84R26458 CLG-F
 
  By: Huffman, et al. S.B. No. 462
 
  (Farrar)
 
  Substitute the following for S.B. No. 462:  No.
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to authorizing a revocable deed that transfers real
  property at the transferor's death.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subtitle C, Title 2, Estates Code, is amended by
  adding Chapter 114 to read as follows:
  CHAPTER 114. TRANSFER ON DEATH DEED
  SUBCHAPTER A. GENERAL PROVISIONS 
         Sec. 114.001.  SHORT TITLE. This chapter may be cited as the
  Texas Real Property Transfer on Death Act.
         Sec. 114.002.  DEFINITIONS. (a) In this chapter:
               (1)  "Beneficiary" means a person who receives real
  property under a transfer on death deed.
               (2)  "Designated beneficiary" means a person
  designated to receive real property in a transfer on death deed.
               (3)  "Joint owner with right of survivorship" or "joint
  owner" means an individual who owns real property concurrently with
  one or more other individuals with a right of survivorship. The term
  does not include a tenant in common or an owner of community
  property with or without a right of survivorship.
               (4)  "Person" has the meaning assigned by Section
  311.005, Government Code.
               (5)  "Real property" means an interest in real property
  located in this state.
               (6)  "Transfer on death deed" means a deed authorized
  under this chapter and does not refer to any other deed that
  transfers an interest in real property on the death of an
  individual.
               (7)  "Transferor" means an individual who makes a
  transfer on death deed.
         (b)  In this chapter, the terms "cancel" and "revoke" are
  synonymous.
         Sec. 114.003.  APPLICABILITY. This chapter applies to a
  transfer on death deed executed and acknowledged on or after
  September 1, 2015, by a transferor who dies on or after September 1,
  2015.
         Sec. 114.004.  NONEXCLUSIVITY. This chapter does not affect
  any method of transferring real property otherwise permitted under
  the laws of this state. 
         Sec. 114.005.  UNIFORMITY OF APPLICATION AND CONSTRUCTION.
  In applying and construing this chapter, consideration must be
  given to the need to promote uniformity of the law with respect to
  the subject matter of this chapter among states that enact a law
  similar to this chapter.
         Sec. 114.006.  RELATION TO ELECTRONIC SIGNATURES IN GLOBAL
  AND NATIONAL COMMERCE ACT. This chapter modifies, limits, and
  supersedes the federal Electronic Signatures in Global and National
  Commerce Act (15 U.S.C. Section 7001 et seq.), except that this
  chapter does not modify, limit, or supersede Section 101(c) of that
  Act (15 U.S.C. Section 7001(c)) or authorize electronic delivery of
  any of the notices described in Section 103(b) of that Act (15
  U.S.C. Section 7003(b)).
  SUBCHAPTER B. AUTHORIZATION, EXECUTION, AND REVOCATION OF TRANSFER
  ON DEATH DEED
         Sec. 114.051.  TRANSFER ON DEATH DEED AUTHORIZED. An
  individual may transfer the individual's interest in real property
  to one or more beneficiaries effective at the transferor's death by
  a transfer on death deed.
         Sec. 114.052.  TRANSFER ON DEATH DEED REVOCABLE. A transfer
  on death deed is revocable regardless of whether the deed or another
  instrument contains a contrary provision.
         Sec. 114.053.  TRANSFER ON DEATH DEED NONTESTAMENTARY. A
  transfer on death deed is a nontestamentary instrument.
         Sec. 114.054.  CAPACITY OF TRANSFEROR; USE OF POWER OF
  ATTORNEY. (a)  The capacity required to make or revoke a transfer
  on death deed is the same as the capacity required to make a
  contract.
         (b)  A transfer on death deed may not be created through use
  of a power of attorney.
         Sec. 114.055.  REQUIREMENTS. To be effective, a transfer on
  death deed must:
               (1)  except as otherwise provided in Subdivision (2),
  contain the essential elements and formalities of a recordable
  deed;
               (2)  state that the transfer of an interest in real
  property to the designated beneficiary is to occur at the
  transferor's death; and
               (3)  be recorded before the transferor's death in the
  deed records in the county clerk's office of the county where the
  real property is located.
         Sec. 114.056.  NOTICE, DELIVERY, ACCEPTANCE, OR
  CONSIDERATION NOT REQUIRED. A transfer on death deed is effective
  without:
               (1)  notice or delivery to or acceptance by the
  designated beneficiary during the transferor's life; or
               (2)  consideration.
         Sec. 114.057.  REVOCATION BY CERTAIN INSTRUMENTS; EFFECT OF
  WILL OR MARRIAGE DISSOLUTION. (a) Subject to Subsections (d) and
  (e), an instrument is effective to revoke a recorded transfer on
  death deed, or any part of it, if the instrument:
               (1)  is one of the following:
                     (A)  a subsequent transfer on death deed that
  revokes the preceding transfer on death deed or part of the deed
  expressly or by inconsistency; or
                     (B)  except as provided by Subsection (b), an
  instrument of revocation that expressly revokes the transfer on
  death deed or part of the deed; 
               (2)  is acknowledged by the transferor after the
  acknowledgment of the deed being revoked; and
               (3)  is recorded before the transferor's death in the
  deed records in the county clerk's office of the county where the
  deed being revoked is recorded.
         (b)  A will may not revoke or supersede a transfer on death
  deed.
         (c)  If a marriage between the transferor and a designated
  beneficiary is dissolved after a transfer on death deed is
  recorded, a final judgment of the court dissolving the marriage
  operates to revoke the transfer on death deed as to that designated
  beneficiary if notice of the judgment is recorded before the
  transferor's death in the deed records in the county clerk's office
  of the county where the deed is recorded, notwithstanding Section
  111.052.
         (d)  If a transfer on death deed is made by more than one
  transferor, revocation by a transferor does not affect the deed as
  to the interest of another transferor who does not make that
  revocation.
         (e)  A transfer on death deed made by joint owners with right
  of survivorship is revoked only if it is revoked by all of the
  living joint owners.
         (f)  This section does not limit the effect of an inter vivos
  transfer of the real property.
  SUBCHAPTER C.  EFFECT OF TRANSFER ON DEATH DEED; LIABILITY OF
  TRANSFERRED PROPERTY FOR CREDITORS' CLAIMS
         Sec. 114.101.  EFFECT OF TRANSFER ON DEATH DEED DURING
  TRANSFEROR'S LIFE. During a transferor's life, a transfer on death
  deed does not:
               (1)  affect an interest or right of the transferor or
  any other owner, including:
                     (A)  the right to transfer or encumber the real
  property that is the subject of the deed; 
                     (B)  homestead rights in the real property, if
  applicable; and
                     (C)  ad valorem tax exemptions, including
  exemptions for residence homestead, persons 65 years of age or
  older, persons with disabilities, and veterans;
               (2)  affect an interest or right of a transferee of the
  real property that is the subject of the deed, even if the
  transferee has actual or constructive notice of the deed;
               (3)  affect an interest or right of a secured or
  unsecured creditor or future creditor of the transferor, even if
  the creditor has actual or constructive notice of the deed;
               (4)  affect the transferor's or designated
  beneficiary's eligibility for any form of public assistance,
  subject to applicable federal law;
               (5)  constitute a transfer triggering a "due on sale"
  or similar clause;
               (6)  invoke statutory real estate notice or disclosure
  requirements;
               (7)  create a legal or equitable interest in favor of
  the designated beneficiary; or
               (8)  subject the real property to claims or process of a
  creditor of the designated beneficiary.
         Sec. 114.102.  EFFECT OF SUBSEQUENT CONVEYANCE ON TRANSFER
  ON DEATH DEED. An otherwise valid transfer on death deed is void as
  to any interest in real property that is conveyed by the transferor
  during the transferor's lifetime after the transfer on death deed
  is executed and recorded if:
               (1)  a valid instrument conveying the interest is
  recorded in the deed records in the county clerk's office of the
  same county in which the transfer on death deed is recorded; and
               (2)  the recording of the instrument occurs before the
  transferor's death.
         Sec. 114.103.  EFFECT OF TRANSFER ON DEATH DEED AT
  TRANSFEROR'S DEATH. (a) Except as otherwise provided in the
  transfer on death deed, this section, or any other statute or the
  common law of this state governing a decedent's estate, on the death
  of the transferor, the following rules apply to an interest in real
  property that is the subject of a transfer on death deed and owned
  by the transferor at death:
               (1)  if the designated beneficiary survives the
  transferor by 120 hours, the interest in the real property is
  transferred to the designated beneficiary in accordance with the
  deed;
               (2)  the interest of a designated beneficiary that
  fails to survive the transferor by 120 hours lapses,
  notwithstanding Section 111.052;
               (3)  subject to Subdivision (4), concurrent interests
  are transferred to the beneficiaries in equal and undivided shares
  with no right of survivorship; and
               (4)  notwithstanding Subdivision (2), if the
  transferor has identified two or more designated beneficiaries to
  receive concurrent interests in the real property, the share of a
  designated beneficiary who predeceases the transferor lapses and is
  subject to and passes in accordance with Subchapter D, Chapter 255,
  as if the transfer on death deed were a devise made in a will.
         (b)  If a transferor is a joint owner with right of
  survivorship who is survived by one or more other joint owners, the
  real property that is the subject of the transfer on death deed
  belongs to the surviving joint owner or owners.  If a transferor is
  a joint owner with right of survivorship who is the last surviving
  joint owner, the transfer on death deed is effective.
         (c)  If a transfer on death deed is made by two or more
  transferors who are joint owners with right of survivorship, the
  last surviving joint owner may revoke the transfer on death deed
  subject to Section 114.057.
         (d)  A transfer on death deed transfers real property without
  covenant of warranty of title even if the deed contains a contrary
  provision.
         Sec. 114.104.  TRANSFER ON DEATH DEED PROPERTY SUBJECT TO
  LIENS AND ENCUMBRANCES AT TRANSFEROR'S DEATH; CREDITORS' CLAIMS.
  (a)  Subject to Section 13.001, Property Code, a beneficiary takes
  the real property subject to all conveyances, encumbrances,
  assignments, contracts, mortgages, liens, and other interests to
  which the real property is subject at the transferor's death. For
  purposes of this subsection and Section 13.001, Property Code, the
  recording of the transfer on death deed is considered to have
  occurred at the transferor's death.
         (b)  If a personal representative has been appointed for the
  transferor's estate, an administration of the estate has been
  opened, and the real property transferring under a transfer on
  death deed is subject to a lien or security interest, including a
  deed of trust or mortgage, the personal representative shall give
  notice to the creditor of the transferor as the personal
  representative would any other secured creditor under Section
  308.053. The creditor shall then make an election under Section
  355.151 in the period prescribed by Section 355.152 to have the
  claim treated as a matured secured claim or a preferred debt and
  lien claim, and the claim is subject to the claims procedures
  prescribed by this section.
         (c)  If the secured creditor elects to have the claim treated
  as a preferred debt and lien claim, Sections 355.154 and 355.155
  apply as if the transfer on death deed were a devise made in a will,
  and the creditor may not pursue any other claims or remedies for any
  deficiency against the transferor's estate.
         (d)  If the secured creditor elects to have the claim treated
  as a matured secured claim, Section 355.153 applies as if the
  transfer on death deed were a devise made in a will, and the claim is
  subject to the procedural provisions of this title governing
  creditor claims.
         Sec. 114.105.  DISCLAIMER. A designated beneficiary may
  disclaim all or part of the designated beneficiary's interest as
  provided by Chapter 122.
         Sec. 114.106.  LIABILITY FOR CREDITOR CLAIMS; ALLOWANCES IN
  LIEU OF EXEMPT PROPERTY AND FAMILY ALLOWANCES. (a)  To the extent
  the transferor's estate is insufficient to satisfy a claim against
  the estate, expenses of administration, any estate tax owed by the
  estate, or an allowance in lieu of exempt property or family
  allowance to a surviving spouse, minor children, or incapacitated
  adult children, the personal representative may enforce that
  liability against real property transferred at the transferor's
  death by a transfer on death deed to the same extent the personal
  representative could enforce that liability if the real property
  were part of the probate estate.
         (b)  Notwithstanding Subsection (a), real property
  transferred at the transferor's death by a transfer on death deed is
  not considered property of the probate estate for any purpose,
  including for purposes of Section 531.077, Government Code.
         (c)  If a personal representative does not commence a
  proceeding to enforce a liability under Subsection (a) on or before
  the 90th day after the date the representative receives a demand for
  payment, a proceeding to enforce the liability may be brought by a
  creditor, a distributee of the estate, a surviving spouse of the
  decedent, a guardian or other appropriate person on behalf of a
  minor child or adult incapacitated child of the decedent, or any
  taxing authority.
         (d)  If more than one real property interest is transferred
  by one or more transfer on death deeds or if there are other
  nonprobate assets of the transferor that may be liable for the
  claims, expenses, and other payments specified in Subsection (a),
  the liability for those claims, expenses, and other payments may be
  apportioned among those real property interests and other assets in
  proportion to their net values at the transferor's death.
         (e)  A proceeding to enforce liability under this section
  must be commenced not later than the second anniversary of the
  transferor's death, except for any rights arising under Section
  114.104(d).
         (f)  In connection with any proceeding brought under this
  section, a court may award costs and reasonable and necessary
  attorney's fees in amounts the court considers equitable and just.
  SUBCHAPTER D. FORMS FOR TRANSFER ON DEATH DEED
         Sec. 114.151.  OPTIONAL FORM FOR TRANSFER ON DEATH DEED. The
  following form may be used to create a transfer on death deed.
  REVOCABLE TRANSFER ON DEATH DEED
  NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU
  MAY REMOVE OR STRIKE ANY OF THE FOLLOWING INFORMATION FROM THIS
  INSTRUMENT BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS:
  YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
  IMPORTANT NOTICE TO OWNER: You should carefully read all the
  information included in the instructions to this form. You may want
  to consult a lawyer before using this form.
  MUST RECORD DEED: Before your death, this deed must be recorded with
  the county clerk where the property is located, or it will not be
  effective.
  MARRIED PERSONS: If you are married and want your spouse to own the
  property on your death, you must name your spouse as the primary
  beneficiary. If your spouse does not survive you, the property will
  transfer to any listed alternate beneficiary or beneficiaries on
  your death.
  1.  Owner (Transferor) Making this Deed:
         ___________________________    ____________________
         Printed name                    Mailing address
  2.  Legal Description of the Property:
         ___________________________________________________
  3.  Address of the Property (if any) (include county):
         ___________________________________________________
  4.  Primary Beneficiary (Transferee) or Beneficiaries
  (Transferees)
         I designate the following beneficiary or beneficiaries, if
  the beneficiary survives me:
         ___________________________    ____________________
         Printed name                    Mailing address
  5.  Alternate Beneficiary or Beneficiaries (Optional)
         If no primary beneficiary survives me, I designate the
  following alternate beneficiary or beneficiaries:
         ___________________________    ____________________
         Printed name                    Mailing address
  6.  Transfer on Death
         At my death, I grant and convey to the primary beneficiary or
  beneficiaries my interest in the property, to have and hold
  forever. If at my death I am not survived by any primary
  beneficiary, I grant and convey to the alternate beneficiary or
  beneficiaries, if designated, my interest in the property, to have
  and hold forever. If the primary and alternate beneficiaries do not
  survive me, this transfer on death deed shall be deemed canceled by
  me.
  7.  Printed Name and Signature of Owner Making this Deed:
         ___________________________    ____________________
         Printed Name                      Date
         ___________________________
         Signature
  BELOW LINE FOR NOTARY ONLY
 
  Acknowledgment
  STATE OF ____________________
  COUNTY OF ___________________
  This instrument was acknowledged before me on the ______ day of
  ______________, 20____,
  by ___________________.
                                       
                                       Notary Public, State of
  After recording, return to:
  (insert name and mailing address)
  ________________________________
  ________________________________
  INSTRUCTIONS FOR TRANSFER ON DEATH DEED
  DO NOT RECORD THESE INSTRUCTIONS
  Instructions for Completing the Form
  1.  Owner (Transferor) Making this Deed: Enter your first, middle
  (if any), and last name here, along with your mailing address.
  2.  Legal Description of the Property: Enter the formal legal
  description of the property. This information is different from the
  mailing and physical address for the property and is necessary to
  complete the form. To find this information, look on the deed you
  received when you became an owner of the property. This information
  may also be available in the office of the county clerk for the
  county where the property is located. Do NOT use your tax bill to
  find this information. If you are not absolutely sure, consult a
  lawyer.
  3.  Address of the Property: Enter the physical address of the
  property.
  4.  Primary Beneficiary or Beneficiaries: Enter the first and last
  name of each person you want to get the property when you die. If you
  are married and want your spouse to get the property when you die,
  enter your spouse's first and last name (even if you and your spouse
  own the property together).
  5.  Alternate Beneficiary or Beneficiaries: Enter the first and
  last name of each person you want to get the property if no primary
  beneficiary survives you.
  6.  Transfer on Death: No action needed.
  7.  Printed Name and Signature of Owner: Do not sign your name or
  enter the date until you are before a notary.  Include your printed
  name.
  8.  Acknowledgment: This deed must be signed before a notary. The
  notary will fill out this section of the deed.
         Sec. 114.152.  OPTIONAL FORM OF REVOCATION. The following
  form may be used to create an instrument of revocation under this
  chapter.
  CANCELLATION OF TRANSFER ON DEATH DEED
  IMPORTANT NOTICE TO OWNER: You should carefully read all the
  information included in the instructions to this form. You may want
  to consult a lawyer before using this form.
  MUST RECORD FORM: Before your death, this cancellation form must be
  recorded with the county clerk where the property is located, or it
  will not be effective. This cancellation is effective only as to the
  interests in the property of owners who sign this cancellation
  form. 
  1.  Owner (Transferor) Making this Cancellation:
         ______________________ ________________________
         Printed name   Mailing address
  2.  Legal Description of the Property:
         ______________________________________________________
  3.  Address of the Property (if any) (include county):
         ______________________________________________________
  4.  Cancellation
         I cancel all my previous transfers of this property by
  transfer on death deed. 
  5.  Printed Name and Signature of Owner (Transferor) Making this
  Cancellation:
         _________________________ ________________________
         Printed Name Date
         _________________________
         Signature
  BELOW LINE FOR NOTARY ONLY
  ________________________________________________________________
  Acknowledgment
  STATE OF __________________
  COUNTY OF _________________
  This instrument was acknowledged before me on the ___ day of
  __________, 20______,
  by ____________________________.
  _______________________________
  Notary Public, State of ________
  After recording, return to:
  (insert name and mailing address)
  _________________________________
  _________________________________
  INSTRUCTIONS FOR CANCELING A TRANSFER ON DEATH (TOD) DEED
  DO NOT RECORD THESE INSTRUCTIONS
  Instructions for Completing the Form
  1.  Owner (Transferor) Making this Cancellation: Enter your first,
  middle (if any), and last name here, along with your mailing
  address.
  2.  Legal Description of the Property: Enter the formal legal
  description of the property. This information is different from the
  mailing and physical address for the property and is necessary to
  complete the form. To find this information, look on the deed you
  received when you became an owner of the property. This information
  may also be available in the office of the county clerk for the
  county where the property is located. Do NOT use your tax bill to
  find this information. If you are not absolutely sure, consult a
  lawyer.
  3.  Address of the Property: Enter the physical address of the
  property.
  4.  Cancellation: No action needed.
  5.  Printed Name and Signature of Owner: Do not sign your name or
  enter the date until you are before a notary.  Include your printed
  name.
  6.  Acknowledgment: This cancellation form must be signed before a
  notary. The notary will fill out this section of the form.
         SECTION 2.  Section 22.027(b), Estates Code, is amended to
  read as follows:
         (b)  Except as otherwise provided by this code, the [The]
  definition of "person" assigned by Section 311.005, Government
  Code, does not apply to any provision in this code.
         SECTION 3.  Section 122.001(1), Estates Code, is amended to
  read as follows:
               (1)  "Beneficiary" includes a person who would have
  been entitled, if the person had not made a disclaimer, to receive
  property as a result of the death of another person:
                     (A)  by inheritance;
                     (B)  under a will;
                     (C)  by an agreement between spouses for community
  property with a right of survivorship;
                     (D)  by a joint tenancy with a right of
  survivorship;
                     (E)  by a survivorship agreement, account, or
  interest in which the interest of the decedent passes to a surviving
  beneficiary;
                     (F)  by an insurance, annuity, endowment,
  employment, deferred compensation, or other contract or
  arrangement; [or]
                     (G)  under a pension, profit sharing, thrift,
  stock bonus, life insurance, survivor income, incentive, or other
  plan or program providing retirement, welfare, or fringe benefits
  with respect to an employee or a self-employed individual; or
                     (H)  by a transfer on death deed.
         SECTION 4.  This Act takes effect September 1, 2015.