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  S.B. No. 1650
 
 
 
 
AN ACT
  relating to durable powers of attorney and the construction of
  certain powers conferred in those durable powers of attorney.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 751.002(5), Estates Code, is amended to
  read as follows:
               (5)  "Principal" means an adult individual [person] who
  signs or directs the signing of the individual's [person's] name on
  a power of attorney that designates an agent to act on the
  individual's [person's] behalf.
         SECTION 2.  Section 751.00201, Estates Code, is amended to
  read as follows:
         Sec. 751.00201.  MEANING OF DISABLED OR INCAPACITATED FOR
  PURPOSES OF DURABLE POWER OF ATTORNEY. Unless otherwise defined by
  a durable power of attorney, an individual [a person] is considered
  disabled or incapacitated for purposes of the durable power of
  attorney if a physician certifies in writing at a date later than
  the date the durable power of attorney is executed that, based on
  the physician's medical examination of the individual [person], the
  individual [person] is determined to be mentally incapable of
  managing the individual's [person's] financial affairs.
         SECTION 3.  Section 751.133, Estates Code, is amended by
  amending Subsection (a) and adding Subsection (a-1) to read as
  follows:
         (a)  If, after execution of a durable power of attorney, a
  court [of the principal's domicile] appoints a:
               (1)  permanent guardian of the estate for a ward who is 
  [of] the principal who executed the power of attorney, on the
  qualification of the guardian the powers and authority granted to 
  [of] the agent named in the power of attorney are automatically
  revoked unless the court enters an order that the powers of the
  agent be suspended during the pendency of the guardianship of the
  estate; or
               (2)  temporary guardian of the estate for a ward who is
  the principal who executed the power of attorney, on the
  qualification of the guardian the powers and authority granted to
  the agent named in the power of attorney are automatically
  suspended for the duration of the guardianship unless the court
  enters an order that:
                     (A)  affirms and states the effectiveness of the
  power of attorney; and
                     (B)  confirms the validity of the appointment of
  the named agent [terminate on the qualification of the guardian of
  the estate].
         (a-1)  If the powers and authority of an [The] agent are
  revoked as provided by Subsection (a), the agent shall:
               (1)  deliver to the guardian of the estate all assets of
  the ward's [incapacitated person's] estate that are in the
  possession of the agent; and
               (2)  account to the guardian of the estate as the agent
  would account to the principal if the principal had terminated the
  powers of the agent.
         SECTION 4.  Section 751.251, Estates Code, is amended by
  amending Subsection (a) and adding Subsection (d) to read as
  follows:
         (a)  The following may bring an action requesting a court to
  construe, or determine the validity or enforceability of, a durable
  power of attorney, or to review an agent's conduct under a durable
  power of attorney and grant appropriate relief:
               (1)  the principal or the agent;
               (2)  a guardian, conservator, or other fiduciary acting
  for the principal;
               (3)  a person named as a beneficiary to receive
  property, a benefit, or a contractual right on the principal's
  death;
               (4)  a governmental agency with [regulatory] authority
  to provide protective services to the principal [protect the
  principal's welfare]; and
               (5)  a person who demonstrates to the court sufficient
  interest in the principal's welfare or estate.
         (d)  In an action brought under this section, the court may
  award costs and reasonable and necessary attorney's fees in an
  amount the court considers equitable and just.
         SECTION 5.  Section 752.001(a), Estates Code, is amended to
  read as follows:
         (a)  An individual [A person] may use a statutory durable
  power of attorney to grant an [attorney in fact or] agent powers
  with respect to an individual's [a person's] property and financial
  matters.
         SECTION 6.  Section 752.107, Estates Code, is amended to
  read as follows:
         Sec. 752.107.  BUSINESS OPERATION TRANSACTIONS. Subject to
  the terms of an agreement or other document governing or relating to
  an entity or entity ownership interest, to the extent the agent is
  permitted by law to act for the principal and unless the power of
  attorney provides otherwise, the [The] language conferring
  authority with respect to business operating transactions in a
  statutory durable power of attorney empowers the [attorney in fact
  or] agent to:
               (1)  operate, buy, sell, enlarge, reduce, or terminate
  an ownership [a business] interest;
               (2)  [do the following, to the extent that an attorney
  in fact or agent is permitted by law to act for a principal and
  subject to the terms of a partnership agreement:
                     [(A)] perform a duty or[,] discharge a liability,
  or exercise in person or by proxy a right, power, privilege, or
  option that the principal has, may have, or claims to have [under
  the partnership agreement, whether or not the principal is a
  general or limited partner];
               (3) [(B)]  enforce the terms of an agreement or other
  document governing or relating to an entity or entity ownership
  interest [the partnership agreement by litigation, action, or
  otherwise]; [and]
               (4) [(C)]  defend, submit to arbitration, settle, or
  compromise litigation or an action to which the principal is a party
  because of an entity ownership interest [membership in the
  partnership];
               (5) [(3)]  exercise in person or by proxy, or enforce
  by litigation, action, or otherwise, a right, power, privilege, or
  option the principal has or claims to have as the holder of a
  certificated or uncertificated ownership interest;
               (6)  [bond, share, or other similar instrument and]
  defend, submit to alternative dispute resolution [arbitration],
  settle, or compromise litigation [a legal proceeding] to which the
  principal is a party concerning a certificated or uncertificated
  ownership interest [because of a bond, share, or similar
  instrument];
               (7) [(4)]  with respect to a business or entity owned
  solely by the principal:
                     (A)  continue, modify, renegotiate, extend, and
  terminate a contract made by or on behalf of the principal with
  respect to the business or entity [before execution of the power of
  attorney with an individual, legal entity, firm, association, or
  corporation by or on behalf of the principal with respect to the
  business];
                     (B)  determine:
                           (i)  the location of the business's or
  entity's operation;
                           (ii)  the nature and extent of the business;
                           (iii)  the methods of manufacturing,
  selling, merchandising, financing, accounting, and advertising
  employed in the business's or entity's operation;
                           (iv)  the amount and types of insurance
  carried; and
                           (v)  the method of engaging, compensating,
  and dealing with the business's or entity's employees and
  accountants, attorneys, or [and] other agents [and employees];
                     (C)  change the name or form of organization under
  which the business or entity is operated and enter into an [a
  partnership] agreement with other persons [or organize a
  corporation] to take over all or part of the operation of the
  business or entity; and
                     (D)  demand and receive money due or claimed by
  the principal or on the principal's behalf in the operation of the
  business or entity and control and disburse the money in the
  operation of the business or entity;
               (8) [(5)]  put additional capital into a business or
  entity in which the principal has an interest;
               (9) [(6)]  join in a plan of reorganization,
  consolidation, interest exchange, conversion, or merger of the
  business or entity;
               (10) [(7)]  sell or liquidate a business or entity or
  all or part of the assets of the business or entity [at the time and
  on the terms that the attorney in fact or agent considers
  desirable];
               (11) [(8)]  establish the value of a business or entity
  under a buy-out agreement to which the principal is a party;
               (12)  [(9)  do the following:
                     [(A)]  prepare, sign, file, and deliver reports,
  compilations of information, returns, or other papers with respect
  to a business or entity and[:
                           [(i)  that are required by a governmental
  agency, department, or instrumentality; or
                           [(ii) that the attorney in fact or agent
  considers desirable; and
                     [(B)]  make related payments; and
               (13) [(10)]  pay, compromise, or contest taxes or
  assessments and perform any other act [that the attorney in fact or
  agent considers desirable] to protect the principal from illegal or
  unnecessary taxation, fines, penalties, or assessments with
  respect to a business or entity, including attempts to recover, in
  any manner permitted by law, money paid before or after the
  execution of the power of attorney.
         SECTION 7.  Section 240.008, Property Code, is amended by
  amending Subsection (c) and adding Subsection (c-1) to read as
  follows:
         (c)  Except as provided by Subsection (c-1), the [The]
  following disclaimers by a fiduciary acting in a fiduciary capacity
  are not effective unless approved by a court of competent
  jurisdiction:
               (1)  a disclaimer by a personal representative who is
  not an independent administrator or independent executor;
               (2)  a disclaimer by the trustee of a management trust
  created under Chapter 1301, Estates Code;
               (3)  a disclaimer by the trustee of a trust created
  under Section 142.005; or
               (4)  a disclaimer that would result in an interest in or
  power over property passing to the person making the disclaimer.
         (c-1)  A disclaimer described by Subsection (c)(4) does not
  require court approval if the disclaimer is authorized under
  Subtitle P, Title 2, Estates Code.
         SECTION 8.  The following sections of the Estates Code are
  repealed:
               (1)  Section 751.052; and
               (2)  Section 751.133(b).
         SECTION 9.  Section 751.251, Estates Code, as amended by
  this Act, applies to a proceeding concerning a durable power of
  attorney pending on, or commenced on or after, the effective date of
  this Act.
         SECTION 10.  Section 752.107, Estates Code, as amended by
  this Act, applies only to a durable power of attorney, including a
  statutory durable power of attorney, executed on or after the
  effective date of this Act. A durable power of attorney, including a
  statutory durable power of attorney, executed before the effective
  date of this Act is governed by the law in effect on the date the
  durable power of attorney was executed, and the former law is
  continued in effect for that purpose.
         SECTION 11.  Section 240.008, Property Code, as amended by
  this Act, applies only to a disclaimer made on or after the
  effective date of this Act.  A disclaimer made before the effective
  date of this Act is governed by the law in effect at the time the
  disclaimer was made, and the former law is continued in effect for
  that purpose.
         SECTION 12.  This Act takes effect September 1, 2023.
 
 
 
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
         I hereby certify that S.B. No. 1650 passed the Senate on
  April 20, 2023, by the following vote:  Yeas 31, Nays 0.
 
 
  ______________________________
  Secretary of the Senate    
 
         I hereby certify that S.B. No. 1650 passed the House on
  May 11, 2023, by the following vote:  Yeas 130, Nays 3, two
  present not voting.
 
 
  ______________________________
  Chief Clerk of the House   
 
 
 
  Approved:
 
  ______________________________ 
              Date
 
 
  ______________________________ 
            Governor