By: Murr (Senate Sponsor - Nichols)	H.B. No. 1954
	(In the Senate - Received from the House May 1, 2017;
	May 4, 2017, read first time and referred to Committee on Business &
	Commerce; May 19, 2017, reported adversely, with favorable
	Committee Substitute by the following vote:  Yeas 8, Nays 0;
	May 19, 2017, sent to printer.)
Click here to see the committee vote
	COMMITTEE SUBSTITUTE FOR H.B. No. 1954	By:  Nichols

	A BILL TO BE ENTITLED
	AN ACT
	relating to certain accounts established at financial
	institutions, including disclosures related to those accounts.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 113.002, Estates Code, is amended to
	read as follows:
	Sec. 113.002.  DEFINITION OF PARTY. (a) In this chapter,
	"party" means a person who, by the terms of a multiple-party
	account, has a present right, subject to request, to payment from
	the account. Except as otherwise required by the context, the term
	includes a guardian, personal representative, or assignee,
	including an attaching creditor, of a party. [The term also
	includes a person identified as a trustee of an account for another
	regardless of whether a beneficiary is named. The term does not
	include a named beneficiary unless the beneficiary has a present
	right of withdrawal.]
	(b)  A P.O.D. payee, including a charitable organization,
	[or beneficiary of a trust account] is a party only after the
	account becomes payable to the P.O.D. payee [or beneficiary] by
	reason of the P.O.D. payee [or beneficiary] surviving the original
	payee [or trustee].
	SECTION 2.  Section 113.004, Estates Code, is amended to
	read as follows:
	Sec. 113.004.  TYPES OF ACCOUNTS. In this chapter:
	(1)  ["Convenience account" means an account that:
	[(A)     is established at a financial institution by
	one or more parties in the names of the parties and one or more
	convenience signers; and
	[(B)     has terms that provide that the sums on
	deposit are paid or delivered to the parties or to the convenience
	signers "for the convenience" of the parties.
	[(2)]  "Joint account" means an account payable on
	request to one or more of two or more parties, regardless of whether
	there is a right of survivorship.
	(2) [(3)]  "Multiple-party account" means a joint
	account or[, a convenience account,] a P.O.D. account[, or a trust
	account]. The term does not include an account established for the
	deposit of funds of a partnership, joint venture, or other
	association for business purposes, or an account controlled by one
	or more persons as the authorized agent or trustee for a
	corporation, unincorporated association, charitable or civic
	organization, or a regular fiduciary or trust account in which the
	relationship is established other than by deposit agreement.
	(3) [(4)]  "P.O.D. account," including an account
	designated as a transfer on death or T.O.D. account, means an
	account payable on request to:
	(A)  one person during the person's lifetime and,
	on the person's death, to one or more P.O.D. payees; or
	(B)  one or more persons during their lifetimes
	and, on the death of all of those persons, to one or more P.O.D.
	payees.
	[(5)     "Trust account" means an account in the name of
	one or more parties as trustee for one or more beneficiaries in
	which the relationship is established by the form of the account and
	the deposit agreement with the financial institution and in which
	there is no subject of the trust other than the sums on deposit in
	the account. The deposit agreement is not required to address
	payment to the beneficiary. The term does not include:
	[(A)     a regular trust account under a testamentary
	trust or a trust agreement that has significance apart from the
	account; or
	[(B)     a fiduciary account arising from a fiduciary
	relationship, such as the attorney-client relationship.]
	SECTION 3.  Section 113.052, Estates Code, is amended to
	read as follows:
	Sec. 113.052.  FORM.  A financial institution may use the
	following form to establish the type of account selected by a party:
	UNIFORM SINGLE-PARTY OR MULTIPLE-PARTY ACCOUNT SELECTION
	FORM NOTICE: The type of account you select may determine how
	property passes on your death. Your will may not control the
	disposition of funds held in some of the following accounts.
	You may choose to designate one or more convenience signers
	on an account[, even if the account is not a convenience account].
	A designated convenience signer may make transactions on your
	behalf during your lifetime, but does not own the account during
	your lifetime. The designated convenience signer owns the account
	on your death only if the convenience signer is also designated as a
	P.O.D. payee [or trust account beneficiary].
	Select one of the following accounts by placing your initials
	next to the account selected:
	___ (1)  SINGLE-PARTY ACCOUNT WITHOUT "P.O.D." (PAYABLE ON
	DEATH) DESIGNATION.  The party to the account owns the account. On
	the death of the party, ownership of the account passes as a part of
	the party's estate under the party's will or by intestacy.
	Enter the name of the party:
	________________________________________________________________
	Enter the name(s) of the convenience signer(s), if you want
	one or more convenience signers on this account:
	________________________________________________________________
	________________________________________________________________
	___ (2)  SINGLE-PARTY ACCOUNT WITH "P.O.D." (PAYABLE ON
	DEATH) DESIGNATION.  The party to the account owns the account. On
	the death of the party, ownership of the account passes to the
	P.O.D. beneficiaries of the account.  The account is not a part of
	the party's estate.
	Enter the name of the party:
	________________________________________________________________
	Enter the name or names of the P.O.D. beneficiaries:
	________________________________________________________________
	________________________________________________________________
	Enter the name(s) of the convenience signer(s), if you want
	one or more convenience signers on this account:
	________________________________________________________________
	________________________________________________________________
	___ (3)  MULTIPLE-PARTY ACCOUNT WITHOUT RIGHT OF
	SURVIVORSHIP.  The parties to the account own the account in
	proportion to the parties' net contributions to the account. The
	financial institution may pay any sum in the account to a party at
	any time. On the death of a party, the party's ownership of the
	account passes as a part of the party's estate under the party's
	will or by intestacy.
	Enter the names of the parties:
	________________________________________________________________
	________________________________________________________________
	________________________________________________________________
	Enter the name(s) of the convenience signer(s), if you want
	one or more convenience signers on this account:
	________________________________________________________________
	________________________________________________________________
	___ (4)  MULTIPLE-PARTY ACCOUNT WITH RIGHT OF
	SURVIVORSHIP.  The parties to the account own the account in
	proportion to the parties' net contributions to the account. The
	financial institution may pay any sum in the account to a party at
	any time. On the death of a party, the party's ownership of the
	account passes to the surviving parties.
	Enter the names of the parties:
	________________________________________________________________
	________________________________________________________________
	Enter the name(s) of the convenience signer(s), if you want
	one or more convenience signers on this account:
	________________________________________________________________
	________________________________________________________________
	___ (5)  MULTIPLE-PARTY ACCOUNT WITH RIGHT OF SURVIVORSHIP
	AND P.O.D. (PAYABLE ON DEATH) DESIGNATION.  The parties to the
	account own the account in proportion to the parties' net
	contributions to the account. The financial institution may pay
	any sum in the account to a party at any time. On the death of the
	last surviving party, the ownership of the account passes to the
	P.O.D. beneficiaries.
	Enter the names of the parties:
	________________________________________________________________
	________________________________________________________________
	Enter the name or names of the P.O.D. beneficiaries:
	________________________________________________________________
	________________________________________________________________
	Enter the name(s) of the convenience signer(s), if you want
	one or more convenience signers on this account:
	________________________________________________________________
	________________________________________________________________
	ACKNOWLEDGMENT:  I acknowledge that I have read each
	paragraph of this form and have received disclosure of the
	ownership rights to the accounts listed above.  I have placed my
	initials next to the type of account I want.
	_______________________
	Signature
	[___   (6)     CONVENIENCE ACCOUNT.     The parties to the account
	own the account.     One or more convenience signers to the account
	may make account transactions for a party. A convenience signer
	does not own the account. On the death of the last surviving party,
	ownership of the account passes as a part of the last surviving
	party's estate under the last surviving party's will or by
	intestacy. The financial institution may pay funds in the account
	to a convenience signer before the financial institution receives
	notice of the death of the last surviving party. The payment to a
	convenience signer does not affect the parties' ownership of the
	account.
	[Enter the names of the parties:
	________________________________________________________________
	________________________________________________________________
	[Enter the name(s) of the convenience signer(s):
	________________________________________________________________
	________________________________________________________________
	[___   (7)     TRUST ACCOUNT.     The parties named as trustees to
	the account own the account in proportion to the parties' net
	contributions to the account. A trustee may withdraw funds from the
	account. A beneficiary may not withdraw funds from the account
	before all trustees are deceased. On the death of the last
	surviving trustee, the ownership of the account passes to the
	beneficiary. The trust account is not a part of a trustee's estate
	and does not pass under the trustee's will or by intestacy, unless
	the trustee survives all of the beneficiaries and all other
	trustees.
	[Enter the name or names of the trustees:
	________________________________________________________________
	________________________________________________________________
	[Enter the name or names of the beneficiaries:
	________________________________________________________________
	________________________________________________________________
	[Enter the name(s) of the convenience signer(s), if you want
	one or more convenience signers on this account:
	________________________________________________________________
	_______________________________________________________________]
	SECTION 4.  Section 113.053, Estates Code, is amended to
	read as follows:
	Sec. 113.053.  REQUIRED DISCLOSURE; USE OF FORM.
	(a)  Except as provided by Subsection (d), a [A] financial
	institution shall disclose the information provided in this
	subchapter to a customer before [at the time] the customer selects
	or modifies an account.
	(a-1)  A financial institution is considered to have
	disclosed the information provided in this subchapter if:
	(1)  the financial institution uses the form provided
	by Section 113.052; and
	(2)  the customer signs the acknowledgment provided at
	the end [places the customer's initials to the right of each
	paragraph] of the form.
	(b)  If a financial institution varies the format of the form
	provided by Section 113.052, the financial institution shall
	disclose [may make disclosures in the account agreement or in any
	other form that discloses] the information provided by this
	subchapter[.  Disclosures under this subsection must:
	[(1)  be given] separately from other account
	information except that the financial institution may disclose that
	information as part of other account documentation if the
	disclosures are the first items of the documentation[;
	[(2)     be provided before account selection or
	modification;
	[(3)  be printed in 14-point boldfaced type; and
	[(4)     if the discussions that precede the account
	opening or modification are conducted primarily in a language other
	than English, be in that language].
	(c)  The financial institution shall notify the customer of
	the type of account the customer selected.  This requirement is
	satisfied by providing the customer with a copy of the account
	opening or modification documentation, as appropriate, in paper or
	electronic format.
	(d)  If a type of multiple-party account is not available
	from a financial institution, the financial institution is not
	required to make a disclosure about that type of account.
	(e)  This section does not apply to:
	(1)  a credit union; or
	(2)  an account that is opened or modified by a customer
	who:
	(A)  is a legal entity, including a governmental
	entity; or
	(B)  is acting as a legal representative for
	another person.
	SECTION 5.  Section 113.101, Estates Code, is amended to
	read as follows:
	Sec. 113.101.  EFFECT OF CERTAIN PROVISIONS REGARDING
	OWNERSHIP BETWEEN PARTIES AND OTHERS. The provisions of this
	subchapter and Subchapters B and D that relate to beneficial
	ownership between parties to multiple-party accounts[,] or between
	parties and P.O.D. payees [or beneficiaries] of multiple-party
	accounts:
	(1)  are relevant only to controversies between those
	persons and those persons' creditors and other successors; and
	(2)  do not affect the withdrawal power of those
	persons under the terms of an account contract.
	SECTION 6.  Section 113.106, Estates Code, is amended to
	read as follows:
	Sec. 113.106.  OWNERSHIP AND OPERATION OF [OTHER] ACCOUNT
	WITH CONVENIENCE SIGNER; PAYMENT; LIABILITY. (a)  One or more
	convenience signers may be designated on [An account established by
	one or more parties at a financial institution that is not
	designated as a convenience account, but is instead designated as]
	a single-party account or [another type of] multiple-party
	account[, may provide that the sums on deposit may be paid or
	delivered to the parties or to one or more convenience signers] "for
	the convenience of the party or parties." A convenience signer is
	not an owner of the account but, on behalf of the party or parties to
	the account, may make deposits to and be paid or delivered sums on
	deposit from the account during the lifetime of the party or
	parties. A convenience signer may be designated as a P.O.D. payee
	of the account.
	(b)  Subsections (c)-(i) apply to an account described by
	Subsection (a) except [Except] as provided by Section 113.1541[:
	[(1)     the provisions of Sections 113.105, 113.206, and
	113.208 apply to an account described by Subsection (a), including
	provisions relating to the ownership of the account during the
	lifetimes and on the deaths of the parties and provisions relating
	to the powers and duties of the financial institution at which the
	account is established; and
	[(2)     any other law relating to a convenience signer
	applies to a convenience signer designated as provided by this
	section to the extent the law applies to a convenience signer on a
	convenience account].
	(c)  The making of a deposit in an account described by
	Subsection (a) does not affect the title to the deposit.
	(d)  A party to an account described by Subsection (a) is not
	considered to have made a gift of the deposit, or of any additions
	or accruals to the deposit, to a convenience signer.
	(e)  An addition made to an account described by Subsection
	(a) by anyone other than a party, and accruals to the addition, are
	considered to have been made by a party.
	(f)  Deposits to an account described by Subsection (a) and
	additions and accruals to the deposits may be paid to a party or a
	convenience signer.
	(g)  A financial institution is completely released from
	liability for a payment made from an account described by
	Subsection (a) before the financial institution receives notice in
	writing signed by a party not to make the payment in accordance with
	the terms of the account. After receipt of the notice from a party,
	the financial institution may require a party to approve any
	further payments from the account.
	(h)  A financial institution that makes a payment of the sums
	on deposit in an account described by Subsection (a) to a
	convenience signer after the death of the last surviving party, but
	before the financial institution receives written notice of the
	last surviving party's death, is completely released from liability
	for the payment.
	(i)  A financial institution that makes a payment of the sums
	on deposit in an account described by Subsection (a) to the personal
	representative of the deceased last surviving party's estate after
	the death of the last surviving party, but before a court order
	prohibiting payment is served on the financial institution, is, to
	the extent of the payment, released from liability to any person
	claiming a right to the funds. The personal representative's
	receipt of the funds is a complete release and discharge of the
	financial institution.
	SECTION 7.  Section 113.151(d), Estates Code, is amended to
	read as follows:
	(d)  If there are two or more surviving parties to a joint
	account that is subject to a right of survivorship agreement:
	(1)  during the parties' lifetimes respective
	ownerships are in proportion to the parties' previous ownership
	interests under Sections 113.102 and[,] 113.103[, and 113.104], as
	applicable, augmented by an equal share for each survivor of any
	interest a deceased party owned in the account immediately before
	that party's death; and
	(2)  the right of survivorship continues between the
	surviving parties if a written agreement signed by a party who dies
	provides for that continuation.
	SECTION 8.  Section 113.1541, Estates Code, is amended to
	read as follows:
	Sec. 113.1541.  OWNERSHIP OF [OTHER] ACCOUNT WITH
	CONVENIENCE SIGNER ON DEATH OF LAST SURVIVING PARTY. On the death
	of the last surviving party to an account that has a convenience
	signer designated as provided by Section 113.106, the convenience
	signer does not have a right of survivorship in the account and the
	estate of the last surviving party owns the account unless the
	convenience signer is also designated as a P.O.D. payee [or as a
	beneficiary].
	SECTION 9.  Sections 113.155, 113.156, and 113.158, Estates
	Code, are amended to read as follows:
	Sec. 113.155.  EFFECT OF DEATH OF PARTY ON CERTAIN ACCOUNTS
	WITHOUT RIGHTS OF SURVIVORSHIP. The death of a party to a
	multiple-party account to which Sections 113.151 and[,] 113.152[,
	and 113.153] do not apply has no effect on the beneficial ownership
	of the account, other than to transfer the rights of the deceased
	party as part of the deceased party's estate.
	Sec. 113.156.  APPLICABILITY OF CERTAIN PROVISIONS ON DEATH
	OF PARTY. Sections 113.151, 113.152, [113.153,] and 113.155 as to
	rights of survivorship are determined by the form of the account at
	the death of a party.
	Sec. 113.158.  NONTESTAMENTARY NATURE OF CERTAIN TRANSFERS.
	Transfers resulting from the application of Sections 113.151,
	113.152, [113.153,] and 113.155 are effective by reason of the
	account contracts involved and this chapter and are not to be
	considered testamentary transfers or subject to the testamentary
	provisions of this title.
	SECTION 10.  Section 113.203(b), Estates Code, is amended to
	read as follows:
	(b)  Payment may not be made to the personal representative
	or heir of a deceased party unless:
	(1)  proofs of death are presented to the financial
	institution showing that the deceased party was the last surviving
	party; or
	(2)  there is no right of survivorship under Sections
	113.151, 113.152, [113.153,] and 113.155.
	SECTION 11.  Section 113.209(a), Estates Code, is amended to
	read as follows:
	(a)  Payment made in accordance with Section 113.202,
	113.203, 113.204, [113.205,] or 113.207 discharges the financial
	institution from all claims for those amounts paid regardless of
	whether the payment is consistent with the beneficial ownership of
	the account between parties, P.O.D. payees, [or beneficiaries,] or
	their successors.
	SECTION 12.  Sections 113.251(a) and (d), Estates Code, are
	amended to read as follows:
	(a)  A party to a multiple-party account may pledge the
	account or otherwise create a security interest in the account
	without the joinder of, as applicable, a P.O.D. payee, [a
	beneficiary,] a convenience signer, or any other party to a joint
	account, regardless of whether  a right of survivorship exists.
	(d)  The financial institution is not required to provide the
	notice described by Subsection (c) to a P.O.D. payee[,
	beneficiary,] or convenience signer.
	SECTION 13.  Section 113.252(b), Estates Code, is amended to
	read as follows:
	(b)  A party or[,] P.O.D. payee[, or beneficiary] who
	receives payment from a multiple-party account after the death of a
	deceased party is liable to account to the deceased party's
	personal representative for amounts the deceased party owned
	beneficially immediately before the party's death to the extent
	necessary to discharge the claims and charges described by
	Subsection (a) that remain unpaid after application of the deceased
	party's estate. The party or[,] P.O.D. payee[, or beneficiary] is
	not liable in an amount greater than the amount the party or[,]
	P.O.D. payee[, or beneficiary] received from the multiple-party
	account.
	SECTION 14.  Section 153.001(3), Estates Code, is amended to
	read as follows:
	(3)  "P.O.D. account" has [and "trust account" have]
	the meaning [meanings] assigned by Section 113.004.
	SECTION 15.  Section 153.002, Estates Code, is amended to
	read as follows:
	Sec. 153.002.  INAPPLICABILITY OF CHAPTER. This chapter
	does not apply to:
	(1)  an account with a beneficiary designation;
	(2)  a P.O.D. account; or
	(3)  [a trust account; or
	[(4)]  an account that provides for a right of
	survivorship.
	SECTION 16.  Sections 113.001(2), 113.104, 113.105,
	113.153, 113.154, 113.205, 113.206, and 113.208, Estates Code, are
	repealed.
	SECTION 17.  (a) In this section, "convenience account" and
	"trust account" have the meanings assigned by Section 113.004,
	Estates Code, as that section existed on January 1, 2017.
	(b)  Except as provided by Subsection (e) of this section,
	the changes in law made by this Act, including the repeal by this
	Act of certain provisions of Chapter 113, Estates Code, apply only
	to:
	(1)  a financial institution account opened on or after
	the effective date of this Act; and
	(2)  a convenience account or trust account opened
	before the effective date of this Act with respect to which a
	financial institution has notified the party or parties to the
	account in writing that the financial institution has converted the
	account to a type of account, other than a convenience account or
	trust account.
	(c)  A convenience account or trust account opened before the
	effective date of this Act with respect to which a financial
	institution has not notified the party or parties to the account in
	writing that the financial institution has converted the account to
	a type of account, other than a convenience account or trust
	account, is governed by the law in effect on the date the account
	was opened or last modified, and the former law is continued in
	effect until the earliest of the date on which:
	(1)  the financial institution notifies the party or
	parties to the account in writing that it has converted the account
	to a type of account, other than a convenience account or a trust
	account;
	(2)  the convenience account or trust account is
	closed; or
	(3)  the last surviving party to a convenience account
	or trust account dies.
	(d)  The repeal by this Act of provisions of Chapter 113,
	Estates Code, relating to trust accounts and convenience accounts
	does not affect the validity of any account or deposit agreement
	between a financial institution and a depositor or other person
	that is entered into before September 1, 2017.
	(e)  Section 113.053, Estates Code, as amended by this Act,
	applies only to a financial institution account opened or modified
	on or after the effective date of this Act. A financial institution
	account opened or modified before the effective date of this Act is
	governed by the law in effect on the date the account was opened or
	modified, and the former law is continued in effect for that
	purpose.
	SECTION 18.  This Act takes effect September 1, 2017.
	* * * * *