H 4748 Session 111 (1995-1996)
H 4748 General Bill, By W.D. Keyserling, Haskins, Richardson, Stuart and
Whipper
A Bill to amend Title 35, Code of Laws of South Carolina, 1976, by adding
Chapter 6 so as to enact the Uniform Transfer on Death Security Registration
Act which permits a person to register a security in beneficiary form thereby
indicating him as the present owner with a designation of a beneficiary to
take ownership at his death.
03/13/96 House Introduced and read first time HJ-21
03/13/96 House Referred to Committee on Labor, Commerce and
Industry HJ-21
A BILL
TO AMEND TITLE 35, CODE OF LAWS OF SOUTH
CAROLINA, 1976, BY ADDING CHAPTER 6 SO AS TO
ENACT THE UNIFORM TRANSFER ON DEATH SECURITY
REGISTRATION ACT WHICH PERMITS A PERSON TO
REGISTER A SECURITY IN BENEFICIARY FORM THEREBY
INDICATING HIM AS THE PRESENT OWNER WITH A
DESIGNATION OF A BENEFICIARY TO TAKE OWNERSHIP
AT HIS DEATH.
Be it enacted by the General Assembly of the State of South
Carolina:
SECTION 1. Title 35 of the 1976 Code is amended by adding:
"CHAPTER 6
Uniform Transfer on Death Security
Registration Act
Section 35-6-10. (A) This chapter is known and may be cited as
the Uniform Transfer on Death Security Registration Act.
(B) As used in this chapter:
(1) `Beneficiary form' means a registration of a security
which indicates the present owner of the security and the intention
of the owner regarding the person who will become the owner of
the security upon the death of the owner.
(2) `Devisee' means any person designated in a will to
receive a disposition of property.
(3) `Heirs' means those persons, including the surviving
spouse, who are entitled under the laws of intestate succession to
the property of a decedent.
(4) `Person' means an individual, a corporation, an
organization, or other legal entity.
(5) `Personal representative' includes a personal
representative, administrator, or other person who performs
substantially the same functions by law.
(6) `Register', including its derivatives, means to issue a
certificate showing the ownership of a certificated security or, in the
case of an uncertificated security, to initiate or transfer an account
showing ownership of securities.
(7) `Registration entity' means a person who originates or
transfers a security title by registration, and includes a broker
maintaining security accounts for customers and a transfer agent or
other person acting for or as an issuer of securities.
(8) `Security' means and is defined as provided in Section
35-1-20(12).
(9) `Security account' means:
(a) a reinvestment account associated with a security, a
securities account with a broker, a cash balance in a brokerage
account, cash, interest, earning, or dividends earned or declared on
a security in an account, a reinvestment account, or a brokerage
account, whether or not credited to the account before the owner's
death; or
(b) a cash balance or other property held for or due to the
owner of a security as a replacement for or product of an account
security, whether or not credited to the account before the owner's
death.
(10) `State' includes any state of the United States, the District
of Columbia, the Commonwealth of Puerto Rico, and any territory
or possession subject to the legislative authority of the United
States.
Section 35-6-20. Only individuals whose registration of a
security shows sole ownership by one individual or multiple
ownership by two or more with right of survivorship, rather than as
tenants in common, may obtain registration in beneficiary form.
Multiple owners of a security registered in beneficiary form hold as
joint tenants with right of survivorship, and not as tenants in
common.
Section 35-6-30. A security may be registered in beneficiary
form if the form is authorized by this chapter, by the laws of the
state of organization of the issuer or registering entity, the location
of the registering entity's principal office, the office of its transfer
agent or its office making the registration, or by the laws of the
state listed as the owner's address at the time of registration. A
registration governed by the law of a jurisdiction in which these
provisions are not in force or was not in force when a registration
in beneficiary form was made is nevertheless presumed to be valid
and authorized as a matter of contract law.
Section 35-6-40. A security, whether evidenced by a certificate
or account, is registered in beneficiary form when the registration
includes a designation of a beneficiary to take the ownership at the
death of the owner or the death of all multiple owners.
Section 35-6-50. Registration in beneficiary form may be shown
by the words, `transfer on death' or the abbreviation `TOD', or by
the words `pay on death' or the abbreviation `POD', after the name
of the registered owner and before the name of a beneficiary.
Section 35-6-60. The designation of a transfer on death
beneficiary on a registration in beneficiary form has no effect on
ownership until the owner's death. A registration of a security in
beneficiary form may be canceled or changed at any time by the
sole owner or all then surviving owners, without the consent of the
beneficiary.
Section 35-6-70. On death of a sole owner or the last to die of
all multiple owners, ownership of securities registered in beneficiary
form passes to the beneficiary or beneficiaries who survive all
owners. On proof of death of all owners and compliance with any
applicable requirements of the registering entity, a security
registered in beneficiary form may be reregistered in the name of
the beneficiary or beneficiaries who survived the death of all
owners. Until division of the security after the death of all owners,
multiple beneficiaries surviving the death of all owners hold their
interests as tenants in common. If no beneficiary survives the death
of all owners, the security belongs to the estate of the deceased sole
owner or the estate of the last to die of all multiple owners.
Section 35-6-80. (A) A registering entity is not required to offer
or to accept a request for security registration in beneficiary form.
If a registration in beneficiary form is offered by a registering
entity, the owner requesting registration in beneficiary form assents
to the protections given to the registering entity by this chapter.
(B) By accepting a request for registration of a security in
beneficiary form, the registering entity agrees that the registration
will be implemented on death of the deceased owner as provided in
this chapter.
(C) A registering entity is discharged from all claims to a
security by the estate, creditors, heirs, or devises of a deceased
owner if it registers a transfer of a security in accordance with
Section 35-6-70 and does so in good faith reliance (1) on the
registration, (2) on this chapter, and (3) on information provided to
it by affidavit of the personal representative of the deceased owner,
or by the surviving beneficiary or by the surviving beneficiary's
representatives, or other information available to the registering
entity. The protections of this chapter do not extend to a
reregistration or payment made after a registering entity has
received written notice from any claimant to any interest in the
security objecting to implementation of a registration in beneficiary
form. No other notice or other information available to the
registering entity affects its right to protection under this chapter.
(D) The protection provided by this chapter to the registering
entity of a security does not affect the rights of beneficiaries in
disputes between themselves and other claimants to ownership of
the security transferred or its value of proceeds.
Section 35-6-90. (A) A transfer on death resulting from a
registration in beneficiary form is effective by reason of the contract
regarding the registration between the owner and the registering
entity and this chapter and is not testamentary.
(B) This chapter does not limit the rights of creditors of security
owners against beneficiaries and other transferees under other laws
of this State.
Section 35-6-100. (A) A registering entity offering to accept
registrations in beneficiary form may establish the terms and
conditions under which it will receive requests (1) for registrations
in beneficiary form, and (2) for implementation of registrations in
beneficiary form, including requests for cancellation of previously
registered transfer on death beneficiary designations and requests
for reregistration to effect a change of beneficiary. The terms and
conditions so established may provide for proving death, avoiding
or resolving any problems concerning fractional shares, designating
primary and contingent beneficiaries, and substituting a named
beneficiary's descendants to take in the place of the named
beneficiary in the event of the beneficiary's death. Substitution
may be indicated by appending to the name of the primary
beneficiary the letters `LDPS,' standing for `lineal descendants per
stirpes'. This designation substitutes a deceased beneficiary's
descendants who survive the owner for a beneficiary who fails to so
survive, the descendants to be identified and to share in accordance
with the law of the beneficiary's domicile at the owner's death
governing inheritance by descendant of an intestate. Other forms of
identifying beneficiaries who are to take on one or more
contingencies, and rules for providing proofs and assurances needed
to satisfy reasonable concerns by registering entities regarding
conditions and identities relevant to accurate implementation of
registrations in beneficiary form, may be contained in a registering
entity's terms and conditions."
SECTION 2. This act takes effect upon approval by the
Governor, and applies to registrations of securities in beneficiary
form made before or after the effective date of this act by decedents
dying on or after the effective date of this act.
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