or a bond with one surety in a sum |
|
that is found by the judge to be adequate under all circumstances, |
|
if the surety is an authorized corporate surety. This section does |
|
not repeal any other section of this title. |
|
Sec. 401.006. GRANTING POWER OF SALE BY AGREEMENT. In a |
|
situation in which a decedent does not have a will or the will does |
|
not contain or insufficiently contains language authorizing the |
|
personal representative to sell real property, the court may |
|
include in an order appointing an independent executor under |
|
Section 401.002 or 401.003 such general or specific authority |
|
regarding the power of the independent executor to sell real |
|
property as may be consented to by the beneficiaries who are to |
|
receive any such real property in their consents to the independent |
|
administration. The independent executor, in such event, may sell |
|
the real property under the authority granted in the court order |
|
without the further consent of those beneficiaries. |
|
Sec. 401.007. NO LIABILITY OF JUDGE. Absent proof of fraud |
|
or collusion on the part of a judge, no judge may be held civilly |
|
liable for the commission of misdeeds or the omission of any |
|
required act of any person, firm, or corporation designated as an |
|
independent executor under Section 401.002 or 401.003. Section |
|
351.354 does not apply to the appointment of an independent |
|
executor under Section 401.002 or 401.003. |
|
Sec. 401.008. PERSON DECLINING TO SERVE. A person who |
|
declines to serve or resigns as independent executor of a |
|
decedent's estate may be appointed an executor or administrator of |
|
the estate if the estate will be administered and settled under the |
|
direction of the court. |
|
CHAPTER 402. ADMINISTRATION |
|
Sec. 402.001. GENERAL SCOPE AND EXERCISE OF POWERS. When an |
|
independent administration has been created, and the order |
|
appointing an independent executor has been entered by the probate |
|
court, and the inventory, appraisement, and list of claims has been |
|
filed by the independent executor and approved by the court, as long |
|
as the estate is represented by an independent executor, further |
|
action of any nature shall not be had in the probate court except |
|
where this title specifically and explicitly provides for some |
|
action in such court. |
|
Sec. 402.002. INDEPENDENT EXECUTORS MAY ACT WITHOUT COURT |
|
APPROVAL. Unless this title specifically provides otherwise, any |
|
action that a personal representative subject to court supervision |
|
may do with or without a court order may be taken by an independent |
|
executor without a court order. The other provisions of this |
|
subtitle are designed to provide additional guidance regarding |
|
independent administrations in specified situations, and are not |
|
designed to limit by omission or otherwise the application of the |
|
general principles set forth in this chapter. |
|
Sec. 402.003. POWER OF SALE. (a) General. (1) An |
|
independent executor has the power of sale set forth in the will, if |
|
applicable, exercisable without court approval as otherwise |
|
provided for independent administrations. |
|
(2) Unless limited by the terms of a will, an |
|
independent executor has, in addition to any power of sale given in |
|
the will, the same power of sale for the same purposes as personal |
|
representatives have in a supervised administration, but without |
|
the requirement of court approval. The procedural requirements |
|
applicable to a supervised administration do not apply. |
|
(b) Protection of Person Purchasing Estate Property. (1) A |
|
person who is not a devisee or heir is not required to inquire into |
|
the independent executor's power of sale or the propriety of the |
|
exercise of the power of sale if the person deals with the |
|
independent executor in good faith and: |
|
(A) a power of sale is granted to the independent |
|
executor in the will or in the court order appointing the |
|
independent executor; or |
|
(B) the independent executor provides an |
|
affidavit, sworn to under oath and recorded in the deed records of |
|
the county where the property is located, that the sale is necessary |
|
or advisable for any of the purposes described in Section |
|
356.251(1). |
|
(2) As to acts undertaken in good faith reliance, the |
|
affidavit executed by the independent executor and described by |
|
Subsection (b)(1)(B) is conclusive proof, as between a purchaser of |
|
property from an estate, and the personal representative of an |
|
estate or the heirs and distributees of the estate, with respect to |
|
the authority of the independent executor to sell the property. The |
|
signature or joinder of any person who is a devisee or heir and who |
|
has an interest in the property being sold as described in this |
|
section is not necessary for the purchaser to obtain all right, |
|
title, and interest of the estate in the property being sold. |
|
(3) This section does not relieve the independent |
|
executor of any duty owing to a devisee or heir related directly or |
|
indirectly to the sale. |
|
(c) No Limitations. This section does not limit the |
|
authority of an independent executor to take other actions without |
|
court supervision or approval with respect to estate assets that |
|
may take place in a supervised administration, for purposes and |
|
within the scope otherwise authorized by this title, including |
|
leases and borrowing money. |
|
CHAPTER 403. CLAIMS; EXEMPTIONS AND ALLOWANCES |
|
Sec. 403.001. SETTING ASIDE EXEMPT PROPERTY AND ALLOWANCES. |
|
The independent executor shall set aside and deliver to those |
|
entitled exempt property and allowances for support, and allowances |
|
in lieu of exempt property, as prescribed in this title, to the same |
|
extent and result as if the independent executor's actions had been |
|
accomplished in, and under orders of, the court. |
|
Sec. 403.002. CLAIMS. (a) Duty of the Independent |
|
Executor. An independent executor, in the administration of an |
|
estate, independently of and without application to, or any action |
|
in or by the court: |
|
(1) shall give the notices required under Sections |
|
308.051, 308.052, 308.053, and 308.054; |
|
(2) may give the notice to an unsecured creditor with a |
|
claim for money permitted under Section 308.054 and bar a claim |
|
under Subsection (e); and |
|
(3) may approve or reject any claim, or take no action |
|
on a claim, and shall classify and pay claims approved or |
|
established by suit against the estate in the same order of |
|
priority, classification, and proration prescribed in this title. |
|
(a-1) Statement in Notice of Claim. In order to be |
|
effective, the notice described by Subsection (a)(2) must include, |
|
in addition to the other information required by Section 308.054, a |
|
statement that a claim may be effectively presented only by one of |
|
the methods described in this section. |
|
(b) Secured Claims for Money. Within six months after the |
|
date letters are granted or within four months after the date notice |
|
is received under Section 308.053, whichever is later, a creditor |
|
with a claim for money secured by real or personal property of the |
|
estate must give notice to the independent executor of the |
|
creditor's election to have the creditor's claim approved as a |
|
matured secured claim to be paid in due course of administration. |
|
In addition to such notice, such creditor whose claim is secured by |
|
real property shall record a notice of such election in the deed |
|
records of the county in which such real property is located. If no |
|
election to be a matured secured creditor is made, or is made but |
|
not within the required period, or is made within the required |
|
period but the creditor has a lien against real property and fails |
|
to record notice of the claim in the deed records as described above |
|
within the required period, the claim shall be a preferred debt and |
|
lien against the specific property securing the indebtedness and |
|
shall be paid according to the terms of the contract that secured |
|
the lien, and the claim may not be asserted against other assets of |
|
the estate. The independent executor may pay the claim prior to |
|
maturity if it is determined to be in the best interest of the |
|
estate to do so. |
|
(c) Matured Secured Claims. (1) A claim approved as a |
|
matured secured claim under Subsection (b) shall remain secured by |
|
any lien or security interest against the specific property |
|
securing its payment but subordinated to the payment from the |
|
property of claims having a higher classification under Section |
|
355.102. However, the secured creditor: |
|
(A) shall not be entitled to exercise any |
|
remedies in a manner that prevents the payment of such higher |
|
priority claims and allowances; and |
|
(B) during the administration of the estate, |
|
shall not be entitled to exercise any contractual collection |
|
rights, including the power to foreclose, without either the prior |
|
written approval of the independent executor or court approval. |
|
(1-a) Nothing in Subdivision (1) shall be construed to |
|
suspend or otherwise prevent a creditor with a matured secured |
|
claim from seeking judicial relief of any kind or executing on any |
|
judgment against an independent executor. Except with respect to |
|
real property, any third party acting in good faith may obtain good |
|
title with respect to an estate asset acquired through a secured |
|
creditor's extrajudicial collection rights, without regard to |
|
whether such creditor had the right to collect or whether the |
|
creditor acted improperly in exercising such rights during an |
|
estate administration due to having elected matured secured status. |
|
(2) If a claim approved or established by suit as a |
|
matured secured claim is secured by property passing to one or more |
|
devisees in accordance with Subchapter G, Chapter 255, the |
|
independent executor shall collect from the devisees the amount of |
|
the debt and pay that amount to the claimant or sell the property |
|
and pay out of the sale proceeds the claim and associated expenses |
|
of sale consistent with the provisions of Sections 355.153(b), (c), |
|
(d), and (e) applicable in court supervised administrations. |
|
(d) Preferred Debt and Lien Claims. During an independent |
|
administration, a secured creditor whose claim is a preferred debt |
|
and lien against property securing the indebtedness under |
|
Subsection (b) is free to exercise any and all judicial or |
|
extrajudicial collection rights, including foreclosure and |
|
execution; provided, however, that such creditor shall not have the |
|
right to conduct a nonjudicial foreclosure sale within a period of |
|
six months after letters are granted. |
|
(e) Certain Unsecured Claims; Barring of Claims. An |
|
unsecured creditor who has a claim for money against an estate and |
|
who receives a notice under Section 308.054 shall give notice to the |
|
independent executor of the nature and amount of the claim not later |
|
than the 120th day after the date on which the notice is received or |
|
the claim is barred. |
|
(f) Notices Required by Creditors. Notice to the personal |
|
representative required by Subsections (b) and (e) must be |
|
contained in: |
|
(1) a written instrument that is hand-delivered with |
|
proof of receipt, or mailed by certified mail, return receipt |
|
requested with proof of receipt, to the independent executor or the |
|
executor's attorney; |
|
(2) a pleading filed in a lawsuit with respect to the |
|
claim; or |
|
(3) a written instrument or pleading filed in the |
|
court in which the administration of the estate is pending. |
|
(f-1) Filing Requirements Applicable. Nothing in |
|
Subsection (f) shall relieve a creditor who elects matured secured |
|
status from the filing requirements in Subsection (b), to the |
|
extent applicable. |
|
(g) Statute of Limitations. Except as otherwise provided in |
|
Section 16.062, Civil Practice and Remedies Code, the running of |
|
the statute of limitations shall be tolled only by a written |
|
approval of a claim signed by an independent executor, a pleading |
|
filed in a suit pending at the time of the decedent's death, or a |
|
suit brought by the creditor against the independent executor. In |
|
particular, the presentation of a statement or claim, or a notice |
|
with respect to a claim, to an independent executor shall not toll |
|
the running of the statute of limitations with respect to that |
|
claim. |
|
(h) Other Claim Procedures of Code Generally Do Not Apply. |
|
Except as otherwise provided in this section, the procedural |
|
provisions of this title governing creditor claims in supervised |
|
administrations do not apply in independent administrations. By way |
|
of example only and not of limitation: |
|
(1) Sections 355.064 and 355.066 do not apply in |
|
independent administrations, and consequently a creditor's claim |
|
shall not be barred solely because the creditor failed to file a |
|
suit within 90 days after a claim has been rejected by an |
|
independent executor or with respect to which the independent |
|
executor takes no action; and |
|
(2) Sections 355.156, 355.157, 355.158, 355.159, and |
|
355.160 do not apply in independent administrations. |
|
(i) Liability of Independent Executor. An independent |
|
executor, in the administration of an estate, may pay at any time |
|
and without personal liability a claim for money against the estate |
|
to the extent approved and classified by the personal |
|
representative if: |
|
(1) the claim is not barred by limitations; and |
|
(2) at the time of payment, the independent executor |
|
reasonably believes the estate will have sufficient assets to pay |
|
all claims against the estate. |
|
Sec. 403.003. ENFORCEMENT OF CLAIMS BY SUIT. Any person |
|
having a debt or claim against the estate may enforce the payment of |
|
the same by suit against the independent executor; and, when |
|
judgment is recovered against the independent executor, the |
|
execution shall run against the estate of the decedent in the |
|
possession of the independent executor that is subject to such |
|
debt. The independent executor shall not be required to plead to |
|
any suit brought against the executor for money until after six |
|
months after the date that an independent administration was |
|
created and the order appointing the executor was entered by the |
|
probate court. |
|
Sec. 403.004. REQUIRING HEIRS TO GIVE BOND. When an |
|
independent administration is created and the order appointing an |
|
independent executor is entered by the probate court, any person |
|
having a debt against such estate may, by written complaint filed in |
|
the probate court in which such order was entered, cause all |
|
distributees of the estate, heirs at law, and other persons |
|
entitled to any portion of such estate under the will, if any, to be |
|
cited by personal service to appear before such probate court and |
|
execute a bond for an amount equal to the amount of the creditor's |
|
claim or the full value of such estate, as shown by the inventory |
|
and list of claims, whichever is the smaller, such bond to be |
|
payable to the judge, and the judge's successors, and to be approved |
|
by the judge, and conditioned that all obligors shall pay all debts |
|
that shall be established against such estate in the manner |
|
provided by law. On the return of the citation served, unless such |
|
person so entitled to any portion of the estate, or some of them, or |
|
some other person for them, shall execute such bond to the |
|
satisfaction of the probate court, such estate shall be |
|
administered and settled under the direction of the probate court |
|
as other estates are required to be settled. If the bond is |
|
executed and approved, the independent administration shall |
|
proceed. Creditors of the estate may sue on such bond, and shall be |
|
entitled to judgment on the bond for the amount of their debt, or |
|
they may have their action against those in possession of the |
|
estate. |
|
CHAPTER 404. ACCOUNTINGS, SUCCESSORS, AND OTHER REMEDIES |
|
Sec. 404.001. ACCOUNTING. (a) Interested Person May |
|
Demand Accounting. At any time after the expiration of 15 months |
|
after the date that an independent administration was created and |
|
the order appointing an independent executor was entered by the |
|
probate court, any person interested in the estate may demand an |
|
accounting from the independent executor. The independent executor |
|
shall furnish to the person or persons making the demand an exhibit |
|
in writing, sworn and subscribed by the independent executor, |
|
setting forth in detail: |
|
(1) the property belonging to the estate that has come |
|
into the executor's possession as executor; |
|
(2) the disposition that has been made of such |
|
property; |
|
(3) the debts that have been paid; |
|
(4) the debts and expenses, if any, still owing by the |
|
estate; |
|
(5) the property of the estate, if any, still |
|
remaining in the executor's possession; |
|
(6) such other facts as may be necessary to a full and |
|
definite understanding of the exact condition of the estate; and |
|
(7) such facts, if any, that show why the |
|
administration should not be closed and the estate distributed. |
|
(a-1) Copy of Exhibit or Accounting. Any other interested |
|
person shall, on demand, be entitled to a copy of any exhibit or |
|
accounting that has been made by an independent executor in |
|
compliance with this section. |
|
(b) Enforcement of Demand. Should the independent executor |
|
not comply with a demand for an accounting authorized by this |
|
section within 60 days after receipt of the demand, the person |
|
making the demand may compel compliance by an action in the probate |
|
court. After a hearing, the court shall enter an order requiring the |
|
accounting to be made at such time as it considers proper under the |
|
circumstances. |
|
(c) Subsequent Demands. After an initial accounting has |
|
been given by an independent executor, any person interested in an |
|
estate may demand subsequent periodic accountings at intervals of |
|
not less than 12 months, and such subsequent demands may be enforced |
|
in the same manner as an initial demand. |
|
(d) Remedies Cumulative. The right to an accounting |
|
accorded by this section is cumulative of any other remedies which |
|
persons interested in an estate may have against the independent |
|
executor of the estate. |
|
Sec. 404.002. REQUIRING INDEPENDENT EXECUTOR TO GIVE BOND. |
|
When it has been provided by will, regularly probated, that an |
|
independent executor appointed by such will shall not be required |
|
to give bond for the management of the estate devised by such will, |
|
or the independent executor is not required to give bond because |
|
bond has been waived by court order as authorized under Section |
|
401.005, then such independent executor may be required to give |
|
bond, on proper proceedings had for that purpose as in the case of |
|
personal representatives in a supervised administration, if it be |
|
made to appear at any time that such independent executor is |
|
mismanaging the property, or has betrayed or is about to betray the |
|
independent executor's trust, or has in some other way become |
|
disqualified. |
|
Sec. 404.003. REMOVAL OF INDEPENDENT EXECUTOR. (a) The |
|
probate court, on its own motion or on motion of any interested |
|
person, after the independent executor has been cited by personal |
|
service to answer at a time and place fixed in the notice, may |
|
remove an independent executor when: |
|
(1) the independent executor fails to return within 90 |
|
days after qualification, unless such time is extended by order of |
|
the court, an inventory of the property of the estate and list of |
|
claims that have come to the independent executor's knowledge; |
|
(2) sufficient grounds appear to support belief that |
|
the independent executor has misapplied or embezzled, or that the |
|
independent executor is about to misapply or embezzle, all or any |
|
part of the property committed to the independent executor's care; |
|
(3) the independent executor fails to make an |
|
accounting which is required by law to be made; |
|
(4) the independent executor fails to timely file the |
|
affidavit or certificate required by Section 308.004; |
|
(5) the independent executor is proved to have been |
|
guilty of gross misconduct or gross mismanagement in the |
|
performance of the independent executor's duties; or |
|
(6) the independent executor becomes an incapacitated |
|
person, or is sentenced to the penitentiary, or from any other cause |
|
becomes legally incapacitated from properly performing the |
|
independent executor's fiduciary duties. |
|
(b) The order of removal shall state the cause of removal |
|
and shall direct by order the disposition of the assets remaining in |
|
the name or under the control of the removed executor. The order of |
|
removal shall require that letters issued to the removed executor |
|
shall be surrendered and that all letters shall be canceled of |
|
record. If an independent executor is removed by the court under |
|
this section, the court may, on application, appoint a successor |
|
independent executor as provided by Section 404.005. |
|
(c) An independent executor who defends an action for the |
|
independent executor's removal in good faith, whether successful or |
|
not, shall be allowed out of the estate the independent executor's |
|
necessary expenses and disbursements, including reasonable |
|
attorney's fees, in the removal proceedings. |
|
(d) Costs and expenses incurred by the party seeking removal |
|
that are incident to removal of an independent executor appointed |
|
without bond, including reasonable attorney's fees and expenses, |
|
may be paid out of the estate. |
|
Sec. 404.004. POWERS OF AN ADMINISTRATOR WHO SUCCEEDS AN |
|
INDEPENDENT EXECUTOR. (a) Grant of Powers by Court. Whenever a |
|
person has died, or shall die, testate, owning property in this |
|
state, and such person's will has been or shall be admitted to |
|
probate by the court, and such probated will names an independent |
|
executor or executors, or trustees acting in the capacity of |
|
independent executors, to execute the terms and provisions of said |
|
will, and such will grants to such independent executor, or |
|
executors, or trustees acting in the capacity of independent |
|
executors, the power to raise or borrow money and to mortgage, and |
|
such independent executor, or executors, or trustees, have died or |
|
shall die, resign, fail to qualify, or be removed from office, |
|
leaving unexecuted parts or portions of the will of the testator, |
|
and an administrator with the will annexed is appointed by the |
|
probate court, and an administrator's bond is filed and approved by |
|
the court, then in all such cases, the court may, in addition to the |
|
powers conferred on such administrator under other provisions of |
|
the laws of this state, authorize, direct, and empower such |
|
administrator to do and perform the acts and deeds, clothed with the |
|
rights, powers, authorities, and privileges, and subject to the |
|
limitations, set forth in the subsequent provisions of this |
|
section. |
|
(b) Power to Borrow Money and Mortgage or Pledge Property. |
|
The court, on application, citation, and hearing, may, by its |
|
order, authorize, direct, and empower such administrator to raise |
|
or borrow such sums of money and incur such obligations and debts as |
|
the court shall, in its said order, direct, and to renew and extend |
|
same from time to time, as the court, on application and order, |
|
shall provide; and, if authorized by the court's order, to secure |
|
such loans, obligations, and debts, by pledge or mortgage on |
|
property or assets of the estate, real, personal, or mixed, on such |
|
terms and conditions, and for such duration of time, as the court |
|
shall consider to be in the best interests of the estate, and by its |
|
order shall prescribe; and all such loans, obligations, debts, |
|
pledges, and mortgages shall be valid and enforceable against the |
|
estate and against such administrator in the administrator's |
|
official capacity. |
|
(c) Powers Limited to Those Granted by the Will. The court |
|
may order and authorize such administrator to have and exercise the |
|
powers and privileges set forth in Subsection (a) or (b) only to the |
|
extent that same are granted to or possessed by the independent |
|
executor, or executors, or trustees acting in the capacity of |
|
independent executors, under the terms of the probated will of such |
|
deceased person, and then only in such cases as it appears, at the |
|
hearing of the application, that at the time of the appointment of |
|
such administrator, there are outstanding and unpaid obligations |
|
and debts of the estate, or of the independent executor, or |
|
executors, or trustees, chargeable against the estate, or unpaid |
|
expenses of administration, or when the court appointing such |
|
administrator orders the business of such estate to be carried on |
|
and it becomes necessary, from time to time, under orders of the |
|
court, for such administrator to borrow money and incur obligations |
|
and indebtedness in order to protect and preserve the estate. |
|
(d) Powers Other Than Those Relating to Borrowing Money and |
|
Mortgaging or Pledging Property. The court, in addition, may, on |
|
application, citation, and hearing, order, authorize, and empower |
|
such administrator to assume, exercise, and discharge, under the |
|
orders and directions of said court, made from time to time, all or |
|
such part of the rights, powers, and authorities vested in and |
|
delegated to, or possessed by, the independent executor, or |
|
executors, or trustees acting in the capacity of independent |
|
executors, under the terms of the will of such deceased person, as |
|
the court finds to be in the best interests of the estate and shall, |
|
from time to time, order and direct. |
|
(e) Application for Grant of Powers. The granting to such |
|
administrator by the court of some, or all, of the powers and |
|
authorities set forth in this section shall be on application filed |
|
by such administrator with the county clerk, setting forth such |
|
facts as, in the judgment of the administrator, require the |
|
granting of the power or authority requested. |
|
(f) Citation. On the filing of such application, the clerk |
|
shall issue citation to all persons interested in the estate, |
|
stating the nature of the application, and requiring such persons |
|
to appear on the return day named in such citation and show cause |
|
why such application should not be granted, should they choose to do |
|
so. Such citation shall be served by posting. |
|
(g) Hearing and Order. The court shall hear such |
|
application and evidence on the application, on or after the return |
|
day named in the citation, and, if satisfied a necessity exists and |
|
that it would be in the best interests of the estate to grant said |
|
application in whole or in part, the court shall so order; |
|
otherwise, the court shall refuse said application. |
|
Sec. 404.005. COURT-APPOINTED SUCCESSOR INDEPENDENT |
|
EXECUTOR. (a) If the will of a person who dies testate names an |
|
independent executor who, having qualified, fails for any reason to |
|
continue to serve, or is removed for cause by the court, and the |
|
will does not name a successor independent executor or if each |
|
successor executor named in the will fails for any reason to qualify |
|
as executor or indicates by affidavit filed with the application |
|
for an order continuing independent administration the successor |
|
executor's inability or unwillingness to serve as successor |
|
independent executor, all of the distributees of the decedent as of |
|
the filing of the application for an order continuing independent |
|
administration may apply to the probate court for the appointment |
|
of a qualified person, firm, or corporation to serve as successor |
|
independent executor. If the probate court finds that continued |
|
administration of the estate is necessary, the probate court shall |
|
enter an order continuing independent administration and |
|
appointing the person, firm, or corporation designated in the |
|
application as successor independent executor, unless the probate |
|
court finds that it would not be in the best interest of the estate |
|
to do so. Such successor shall serve with all of the powers and |
|
privileges granted to the successor's predecessor independent |
|
executor. |
|
(b) If a distributee described in this section is an |
|
incapacitated person, the guardian of the person of the distributee |
|
may sign the application on behalf of the distributee. If the |
|
probate court finds that either the continuing of independent |
|
administration or the appointment of the person, firm, or |
|
corporation designated in the application as successor independent |
|
executor would not be in the best interest of the incapacitated |
|
person, then, notwithstanding Subsection (a), the probate court may |
|
not enter an order continuing independent administration of the |
|
estate. If the distributee is an incapacitated person and has no |
|
guardian of the person, the court may appoint a guardian ad litem to |
|
make application on behalf of the incapacitated person if the |
|
probate court considers such an appointment necessary to protect |
|
the interest of such distributee. |
|
(c) If a trust is created in the decedent's will, the person |
|
or class of persons first eligible to receive the income from the |
|
trust, determined as if the trust were to be in existence on the |
|
date of the filing of the application for an order continuing |
|
independent administration, shall, for the purposes of this |
|
section, be considered to be the distributee or distributees on |
|
behalf of such trust, and any other trust or trusts coming into |
|
existence on the termination of such trust, and are authorized to |
|
apply for an order continuing independent administration on behalf |
|
of the trust without the consent or agreement of the trustee or any |
|
other beneficiary of the trust, or the trustee or any beneficiary of |
|
any other trust which may come into existence on the termination of |
|
such trust. |
|
(d) If a life estate is created either in the decedent's |
|
will or by law, and if a life tenant is living at the time of the |
|
filing of the application for an order continuing independent |
|
administration, then the life tenant or life tenants, determined as |
|
if the life estate were to commence on the date of the filing of the |
|
application for an order continuing independent administration, |
|
shall, for the purposes of this section, be considered to be the |
|
distributee or distributees on behalf of the entire estate created, |
|
and are authorized to apply for an order continuing independent |
|
administration on behalf of the estate without the consent or |
|
approval of any remainderman. |
|
(e) If a decedent's will contains a provision that a |
|
distributee must survive the decedent by a prescribed period of |
|
time in order to take under the decedent's will, for the purposes of |
|
determining who shall be the distributee under this section, it |
|
shall be presumed that the distributees living at the time of the |
|
filing of the application for an order continuing independent |
|
administration of the decedent's estate survived the decedent for |
|
the prescribed period. |
|
(f) In the case of all decedents, for the purposes of |
|
determining who shall be the distributees under this section, it |
|
shall be presumed that no distributee living at the time the |
|
application for an order continuing independent administration of |
|
the decedent's estate is filed shall subsequently disclaim any |
|
portion of such distributee's interest in the decedent's estate. |
|
(g) If a distributee of a decedent's estate should die, and |
|
if by virtue of such distributee's death such distributee's share of |
|
the decedent's estate shall become payable to such distributee's |
|
estate, then the deceased distributee's personal representative |
|
may sign the application for an order continuing independent |
|
administration of the decedent's estate under this section. |
|
(h) If a successor independent executor is appointed under |
|
this section, then, unless the probate court shall waive bond on |
|
application for waiver, the successor independent executor shall be |
|
required to enter into bond payable to and to be approved by the |
|
judge and the judge's successors in a sum that is found by the judge |
|
to be adequate under all circumstances, or a bond with one surety in |
|
an amount that is found by the judge to be adequate under all |
|
circumstances, if the surety is an authorized corporate surety. |
|
(i) Absent proof of fraud or collusion on the part of a |
|
judge, the judge may not be held civilly liable for the commission |
|
of misdeeds or the omission of any required act of any person, firm, |
|
or corporation designated as a successor independent executor under |
|
this section. Section 351.354 does not apply to an appointment of a |
|
successor independent executor under this section. |
|
CHAPTER 405. CLOSING AND DISTRIBUTIONS |
|
Sec. 405.001. ACCOUNTING AND DISTRIBUTION. (a) In |
|
addition to or in lieu of the right to an accounting provided by |
|
Section 404.001, at any time after the expiration of two years after |
|
the date that an independent administration was created and the |
|
order appointing an independent executor was entered, a person |
|
interested in the estate may petition the court for an accounting |
|
and distribution. The court may order an accounting to be made with |
|
the court by the independent executor at such time as the court |
|
considers proper. The accounting shall include the information that |
|
the court considers necessary to determine whether any part of the |
|
estate should be distributed. |
|
(b) On receipt of the accounting and, after notice to the |
|
independent executor and a hearing, unless the court finds a |
|
continued necessity for administration of the estate, the court |
|
shall order its distribution by the independent executor to the |
|
distributees entitled to the property. If the court finds there is |
|
a continued necessity for administration of the estate, the court |
|
shall order the distribution of any portion of the estate that the |
|
court finds should not be subject to further administration by the |
|
independent executor. If any portion of the estate that is ordered |
|
to be distributed is incapable of distribution without prior |
|
partition or sale, the court shall order partition and |
|
distribution, or sale, in the manner provided for the partition and |
|
distribution of property incapable of division in supervised |
|
estates. |
|
(c) If all the property in the estate is ordered distributed |
|
by the court and the estate is fully administered, the court may |
|
also order the independent executor to file a final account with the |
|
court and may enter an order closing the administration and |
|
terminating the power of the independent executor to act as |
|
executor. |
|
Sec. 405.002. RECEIPTS AND RELEASES FOR DISTRIBUTIONS BY |
|
INDEPENDENT EXECUTOR. (a) An independent executor may not be |
|
required to deliver tangible or intangible personal property to a |
|
distributee unless the independent executor shall receive, at or |
|
before the time of delivery of the property, a signed receipt or |
|
other proof of delivery of the property to the distributee. |
|
(b) An independent executor may not require a waiver or |
|
release from the distributee as a condition of delivery of property |
|
to a distributee. |
|
Sec. 405.003. JUDICIAL DISCHARGE OF INDEPENDENT EXECUTOR. |
|
(a) After an estate has been administered and if there is no |
|
further need for an independent administration of the estate, the |
|
independent executor of the estate may file an action for |
|
declaratory judgment under Chapter 37, Civil Practice and Remedies |
|
Code, seeking to discharge the independent executor from any |
|
liability involving matters relating to the past administration of |
|
the estate that have been fully and fairly disclosed. |
|
(b) On the filing of an action under this section, each |
|
beneficiary of the estate shall be personally served with citation, |
|
except for a beneficiary who has waived the issuance and service of |
|
citation. |
|
(c) In a proceeding under this section, the court may |
|
require the independent executor to file a final account that |
|
includes any information the court considers necessary to |
|
adjudicate the independent executor's request for a discharge of |
|
liability. The court may audit, settle, or approve a final account |
|
filed under this subsection. |
|
(d) On or before filing an action under this section, the |
|
independent executor must distribute to the beneficiaries of the |
|
estate any of the remaining assets or property of the estate that |
|
remains in the independent executor's possession after all of the |
|
estate's debts have been paid, except for a reasonable reserve of |
|
assets that the independent executor may retain in a fiduciary |
|
capacity pending court approval of the final account. The court may |
|
review the amount of assets on reserve and may order the independent |
|
executor to make further distributions under this section. |
|
(e) Except as ordered by the court, the independent executor |
|
is entitled to pay from the estate legal fees, expenses, or other |
|
costs incurred in relation to a proceeding for judicial discharge |
|
filed under this section. The independent executor shall be |
|
personally liable to refund any amount of such fees, expenses, or |
|
other costs not approved by the court as a proper charge against the |
|
estate. |
|
Sec. 405.004. CLOSING INDEPENDENT ADMINISTRATION BY |
|
CLOSING REPORT OR NOTICE OF CLOSING ESTATE. When all of the debts |
|
known to exist against the estate have been paid, or when they have |
|
been paid so far as the assets in the independent executor's |
|
possession will permit, when there is no pending litigation, and |
|
when the independent executor has distributed to the distributees |
|
entitled to the estate all assets of the estate, if any, remaining |
|
after payment of debts, the independent executor may file with the |
|
court a closing report or a notice of closing of the estate. |
|
(a) Closing Report. An independent executor may file a |
|
closing report verified by affidavit that: |
|
(1) shows: |
|
(A) the property of the estate that came into the |
|
independent executor's possession; |
|
(B) the debts that have been paid; |
|
(C) the debts, if any, still owing by the estate; |
|
(D) the property of the estate, if any, remaining |
|
on hand after payment of debts; and |
|
(E) the names and addresses of the distributees |
|
to whom the property of the estate, if any, remaining on hand after |
|
payment of debts has been distributed; and |
|
(2) includes signed receipts or other proof of |
|
delivery of property to the distributees named in the closing |
|
report if the closing report reflects that there was property |
|
remaining on hand after payment of debts. |
|
(b) Notice of Closing Estate. (1) An independent executor |
|
is not required to but may file a notice of closing estate verified |
|
by affidavit that states: |
|
(A) that all debts known to exist against the |
|
estate have been paid or that the debts have been paid so far as the |
|
assets in the possession of the independent executor will permit; |
|
(B) that all remaining assets of the estate, if |
|
any, have been distributed; and |
|
(C) the names and addresses of the distributees |
|
to whom the property of the estate, if any, remaining on hand after |
|
payment of debts has been distributed. |
|
(2) Before filing the notice, the independent executor |
|
shall provide all distributees of the estate with a copy of the |
|
notice of closing estate. The notice of closing estate filed by the |
|
independent executor shall include signed receipts or other proof |
|
that all distributees have received a copy of the notice of closing |
|
estate. |
|
(c) Effect of Filing Closing Report or Notice of Closing |
|
Estate. (1) The independent administration of an estate shall be |
|
considered closed 30 days after the filing of a closing report or |
|
notice of closing estate unless an interested person files an |
|
objection within the 30-day period. If an interested person files |
|
an objection, the independent administration of the estate shall be |
|
closed when the objection has been disposed of or the court signs an |
|
order closing the estate. |
|
(2) The closing of an independent administration by |
|
filing of a closing report or notice of closing estate terminates |
|
the power and authority of the independent executor, but does not |
|
relieve the independent executor from liability for any |
|
mismanagement of the estate or from liability for any false |
|
statements contained in the report or notice. |
|
(3) When a closing report or notice of closing estate |
|
has been filed, persons dealing with properties of the estate, or |
|
with claims against the estate, shall deal directly with the |
|
distributees of the estate; and the acts of such distributees with |
|
respect to such properties or claims shall in all ways be valid and |
|
binding as regards the persons with whom they deal, notwithstanding |
|
any false statements made by the independent executor in such |
|
report or notice. |
|
(4) If the independent executor is required to give |
|
bond, the independent executor's filing of the closing report and |
|
proof of delivery, if required, automatically releases the sureties |
|
on the bond from all liability for the future acts of the principal. |
|
The filing of a notice of closing estate does not release the |
|
sureties on the bond of an independent executor. |
|
(5) An independent executor's closing report or notice |
|
of closing estate shall constitute sufficient legal authority to |
|
all persons owing any money, having custody of any property, or |
|
acting as registrar or transfer agent or trustee of any evidence of |
|
interest, indebtedness, property, or right that belongs to the |
|
estate, for payment or transfer without additional administration |
|
to the distributees described in the will as entitled to receive the |
|
particular asset or who as heirs at law are entitled to receive the |
|
asset. The distributees described in the will as entitled to |
|
receive the particular asset or the heirs at law entitled to receive |
|
the asset may enforce their right to the payment or transfer by |
|
suit. |
|
Sec. 405.005. PARTITION AND DISTRIBUTION OR SALE OF |
|
PROPERTY INCAPABLE OF DIVISION. If the will does not distribute the |
|
entire estate of the testator or provide a means for partition of |
|
the estate, or if no will was probated, the independent executor |
|
may, but may not be required to, petition the probate court for |
|
either a partition and distribution of the estate or an order of |
|
sale of any portion of the estate alleged by the independent |
|
executor and found by the court to be incapable of a fair and equal |
|
partition and distribution, or both. The estate or portion of the |
|
estate shall either be partitioned and distributed or sold, or |
|
both, in the manner provided for the partition and distribution of |
|
property and the sale of property incapable of division in |
|
supervised estates. |
|
Sec. 405.006. CLOSING INDEPENDENT ADMINISTRATION ON |
|
APPLICATION BY DISTRIBUTEE. (a) At any time after an estate has |
|
been fully administered and there is no further need for an |
|
independent administration of such estate, any distributee may file |
|
an application to close the administration; and, after citation on |
|
the independent executor, and on hearing, the court may enter an |
|
order: |
|
(1) requiring the independent executor to file a |
|
closing report meeting the requirements of Section 405.004; |
|
(2) closing the administration; |
|
(3) terminating the power of the independent executor |
|
to act as such; and |
|
(4) releasing the sureties on any bond the independent |
|
executor was required to give from all liability for the future acts |
|
of the principal. |
|
(b) The order of the court closing the independent |
|
administration shall constitute sufficient legal authority to all |
|
persons owing any money, having custody of any property, or acting |
|
as registrar or transfer agent or trustee of any evidence of |
|
interest, indebtedness, property, or right that belongs to the |
|
estate, for payment or transfer without additional administration |
|
to the distributees described in the will as entitled to receive the |
|
particular asset or who as heirs at law are entitled to receive the |
|
asset. The distributees described in the will as entitled to |
|
receive the particular asset or the heirs at law entitled to receive |
|
the asset may enforce their right to the payment or transfer by |
|
suit. |
|
Sec. 405.007. ISSUANCE OF LETTERS. At any time before the |
|
authority of an independent executor has been terminated in the |
|
manner set forth in this subtitle, the clerk shall issue such number |
|
of letters testamentary as the independent executor shall request. |
|
Sec. 405.008. RIGHTS AND REMEDIES CUMULATIVE. The rights |
|
and remedies conferred by this chapter are cumulative of other |
|
rights and remedies to which a person interested in the estate may |
|
be entitled under law. |
|
Sec. 405.009. CLOSING PROCEDURES NOT REQUIRED. An |
|
independent executor is not required to close the independent |
|
administration of an estate under Section 405.003 or 405.004. |
|
SECTION 2.02. Chapter VI-1, Texas Probate Code, as added by |
|
Article 1 of this Act, is repealed. |
|
SECTION 2.03. (a) Except as provided by Subsection (b) of |
|
this section, this article takes effect January 1, 2014. |
|
(b) The changes in law made by this article take effect only |
|
if H.B. No. 2502 or S.B. No. 2071, Acts of the 81st Legislature, |
|
Regular Session, 2009, are enacted and become law. If neither bill |
|
becomes law, this article has no effect. |
|
ARTICLE 3. EFFECTIVE DATE |
|
SECTION 3.01. Except as otherwise provided by this Act, |
|
this Act takes effect September 1, 2009. |
|
|
|
* * * * * |