TITLE 62. SOUTH CAROLINA PROBATE CODE
CHAPTER 1. General Provisions, Definitions, and Probate Jurisdiction of Court
Part 1
Short Title, Construction, General Provisions
SECTION 62-1-100. Effective date.
(a) Except as otherwise provided, this Code takes effect July 1, 1987.
(b) Except as provided elsewhere in this Code, on the effective date of this Code:
(1) the Code applies to any estates of decedents dying thereafter;
(2) the procedural provisions of the Code apply to any proceedings in court then pending or thereafter commenced regardless of the time of the death of decedent except to the extent that in the opinion of the court the former procedure should be made applicable in a particular case in the interest of justice or because of infeasibility of application of the procedure of this Code;
(3) every personal representative, including a person administering an estate of a minor or incompetent holding an appointment on that date, continues to hold the appointment but has only the powers conferred by this Code and is subject to the duties imposed with respect to any act occurring or done thereafter;
(4) an act done before the effective date in any proceeding and any accrued right is not impaired by this Code. Unless otherwise provided in the Code, a substantive right in the decedent's estate accrues in accordance with the law in effect on the date of the decedent's death. If a right is acquired, extinguished, or barred upon the expiration of a prescribed period of time which has commenced to run by the provisions of any statute before the effective date, the provisions remain in force with respect to that right;
(5) a rule of construction or presumption provided in this code applies to multiple-party accounts opened before the effective date unless there is a clear indication of a contrary intent.
(c) Section 62-2-502 is effective for all wills executed after June 27, 1984, whether the testator dies before or after July 1, 1987.
HISTORY: 1986 Act No. 539, § 5; 1987 Act No. 171, § 78; 1990 Act No. 522, Part I, § 1; 1997 Act No. 152, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-101. Short title.
Sections 62-1-101 et seq. shall be known and may be cited as the South Carolina Probate Code. References in Sections 62-1-101 et seq. to the term "Code", unless the context clearly indicates otherwise, shall mean the South Carolina Probate Code.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-102. Purposes; rules of construction.
(a) This Code shall be liberally construed and applied to promote its underlying purposes and policies.
(b) The underlying purposes and policies of this Code are:
(1) to simplify and clarify the law concerning the affairs of decedents, missing persons, protected persons, minors, and incapacitated persons;
(2) to discover and make effective the intent of a decedent in the distribution of his property;
(3) to promote a speedy and efficient system for liquidating the estate of the decedent and making distribution to his successors;
(4) to facilitate use and enforcement of certain trusts;
(5) to make uniform the law among the various jurisdictions.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-103. Supplementary general principles of law applicable.
Unless displaced by the particular provisions of this Code, the principles of law and equity supplement its provisions.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-104. Severability.
If any provision of this Code or the application thereof to any person or circumstances is held invalid, the invalidity shall not affect other provisions or applications of the Code which can be given effect without the invalid provision or application and to this end the provisions of this Code are declared to be severable.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-105. Construction against implied repeal.
This Code is a general act intended as a unified coverage of its subject matter and no part of it shall be deemed impliedly repealed by subsequent legislation if it can reasonably be avoided.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-106. Effect of fraud and evasion.
Whenever fraud has been perpetrated in connection with any proceeding or in any statement filed under this Code or if fraud is used to avoid or circumvent the provisions or purposes of this Code, any person injured thereby may: (i) obtain appropriate relief against the perpetrator of the fraud and (ii) restitution from any person (other than a bona fide purchaser) benefiting from the fraud, whether innocent or not, but only to the extent of any benefit received. Any proceeding must be commenced within two years after the discovery of the fraud, but no proceeding may be brought against one not a perpetrator of the fraud later than five years after the time of commission of the fraud. This section has no bearing on remedies relating to fraud practiced on a decedent during his lifetime which affects the succession of his estate.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-107. Evidence as to death or status.
In proceedings under this Code the South Carolina Rules of Evidence are applicable unless specifically displaced by the Code.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-108. Acts by holder of general power.
For the purpose of granting consent or approval with regard to the acts or accounts of a personal representative or trustee, including relief from liability or penalty for failure to post bond, or to perform other duties, and for purposes of consenting to modification or termination of a trust or to deviation from its terms, the sole holder or all co-holders of a presently exercisable general power of appointment, including one in the form of a power of amendment or revocation, are deemed to act for beneficiaries to the extent their interests (as objects, takers in default, or otherwise) are subject to the power. The term "presently exercisable general power of appointment" includes a testamentary general power of appointment having no conditions precedent to its exercise other than the death of the holder, the validity of the holder's last will and testament, and the inclusion of a provision in the will sufficient to exercise this power.
HISTORY: 1986 Act No. 539, § 1; 1988 Act No. 659, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-109. Duties and obligations of lawyer and person serving as a fiduciary.
Unless expressly provided otherwise in a written employment agreement, the creation of an attorney-client relationship between a lawyer and a person serving as a fiduciary shall not impose upon the lawyer any duties or obligations to other persons interested in the estate, trust estate, or other fiduciary property, even though fiduciary funds may be used to compensate the lawyer for legal services rendered to the fiduciary. This section is intended to be declaratory of the common law and governs relationships in existence between lawyers and persons serving as fiduciaries as well as such relationships hereafter created.
HISTORY: 1994 Act No. 449, § 2; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-110. Fiduciary and lawyer, privileged communication.
Whenever an attorney-client relationship exists between a lawyer and a fiduciary, communications between the lawyer and the fiduciary shall be subject to the attorney-client privilege unless waived by the fiduciary, even though fiduciary funds may be used to compensate the lawyer for legal services rendered to the fiduciary. The existence of a fiduciary relationship between a fiduciary and a beneficiary does not constitute or give rise to any waiver of the privilege for communications between the lawyer and the fiduciary.
HISTORY: 2008 Act No. 211, § 1, eff May 13, 2008; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-111. Authority to award costs and expenses.
In a formal proceeding, the court, as justice and equity may require, may award costs and expenses, including reasonable attorney's fees, to any party, to be paid by another party or from the estate that is the subject of the controversy.
HISTORY: 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-112. Inherent power of court.
The inherent power of the court to impose penalties for contempt extends to all filing requirements, proceedings, judgments, and orders of the court. The court has the power to grant a motion to proceed in forma pauperis.
HISTORY: 2017 Act No. 87 (S.415), § 1, eff January 1, 2019.
Part 2
Definitions
SECTION 62-1-201. General definitions.
Subject to additional definitions contained in the subsequent articles which are applicable to specific articles or parts, and unless the context otherwise requires, in this Code:
(1) "Application" means a written request to the probate court for an order. An application does not require a summons and is not governed by or subject to the rules of civil procedure adopted for the circuit court.
(2) "Beneficiary", as it relates to trust beneficiaries, includes a person who has any present or future interest, vested or contingent, and also includes the owner of an interest by assignment or other transfer and, as it relates to a charitable trust, includes any person entitled to enforce the trust.
(3) "Child" includes any individual entitled to take as a child under this Code by intestate succession from the parent whose relationship is involved and excludes any person who is only a stepchild, a foster child, a grandchild, or any more remote descendant.
(4) "Claims", in respect to estates of decedents and protected persons, includes liabilities of the decedent or protected person whether arising in contract, in tort, or otherwise, and liabilities of the estate which arise at or after the death of the decedent or after the appointment of a conservator, including funeral expenses and expenses of administration. The term does not include estate or inheritance taxes, or demands or disputes regarding title of a decedent or protected person to specific assets alleged to be included in the estate.
(5) "Court" means the court or branch having jurisdiction in matters as provided in this Code.
(6) "Conservator" means a person who is appointed by a court to manage the estate of a protected person.
(7) "Devise", when used as a noun, means a testamentary disposition of real or personal property, including both devise and bequest as formerly used, and when used as a verb, means to dispose of real or personal property by will.
(8) "Devisee" means any person designated in a will to receive a devise. In the case of a devise to an existing trust or trustee, or to a trustee on trust described by will, the trust or trustee is the devisee and the beneficiaries are not devisees.
(9) "Disability" means cause for a protective order as described by Section 62-5-401.
(10) "Distributee" means any person who has received property of a decedent from his personal representative other than as creditor or purchaser. A testamentary trustee is a distributee only to the extent of distributed assets or increment thereto remaining in his hands. A beneficiary of a testamentary trust to whom the trustee has distributed property received from a personal representative is a distributee of the personal representative. For purposes of this provision, "testamentary trustee" includes a trustee to whom assets are transferred by will, to the extent of the devised assets.
(11) "Estate" includes the property of the decedent, trust, or other person whose affairs are subject to this Code as originally constituted and as it exists from time to time during administration.
(12) "Exempt property" means that property of a decedent's estate which is described in Section 62-2-401.
(13) "Expense of administration" includes commissions of personal representatives, fees and disbursements of attorneys, fees of appraisers, and such other expenses that are reasonably incurred in the administration of the estate.
(14) "Fair market value" is the price that property would sell for on the open market that would be agreed on between a willing buyer and a willing seller, with neither being required to act, and both having reasonable knowledge of the relevant facts.
(15) "Fiduciary" includes personal representative, guardian, conservator, and trustee.
(16) "Foreign personal representative" means a personal representative of another jurisdiction.
(17) "Formal proceedings" means actions commenced by the filing of a summons and petition with the probate court and service of the summons and petition upon the interested persons. Formal proceedings are governed by and subject to the rules of civil procedure adopted for circuit courts and other rules of procedure in this title.
(18) "Guardian" means a person appointed by the court as guardian, but excludes one who is a guardian ad litem.
(19) "General power of appointment" means any power that would cause income to be taxed to the fiduciary in his individual capacity under Section 678 of the Internal Revenue Code and any power that would be a general power of appointment, in whole or in part, under Section 2041(a)(2) or 2514(c) of the Internal Revenue Code.
(20) "Heirs" means those persons, including the surviving spouse, who are entitled under the statute of intestate succession to the property of a decedent.
(21) "Incapacitated person" is as defined in Section 62-5-101.
(22) "Informal proceedings" means those commenced by application and conducted without notice to interested persons by the court for probate of a will or appointment of a personal representative. Informal proceedings are not governed by or subject to the rules of civil procedure adopted for the circuit court.
(23) "Interested person" includes heirs, devisees, children, spouses, creditors, beneficiaries, and any others having a property right in or claim against a trust estate or the estate of a decedent, ward, or protected person which may be affected by the proceeding. It also includes persons having priority for appointment as personal representative and other fiduciaries representing interested persons. The meaning as it relates to particular persons may vary from time to time and must be determined according to the particular purposes of, and matter involved in, any proceeding.
(24) "Issue" of a person means all his lineal descendants whether natural or adoptive of all generations, with the relationship of parent and child at each generation being determined by the definitions of child and parent contained in this Code.
(25) "Lease" includes an oil, gas, or other mineral lease.
(26) "Letters" includes letters testamentary, letters of guardianship, letters of administration, and letters of conservatorship.
(27) "Minor" means a person who is under eighteen years of age, excluding a person under the age of eighteen who is married or emancipated as decreed by the family court.
(28) "Mortgage" means any conveyance, agreement, or arrangement in which real property is used as security.
(29) "Nonresident decedent" means a decedent who was domiciled in another jurisdiction at the time of his death.
(30) "Organization" includes a corporation, government or governmental subdivision or agency, business trust, estate, trust, partnership or association, two or more persons having a joint or common interest, or any other legal entity.
(31) "Parent" includes any person entitled to take, or who would be entitled to take if the child died without a will, as a parent under this Code by intestate succession from the child whose relationship is in question and excludes any person who is only a stepparent, foster parent, or grandparent.
(32) "Person" means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government or governmental subdivision, agency, or instrumentality, public corporation, or any other legal or commercial entity.
(33) "Personal representative" includes executor, administrator, successor personal representative, special administrator, and persons who perform substantially the same function under the law governing their status. "General personal representative" excludes special administrator.
(34) "Petition" means a complaint as defined in the rules of civil procedure adopted for the circuit court. A petition requires a summons and is governed by and subject to the rules of civil procedure adopted for the circuit court and other rules of procedure in this title.
(35) "Probate estate" means the decedent's property passing under the decedent's will plus the decedent's property passing by intestacy.
(36) "Proceeding" includes action at law and suit in equity.
(37) "Property" includes both real and personal property or any interest therein and means anything that may be the subject of ownership.
(38) "Protected person" is as defined in Section 62-5-101.
(39) "Protective proceeding" is as defined in Section 62-5-101.
(40) "SCACR" means the South Carolina Appellate Court Rules.
(41) "Security" includes any note, stock, treasury stock, bond, debenture, evidence of indebtedness, certificate of interest, or participation in an oil, gas, or mining title or lease or in payments out of production under such a title or lease, collateral trust certificate, transferable share, voting trust certificate or, in general, any interest or instrument commonly known as a security or any certificate of interest or participation, any temporary or interim certificate, receipt or certificate of deposit for, or any warrant or right to subscribe to or purchase, any of the foregoing.
(42) "Security interest" means any conveyance, agreement, or arrangement in which personal property is used as security.
(43) "Settlement" in reference to a decedent's estate includes the full process of administration, distribution, and closing.
(44) "Special administrator" means a personal representative as described by Sections 62-3-614 through 62-3-618.
(45) "State" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, a federally recognized Indian tribe, or any territory or insular possession subject to the jurisdiction of the United States.
(46) "Successor personal representative" means a personal representative, other than a special administrator, who is appointed to succeed a previously appointed personal representative.
(47) "Successors" means those persons, other than creditors, who are entitled to property of a decedent under his will or this Code.
(48) "Testacy proceeding" means a formal proceeding to establish a will or determine intestacy.
(49) "Trust" includes any express trust, private or charitable, with additions thereto, wherever and however created. It also includes a trust created or determined by judgment or decree under which the trust is to be administered in the manner of an express trust. "Trust" excludes other constructive trusts, and it excludes resulting trusts, conservatorships, personal representatives, trust accounts as defined in Article 6 (Sections 62-6-101, et seq.), custodial arrangements pursuant to the South Carolina Uniform Transfers to Minors Act, Article 6, Chapter 5, Title 63, business trusts providing for certificates to be issued to beneficiaries, common trust funds, voting trusts, security arrangements, liquidation trusts, and trusts for the primary purpose of paying debts, dividends, interest, salaries, wages, profits, pensions, or employee benefits of any kind, and any arrangement under which a person is nominee or escrowee for another.
(50) "Trustee" includes an original, additional, or successor trustee, whether or not appointed or confirmed by court.
(51) "VA" means the United States Department of Veterans Affairs or its successor.
(52) "Ward" is as defined in Section 62-5-101.
(53) "Will" includes codicil and any testamentary instrument that merely appoints an executor or revokes or revises another will.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, §§ 1, 2; 1990 Act No. 521, §§ 2-7; 1997 Act No. 152, § 2; 2010 Act No. 244, § 1, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014; 2016 Act No. 278 (S.777), § 2, eff June 9, 2016; 2022 Act No. 128 (H.3821), § 2, eff April 4, 2022.
Part 3
Scope, Jurisdiction, and Courts
SECTION 62-1-301. Territorial application.
Except as otherwise provided in this Code, this Code applies to (1) the affairs and estates of decedents, missing persons, and persons to be protected domiciled in this State, (2) the property of nonresidents located in this State or property coming into the control of a fiduciary who is subject to the laws of this State, (3) incapacitated persons and minors in this State, (4) survivorship and related accounts in this State, and (5) trusts subject to administration in this State.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-302. Subject matter jurisdiction; concurrent jurisdiction with family court.
(a) To the full extent permitted by the Constitution, and except as otherwise specifically provided, the probate court has exclusive original jurisdiction over all subject matter related to:
(1) estates of decedents, including the contest of wills, construction of wills, determination of property in which the estate of a decedent or a protected person has an interest, and determination of heirs and successors of decedents and estates of protected persons, except that the circuit court also has jurisdiction to determine heirs and successors as necessary to resolve real estate matters, including partition, quiet title, and other actions pending in the circuit court;
(2) subject to Part 7, Article 5:
(i) protective proceedings and guardianship proceedings under Article 5;
(ii) gifts made pursuant to the South Carolina Uniform Transfers to Minors Act under Article 6, Chapter 5, Title 63;
(iii) matters involving the establishment, administration, or termination of a special needs trust for disabled individuals;
(3) trusts, inter vivos or testamentary, including the appointment of successor trustees;
(4) the issuance of marriage licenses, in form as provided by the Bureau of Vital Statistics of the Department of Health and Environmental Control; record, index, and dispose of copies of marriage certificates; and issue certified copies of the licenses and certificates;
(5) the performance of the duties of the clerk of the circuit and family courts of the county in which the probate court is held when there is a vacancy in the office of clerk of court and in proceedings in eminent domain for the acquisition of rights of way by railway companies, canal companies, governmental entities, or public utilities when the clerk is disqualified by reason of ownership of or interest in lands over which it is sought to obtain the rights of way; and
(6) the involuntary commitment of persons suffering from mental illness, intellectual disability, alcoholism, drug addiction, and active pulmonary tuberculosis.
(b) The court's jurisdiction over matters involving wrongful death or actions under the survival statute is concurrent with that of the circuit court and extends only to the approval of settlements as provided in Sections 15-51-41 and 15-51-42 and to the allocation of settlement proceeds among the parties involved in the estate.
(c) The probate court has jurisdiction to hear and determine issues relating to paternity, common-law marriage, and interpretation of marital agreements in connection with estate, trust, guardianship, and conservatorship actions pending before it, concurrent with that of the family court pursuant to Section 63-3-530.
(d) Notwithstanding the exclusive jurisdiction of the probate court over the foregoing matters, any action or proceeding filed in the probate court and relating to the following subject matters, on motion of a party, or by the court on its own motion, made not later than ten days following the date on which all responsive pleadings must be filed, must be removed to the circuit court and in these cases the circuit court shall proceed upon the matter de novo:
(1) formal proceedings for the probate of wills and for the appointment of general personal representatives;
(2) construction of wills;
(3) actions to try title concerning property in which the estate of a decedent or protected person asserts an interest;
(4) matters involving the internal or external affairs of trusts as provided in Section 62-7-201, excluding matters involving the establishment of a "special needs trust" as described in Article 7;
(5) actions in which a party has a right to trial by jury and which involve an amount in controversy of at least five thousand dollars in value; and
(6) actions concerning gifts made pursuant to the South Carolina Uniform Transfers to Minors Act, Article 6, Chapter 5, Title 63.
(e) The removal to the circuit court of an action or proceeding within the exclusive jurisdiction of the probate court applies only to the particular action or proceeding removed, and the probate court otherwise retains continuing exclusive jurisdiction.
(f) Notwithstanding the exclusive jurisdiction of the probate court over the matters set forth in subsections (a) through (c), if an action described in subsection (d) is removed to the circuit court by motion of a party, or by the probate court on its own motion, the probate court may, in its discretion, remove any other related matter or matters which are before the probate court to the circuit court if the probate court finds that the removal of such related matter or matters would be in the best interest of the estate or in the interest of judicial economy. For any matter removed by the probate court to the circuit court pursuant to this subsection, the circuit court shall proceed upon the matter de novo.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 3; 1988 Act No. 659, §§ 2, 3; 1990 Act No. 521, § 8; 1992 Act No. 475, § 2; 1997 Act No. 152, § 3; 2005 Act No. 132, § 4; 2008 Act No. 257, § 1, eff June 4, 2008; 2013 Act No. 100, § 1, eff January 1, 2014; 2017 Act No. 87 (S.415), § 3, eff January 1, 2019; 2022 Act No. 128 (H.3821), § 3, eff April 4, 2022.
SECTION 62-1-303. Venue; multiple proceedings; transfer.
(a) Subject to the provisions of Section 62-3-201, where a proceeding under this Code could be maintained in more than one place in South Carolina, the court in which the proceeding is first commenced has the exclusive right to proceed.
(b) If proceedings concerning the same estate, protected persons, ward, or trust are commenced in more than one court of South Carolina, the court in which the proceeding was first commenced shall continue to hear the matter, and the other courts shall hold the matter in abeyance until the question of venue is decided, and, if the ruling court determines that venue is properly in another court, it shall transfer the proceeding to the other court.
(c) If a court finds that, in the interest of justice, a proceeding or a file should be located in another court of probate in South Carolina, the court making the finding may transfer the proceeding or file to the other court.
(d) If a court transfers venue of a proceeding or file to a court in another county, venue for that proceeding or file, and any subsequent matters concerning that proceeding or file, including appeals, shall be retained by the county to which the venue has been transferred.
(e) If a probate court judge is disqualified from matters concerning a proceeding or a file, and venue has not been transferred to another county, a special probate court judge appointed for that proceeding or file has all of the powers and duties appertaining to the probate court judge of the county where the proceeding or file commenced, and venue for any subsequent matters concerning that proceeding or file, including appeals, remains with the county where that proceeding or file commenced.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-304. South Carolina Rules of Civil Procedure govern formal proceedings.
The South Carolina Rules of Civil Procedure (SCRCP) adopted for the circuit court and other rules of procedure in this title govern formal proceedings pursuant to this title. A formal proceeding is a "civil action" as defined in Rule 2, SCRCP, and must be commenced as provided in Rule 3, SCRCP.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 2, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-305. Records and certified copies.
The court shall keep a record for each decedent, ward, protected person, or trust involved in any document which may be filed with the court under this Code, including petitions and applications, demands for notices or bonds, and of any orders or responses relating thereto by the probate court, and establish and maintain a system for indexing, filing, or recording which is sufficient to enable users of the records to obtain adequate information. Upon payment of the fees required by law, the clerk must issue certified copies of any probated wills, letters issued to personal representatives, or any other record or paper filed or recorded. Certificates relating to letters must show the date of appointment.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-306. Jury trials.
(a) If duly demanded, a party is entitled to trial by jury in any proceeding involving an issue of fact in an action for the recovery of money only or of specific real or personal property, unless waived as provided in the rules of civil procedure for the courts of this State. The right to trial by jury exists in, but is not limited to, formal proceedings in favor of the probate of a will or contesting the probate of a will.
(b) If there is no right to trial by jury under subsection (a) or the right is waived, the court in its discretion may call a jury to decide any issue of fact, in which case the verdict is advisory only.
(c) The method of drawing, summoning, and compensating jurors under this section shall be within the province of the county jury commission and shall be governed by Chapter 7, Title 14 of the 1976 Code relating to juries in circuit courts.
HISTORY: 1986 Act No. 539, § 1; 1988 Act No. 659, § 4; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-307. Probate judge; powers.
The acts and orders which this Code specifies as performable by the court may be performed either by the judge or by a person, including one or more clerks, designated by the judge by a written order filed and recorded in the office of the court.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-308. Appeals.
Except as provided in subsection (1), appeals from the probate court must be to the circuit court and are governed by the following rules:
(a) A person interested in a final order, sentence, or decree of a probate court may appeal to the circuit court in the same county, subject to the provisions of Section 62-1-303. The notice of intention to appeal to the circuit court must be filed in the office of the circuit court and in the office of the probate court and a copy served on all parties not in default within ten days after receipt of written notice of the appealed from order, sentence, or decree of the probate court.
(b) Within forty-five days after receipt of written notice of the order, sentence, or decree of the probate court, the appellant must file with the clerk of the circuit court a Statement of Issues on Appeal (in a format described in Rule 208(b)(1)(B), SCACR) with proof of service and a copy served on all parties.
(c) Where a transcript of the testimony and proceedings in the probate court was prepared, the appellant shall, within ten days after the date of service of the notice of intention to appeal, make satisfactory arrangements with the court or court reporter for furnishing the transcript. If the appellant has not received the transcript within forty-five days after receipt of written notice of the order, sentence, or decree of the probate court, the appellant may make a motion to the circuit court for an extension to serve and file the parties' briefs and Designations of Matter to be Included in the Record on Appeal, as provided in subsections (d) and (e).
(d) Within thirty days after service of the Statement of Issues on Appeal, all parties to the appeal shall serve on all other parties to the appeal a Designation of Matter to be Included in the Record on Appeal (in a format described in Rule 209, SCACR) and file with the clerk of the circuit court one copy of the Designation of Matter to be Included in the Record on Appeal with proof of service.
(e) At the same time the appellant serves his Designation of Matter to be Included in the Record on Appeal, the appellant shall serve one copy of his brief on all parties to the appeal, and file with the clerk of the circuit court one copy of the brief with proof of service. The appellant's brief shall be in a format described in Rule 208(b)(1), SCACR. Within thirty days after service of the appellant's brief, the respondent shall serve one copy of his brief on all parties to the appeal, and file with the clerk of the circuit court one copy of the brief with proof of service. The respondent's brief shall be in a format described in Rule 208(b)(2), SCACR. Appellant may file and serve a brief in reply to the brief of the respondent. If a reply brief is prepared, the appellant shall, within ten days after service of the respondent's brief, serve one copy of the reply brief on all parties to the appeal and file with the clerk of circuit court one copy of the reply brief with proof of service. The appellant's reply brief shall be in a format described in Rule 208(b)(3), SCACR.
(f) Within thirty days after service of the respondent's brief, the appellant shall serve a copy of the Record on Appeal (in a format described in subsections (c), (e), (f) and (g) of Rule 210, SCACR, except that the Record of Appeal need not comply with the requirements of Rule 267, SCACR) on each party who has served a brief and file with the clerk of the circuit court one copy of the Record on Appeal with proof of service.
(g) Except as provided in this section, no party is required to comply with any other requirements of the South Carolina Appellate Court Rules. Upon final disposition of the appeal, all exhibits filed separately (as described in Rule 210(f), SCACR), but not included in the Record on Appeal, must be forwarded to the probate court.
(h) When an appeal according to law is taken from any sentence or decree of the probate court, all proceedings in pursuance of the order, sentence, or decree appealed from shall cease until the judgment of the circuit court, court of appeals or Supreme Court is had. If the appellant, in writing, waives his appeal before the entry of the judgment, proceedings may be had in the probate court as if no appeal had been taken.
(i) The circuit court, court of appeals, or Supreme Court shall hear and determine the appeal according to the rules of law. The hearing must be strictly on appeal and no new evidence may be presented.
(j) The final decision and judgment in cases appealed, as provided in this code, shall be certified to the probate court by the circuit court, court of appeals, or Supreme Court, as the case may be, and the same proceedings shall be had in the probate court as though the decision had been made in the probate court. Within forty-five days after receipt of written notice of the final decision and judgment in cases appealed, the prevailing party shall provide a copy of such decision and judgment to the probate court.
(k) A judge of a probate court must not be admitted to have any voice in judging or determining an appeal from his decision or be permitted to act as attorney or counsel.
(l) If the parties not in default consent either in writing or on the record at a hearing in the probate court, a party to a final order, sentence, or decree of a probate court who considers himself injured by it may appeal directly to the Supreme Court, and the procedure for the appeal must be governed by the South Carolina Appellate Court Rules.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 9; 1997 Act No. 152, § 4; 1999 Act No. 55, § 56; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-309. Election and term of judges.
The judges of the probate court shall be elected by the qualified electors of the respective counties for the term of four years in the manner specified by Section 14-23-1020.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 4
Notice, Parties, and Representation in Estate Litigation and Other Matters
SECTION 62-1-401. Notice; method and time of giving.
(a) If notice of a hearing on a petition is required and, except for specific notice requirements as otherwise provided, the petitioner shall cause notice of the time and place of hearing of a petition to be given to any interested person or his attorney if he has appeared by attorney or requested that notice be sent to his attorney. Notice must be given:
(1) by mailing a copy of the notice at least twenty days before the time set for the hearing by certified, registered, or ordinary first class mail, or by a commercial delivery service that meets the requirements to be considered a designated delivery service in accordance with 26 U.S.C. Section 7502(f)(2) addressed to the person being notified at the post office address given in his demand for notice, if any, or at his office or place of residence, if known;
(2) by delivering a copy of the notice to the person being notified personally at least twenty days before the time set for the hearing; or
(3) if the address or identity of any person is not known and cannot be ascertained with reasonable diligence by publishing a copy of the notice in the same manner as required by law in the case of the publication of a summons for an absent defendant in the court of common pleas.
(b) The court for good cause shown may provide for a different method or time of giving notice for any hearing.
(c) Proof of the giving of notice shall be made on or before the hearing and filed in the proceeding.
(d) Notwithstanding a provision to the contrary, the notice provisions in this section do not, and are not intended to, constitute a summons that is required for a petition.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 3, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014; 2017 Act No. 87 (S.415), § 4, eff January 1, 2019.
SECTION 62-1-402. Notice; waiver.
A person, including a guardian ad litem, conservator, or other fiduciary, may waive notice by a writing signed by him or his attorney and filed in the proceeding.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-403. Pleadings; when parties bound by others; notice.
In formal proceedings involving trusts or estates of decedents, minors, protected persons, or incapacitated persons and in judicially supervised settlements the following apply:
(1) Interests to be affected must be described in pleadings that give reasonable information to owners by name or class by reference to the instrument creating the interests or in other appropriate manner.
(2) Persons are bound by orders binding others in the following cases:
(i) Orders binding the sole holder or all coholders of a power of revocation or a presently exercisable general power of appointment, including one in the form of a power of amendment, bind other persons to the extent their interests (as objects, takers in default, or otherwise) are subject to the power.
(ii) To the extent there is no conflict of interest between them or among persons represented, orders binding a conservator bind the person whose estate he controls; orders binding a guardian bind the ward if no conservator of his estate has been appointed; orders binding a trustee bind beneficiaries of the trust in proceedings to probate a will establishing or adding to a trust to review the acts or accounts of a prior fiduciary and in proceedings involving creditors or other third parties; and orders binding a personal representative bind persons interested in the undistributed assets of a decedent's estate in actions or proceedings by or against the estate. If there is no conflict of interest and no conservator or guardian has been appointed, a person may represent his minor or unborn issue.
(iii) A minor or unborn or unascertained person who is not otherwise represented is bound by an order to the extent his interest is adequately represented by another party having a substantially identical interest in the proceeding.
(3) Service of summons, petition, and notice is required as follows:
(i) Service of summons, petition, and notice must be given to every interested person or to one who can bind an interested person as described in (2)(i) or (2)(ii) above. Service of summons and petition upon, as well as notice, may be given both to a person and to another who may bind him.
(ii) Service upon and notice is given to unborn or unascertained persons who are not represented under (2)(i) or (2)(ii) above by giving notice to all known persons whose interests in the proceedings are substantially identical to those of the unborn or unascertained persons.
(4) At any point in a proceeding, a court may appoint a guardian ad litem to represent the interest of a minor, an incapacitated, unborn, or unascertained person, or a person whose identity or address is unknown, if the court determines that representation of the interest otherwise would be inadequate. If not precluded by conflict of interests, a guardian ad litem may be appointed to represent several persons or interests. The court shall set out its reasons for appointing a guardian ad litem as a part of the record of the proceeding.
HISTORY: 1986 Act No. 539, § 1; 1997 Act No. 152, § 5; 2010 Act No. 244, § 4, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 5
Uniform Simultaneous Death Act
SECTION 62-1-500. Short title.
This part may be cited as the "Uniform Simultaneous Death Act".
HISTORY: 1986 Act No. 539, § 1; 1976 Code § 62-1-501; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-501. Definitions.
For purposes of this part:
(1) "Co-owners with right of survivorship" includes joint tenants in a joint tenancy with right of survivorship, joint tenants in a tenancy in common with right of survivorship, tenants by the entireties, and other co-owners of property or accounts held under circumstances that entitle one or more to the whole of the property or account on the death of the other or others.
(2) "Governing instrument" means a deed, will, trust, insurance or annuity policy, account with POD designation, pension, profit-sharing, retirement, or similar benefit plan, instrument creating or exercising a power of appointment or a power of attorney, or a dispositive, appointive, or nominative instrument of any similar type.
(3) "Payor" means a trustee, insurer, business entity, employer, government, governmental agency, subdivision, or instrumentality, or any other person authorized or obligated by law or a governing instrument to make payments.
HISTORY: 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-502. Requirement of survival by 120 hours; individuals, two or more beneficiaries, class members.
(a) Except as otherwise provided by this Code, where the title to property, the devolution of property, the right to elect an interest in property, or any other right or benefit depends upon an individual's survivorship of the death of another individual, an individual who is not established by clear and convincing evidence to have survived the other individual by at least one hundred twenty hours is deemed to have predeceased the other individual.
(b) If the language of the governing instrument disposes of property in such a way that two or more beneficiaries are designated to take alternatively by reason of surviving each other and it is not established by clear and convincing evidence that any such beneficiary has survived any other beneficiary by at least one hundred twenty hours, the property shall be divided into as many equal shares as there are alternative beneficiaries, and these shares shall be distributed respectively to each such beneficiary's estate.
(c) If the language of the governing instrument disposes of property in such a way that it is to be distributed to the member or members of a class who survived an individual, each member of the class will be deemed to have survived that individual by at least one hundred twenty hours unless it is established by clear and convincing evidence that the individual survived the class member or members by at least one hundred twenty hours.
HISTORY: 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-503. Requirement of survival by 120 hours under governing instruments.
Except as otherwise provided by this Code, for purposes of a provision of a governing instrument that relates to an individual surviving an event, including the death of another individual, an individual who is not established by clear and convincing evidence to have survived the event by at least one hundred twenty hours is deemed to have predeceased the event.
HISTORY: 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-504. Co-owners with right of survivorship; requirement of survival by 120 hours.
Except as otherwise provided by this Code, if:
(a) it is not established by clear and convincing evidence that one of two co-owners with right of survivorship survived the other co-owner by at least one hundred twenty hours, one-half of the property passes as if one had survived by at least one hundred twenty hours and one-half as if the other had survived by at least one hundred twenty hours;
(b) there are more than two co-owners and it is not established by clear and convincing evidence that at least one of them survived the others by at least one hundred twenty hours, the property passes to the estates of each of the co-owners in the proportion that one bears to the whole number of co-owners.
HISTORY: 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-505. Right or benefit that depends on surviving the death of a decedent's killer.
Notwithstanding any other provisions of the Code, solely for the purpose of determining whether a decedent is entitled to any right or benefit that depends on surviving the death of a decedent's killer under Section 62-2-803, the killer is deemed to have predeceased the decedent, and the decedent is deemed to have survived the killer by at least one hundred twenty hours, or any greater survival period required of the decedent under the killer's will or other governing instrument, unless it is established by clear and convincing evidence that the killer survived the victim by at least one hundred twenty hours.
HISTORY: 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-506. Exceptions.
Survival by one hundred twenty hours is not required if any of the following apply:
(1) the governing instrument contains language dealing explicitly with simultaneous deaths or deaths in a common disaster and that language is operable under the facts of the case;
(2) the governing instrument expressly indicates that an individual is not required to survive an event, including the death of another individual, by any specified period or expressly requires the individual to survive the event for a specified period; but survival of the event or the specified period must be established by clear and convincing evidence;
(3) the imposition of a one hundred twenty hour requirement of survival would cause a nonvested property interest or a power of appointment to be invalid under other provisions of the Code; but survival must be established by clear and convincing evidence;
(4) the application of a one hundred and twenty hour requirement of survival to multiple governing instruments would result in an unintended failure or duplication of a disposition; but survival must be established by clear and convincing evidence;
(5) the application of a one hundred twenty hour requirement of survival would deprive an individual or the estate of an individual of an otherwise available tax exemption, deduction, exclusion, or credit, expressly including the marital deduction, resulting in the imposition of a tax upon a donor or a decedent's estate, other person, or their estate, as the transferor of any property. "Tax" includes any federal or state gift, estate or inheritance tax;
(6) the application of a one hundred twenty hour requirement of survival would result in an escheat.
HISTORY: 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-507. Evidence of death or status.
In addition to the South Carolina Rules of Evidence, the following rules relating to a determination of death and status apply:
(1) Death occurs when an individual is determined to be dead under the Uniform Determination of Death Act, Section 44-43-460.
(2) A certified or authenticated copy of a death certificate purporting to be issued by an official or agency of the place where the death purportedly occurred is prima facie proof of the fact, place, date and time of death, and the identity of the decedent.
(3) A certified or authenticated copy of any record or report of a governmental agency, domestic or foreign, that a person is missing, detained, dead, or alive is prima facie evidence of the status and of the dates, circumstances, and places disclosed by the record or report.
(4) In the absence of prima facie evidence of death under subsection (2) or (3), the fact of death may be established by clear and convincing evidence, including circumstantial evidence.
(5) A person whose death is not established under the preceding paragraphs who is absent for a continuous period of five years, during which he has not been heard from, and whose absence is not satisfactorily explained after diligent search or inquiry, is presumed to be dead. His death is presumed to have occurred at the end of the period unless there is sufficient evidence for determining that death occurred earlier.
(6) In the absence of evidence disputing the time of death stated on a document described in subsection (2) or (3), a document described in subsection (2) or (3) that states a time of death one hundred twenty hours or more after the time of death of another person, however the time of death of the other person is determined, establishes by clear and convincing evidence that the person survived the other person by one hundred twenty hours.
HISTORY: 1986 Act No. 539, § 1; Code 1976 § 62-1-107; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-508. Protection of payors, bona fide purchasers, and other third parties; personal liability of recipient.
(1) A payor or other third party is not liable for having made a payment or transferred an item of property or any other benefit to a person designated in a governing instrument who, under this part, is not entitled to the payment or item of property, or for having taken any other action in good faith reliance on the person's apparent entitlement under the terms of the governing instrument, before the payor or other third party received written notice of a claimed lack of entitlement under this part. A payor or other third party is liable for a payment made or other action taken after the payor or other third party received written notice of a claimed lack of entitlement under this part.
(2) Written notice of a claimed lack of entitlement under subsection (1) must be mailed to the payor's or other third party's main office or home by registered or certified mail, return receipt requested, or served upon the payor or other third party in the same manner as a summons in a civil action. Upon receipt of written notice of a claimed lack of entitlement under this part, a payor or other third party may pay any amount owed or transfer or deposit any item of property, other than tangible personal property, held by it to or with the court having jurisdiction of the probate proceedings relating to the decedent's estate, or if no proceedings have been commenced, to or with the court having jurisdiction of probate proceedings relating to decedents' estates located in the county of the decedent's residence. The court shall hold the funds or item of property and, upon its determination under this part, shall order disbursement in accordance with the determination. Payments, transfers, or deposits made to or with the court discharge the payor or other third party from all claims for the value of amounts paid to or items of property transferred to or deposited with the court.
(3) A person who purchases property for value and without notice, or who receives a payment or other item of property in partial or full satisfaction of a legally enforceable obligation, is not obligated under this part to return the payment, item of property, or benefit, and is not liable under this part for the amount of the payment or the value of the item of property or benefit. However, a person who, not for value, receives a payment, item of property, or any other benefit to which the person is not entitled under this part is obligated to return the payment, item of property, or benefit, or is personally liable for the amount of the payment or the value of the item of property or benefit, to the person who is entitled to it under this part.
HISTORY: 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-1-509. Construction.
This part [Sections 62-1-501 et seq.] shall be so construed and interpreted as to effectuate its general purpose to make uniform the law in those states which enact substantially identical laws.
HISTORY: 1986 Act No. 539, § 1; 1976 Code § 62-1-508; 2013 Act No. 100, § 1, eff January 1, 2014.TITLE 62. SOUTH CAROLINA PROBATE CODE
CHAPTER 2. Intestate Succession and Wills
Part 1
Intestate Succession
SECTION 62-2-101. Intestate estate.
Any part of the estate of a decedent not effectively disposed of by his will passes to his heirs as prescribed in the following sections of this Code.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-102. Share of the spouse.
The intestate share of the surviving spouse is:
(1) if there is no surviving issue of the decedent, the entire intestate estate;
(2) if there are surviving issue, one-half of the intestate estate.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-103. Share of heirs other than surviving spouse.
The part of the intestate estate not passing to the surviving spouse under Section 62-2-102, or the entire estate if there is no surviving spouse, passes as follows:
(1) to the issue of the decedent: if they are all of the same degree of kinship to the decedent they take equally, but if of unequal degree then those of more remote degree take by representation;
(2) if there is no surviving issue, to his parent or parents equally;
(3) if there is no surviving issue or parent, to the issue of the parents or either of them by representation;
(4) if there is no surviving issue, parent or issue of a parent, but the decedent is survived by one or more grandparents or issue of grandparents, half of the estate passes to the paternal grandparents if both survive, or to the surviving paternal grandparent, or to the issue of the paternal grandparents if both are deceased, the issue taking equally if they are all of the same degree of kinship to the decedent, but if of unequal degree those of more remote degree take by representation; and the other half passes to the maternal relatives in the same manner; but if there be no surviving grandparent or issue of grandparent on either the paternal or the maternal side, the entire estate passes to the relatives on the other side in the same manner as the half;
(5) if there is no surviving issue, parent or issue of a parent, grandparent or issue of a grandparent, but the decedent is survived by one or more great-grandparents or issue of great-grandparents, half of the estate passes to the surviving paternal great-grandparents in equal shares, or to the surviving paternal great-grandparent if only one survives, or to the issue of the paternal great-grandparents if none of the great-grandparents survive, the issue taking equally if they are all of the same degree of kinship to the decedent, but if of unequal degree those of more remote degree take by representation; and the other half passes to the maternal relatives in the same manner; but if there be no surviving great-grandparent or issue of a great-grandparent on either the paternal or the maternal side, the entire estate passes to the relatives on the other side in the same manner as the half.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 10; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-104. Requirement that individual survive decedent for one hundred twenty hours.
(1) For purposes of intestate succession, homestead allowance, and exempt property, and except as otherwise provided in subsection (2):
(a) an individual who was born before a decedent's death but who fails to survive the decedent by one hundred twenty hours is deemed to have predeceased the decedent. If it is not established that an individual who was born before the decedent's death survived the decedent by one hundred twenty hours, it is deemed that the individual failed to survive for the required period;
(b) an individual who was in gestation at a decedent's death is deemed to be living at the decedent's death if the individual lives one hundred twenty hours after birth. If it is not established that an individual who was in gestation at the decedent's death lived one hundred twenty hours after birth, it is deemed that the individual failed to survive for the required period.
(2) This section does not apply if it would result in a taking of the intestate estate by the state under Section 62-2-105.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 11; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-105. No taker.
If there is no taker under the provisions of this article [Sections 62-2-101 et seq.], the intestate estate passes to the State of South Carolina.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-106. Representation; disclaimer by intestate beneficiary.
If representation is called for by this Code, the estate is divided into as many equal shares as there are surviving heirs in the nearest degree of kinship and deceased persons in the same degree who left issue who survive the decedent, each surviving heir in the nearest degree receiving one share and the share of each deceased person in the same degree being divided among his issue in the same manner. If an interest created by intestate succession is disclaimed, the beneficiary is not treated as having predeceased the decedent for purposes of determining the generation at which the division of the estate is to be made.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 12; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-107. Kindred of half blood.
Relatives of the half blood inherit the same share they would inherit if they were of the whole blood.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 13; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-108. Afterborn heirs.
Issue of the decedent (but no other persons) conceived before his death but born within ten months thereafter inherit as if they had been born in the lifetime of the decedent.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 14; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-109. Meaning of child and related terms.
If, for purposes of intestate succession, a relationship of parent and child must be established to determine succession by, through, or from a person:
(1) From the date the final decree of adoption is entered, and except as otherwise provided in Section 63-9-1120, an adopted person is the child of an adopting parent and not of the natural parents except that adoption of a child by the spouse of a natural parent has no effect on the relationship between the child and that natural parent.
(2) In cases not covered by (1), a person born out of wedlock is a child of the mother. That person is also a child of the father if:
(i) the natural parents participated in a marriage ceremony before or after the birth of the child, even though the attempted marriage is void; or
(ii) the paternity is established by an adjudication commenced before the death of the father or within the later of eight months after the death of the father or six months after the initial appointment of a personal representative of his estate and, if after his death, by clear and convincing proof, except that the paternity established under this subitem (ii) is ineffective to qualify the father or his kindred to inherit from or through the child unless the father has openly treated the child as his and has not refused to support the child.
(3) A person is not the child of a parent whose parental rights have been terminated under Section 63-7-2580 of the 1976 Code, except that the termination of parental rights is ineffective to disqualify the child or its kindred to inherit from or through the parent.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 4; 1990 Act No. 521, § 15; 1997 Act No. 152, § 6; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-110. Advancements.
If a person dies intestate as to all his estate, property which he gave in his lifetime to an heir is treated as an advancement against the latter's share of the estate only if declared in a contemporaneous writing signed by the decedent or acknowledged in a writing signed by the heir to be an advancement. For this purpose, the property advanced is valued as of the time the heir came into possession or enjoyment of the property or as of the time of death of the decedent, whichever first occurs. If the recipient of the property fails to survive the decedent, the property shall be taken into account in computing the intestate share to be received by the recipient's issue, unless the declaration or acknowledgment provides otherwise.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-111. Debts to decedent.
A debt owed to the decedent is not charged against the intestate share of any person except the debtor. If the debtor fails to survive the decedent, the debt is not taken into account in computing the intestate share of the debtor's issue.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-112. Alienage.
No person is disqualified to take as an heir because he, or a person through whom he claims, is or has been an alien.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-113. Persons related to decedent through two lines.
A person who is related to the decedent through two lines of relationship is entitled to only a single share based on the relationship which would entitle him to the larger share.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-114. Limitation on parent's entitlement as intestate heirs to estate proceeds; failure to provide support for decedent during minority.
Notwithstanding any other provision of law, if the parents of the deceased would be the intestate heirs pursuant to Section 62-2-103(2), upon the service of a summons, petition and notice by either parent or any other party of potential interest based upon the decedent having died intestate, the probate court may deny or limit either or both parent's entitlement for a share of the proceeds if the court determines, by a preponderance of the evidence, that the parent or parents failed to reasonably provide support for the decedent as defined in Section 63-5-20 and did not otherwise provide for the needs of the decedent during his or her minority. If the court makes such a determination as to a parent or parents, the parent shall be a disqualified parent. The proceeds, or portion of the proceeds, that a disqualified parent would have taken shall pass as though the disqualified parent had predeceased the decedent.
HISTORY: 1996 Act No. 370, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 2
Elective Share of Surviving Spouse
SECTION 62-2-201. Right of elective share.
(a) If a married person domiciled in this State dies, the surviving spouse has a right of election to take an elective share of one-third of the decedent's probate estate, as computed under Section 62-2-202, the share to be satisfied as detailed in Sections 62-2-206 and 62-2-207 and, generally, under the limitations and conditions hereinafter stated.
(b) If a married person not domiciled in this State dies, the right, if any, of the surviving spouse to take an elective share in property in this State is governed by the law of the decedent's domicile at death.
(c) "Surviving spouse", as used in this Part, is as defined in Section 62-2-802.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 5; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-202. Probate estate.
(a) For purposes of this Part, probate estate means the decedent's property passing under the decedent's will plus the decedent's property passing by intestacy, reduced by funeral and administration expenses and enforceable claims.
(b) Except as provided in Section 62-7-401(c) with respect to a revocable inter vivos trust found to be illusory, the elective share shall apply only to the decedent's probate estate.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 6; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-203. Exercise of right of election by surviving spouse.
The right of election of the surviving spouse may be exercised only during his lifetime by him or by his duly appointed attorney in fact. In the case of a protected person, the right of election may be exercised only by order of the court in which protective proceedings as to his property are pending.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-204. Voluntary waiver of surviving spouse's right to elective share, homestead allowance, and exempt property; property settlement in anticipation of divorce.
(A) The rights of a surviving spouse to an elective share, homestead allowance, and exempt property, or any of them, may be waived, wholly or partially, before or after marriage, by a written contract, agreement, or waiver voluntarily signed by the waiving party after fair and reasonable disclosures to the waiving party of the other party's property and financial obligations have been given in writing.
(B) Unless it provides to the contrary, a waiver of all rights in the property or estate of a present or prospective spouse or a complete property settlement entered into after or in anticipation of separation or divorce is a waiver of all rights to elective share, homestead allowance, and exempt property by each spouse in the property of the other and a disclaimer by each of all benefits which would otherwise pass to him from the other by intestate succession or by virtue of the provisions of a will executed before the waiver or property settlement.
HISTORY: 1986 Act No. 539, § 1; 2008 Act No. 173, § 1, eff February 4, 2008, applicable to all waivers executed after that date; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-205. Proceedings for elective share; time limit.
(a) The surviving spouse may elect to take an elective share in the probate estate by filing in the court and serving upon the personal representative, if any, a summons and petition for the elective share within the later of (1) eight months after the date of death, (2) six months after the informal or formal probate of the decedent's will, or (3) thirty days after a surviving spouse is served with a summons and petition to set aside an informal probate or to modify or vacate an order for formal probate of decedent's will.
(b) The surviving spouse shall give notice of the time and place set for the hearing on the elective share claim to the personal representative and to distributees and recipients of portions of the probate estate whose interests will be adversely affected by the taking of the elective share.
(c) The surviving spouse may withdraw or reduce his demand for an elective share at any time before entry of a final determination by the court.
(d) After notice and hearing, the court shall determine the amount of the elective share and shall order its payment from the assets of the probate estate or by contribution as set out in Sections 62-2-206 and 62-2-207.
(e) The order or judgment of the court for payment or contribution may be enforced as necessary in other courts of this State or other jurisdictions.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 7; 2010 Act No. 244, § 5, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-206. Effect of election on benefits by will or statute.
A surviving spouse is entitled to benefits provided under or outside of the decedent's will, by any homestead allowance, by Section 62-2-401, whether or not he elects to take an elective share, but such amounts as pass under the will or by intestacy, by any homestead allowance, and by Section 62-2-401 are to be charged against the elective share pursuant to Section 62-2-207(a).
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 16; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-207. Charging spouse with gifts received; liability of others for balance of elective share.
(a) In the proceeding for an elective share, all property, including any beneficial interest, which passes or has passed to the surviving spouse, or would have passed to the surviving spouse, but was renounced or disclaimed, must be applied first to satisfy the elective share and to reduce any contributions due from other recipients of transfers included in the probate estate, so long as the property is passed to the surviving spouse:
(1) under the decedent's will;
(2) by intestacy;
(3) by a homestead allowance;
(4) by Section 62-2-401;
(5) by a beneficiary designation in life insurance policies;
(6) by a beneficiary designation of an Individual Retirement Account, qualified retirement plan, or annuity;
(7) in a trust created by the decedent's will; or
(8) in a revocable inter vivos trust created by the decedent.
(b) A beneficial interest that passes or has passed to a surviving spouse under the decedent's will includes:
(1) an interest as a beneficiary in a trust created by the decedent's will;
(2) an interest as a beneficiary in property passing under the decedent's will to an inter vivos trust created by the decedent; and
(3) an interest as a beneficiary in property contained at the decedent's death in a revocable inter vivos trust found to be illusory, as provided in Section 62-7-401(c).
(c)(1) For purposes of this provision, the value of the electing spouse's beneficial interest in property which qualifies for the federal estate tax marital deduction pursuant to Section 2056 of the Internal Revenue Code, as amended, or, if the federal estate tax is not applicable at the decedent's death, would have qualified for the federal estate tax marital deduction pursuant to Section 2056 of the Internal Revenue Code, as amended, in effect on December 31, 2009, must be computed at the full value of the qualifying property. Qualifying for these purposes must be determined without regard to whether an election has been made to treat the property as qualified terminable interest property.
(2) The value of this qualifying property shall be the value at the date of death as finally determined in the decedent's estate tax proceedings, or if there is no federal estate tax proceeding, as shown on the inventory and appraisement or as determined by the court. The personal representative must choose assets, in order of abatement pursuant to Section 62-3-902, to satisfy the elective share, using the fair market value at the date of distribution. The elective share is pecuniary in nature.
(3) The electing spouse who is the income beneficiary of a trust, the value of which is treated, or could be treated, as qualifying property, shall have the right to require a conversion of the income trust to a total return unitrust as defined in the South Carolina Uniform Principal and Income Act.
(d) In choosing assets to fund the elective share, remaining property of the probate estate is applied so that liability for the balance of the elective share of the surviving spouse is satisfied from the probate estate, with devises abating in accordance with Section 62-3-902.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 8; 1990 Act No. 521, § 17; 2010 Act No. 181, § 1, eff May 28, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 3
Spouse and Children Unprovided for in Wills
SECTION 62-2-301. Omitted spouse.
(a) If a testator fails to provide by will for his surviving spouse who married the testator after the execution of the will, the omitted spouse, upon compliance with the provisions of subsection (c), shall receive the same share of the estate he would have received if the decedent left no will unless:
(1) it appears from the will that the omission was intentional; or
(2) the testator provided for the spouse by transfer outside the will and the intent that the transfer be in lieu of a testamentary provision is shown by statements of the testator or from the amount of the transfer or other evidence.
(b) In satisfying a share provided by this section, the devises made by the will abate as provided in Section 62-3-902.
(c) The spouse may claim a share as provided by this section by filing in the court and serving upon the personal representative, if any, a summons and petition for such share within the later of (1) eight months after the date of death, (2) six months after the informal or formal probate of the decedent's will, or (3) thirty days after the omitted spouse is served with a summons and petition to set aside an informal probate or to modify or vacate an order for formal probate of decedent's will. The spouse shall give notice of the time and place set for the hearing on the omitted spouse claim to the personal representative and to distributees and recipients of portions of the probate estate whose interests will be adversely affected by the taking of the share.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 9; 1990 Act No. 521, § 18; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-302. Pretermitted children.
(a) If a testator fails to provide in his will for any of his children born or adopted after the execution of his will, the omitted child, upon compliance with subsection (d), receives a share in the estate equal in value to that which he would have received if the testator had died intestate unless:
(1) it appears from the will that the omission was intentional; or
(2) when the will was executed the testator devised substantially all his estate to his spouse; or
(3) the testator provided for the child by transfer outside the will and the intent that the transfer be in lieu of a testamentary provision is shown by statements of the testator or from the amount of the transfer or other evidence.
(b) If, at the time of execution of the will the testator fails to provide in his will for a living child solely because he believes that child to be dead, the child, upon compliance with subsection (d), receives a share in the estate equal in value to that which he would have received if the testator had died intestate.
(c) In satisfying a share provided by this section, the devises made by the will abate as provided in Section 62-3-902.
(d) The child, and his guardian or conservator acting for him, may claim a share as provided by this section by filing in the court and serving upon the personal representative, if any, a summons and petition for such share within the later of (1) eight months after the date of death, (2) six months after the informal or formal probate of the decedent's will, or (3) thirty days after the omitted child is served with a summons and petition to set aside an informal probate or to modify or vacate an order for formal probate of a decedent's will. The child, and his guardian or conservator acting for him, shall give notice of the time and place set for the hearing on the omitted child claim to the personal representative and to distributees and recipients of portions of the probate estate whose interests will be adversely affected by the taking of the share.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 10; 1990 Act No. 521, § 19; 1997 Act No. 152, § 7; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 4
Exempt Property
SECTION 62-2-401. Exempt property.
The surviving spouse of a decedent who was domiciled in this State is entitled from the estate to a value not exceeding twenty-five thousand dollars in excess of any security interests therein in household furniture, automobiles, furnishings, appliances, and personal effects. If there is no surviving spouse, minor or dependent children of the decedent are entitled jointly to the same value. If encumbered chattels are selected and if the value in excess of security interests, plus that of other exempt property, is less than twenty-five thousand dollars, or if there is not twenty-five thousand dollars worth of exempt property in the estate, the spouse or children are entitled to other assets of the estate, if any, to the extent necessary to make up the twenty-five thousand dollar value. Rights to exempt property and assets needed to make up a deficiency of exempt property have priority over all claims against the estate except claims described in Section 62-3-805(a)(1). These rights are in addition to any right of homestead and personal property exemption otherwise granted by law but are chargeable against and not in addition to any benefit or share passing to the surviving spouse or children by the will of the decedent unless otherwise provided, by intestate succession, or by the elective share. Any surviving spouse or minor or dependent children of the decedent who fails to survive the decedent by one hundred twenty hours is deemed to have predeceased the decedent for purposes of this section.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 20; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-402. Source, determination, and documentation.
(a) If the estate is otherwise sufficient, property specifically devised is not used to satisfy rights to exempt property. Subject to this restriction, the surviving spouse, the guardians or conservators of the minor children, or children who are adults may select property of the estate as exempt property. The personal representative may make these selections if the surviving spouse, the children, or the guardians or conservators of the minor children are unable or fail to do so within a reasonable time or if there are no guardians or conservators of the minor children. The personal representative may execute an instrument or deed of distribution to establish the ownership of property taken as exempt property. The personal representative or any interested person aggrieved by any selection, determination, payment, proposed payment, or failure to act under this section may make application to the court for appropriate relief.
(b) The surviving spouse or the minor or dependent child, and the minor's guardian or conservator acting for him, as the case may be, may claim a share of exempt property as provided in this part by filing in the court and mailing or delivering to the personal representative, if any, a claim for such share within eight months after the date of death, or within six months after the probate of the decedent's will, whichever limitation last expires.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 11; 1990 Act No. 521, § 21; 2010 Act No. 244, § 6, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-403. Federal veteran payments shall be exempt from creditors' claims.
All monies paid for insurance, compensation, or pensions by the United States of America to the executors, administrators, or heirs-at-law of any deceased veteran who served during any "period of war" as determined in reference to pension entitlement under 38 U.S.C. 1521, 1541 and 1542 and the regulations issued thereunder, and whose estate is administered in this State for insurance, compensation, or pensions is hereby declared to be exempt from the claims of any and all creditors of such deceased veteran.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 5
Wills
SECTION 62-2-501. Who may make a will.
An individual who is of sound mind and who is not a minor as defined in Section 62-1-201(27) may make a will.
HISTORY: 1986 Act No. 539, § 1; 1997 Act No. 152, § 8; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-502. Execution.
Except as provided for writings within Section 62-2-512 and wills within Section 62-2-505, every will shall be:
(1) in writing;
(2) signed by the testator or signed in the testator's name by some other individual in the testator's presence and by the testator's direction; and
(3) signed by at least two individuals each of whom witnessed either the signing or the testator's acknowledgment of the signature or of the will.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 22; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-503. Attestation and self-proving.
(a) Any will may be simultaneously executed, attested, and made self-proved. The self-proof shall be effective upon the acknowledgment by the testator and the affidavit of at least one witness, each made before an officer authorized to administer oaths under the laws of the state where execution occurs and evidenced by the officer's certificate, under official seal, in the following form or in a similar form showing the same intent:
I, __________, the testator, sign my name to this instrument this ___ day of __________, 20___, and being first duly sworn, do hereby declare to the undersigned authority that I sign and execute this instrument as my last will and that I sign it willingly (or willingly direct another to sign for me), that I execute it as my free and voluntary act for the purposes therein expressed, and that I am eighteen years of age or older (or if under the age of eighteen, am married or emancipated as decreed by a family court), of sound mind, and under no constraint or undue influence.
We, __________ and __________, the witnesses, sign our names to this instrument, and at least one of us, being first duly sworn, does hereby declare, generally and to the undersigned authority, that the testator signs and executes this instrument as his last will and that he signs it willingly (or willingly directs another to sign for him), and that each of us, in the presence and hearing of the testator, hereby signs this will as witness to the testator's signing, and that to the best of our knowledge the testator is eighteen years of age or older (or if under the age of eighteen, was married or emancipated as decreed by a family court), of sound mind, and under no constraint or undue influence.
(b) An attested will may at any time subsequent to its execution be made self-proved by the acknowledgment thereof by the testator and the affidavit of at least one witness, each made before an officer authorized to administer oaths under the laws of the state where the acknowledgment occurs and evidenced by the officer's certificate, under the official seal, attached, or annexed to the will in the following form or in a similar form showing the same intent:
The State of __________ County of __________ We, __________ and __________, the testator and at least one of the witnesses, respectively, whose names are signed to the attached or foregoing instrument, being first duly sworn, do hereby declare to the undersigned authority that the testator signed and executed the instrument as his last will and that he had signed willingly (or willingly directed another to sign for him), and that he executed it as his free and voluntary act for the purposes therein expressed, and that each of the witnesses, in the presence and hearing of the testator, signed the will as witness and to the best of his knowledge the testator was at that time eighteen years of age or older (or if under the age of eighteen, was married or emancipated as decreed by a family court), of sound mind, and under no constraint or undue influence.
(c) A witness to any will who is also an officer authorized to administer oaths under the laws of this State may notarize the signature of the other witness of the will in the manner provided by this section.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 12; 1988 Act No. 659, § 15; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-504. Subscribing witnesses not incompetent because of interest; effect on gifts to them.
(a) A subscribing witness to any will is not incompetent to attest or prove the same by reason of any devise therein in favor of the witness, the witness's spouse, or the witness's issue. If there are two disinterested witnesses to a will in addition to the interested witness, then the devise is valid and effectual, if otherwise effective. If there are not two disinterested witnesses to a will in addition to an interested witness, then the devise is null and void to the extent of the value of the excess property, estate, or interest so devised over the value of the property, estate or interest to which the witness, the witness's spouse, or the witness' issue would be entitled upon the failure to establish the will. The voided portion of the devise shall pass by intestacy in accordance with Section 62-2-101 et seq., provided the share of the interested witness, the witness's spouse, or the witness' issue shall not increase due to the devise passing by intestacy.
(b) A subscribing witness to any will is not incompetent to attest or prove the will by reason of any appointment within the will of the witness, the witness's spouse, or the witness's issue to any office, trust, or duty. The appointment of a witness, a witness's spouse, or a witness's issue is valid, if otherwise so, and the individual so appointed, in such case, is entitled by law to take or receive any commissions or other compensation on account thereof.
(c) A subscribing witness to any will is not incompetent to attest or prove the will by reason of any charge within the will of debts to any part of the estate in favor of the witness, the witness's spouse, or the witness's issue as creditor.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 23; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-505. Choice of law as to execution.
A written will is valid if:
(a) it is executed in compliance with Section 62-2-502 either at the time of execution or at the date of the testator's death; or
(b) if its execution complies with the law at the time of execution of either (1) the place where the will is executed, or (2) the place where the testator is domiciled at the time of execution or at the time of death.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 13; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-506. Revocation by writing or by act.
(a) A will or any part thereof is revoked:
(1) by executing a subsequent will that revokes the previous will or part expressly or by inconsistency; or
(2) by being burned, torn, canceled, obliterated, or destroyed, with the intent and for the purpose of revoking it by the testator or by another person in the testator's presence and by the testator's direction.
(b) If a subsequent will does not expressly revoke a previous will, the execution of the subsequent will wholly revokes the previous will by inconsistency if the testator intended the subsequent will to replace rather than supplement the previous will.
(1) The testator is presumed to have intended a subsequent will to replace rather than to supplement a previous will if the subsequent will makes a complete disposition of the testator's estate. If this presumption arises and is not rebutted by clear and convincing evidence, the previous will is revoked and only the subsequent will is operative on the testator's death.
(2) The testator is presumed to have intended a subsequent will to supplement rather than replace a previous will if the subsequent will does not make a complete disposition of the testator's estate. If this presumption arises and is not rebutted by clear and convincing evidence, the subsequent will revokes the previous will only to the extent the subsequent will is inconsistent with the previous will and each will is fully operative on the testator's death to the extent they are not inconsistent.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-507. Revocation by divorce, annulment, and order terminating marital property rights; no revocation by other changes of circumstances.
(a) In this section:
(1) "Disposition or appointment of property" includes a transfer of an item of property or any other benefit to a beneficiary designated in a governing instrument.
(2) "Divorce or annulment" means any divorce or annulment or declaration of invalidity of a marriage or other event that would exclude the spouse as a surviving spouse in accordance with Section 62-2-802. It also includes a court order purporting to terminate all marital property rights or confirming equitable distribution between spouses unless they are living together as husband and wife at the time of the decedent's death. A decree of separate maintenance that does not terminate the status of husband and wife is not a divorce for purposes of this section.
(3) "Divorced individual" includes an individual whose marriage has been annulled.
(4) "Governing instrument" means an instrument executed by the divorced individual before the divorce or annulment of the individual's marriage to the individual's former spouse including, but not limited to wills, revocable inter vivos trusts, powers of attorney, life insurance beneficiary designations, annuity beneficiary designations, retirement plan beneficiary designations and transfer on death accounts. "Governing instrument" does not include a beneficiary designation made in connection with a governmental employee benefit plan established or maintained for employees of the government of the State or a political subdivision thereof, or by an agency or instrumentality of any of the foregoing.
(5) "Revocable" with respect to a disposition, appointment, provision, or nomination, means one under which the divorced individual, at the time of the divorce or annulment, was alone empowered, by law or under the governing instrument, to cancel the designation in favor of the divorced individual's former spouse, whether or not the divorced individual was then empowered to designate the divorced individual in place of the divorced individual's former spouse and whether or not the divorced individual then had the capacity to exercise the power.
(b) No change of circumstances other than those described in this section and in Section 62-2-803 effects a revocation.
(c) Except as provided by the express terms of a governing instrument, a court order, or a contract relating to the division of the marital estate made between the divorced individuals before or after the marriage, divorce or annulment, the divorce or annulment of a marriage:
(1) revokes any revocable:
(i) disposition or appointment of property or beneficiary designation made by a divorced individual to the divorced individual's former spouse in a governing instrument;
(ii) provision in a governing instrument conferring a general or nongeneral power of appointment on the divorced individual's former spouse; or
(iii) nomination in a governing instrument, nominating a divorced individual's former spouse to serve in any fiduciary or representative capacity, including a personal representative, trustee, conservator, agent, attorney in fact or guardian;
(2) severs the interests of the former spouses in property held by them at the time of the divorce or annulment as joint tenants with the right of survivorship so that the share of the decedent passes as the decedent's property and the former spouse has no rights by survivorship. This provision applies to joint tenancies in real and personal property, joint and multiple-party accounts in banks, savings and loan associations, credit unions, and other institutions, and any other form of co-ownership with survivorship incidents.
(d) A severance under subsection (c)(2) does not affect any third-party interest in property acquired for value and in good faith reliance on an apparent title by survivorship in the survivor of the former spouses unless a writing declaring the severance has been noted, registered, filed, or recorded in records appropriate to the kind and location of the property which are relied upon, in the ordinary course of transactions involving the property, as evidence of ownership.
(e) Provisions of a governing instrument and nomination in a fiduciary or representative capacity that are revoked by this section are given effect as if the former spouse predeceased the decedent.
(f) Provisions revoked solely by this section are revived by the divorced individual's remarriage to the former spouse or by a nullification of the divorce or annulment.
(g)(1) A payor or other third party is not liable for having made a payment or transferred an item of property or any other benefit to a beneficiary designated in a governing instrument affected by a divorce, annulment, or remarriage, or for having taken any other action in good faith reliance on the validity of the governing instrument, before the payor or other third party received written notice of the divorce, annulment, or remarriage. A payor or other third party is liable for a payment made or other action taken after the payor or other third party received written notice of a claimed forfeiture or revocation under this section.
(2) Written notice of the divorce, annulment, or remarriage under subsection (g)(1) must be mailed to the payor's or other third party's main office or home by registered or certified mail, return receipt requested, or served upon the payor or other third party in the same manner as a summons in a civil action. Upon receipt of written notice of the divorce, annulment, or remarriage, a payor or other third party may pay any amount owed or transfer or deposit any item of property held by it to or with the court having jurisdiction. The court shall hold the funds or item of property and, upon its determination under this section, shall order disbursement or transfer in accordance with the determination. Payments, transfers, or deposits made to or with the court discharge the payor or other third party from all claims for the value of amounts paid to or items of property transferred to or deposited with the court.
(h)(1) A person who purchases property from a former spouse or any other person for value and without notice, or who receives from a former spouse or any other person a payment or other item of property in partial or full satisfaction of a legally enforceable obligation, is neither obligated under this section to return the payment, item of property, or benefit nor is liable under this section for the amount of the payment or the value of the item of property or benefit. However, a person who, not for value, receives a payment, item of property, or any other benefit to which that person is not entitled under this section is obligated to return the payment, item of property, or benefit, or is personally liable for the amount of the payment or the value of the item of property or benefit, to the person who is entitled to it under this section.
(2) If this section or any part of this section is preempted by federal law with respect to a payment, an item of property, or any other benefit covered by this section, a person who, not for value, receives a payment, item of property, or any other benefit to which that person is not entitled under this section is obligated to return that payment, item of property, or benefit, or is personally liable for the amount of the payment or the value of the item of property or benefit, to the person who would have been entitled to it were this section or part of this section not preempted.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 24; 2013 Act No. 100, § 1, eff January 1, 2014; 2018 Act No. 250 (H.4673), § 1, eff May 18, 2018.
SECTION 62-2-508. Revival of revoked will.
(a) If a subsequent will that wholly revoked a previous will is thereafter revoked by a revocatory act under Section 62-2-506(a)(2) the previous will remains revoked unless it is revived. The previous will is revived if it appears by clear and convincing evidence that the testator intended to revive or make effective the previous will.
(b) If a subsequent will that partly revoked a previous will is thereafter revoked by a revocatory act under Section 62-2-506(a)(2), a revoked part of the previous will is revived unless it appears by clear and convincing evidence that the testator did not intend the revoked part to take effect as executed.
(c) If a subsequent will that revoked a previous will in whole or in part is thereafter revoked by another, later will, the previous will remains revoked in whole or in part, unless it or its revoked part is revived. The previous will or its revoked part is revived to the extent it appears from the terms of the later will that the testator intended the previous will to take effect.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-509. Incorporation by reference.
Any writing in existence when a will is executed may be incorporated by reference if the language of the will manifests this intent and describes the writing sufficiently to permit its identification.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-510. Additions to trusts.
(A) A devise made by a will to the trustee of a trust to a trust is valid so long as:
(1) the trust is identified in the testator's will and its terms are set forth in:
(a) a written instrument (other than a will) executed before, concurrently with, or after the execution of the testator's will but not later than the testator's death; or
(b) in the valid last will of another individual who has predeceased the testator;
(B) The trust is not required to have a trust corpus other than the expectancy of receiving the testator's devise.
(C) The devise is not invalid because the trust is amendable or revocable, or because the trust was amended after the execution of the will or after the death of the testator.
(D) Unless the testator's will provides otherwise, the property so devised:
(1) is not deemed to be held under a testamentary trust of the testator but becomes a part of the trust to which it is given; and
(2) shall be administered and disposed of in accordance with the provisions of the instrument or will setting forth the terms of the trust, including any amendments thereto made before or after the death of the testator.
(E) Unless the testator's will provides otherwise, a revocation or termination of the trust before the death of the testator causes the devise to lapse.
(F) Death benefits of any kind, including but not limited to proceeds of life insurance policies and payments under an employees' trust, or contract of insurance purchased by such a trust, forming part of a pension, stock-bonus or profit-sharing plan, or under a retirement annuity contract, may be paid to the trustee of a trust established by the insured, employee, or annuitant or by some other person if the trust is in existence at the death of the insured, employee, or annuitant, it is identified and its terms are set forth in a written instrument, and such death benefits shall be administered and disposed of in accordance with the provisions of the instrument setting forth the terms of the trust including any amendments made thereto before the death of the insured, employee, or annuitant and, if the instrument so provides, including any amendments to the trust made after the death of the insured, employee, or annuitant. It shall not be necessary to the validity of any such trust instrument, whether revocable or irrevocable, that it have a trust corpus other than the right of the trustee to receive such death benefits.
(G) Death benefits of any kind, including but not limited to proceeds of life insurance policies and payments under an employees' trust, or contract of insurance purchased by such a trust, forming part of a pension, stock-bonus, or profit-sharing plan, or under a retirement annuity contract, may be paid to a trustee named, or to be named, in a will which is admitted to probate as the last will of the insured or the owner of the policy, or the employee covered by such plan or contract, as the case may be, whether or not such will is in existence at the time of such designation. Upon the admission of such will to probate, and the payment thereof to the trustee, such death benefits shall be administered and disposed of in accordance with the provisions of the testamentary trust created by the will as they exist at the time of the death of the testator. Such payments shall be deemed to pass directly to the trustee of the testamentary trust and shall not be deemed to have passed to or be receivable by the executor of the estate of the insured, employee, or annuitant.
(H) In the event no trustee makes proper claim to the proceeds payable as provided in subsections (F) and (G) of this section from the insurance company or the obligor within a period of one year after the date of the death of the insured, employee, or annuitant, or if satisfactory evidence is furnished to the insurance company or other obligor within such one year period that there is or will be no trustee to receive the proceeds, payment must be made by the executors or administrators of the person making such designations, unless otherwise provided by agreement.
(I) Death benefits payable as provided in subsections (F) and (G) of this section shall not be subject to the debts of the insured, employee, or annuitant nor to transfer or estate taxes to any greater extent than if such proceeds were payable to the beneficiary of such trust and not to the estate of the insured, employee, or annuitant.
(J) Such death benefits payable as provided in subsections (F) and (G) of this section so held in trust may be commingled with any other assets which may properly come into such trust.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-511. Events of independent significance.
A will may dispose of property by reference to acts and events that have significance apart from their effect upon the dispositions made by the will, whether they occur before or after the execution of the will or before or after the testator's death. The execution or revocation of a will of another person is such an event.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-512. Separate writing identifying bequest of tangible property.
A will may refer to a written statement or list to dispose of items of tangible personal property not otherwise specifically disposed of by the will, other than money and property used in trade or business. To be admissible under this section as evidence of the intended disposition, the writing must either be in the handwriting of the testator or be signed by the testator and must describe the items and the devisees with reasonable certainty. The writing may be referred to as one to be in existence at the time of the testator's death; it may be prepared before or after the execution of the will; it may be altered by the testator after its preparation; and it may be a writing that has no significance apart from its effect upon the dispositions made by the will.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 25; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 6
Construction
SECTION 62-2-601. Rules of construction and intention; reformation of will.
(A) The intention of a testator as expressed in the testator's will controls the legal effect of the testator's dispositions. The rules of construction expressed in the succeeding sections of this part apply unless a contrary intention is indicated by the will.
(B) Notwithstanding subsection (A), the court may reform the terms of the will, even if unambiguous, to conform the terms to the testator's intention if it is proved by clear and convincing evidence that the testator's intent and the terms of the will were affected by a mistake of fact or law, whether in expression or inducement.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-602. Construction that will passes all property; after-acquired property.
A will is construed to pass all property which the testator owns at the testator's death including property acquired after the execution of the will and all property acquired by the testator's estate after the testator's death.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-603. Anti-lapse; deceased devisee; class gifts.
(A) Unless a contrary intent appears in the will, if a devisee, who is a great-grandparent or a lineal descendant of a great-grandparent of the testator is dead at the time of execution of the will, fails to survive the testator, or is treated as if he predeceased the testator, the issue of the deceased devisee who survive the testator take in place of the deceased devisee and if they are all of the same degree of kinship to the devisee they take equally, but if of unequal degree than those of more remote degree take by representation.
(B) One who would have been a devisee under a class gift if he had survived the testator is treated as a devisee for purposes of this section whether his death occurred before or after the execution of the will.
(C) Words of survivorship in a devise to an individual, such as, "if he survives me," or to "my surviving children," are, in the absence of additional evidence, a sufficient indication of an intent contrary to the application of subsections (A) and (B).
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-604. Failure of testamentary provision.
(A) Except as provided in Section 62-2-603, if a devise other than a residuary devise fails for any reason it becomes a part of the residue.
(B) Except as provided in Section 62-2-603 if the residue is devised to two or more persons, the share of the residuary devisees that fails for any reason passes to the other residuary devisee, or to other residuary devisees in proportion to their interests in the residue.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-605. Change in securities; accessions; nonademption.
(A) If the testator intended a specific devise of certain securities rather than the equivalent value thereof, the specific devisee is entitled only to:
(1) as much of the devised securities as is a part of the testator's estate at the time of the testator's death;
(2) any additional or other securities of the same organization owned by the testator by reason of action initiated by the organization or any successor, related or acquiring organization excluding any acquired by exercise of purchase options;
(3) securities of another organization owned by the testator as a result of a merger, consolidation, reorganization, or other similar action initiated by the organization or any successor, related or acquiring organization;
(4) any additional securities of the organization owned by the testator as a result of a plan of reinvestment in the organization.
(B) Distributions in cash declared prior to death with respect to a specifically devised security not provided for in subsection (A) are not part of the specific devise.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 26; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-606. Nonademption of specific devises in certain cases; unpaid proceeds of sale, condemnation, or insurance; sale by conservator.
(a) A specific devisee has the right to the specifically devised property in the testator's estate at the testator's death and to:
(1) any balance of the purchase price (together with any mortgage or other security interest) owed by a purchaser to the testator at the testator's death by reason of sale of the property;
(2) any amount of a condemnation award for the taking of the property unpaid at the testator's death;
(3) any proceeds unpaid at the testator's death on fire or casualty insurance or on other recovery for injury to the property;
(4) any property owned by the testator at death and acquired as a result of foreclosure, or obtained in lieu of foreclosure, of the security for a specifically devised obligation.
(b) If specifically devised property is sold or mortgaged by a conservator or by an agent acting within the authority of a durable power of attorney for an incapacitated principal, or a condemnation award or insurance proceeds or recovery for injury to the property is paid to a conservator or to an agent acting within the authority of a durable power of attorney for an incapacitated principal, the specific devisee has the right to a general pecuniary devise equal to the net sale price, the amount of the unpaid loan, the condemnation award, the insurance proceeds, or the recovery.
(c) The right of the specific devisee under subsection (b) is reduced by the value of any right he has under subsection (a).
(d) For purposes of references in subsection (b) to a conservator, subsection (b) does not apply if after the sale, mortgage, condemnation, casualty or recovery, it was adjudicated that the testator's disability ceased and the testator survived the adjudication for at least one year.
(e) For purposes of references in subsection (b) to an agent acting within the authority of a durable power of attorney for an incapacitated principal, (i) "incapacitated principal" means a principal who is an incapacitated person, (ii) no adjudication of incapacity before death is necessary, and (iii) the acts of an agent within the authority of a durable power of attorney are presumed to be for an incapacitated principal.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-607. Nonexoneration.
A specific devise passes subject to any mortgage, pledge, security interest or other lien existing at the date of death, without right of exoneration, regardless of a general directive in the will to pay debts.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 27; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-608. Exercise of power of appointment.
A general residuary clause in a will, or a will making general disposition of all of the testator's property, does not exercise a power of appointment held by the testator unless specific reference is made to the power or there is some other indication of intention to include the property subject to the power.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-609. Construction of generic terms to accord with relationships as defined for intestate succession.
Half bloods, adopted persons, and persons born out of wedlock are included in class gift terminology and terms of relationship in accordance with rules for determining relationships for purposes of intestate succession, but a person born out of wedlock is not treated as the child of the father unless the person is openly and notoriously so treated by the father.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-610. Ademption by satisfaction.
(a) Property which a testator gave in the testator's lifetime to a person is treated as a satisfaction of a devise to that person in whole or in part, only if:
(i) the will provides for deduction of the lifetime gift;
(ii) the testator declared in a contemporaneous writing that the gift is to be deducted from the devise; or
(iii) the devisee acknowledged in writing that the gift is in satisfaction of the devise or that its value is to be deducted from the value of the devise.
(b) For purpose of partial satisfaction, property given during lifetime is valued as of the time the devisee came into possession or enjoyment of the property or at the testator's death, whichever occurs first.
(c) If the devisee fails to survive the testator, the gift is treated as a full or partial satisfaction of the devise, as appropriate, in applying Sections 62-2-603 and 62-2-604, unless the testator's contemporaneous writing provides otherwise.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-611. Construction that devise passes fee simple.
A devise of land is construed to pass an estate in fee simple, regardless of the absence of words of limitation in the devise.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-612. Proceeding to determine decedent's intent regarding application of certain federal tax formulas.
The personal representative, trustee, or any affected beneficiary under a will, trust, or other instrument of a decedent who dies or did die after December 31, 2009, and before January 1, 2011, may bring a proceeding to determine the decedent's intent when the will, trust, or other instrument contains a formula that is based on the federal estate tax or generation-skipping tax.
HISTORY: 2010 Act No. 251, § 1, eff June 11, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 7
Contractual Arrangements Relating to Death
SECTION 62-2-701. Contracts concerning succession.
A contract to make a will or devise, or to revoke a will or devise, or not to revoke a will or devise, or to die intestate, if executed after the effective date of this act, can be established only by (1) provisions of a will of the decedent stating material provisions of the contract; (2) an express reference in a will of the decedent to a contract and extrinsic evidence proving the terms of the contract; or (3) a writing signed by the decedent evidencing the contract and extrinsic evidence proving the terms of the contract. The execution of a joint will or mutual wills does not create a presumption of a contract not to revoke the will or wills.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 28; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 8
General Provisions
SECTION 62-2-801. Disclaimer.
(a) This section applies to disclaimers of any interest in or power over property, whenever created, and, in addition to other methods, is the means by which a disclaimer may be made under the laws of this State.
(b) For purpose of this section:
(1) "Disclaimer" means any writing which disclaims, renounces, declines, or refuses an interest in or power over property.
(2) "Disclaimant" means the person to whom a disclaimed interest or power would have passed had the disclaimer not been made.
(3) "Disclaimed interest" means the interest that would have passed to the disclaimant had the disclaimer not been made.
(4) "Fiduciary" means a personal representative, trustee, agent acting under a power of attorney, guardian, conservator, or other person authorized to act as a fiduciary with respect to the property of another person.
(c)(1) A person may disclaim, in whole or in part, any interest in or power over property, including a power of appointment.
(2) Unless barred, a disclaimer must be made within a reasonable time after the disclaimant acquires actual knowledge of the interest. A disclaimer is conclusively presumed to have been made within a reasonable time if made within nine months after the date of effectiveness of the transfer as determined under subsection (d)(3).
(3) To be effective, a disclaimer must be:
(i) in writing;
(ii) declare the writing as a disclaimer;
(iii) describe the interest or power disclaimed; and
(iv) be delivered to the transferor of the interest, the transferor's fiduciary, the holder of the legal title to or the person in possession of the property to which the interest relates, or a court that would have jurisdiction over such interest or subject matter. A disclaimer of a power must be delivered as if the power disclaimed were an interest in property. Delivery of a disclaimer may be made by personal delivery, first-class mail, or any other method that results in its receipt. A disclaimer sent by first-class mail shall be deemed to have been delivered on the date it is postmarked.
(4) A disclaimer is not a transfer, assignment, or release if made within a reasonable time after the disclaimant acquires actual knowledge of the interest and if not otherwise barred.
(5) A barred disclaimer is ineffective as a disclaimer under this section. A disclaimer is barred by any of the following conditions occurring before the disclaimer becomes effective:
(i) the disclaimant waived in writing the right to disclaim;
(ii) the disclaimant accepted the interest sought to be disclaimed;
(iii) the disclaimant voluntarily assigned, conveyed, encumbered, pledged, transferred, or directed the interest sought to be disclaimed or has contracted to do so; or
(iv) a judicial sale of the interest sought to be disclaimed has occurred.
(6) A disclaimer is not barred by a spendthrift provision or similar restriction on transfer or the right to disclaim imposed by the creator of the interest in or power over the property.
(7) A disclaimer is not barred by a disclaimant's financial condition, whether or not insolvent, and a disclaimer that complies with this section is not a fraudulent transfer under the laws of this State.
(8) A disclaimer, in whole or in part, of the future exercise of a power held in a fiduciary capacity is not barred by its previous exercise.
(9) A disclaimer, in whole or in part, of the future exercise of a power not held in a fiduciary capacity is not barred unless the power is exercisable in favor of a disclaimant.
(10) Unless a disclaimer is barred, a disclaimer treated as a qualified disclaimer pursuant to Internal Revenue Code Section 2518 is effective as a disclaimer under this section.
(d)(1) If a disclaimant makes a disclaimer with respect to any transferor's transfer (including transfers by any means whatsoever, lifetime and testamentary, voluntary and by operation of law, initial and successive, by grant, gift, trust, contract, intestacy, wrongful death, elective share, forced share, homestead allowance, exempt property, devise, bequest, beneficiary designation, survivorship provision, exercise and nonexercise of a power, and otherwise) to the disclaimant of any interest in, including any power with respect to, property, or any undivided portion thereof, the interest, or such portion, is considered never to have been transferred to the disclaimant.
(2) Unless the transferor has provided otherwise in the event of a disclaimer, the disclaimed interest shall be transferred (or fail to be transferred), as if the disclaimant had predeceased the date of effectiveness of the transfer of the interest. The disclaimer shall relate back to that date of effectiveness for all purposes, and any future interest which is provided to take effect in possession or enjoyment after the termination of the disclaimed interest shall take effect as if the disclaimant had predeceased the date on which he or she as the taker of the disclaimed interest became finally ascertained and the disclaimed interest became indefeasibly vested. Provided, that an interest disclaimed by a disclaimant who is the spouse of a decedent, the transferor of the interest, may pass by any further process of transfer to such spouse, notwithstanding the treatment of the transfer of the disclaimed interest as if the disclaimant had predeceased.
(3) The date of effectiveness of the transfer of the disclaimed interest is (i) as to transfers by intestacy, wrongful death, elective share, forced share, homestead allowance, exempt property allowance, and devise and bequest, the date of death of the decedent transferor, or that of the donee of a testamentary power of appointment (whether exercised or not exercised) with respect to, the interest, as the case may be, and (ii) as to all other transfers, the date of effectiveness of the instrument, contract, or act of transfer.
(e)(1) If and to the extent an instrument creates a fiduciary relationship and expressly grants the fiduciary the right to disclaim, the fiduciary may disclaim, in whole or in part, any interest in or power over property, including a power of appointment. If there is no instrument expressly granting the fiduciary the right to disclaim, the fiduciary's right to disclaim shall be determined by the laws of this State applicable to that fiduciary relationship.
(2) If a trustee disclaims an interest in property that otherwise would have become trust property, the disclaimed interest does not become trust property.
(3) A fiduciary may disclaim a power held in a fiduciary capacity. If the power has not been previously exercised, the disclaimer takes effect as of the time the instrument creating the power became irrevocable. If the power has been previously exercised, the disclaimer takes effect immediately after the last exercise of the power. The disclaimer of a fiduciary power may be made binding on any successor fiduciary if the disclaimer so provides.
(4) If no conservator or guardian has been appointed, a parent may disclaim on behalf of that parent's minor child and unborn issue, in whole or in part, any interest in or power over property which the minor child or unborn issue is to receive as a result of another disclaimer, but only if the disclaimed interest or power does not pass outright to that parent as a result of the disclaimer.
(f) A fiduciary or other person having custody of the disclaimed interest is not liable for any otherwise proper distribution or other disposition made without actual notice of the disclaimer or, if the disclaimer is barred pursuant to subsection (c)(5), for any otherwise proper distribution or other disposition made in reliance on the disclaimer, if the distribution or disposition is made without actual knowledge of the facts constituting the bar of the right to disclaim.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 70 § 7; 1990 Act No. 521, § 29; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-802. Effect of divorce, annulment, decree of separate maintenance, or order terminating marital property rights.
(a) An individual who is divorced from the decedent or whose marriage to the decedent has been annulled is not a surviving spouse unless, by virtue of a subsequent marriage, the individual is married to the decedent at the time of death. A decree of separate maintenance that does not terminate the status of husband and wife is not a divorce for purposes of this section.
(b) For purposes of Parts 1, 2, 3, and 4 of Article 2 [Sections 62-2-101 et seq., 62-2-201 et seq., 62-2-301 et seq., and 62-2-401 et seq.] and of Section 62-3-203, a surviving spouse does not include:
(1) an individual who obtains or consents to a final decree or judgment of divorce from the decedent or an annulment of their marriage, which decree or judgment is not recognized as valid in this State, unless they subsequently participate in a marriage ceremony purporting to marry each to the other, or live together as husband and wife at the time of the decedent's death;
(2) an individual who, following an invalid decree or judgment of divorce or annulment obtained by the decedent, participates in a marriage ceremony with a third person;
(3) an individual who was a party to a valid proceeding concluded by an order purporting to terminate all marital property rights or confirming equitable distribution between spouses unless they are living together as husband and wife at the time of the decedent's death; or
(4) an individual claiming to be a common law spouse who has not been established to be a common law spouse by an adjudication commenced before the death of the decedent or within the later of eight months after the death of the decedent or six months after the initial appointment of a personal representative; if the action is commenced after the death of the decedent, proof must be by clear and convincing evidence.
(c) A divorce or annulment is not final until signed by the court and filed in the office of the clerk of court.
HISTORY: 1986 Act No. 539, § 1; 1997 Act No. 152, § 9; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-803. Effect of homicide on intestate succession, wills, joint assets, life insurance, and beneficiary designations.
(a) An individual who feloniously and intentionally kills the decedent is not entitled to any benefits under the decedent's will, trust of which the decedent is a grantor or under this article with respect to the decedent's estate, including, but not limited to, an intestate share, an elective share, an omitted spouse's share or child's share, a homestead allowance, and exempt property, and the estate of the decedent passes as if the killer had predeceased the decedent. Property appointed by the will of the decedent to or for the benefit of the killer passes as if the killer had predeceased the decedent.
(b) Any joint tenant who feloniously and intentionally kills another joint tenant thereby effects a severance of the interest of the decedent so that the share of the decedent passes as the decedent's property and the killer has no rights by survivorship. This provision applies to joint tenancies in real and personal property, joint and multiple-party accounts in banks, savings and loan associations, credit unions, and other institutions, and any other form of co-ownership with survivorship incidents.
(c) A named beneficiary of a bond, life insurance policy, retirement plan, annuity, or other contractual arrangement who feloniously and intentionally kills the principal obligee or the individual upon whose life the policy is issued is not entitled to any benefit under the bond, policy, retirement plan, annuity, or other contractual arrangement, and it becomes payable as though the killer had predeceased the decedent.
(d) Any other acquisition of property or interest by the killer shall be treated in accordance with the principles of this section. A beneficiary whose interest is increased as a result of feloniously and intentionally killing shall be treated in accordance with the principles of this section.
(e) The felonious and intentional killing of the decedent revokes the nomination of the killer in a will or other document nominating or appointing the killer to serve in any fiduciary capacity or representative capacity, including, but not limited to, as personal representative, trustee, agent or guardian.
(f) A final judgment by conviction, or guilty plea establishing criminal accountability of felonious and intentional killing the decedent conclusively establishes that the convicted individual feloniously and intentionally killed the decedent for purposes of this section. In the absence of such final judgment the court, upon the petition of an interested person, must determine whether, upon the preponderance of the evidence standard, the individual would be found responsible for the felonious and intentional killing of the decedent. If the court determines that, under that standard, the individual would be responsible for the felonious and intentional killing of the decedent, the determination conclusively establishes that individual as the decedent's killer for purposes of this section.
(g) This section does not affect the rights of any person who, before rights under this section have been adjudicated, purchases from the killer, for value and without notice, property which the killer would have acquired except for this section, but the killer is liable for the amount of the proceeds or the value of the property. Any insurance company, bank, or other obligor making payment according to the terms of its policy or obligation is not liable by reason of this section unless prior to payment it has received at its home office or principal address written notice of a claim under this section.
(h) If an individual feloniously and intentionally kills the decedent, and if the killer dies within one hundred twenty hours of the decedent's death, then the decedent shall be deemed to have survived the killer for purposes of distributing the killer's estate, including, but not limited to, property passing by intestacy, the killer's will, any trust of which the killer is a grantor, joint tenancy with right of survivorship and benefits payable under a life insurance policy, retirement plan, annuity or other contractual arrangement.
HISTORY: 1986 Act No. 539, § 1; 1997 Act No. 152, § 10; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-804. Effect of provision for survivorship on succession to joint tenancy.
When any individual is seized or possessed of any real property held in joint tenancy at the time of the individual's death, the joint tenancy is deemed to have been severed by the death of the joint tenant and the real property is distributable as a tenancy in common unless the instrument which creates the joint tenancy in real property, including any instrument in which one individual conveys to himself and one or more other persons, or two or more persons convey to themselves, or to themselves and another or others, expressly provides for a right of survivorship, in which case the severance does not occur. While other methods for the creation of a joint tenancy in real property may be utilized, an express provision for a right of survivorship is conclusively considered to have occurred if the will or instrument of conveyance contains the names of the devisees or grantees followed by the words "as joint tenants with right of survivorship and not as tenants in common".
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 14; 1996 Act No. 405, § 1; 2000 Act No. 398, § 3; 2010 Act No. 266, § 1, eff June 24, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-805. Presumption of ownership of tangible personal property; exceptions.
(A) For purposes of this article, tangible personal property in the joint possession or control of the decedent and the surviving spouse at the time of the decedent's death is presumed to be owned by the decedent and the decedent's spouse in joint tenancy with right of survivorship if ownership is not evidenced otherwise by a certificate of title, bill of sale, or other writing. This presumption does not apply to property:
(1) acquired by either spouse before marriage;
(2) acquired by either spouse by gift or inheritance during the marriage;
(3) used by the decedent spouse in a trade or business in which the surviving spouse has no interest;
(4) held for another; or
(5) specifically devised in a will or devised in a written statement or list disposing of tangible personal property pursuant to Section 62-2-512.
(B) The presumption created in this section may be overcome by a preponderance of the evidence demonstrating that ownership was held other than in joint tenancy with right of survivorship.
HISTORY: 2010 Act No. 266, § 2, eff June 24, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-2-806. Modification to achieve testator's tax objectives.
To achieve the testator's tax objectives, the personal representative or any interested person may file a summons and petition requesting the court, after notice and a hearing, to issue an order modifying the terms of a testator's will in a manner not contrary to the testator's probable intent. The court may provide that the modification has retroactive effect.
HISTORY: 2013 Act No. 100, § 1, eff January 1, 2014.
Part 9
Delivery and Suppression of Wills
SECTION 62-2-901. Delivery of will to judge of probate; filing.
(a) After the death of a testator, a person having custody of a will of the testator shall deliver such will, within thirty days of actual notice or knowledge of the testator's death to the judge of the probate court having jurisdiction to admit the same or to a person named as personal representative in the will who shall deliver the will to the judge of the probate court. Upon receipt of the will, the judge of probate shall file the same in probate court and if proceedings for the probate are not begun within thirty days the judge shall publish a notice of such delivery and filing in one of the newspapers in the county of the probate court for once a week for three consecutive weeks.
(b) Any person who intentionally or fraudulently destroys, suppresses, conceals, or fails to deliver the will to the judge of the probate court having jurisdiction to admit it to probate is liable to any person aggrieved for any damages that may be sustained by such action or inaction.
(c) Any person who intentionally or fraudulently destroys, suppresses, conceals, or fails to deliver the will to the judge of the probate court having jurisdiction to admit it to probate, after being ordered by the court in a proceeding brought for the purpose of compelling delivery, is subject to a penalty for contempt of court.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 15; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 10
Uniform Fiduciary Access to Digital Assets
SECTION 62-2-1010. Definitions.
As used in this part:
(1) "Account" means an arrangement under a terms-of-service agreement in which a custodian carries, maintains, processes, receives, or stores a digital asset of the user or provides goods or services to the user.
(2) "Agent" means an attorney-in-fact granted authority under a durable or nondurable power of attorney.
(3) "Carries" means engages in the transmission of an electronic communication.
(4) "Catalogue of electronic communications" means information that identifies each person with whom a user has had an electronic communication, the time and date of the communication, and the electronic address of the person.
(5) "Conservator" means a person appointed by a court to manage the estate of a living individual. The term includes a limited conservator.
(6) "Content of an electronic communication" means information concerning the substance or meaning of the communication that:
(a) has been sent or received by a user;
(b) is in electronic storage by a custodian providing an electronic-communication service to the public or is carried or maintained by a custodian providing a remote-computing service to the public; and
(c) is not readily accessible to the public.
(7) "Court" has the meaning specified in Section 62-1-201(5).
(8) "Custodian" means a person that carries, maintains, processes, receives, or stores a digital asset of a user.
(9) "Designated recipient" means a person chosen by a user using an online tool to administer digital assets of the user.
(10) "Digital asset" means an electronic record in which an individual has a right or interest. The term does not include an underlying asset or liability unless the asset or liability is itself an electronic record.
(11) "Electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.
(12) "Electronic communication" has the meaning as specified in 18 U.S.C. Section 2510(12), as amended.
(13) "Electronic-communication service" means a custodian that provides to a user the ability to send or receive an electronic communication.
(14) "Fiduciary" means an original, additional, or successor personal representative, conservator, agent, or trustee.
(15) "Information" means data, text, images, videos, sounds, codes, computer programs, software, databases, or the like.
(16) "Online tool" means an electronic service provided by a custodian that allows the user, in an agreement distinct from the terms-of-service agreement between the custodian and user, to provide directions for disclosure or nondisclosure of digital assets to a third person.
(17) "Person" means an individual, estate, business or nonprofit entity, public corporation, government or governmental subdivision, agency or instrumentality, or other legal entity.
(18) "Personal representative" has the meaning specified in Section 62-1-201(33).
(19) "Power of attorney" means a record that grants an agent authority to act in the place of a principal.
(20) "Principal" means an individual who grants authority to an agent in a power of attorney.
(21) "Protected person" has the meaning specified in Section 62-5-101(3). The term includes an individual for whom an application for the appointment of a conservator is pending.
(22) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.
(23) "Remote-computing service" means a custodian that provides to a user computer-processing services or the storage of digital assets by means of an electronic communications system, as defined in 18 U.S.C. Section 2510(14), as amended.
(24) "Terms-of-service agreement" means an agreement that controls the relationship between a user and a custodian.
(25) "Trustee" has the meaning specified in Section 62-7-103(19). The term includes a successor trustee.
(26) "User" means a person who has an account with a custodian.
(27) "Will" has the meaning specified in Section 62-1-201(52).
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1015. Application of part.
(A) This part applies to a:
(1) fiduciary acting under a will or power of attorney executed before, on, or after the effective date of this act;
(2) personal representative acting for a decedent who died before, on, or after the effective date of this act;
(3) conservatorship proceeding, commenced before, on, or after the effective date of this act; and
(4) trustee acting under a trust created before, on, or after the effective date of this act.
(B) This part applies to a custodian if the user resides in this State or resided in this State at the time of the user's death.
(C) This part does not apply to a digital asset of an employer used by an employee in the ordinary course of the employer's business.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1020. User direction for disclosure of digital assets.
(A) A user may use an online tool to direct the custodian to disclose or not to disclose to a designated recipient some or all of the user's digital assets, including the content of electronic communications. If the online tool allows the user to modify or delete a direction at all times, a direction regarding disclosure using an online tool overrides a contrary direction by the user in a will, trust, power of attorney, or other record.
(B) If a user has not used an online tool to give direction under subsection (A) or if the custodian has not provided an online tool, the user may allow or prohibit in a will, trust, power of attorney, or other record, disclosure to a fiduciary of some or all of the user's digital assets, including the content of electronic communications sent or received by the user.
(C) A user's direction under subsection (A) or (B) overrides a contrary provision in a terms-of-service agreement that does not require the user to act affirmatively and distinctly from the user's assent to the terms of service.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1025. Terms-of-service agreement.
(A) This part does not change or impair a right of a custodian or a user under a terms-of-service agreement to access and use digital assets of the user.
(B) This part does not give a fiduciary or a designated recipient any new or expanded rights other than those held by the user for whom, or for whose estate, the fiduciary or designated recipient acts or represents.
(C) A fiduciary's or designated recipient's access to digital assets may be modified or eliminated by a user, by federal law, or by a terms-of-service agreement if the user has not provided direction under Section 62-2-1020.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1030. Procedure for disclosing digital assets.
(A) When disclosing digital assets of a user under this part, the custodian may at its sole discretion:
(1) grant a fiduciary or designated recipient full access to the user's account;
(2) grant a fiduciary or designated recipient partial access to the user's account sufficient to perform the tasks with which the fiduciary or designated recipient is charged; or
(3) provide a fiduciary or designated recipient a copy in a record of any digital asset that, on the date the custodian received the request for disclosure, the user could have accessed if the user were alive and had full capacity and access to the account.
(B) A custodian may assess a reasonable administrative charge for the cost of disclosing digital assets under this part.
(C) A custodian need not disclose under this part a digital asset deleted by a user.
(D) If a user directs or a fiduciary requests a custodian to disclose under this part some, but not all, of the user's digital assets, the custodian need not disclose the assets if segregation of the assets would impose an undue burden on the custodian. If the custodian believes the direction or request imposes an undue burden, the custodian or fiduciary may seek an order from the court to disclose:
(1) a subset limited by date of the user's digital assets;
(2) all of the user's digital assets to the fiduciary or designated recipient;
(3) none of the user's digital assets; or
(4) all of the user's digital assets to the court for review in camera.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1035. Disclosure of content of electronic communications of deceased user.
If a deceased user consented or a court directs disclosure of the contents of electronic communications of the user, the custodian shall disclose to the personal representative of the estate of the user the content of an electronic communication sent or received by the user if the representative gives the custodian:
(1) a written request for disclosure in physical or electronic form;
(2) a certified copy of the death certificate of the user;
(3) a certified copy of the letter of appointment of the representative or a small estate affidavit or court order;
(4) unless the user provided direction using an online tool, a copy of the user's will, trust, power of attorney, or other record evidencing the user's consent to disclosure of the content of electronic communications; and
(5) if requested by the custodian:
(a) a number, username, address, or other unique subscriber or account identifier assigned by the custodian to identify the user's account;
(b) evidence linking the account to the user; or
(c) a finding by the court that:
(i) the user had a specific account with the custodian, identifiable by the information specified in subitem (a);
(ii) disclosure of the content of electronic communications of the user would not violate 18 U.S.C. Section 2701, et seq., as amended, 47 U.S.C. Section 222, as amended, or other applicable law;
(iii) unless the user provided direction using an online tool, the user consented to disclosure of the content of electronic communications; or
(iv) disclosure of the content of electronic communications of the user is reasonably necessary for administration of the estate.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1040. Disclosure of other digital assets of deceased user.
Unless the user prohibited disclosure of digital assets or the court directs otherwise, a custodian shall disclose to the personal representative of the estate of a deceased user a catalogue of electronic communications sent or received by the user and digital assets, other than the content of electronic communications, of the user, if the representative gives the custodian:
(1) a written request for disclosure in physical or electronic form;
(2) a certified copy of the death certificate of the user;
(3) a certified copy of the letter of appointment of the representative or a small estate affidavit or court order; and
(4) if requested by the custodian:
(a) a number, username, address, or other unique subscriber or account identifier assigned by the custodian to identify the user's account;
(b) evidence linking the account to the user;
(c) an affidavit stating that disclosure of the user's digital assets is reasonably necessary for administration of the estate; or
(d) a finding by the court that:
(i) the user had a specific account with the custodian, identifiable by the information specified in subitem (a); or
(ii) disclosure of the user's digital assets is reasonably necessary for administration of the estate.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1045. Disclosure of content of electronic communications of principal.
To the extent a power of attorney expressly grants an agent authority over the content of electronic communications sent or received by the principal and unless directed otherwise by the principal or the court, a custodian shall disclose to the agent the content if the agent gives the custodian:
(1) a written request for disclosure in physical or electronic form;
(2) an original or copy of the power of attorney expressly granting the agent authority over the content of electronic communications of the principal;
(3) a certification by the agent, under penalty of perjury, that the power of attorney is in effect; and
(4) if requested by the custodian:
(a) a number, username, address, or other unique subscriber or account identifier assigned by the custodian to identify the principal's account; or
(b) evidence linking the account to the principal.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1050. Disclosure of other digital assets of principal.
Unless otherwise ordered by the court, directed by the principal, or provided by a power of attorney, a custodian shall disclose to an agent with specific authority over digital assets or general authority to act on behalf of a principal a catalogue of electronic communications sent or received by the principal and digital assets, other than the content of electronic communications, of the principal if the agent gives the custodian:
(1) a written request for disclosure in physical or electronic form;
(2) an original or a copy of the power of attorney that gives the agent specific authority over digital assets or general authority to act on behalf of the principal;
(3) a certification by the agent, under penalty of perjury, that the power of attorney is in effect; and
(4) if requested by the custodian:
(a) a number, username, address, or other unique subscriber or account identifier assigned by the custodian to identify the principal's account; or
(b) evidence linking the account to the principal.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1055. Disclosure of digital assets held in trust when trustee is original user.
Unless otherwise ordered by the court or provided in a trust, a custodian shall disclose to a trustee that is an original user of an account any digital asset of the account held in trust, including a catalogue of electronic communications of the trustee and the content of electronic communications.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1060. Disclosure of contents of electronic communications held in trust when trustee not original user.
Unless otherwise ordered by the court, directed by the user, or provided in a trust, a custodian shall disclose to a trustee that is not an original user of an account the content of an electronic communication sent or received by an original or successor user and carried, maintained, processed, received, or stored by the custodian in the account of the trust if the trustee gives the custodian:
(1) a written request for disclosure in physical or electronic form;
(2) a certified copy of the trust instrument or a certification of the trust under Section 62-7-1013 which includes consent to disclosure of the content of electronic communications to the trustee;
(3) a certification by the trustee, under penalty of perjury, that the trust exists and the trustee is a currently acting trustee of the trust; and
(4) if requested by the custodian:
(a) a number, username, address, or other unique subscriber or account identifier assigned by the custodian to identify the trust's account; or
(b) evidence linking the account to the trust.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1065. Disclosure of other digital assets held in trust when trustee not original user.
Unless otherwise ordered by the court, directed by the user, or provided in a trust, a custodian shall disclose, to a trustee that is not an original user of an account, a catalogue of electronic communications sent or received by an original or successor user and stored, carried, or maintained by the custodian in an account of the trust and any digital assets, other than the content of electronic communications, in which the trust has a right or interest if the trustee gives the custodian:
(1) a written request for disclosure in physical or electronic form;
(2) a certified copy of the trust instrument or a certification of the trust under Section 62-7-1013;
(3) a certification by the trustee, under penalty of perjury, that the trust exists and the trustee is a currently acting trustee of the trust; and
(4) if requested by the custodian:
(a) a number, username, address, or other unique subscriber or account identifier assigned by the custodian to identify the trust's account; or
(b) evidence linking the account to the trust.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1070. Disclosure of digital assets to conservator of protected person.
(A) After an opportunity for a hearing under Article 5 of this title, the court may grant a conservator access to the digital assets of a protected person.
(B) Unless otherwise ordered by the court or directed by the user, a custodian shall disclose to a conservator the catalogue of electronic communications sent or received by a protected person and any digital assets, other than the content of electronic communications, in which the protected person has a right or interest if the conservator gives the custodian:
(1) a written request for disclosure in physical or electronic form;
(2) a certified copy of the court order that gives the conservator authority over the digital assets of the protected person; and
(3) if requested by the custodian:
(a) a number, username, address, or other unique subscriber or account identifier assigned by the custodian to identify the account of the protected person; or
(b) evidence linking the account to the protected person.
(C) A conservator with general authority to manage the assets of a protected person may request a custodian of the digital assets of the protected person to suspend or terminate an account of the protected person for good cause. A request made under this section must be accompanied by a certified copy of the court order giving the conservator authority over the protected person's property.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1075. Fiduciary duty and authority.
(A) The legal duties imposed on a fiduciary charged with managing tangible property apply to the management of digital assets, including the:
(1) duty of care;
(2) duty of loyalty; and
(3) duty of confidentiality.
(B) A fiduciary's or designated recipient's authority with respect to a digital asset of a user:
(1) except as otherwise provided in Section 62-2-1020, is subject to the applicable terms of service;
(2) in the case of a fiduciary, is subject to other applicable law, including copyright law;
(3) is limited by the scope of the fiduciary's duties; and
(4) may not be used to impersonate the user.
(C) A fiduciary with authority over the property of a decedent, protected person, principal, or settlor has the right to access any digital asset in which the decedent, protected person, principal, or settlor had a right or interest and that is not held by a custodian or subject to a terms-of-service agreement.
(D) A fiduciary acting within the scope of the fiduciary's duties is an authorized user of the property of the decedent, protected person, principal, or settlor for the purpose of applicable computer fraud and unauthorized computer access laws, including this state's law on unauthorized computer access.
(E) A fiduciary with authority over the tangible, personal property of a decedent, protected person, principal, or settlor:
(1) has the right to access the property and any digital asset stored in it; and
(2) is an authorized user for the purpose of computer fraud and unauthorized computer access laws, including this state's law regarding unauthorized computer access.
(F) A custodian may disclose information in an account to a fiduciary of the user when the information is required to terminate an account used to access digital assets licensed to the user.
(G) A fiduciary of a user may request a custodian to terminate the user's account. A request for termination must be in writing, in either physical or electronic form, and accompanied by:
(1) if the user is deceased, a certified copy of the death certificate of the user;
(2) a certified copy of the letter of appointment of the representative or a small estate affidavit or court order, power of attorney, or trust giving the fiduciary authority over the account; and
(3) if requested by the custodian:
(a) a number, username, address, or other unique subscriber or account identifier assigned by the custodian to identify the user's account;
(b) evidence linking the account to the user; or
(c) a finding by the court that the user had a specific account with the custodian, identifiable by the information specified in subitem (a).
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1080. Custodian compliance and immunity.
(A) Not later than sixty days after receipt of the information required under Sections 62-2-1035 through 62-2-1075, a custodian shall comply with a request under this part from a fiduciary or designated recipient to disclose digital assets or terminate an account. If the custodian fails to comply, the fiduciary or designated recipient may apply to the court for an order directing compliance.
(B) An order under subsection (A) directing compliance must contain a finding that compliance is not in violation of 18 U.S.C. Section 2702, as amended.
(C) A custodian may notify the user that a request for disclosure or to terminate an account was made under this part.
(D) A custodian may deny a request under this part from a fiduciary or designated recipient for disclosure of digital assets or to terminate an account if the custodian is aware of any lawful access to the account following the receipt of the fiduciary's request.
(E) This part does not limit a custodian's ability to obtain or require a fiduciary or designated recipient requesting disclosure or termination under this part to obtain a court order which:
(1) specifies that an account belongs to the protected person or principal;
(2) specifies that there is sufficient consent from the protected person or principal to support the requested disclosure; and
(3) contains a finding required by law other than this part.
(F) A custodian and its officers, employees, and agents are immune from liability for an act or omission done in good faith in compliance with this part.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1085. Uniformity of application and construction.
In applying and construing this uniform act, consideration must be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it.
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.
SECTION 62-2-1090. Electronic Signatures in Global and National Commerce Act.
This uniform act modifies, limits, or supersedes the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. Section 7001, et seq., but 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).
HISTORY: 2016 Act No. 260 (S.908), § 2, eff June 3, 2016.TITLE 62. SOUTH CAROLINA PROBATE CODE
CHAPTER 3. Probate of Wills and Administration
Part 1
General Provisions
SECTION 62-3-101. Devolution of estate at death; restrictions.
The power of a person to leave property by will and the rights of creditors, devisees, and heirs to his property are subject to the restrictions and limitations contained in this Code to facilitate the prompt settlement of estates, including the exercise of the powers of the personal representative. Upon the death of a person, his real property devolves to the persons to whom it is devised by his last will or to those indicated as substitutes for them in cases involving lapse, renunciation, or other circumstances affecting the devolution of testate estates, or in the absence of testamentary disposition, to his heirs, or to those indicated as substitutes for them in cases involving renunciation or other circumstances affecting the devolution of intestate estates, subject to the purpose of satisfying claims as to exempt property rights and the rights of creditors, and the purposes of administration, particularly the exercise of the powers of the personal representative under Sections 62-3-709, 62-3-710, and 62-3-711, and his personal property devolves, first, to his personal representative, for the purpose of satisfying claims as to exempt property rights and the rights of creditors, and the purposes of administration, particularly the exercise of the powers of the personal representative under Sections 62-3-709, 62-3-710, and 62-3-711, and, at the expiration of three years after the decedent's death, if not yet distributed by the personal representative, his personal property devolves to those persons to whom it is devised by will or who are his heirs in intestacy, or their substitutes, as the case may be, just as with respect to real property.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 16; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-102. Necessity of order of probate for will.
Except as provided in Section 62-3-1201 and except as to a will that has been admitted to probate in another jurisdiction which is filed as provided in Article 4, to be effective to prove the transfer of any property or to nominate a personal representative, a will must be declared to be valid by an order of informal probate by the court or an adjudication of probate by the court.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-103. Necessity of appointment for administration.
Except as otherwise provided in this article [Sections 62-3-101 et seq.] and in Article 4 [Sections 62-4-101 et seq.], to acquire the powers and undertake the duties and liabilities of a personal representative of a decedent, a person must be appointed by order of the court, qualify, and be issued letters. Administration of an estate is commenced by the issuance of letters.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-104. Claims against decedent; necessity of administration.
No claim may be filed against the estate of a decedent and no proceeding to enforce a claim against the estate of a decedent or his successors may be revived or commenced before the appointment of a personal representative, except as provided in Section 62-3-804(1)(b). After the appointment and until distribution, all proceedings and actions to enforce a claim against the estate are governed by the procedure prescribed by this article [Sections 62-3-101 et seq.]. After distribution, a creditor whose claim has not been barred may recover from the distributees as provided in Section 62-3-1004 or from a former personal representative individually liable as provided in Section 62-3-1005. This section has no application to a proceeding by a secured creditor of the decedent to enforce his right to his security except as to any deficiency judgment which might be sought therein.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-105. Proceedings affecting devolution and administration; jurisdiction of subject matter.
Persons interested in decedents' estates may apply to the court for determination in the informal proceedings provided in this article [Sections 62-3-101 et seq.], and may petition the court for orders in formal proceedings within the court's jurisdiction including but not limited to those described in this article.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-106. Proceedings within the jurisdiction of court; service; jurisdiction over persons.
In proceedings within the jurisdiction of the court where notice is required by this Code or by rule, and in proceedings to construe probated wills or determine heirs which concern estates that have not been and cannot now be opened for administration, interested persons may be bound by the orders of the court in respect to property in or subject to the laws of this State by notice in conformity with Section 62-1-401. An order is binding as to all who are given notice of the proceeding though less than all interested persons are notified.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 30; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-107. Scope of proceedings; proceedings independent; exception.
Unless administration under Part 5 [Sections 62-3-501 et seq.] is involved, (1) each proceeding before the court is independent of any other proceeding involving the same estate; (2) petitions for formal orders of the court may combine various requests for relief in a single proceeding if the orders sought may be finally granted without delay, but, except as required for proceedings which are particularly described by other sections of this article [Sections 62-3-101 et seq.], no petition is defective because it fails to embrace all matters which might then be the subject of a final order; (3) proceedings for probate of wills or adjudications of no will may be combined with proceedings for appointment of personal representatives; and (4) a proceeding for appointment of a personal representative is concluded by an order making or declining the appointment.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-108. Probate, testacy, and appointment proceedings; ultimate time limit.
(A)(1) No informal probate or appointment proceeding or formal testacy or appointment proceeding, other than a proceeding to probate a will previously probated at the testator's domicile and appointment proceedings relating to an estate in which there has been a prior appointment, may be commenced more than ten years after the decedent's death.
(2) Notwithstanding any other provision of this section:
(a) if a previous proceeding was dismissed because of doubt about the fact of the decedent's death, appropriate probate, appointment, or testacy proceedings may be maintained at any time upon a finding that the decedent's death occurred prior to the initiation of the previous proceeding and the applicant or petitioner has not delayed unduly in initiating the subsequent proceeding and if that previous proceeding was commenced within the time limits of this section;
(b) appropriate probate, appointment, or testacy proceedings may be maintained in relation to the estate of an absent, disappeared, or missing person for whose estate a conservator has been appointed, at any time within three years after the conservator becomes able to establish the death of the protected person; and
(c) a proceeding to contest an informally probated will and to secure appointment of the person with legal priority for appointment in the event the contest is successful may be commenced within eight months from informal probate or one year from the decedent's death, whichever is later.
(B) If no informal probate and no formal testacy proceedings are commenced within ten years after the decedent's death, and no proceedings under subsection (A)(2)(b) are commenced within the applicable period of three years, it is incontestable that the decedent left no will and that the decedent's estate passes by intestate succession. These limitations do not apply to proceedings to construe probated wills or determine heirs of an intestate. In proceedings commenced under subsection (A)(2)(a) or (A)(2)(b), the date on which a testacy or appointment proceeding is properly commenced is deemed to be the date of the decedent's death for purposes of other limitations provisions of this Code which relate to the date of death.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 17; 1990 Act No. 521, § 31; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-109. Statute of limitations on decedent's cause of action.
The running of any statute of limitations on a cause of action belonging to a decedent which had not been barred as of the date of his death is suspended during the eight months following the decedent's death but resumes thereafter unless otherwise tolled.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 32; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 2
Venue for Probate and Administration; Priority to Administer; Demand for Notice
SECTION 62-3-201. Venue for first and subsequent estate proceedings; location of property.
(a) Venue for the first informal or formal testacy or appointment proceedings after a decedent's death is:
(1) in the county where the decedent had his domicile at the time of his death; or
(2) if the decedent was not domiciled in this State, in any county where property of the decedent was located at the time of his death.
(b) Venue for all subsequent proceedings within the exclusive jurisdiction of the court is in the place where the initial proceeding occurred, unless the initial proceeding has been transferred as provided in Section 62-1-303 or (c) of this section.
(c) If the first proceeding was informal, on application of an interested person and after notice to the proponent in the first proceeding, the court, upon finding that venue is elsewhere, may transfer the proceeding and the file to the other court.
(d) For the purpose of aiding determinations concerning location of assets which may be relevant in cases involving nondomiciliaries, a debt, other than one evidenced by investment or commercial paper or other instrument in favor of a nondomiciliary, is located where the debtor resides or, if the debtor is a person other than an individual, at the place where it has its principal office. Commercial paper, investment paper, and other instruments are located where the instrument is. An interest in property held in trust is located where the trustee may be sued.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-202. Appointment or testacy proceedings; conflicting claim of domicile in another state.
If conflicting claims as to the domicile of a decedent are made in a formal testacy or appointment proceeding commenced in this State, and in a testacy or appointment proceeding after notice pending at the same time in another state, the court of this State must stay, dismiss, or permit suitable amendment in, the proceeding here unless it is determined that the local proceeding was commenced before the proceeding elsewhere. The determination of domicile in the proceeding first commenced must be accepted as determinative in the proceeding in this State.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-203. Priority among persons seeking appointment as personal representative.
(a) Whether the proceedings are formal or informal, persons who are not disqualified have priority for appointment in the following order:
(1) the person with priority as determined by a probated will including a person nominated by a power conferred in a will;
(2) the surviving spouse of the decedent who is a devisee of the decedent;
(3) other devisees of the decedent;
(4) the surviving spouse of the decedent;
(5) other heirs of the decedent regardless of whether the decedent died intestate and determined as if the decedent died intestate (for the purposes of determining priority under this item, any heirs who could have qualified under items (1), (2), (3), and (4) of subsection (a) are treated as having predeceased the decedent);
(6) forty-five days after the death of the decedent, any creditor complying with the requirements of Section 62-3-804(1)(b);
(7) four months after the death of the decedent, upon application by the South Carolina Department of Revenue, a person suitable to the court.
(8) Unless a contrary intent is expressed in the decedent's will, a person with priority under subsection (a) may nominate another, who shall have the same priority as the person making the nomination, except that a person nominated by the testator to serve as personal representative or successor personal representative shall have a higher priority than a person nominated pursuant to this item.
(b) An objection to an appointment can be made only in formal proceedings. In case of objection the priorities stated in (a) apply except that:
(1) if the estate appears to be more than adequate to meet exemptions and costs of administration but inadequate to discharge anticipated unsecured claims, the court, on petition of creditors, may appoint any qualified person;
(2) in case of objection to appointment of a person other than one whose priority is determined by will by an heir or devisee appearing to have a substantial interest in the estate, the court may appoint a person who is acceptable to heirs and devisees whose interests in the estate appear to be worth in total more than half of the probable distributable value or, in default of this accord, any suitable person.
(c) Conservators of the estates of protected persons or, if there is no conservator, any guardian for the protected person or the custodial parent of a minor, except a court-appointed guardian ad litem of a minor or incapacitated person may exercise the same right to be appointed as personal representative, to object to another's appointment, or to participate in determining the preference of a majority in interest of the heirs and devisees that the protected person or ward would have if qualified for appointment.
(d) If the administration is necessary, appointment of one who has equal or lower priority may be made as follows within the discretion of the court:
(1) informally if all those of equal or higher priority have filed a writing with the court renouncing the right to serve and nominating the same person in his place; or
(2) in the absence of agreement, informally in accordance with the requirements of Section 62-3-310; or
(3) in formal proceedings.
(e) No person is qualified to serve as a personal representative who is:
(1) under the age of eighteen;
(2) a person whom the court finds unsuitable in formal proceedings;
(3) with respect to the estate of any person domiciled in this State at the time of his death, a corporation created by another state of the United States or by any foreign state, kingdom or government, or a corporation created under the laws of the United States and not having a business in this State, or an officer, employee, or agent of such foreign corporation, whether the officer, employee, or agent is a resident or a nonresident of this State, if such officer, employee, or agent is acting as personal representative on behalf of such corporation;
(4) a probate judge for an estate of any person within his jurisdiction; however, a probate judge may serve as a personal representative of the estate of a family member if the service does not interfere with the proper performance of the probate judge's official duties and the estate must be transferred to another county for administration. For purposes of this subsection, "family member" means a spouse, parent, child, brother, sister, aunt, uncle, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, grandparent, or grandchild.
(f) A personal representative appointed by a court of the decedent's domicile has priority over all other persons except where the decedent's will nominates different persons to be personal representatives in this State and in the state of domicile. The domiciliary personal representative may nominate another, who shall have the same priority as the domiciliary personal representative.
(g) This section governs priority for appointment of a successor personal representative but does not apply to the selection of a special administrator.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 18; 1990 Act No. 521, §§ 33, 34; 1993 Act No. 181, § 1606; 1995 Act No. 15, § 3; 1997 Act No. 152, §§ 11, 12; 2010 Act No. 244, § 7, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-204. Demand for notice of order or filing concerning decedent's estate.
Any interested person desiring notice of any order or filing pertaining to a decedent's estate may file a demand for notice with the court at any time after the death of the decedent stating the name of the decedent, the nature of his interest in the estate, and the demandant's address or that of his attorney. The demand for notice shall expire one year from the date of filing with the court. The clerk shall mail a copy of the demand to the personal representative if one has been appointed. After filing of a demand, the personal representative must give a copy of the demanded filing to the demandant or his attorney. If the demand is a demand for a hearing, then the personal representative must comply with Section 62-1-401. The validity of an order which is issued or filing which is accepted without compliance with this requirement is not affected by the error, but the petitioner receiving the order or the person making the filing may be liable for any damage caused by the absence of notice. The requirement of notice arising from a demand under this provision may be waived in writing by the demandant and ceases upon the termination of his interest in the estate.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 19; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 3
Informal Probate and Appointment Proceedings
SECTION 62-3-301. Applications for informal probate or appointment; contents.
(a) Applications for informal probate or informal appointment shall be directed to the court, and verified by the applicant to be accurate and complete to the best of his knowledge and belief as to the following information:
(1) Every application for informal probate of a will or for informal appointment of a personal representative, other than a special or successor representative, shall contain the following:
(i) a statement of the interest of the applicant;
(ii) the name, and date of death of the decedent, his age, and the county and state of his domicile at the time of death, and the names and addresses of the spouse, children, heirs (regardless of whether the decedent died intestate and determined as if the decedent died intestate) and devisees, and the ages of any who are minors so far as known or ascertainable with reasonable diligence by the applicant;
(iii) if the decedent was not domiciled in the State at the time of his death, a statement showing venue;
(iv) a statement identifying and indicating the address of any personal representative of the decedent appointed in this State or elsewhere whose appointment has not been terminated;
(v) a statement indicating whether the applicant has received a demand for notice, or is aware of a demand for notice of any probate or appointment proceeding concerning the decedent that may have been filed in this State or elsewhere; and
(vi) that the time limit for informal probate or appointment as provided in this article has not expired either because ten years or less has passed since the decedent's death, or, if more than ten years from death have passed, circumstances as described by Section 62-3-108 authorizing tardy probate or appointment have occurred.
(2) An application for informal probate of a will shall state the following in addition to the statements required by (1):
(i) that the original of the decedent's last will is in the possession of the court, or accompanies the application, or that an authenticated copy of a will probated in another jurisdiction accompanies the application;
(ii) that the applicant, to the best of his knowledge, believes the will to have been validly executed;
(iii) that after the exercise of reasonable diligence, the applicant is unaware of any instrument revoking the will, and that the applicant believes that the instrument which is the subject of the application is the decedent's last will.
(3) An application for informal appointment of a personal representative to administer an estate under a will shall describe the will by date of execution and state the time and place of probate or the pending application or petition for probate. The application for appointment shall adopt the statements in the application or petition for probate and state the name, address, and priority for appointment of the person whose appointment is sought.
(4) An application for informal appointment of an administrator in intestacy must state the name and address of the person whose appointment is sought and must state in addition to the statements required by item (1):
(i) that after the exercise of reasonable diligence, the applicant is unaware of any unrevoked testamentary instrument relating to property having a situs in this State under Section 62-1-301 or a statement why any such instrument of which he may be aware is not being probated;
(ii) the priority of the person whose appointment is sought and the names of any other persons having a prior or equal right to the appointment under Section 62-3-203.
(5) An application for appointment of a personal representative to succeed a personal representative appointed under a different testacy status shall refer to the order in the most recent testacy proceeding, state the name and address of the person whose appointment is sought and of the person whose appointment will be terminated if the application is granted, and describe the priority of the applicant.
(6) An application for appointment of a personal representative to succeed a personal representative who has tendered a resignation as provided in Section 62-3-610, or whose appointment has been terminated by death or removal, shall adopt the statements in the application or petition which led to the appointment of the person being succeeded except as specifically changed or corrected, state the name and address of the person who seeks appointment as successor, and describe the priority of the applicant.
(7) The court may probate a will without appointing a personal representative.
(b) By verifying an application for informal probate, or informal appointment, the applicant submits personally to the jurisdiction of the court in any proceeding for relief from fraud relating to the application, or for perjury, that may be instituted against him.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 20; 1990 Act No. 521, § 35; 1993 Act No. 181, § 1607; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-302. Informal probate; duty of court; effect of informal probate.
Upon receipt of an application requesting informal probate of a will, the court, upon making the findings required by Section 62-3-303, shall issue a written statement of informal probate. Informal probate is conclusive as to all persons until superseded by an order in a formal testacy proceeding. No defect in the application or procedure relating thereto which leads to informal probate of a will renders the probate void.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 36; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-303. Informal probate; proof and findings required.
(a) In an informal proceeding for original probate of a will, the court shall determine whether:
(1) the application is complete;
(2) the applicant has made oath or affirmation that the statements contained in the application are true to the best of his knowledge and belief;
(3) the applicant appears from the application to be an interested person as defined in Section 62-1-201;
(4) on the basis of the statements in the application, venue is proper;
(5) an original, duly executed and apparently unrevoked will is in the court's possession;
(6) any notice required by Section 62-3-204 has been given and that the application is not within Section 62-3-304;
(7) it appears from the application that the time limit for original probate has not expired.
(b) The application shall be denied if it indicates that a personal representative has been appointed in another county of this State or except as provided in subsection (d) below, if it appears that this or another will of the decedent has been the subject of a previous probate order.
(c) A will which appears to have the required signatures and which contains an attestation clause showing that requirements of execution under Section 62-2-502 or 62-2-505 have been met shall be probated without further proof. In other cases, the court may assume execution if the will appears to have been properly executed, or he may accept a sworn statement or affidavit of any person having knowledge of the circumstances of execution, whether or not the person was a witness to the will.
(d) Informal probate of a will which has been previously probated elsewhere may be granted at any time upon written application by any interested person, together with deposit of an authenticated copy of the will and of the statement probating it from the office or court where it was first probated.
(e) A will of a nonresident decedent which has not been probated and is not eligible for probate under subsection (a)(5) may nevertheless be probated in this State upon receipt by the court of a copy of the will authenticated as true by its legal custodian together with the legal custodian's certificate that the will is not ineligible for probate under the law of the other place.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-304. Informal probate unavailable in certain cases.
Applications for informal probate which relate to one or more of a known series of testamentary instruments (other than a will and its codicils), the latest of which does not expressly revoke the earlier, shall be declined.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-305. Informal probate; court not satisfied.
If the court is not satisfied that a will is entitled to be probated in informal proceedings because of failure to meet the requirements of Sections 62-3-303 and 62-3-304 or any other reason, he may decline the application. A declination of informal probate is not an adjudication and does not preclude formal probate proceedings.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-306. Notice requirements.
(a) The moving party must give notice as described by Section 62-1-401 of his application for informal probate to any person demanding it pursuant to Section 62-3-204, and to any personal representative of the decedent whose appointment has not been terminated. No other notice of informal probate is required.
(b) If an informal probate is granted, within thirty days thereafter the applicant shall give written information of the probate to the heirs (determined as if the decedent died intestate) and devisees. The information must include the name and address of the applicant, the date of execution of the will, and any codicil thereto, the name and location of the court granting the informal probate, and the date of the probate. The information must be delivered or sent by ordinary mail to each of the heirs and devisees whose address is reasonably available to the applicant. No duty to give information is incurred if a personal representative is appointed who is required to give the written information required by Section 62-3-705. An applicant's failure to give information as required by this section is a breach of his duty to the heirs and devisees but does not affect the validity of the probate.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 37; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-307. Informal appointment proceedings; delay in order; duty of court; effect of appointment.
(a) Upon receipt of an application for informal appointment of a personal representative other than a special administrator as provided in Section 62-3-614, the court, after making the findings required by Section 62-3-308, shall appoint the applicant subject to qualification and acceptance; provided, that if the decedent was a nonresident, the court shall delay the order of appointment until thirty days have elapsed since death unless the personal representative appointed at the decedent's domicile is the applicant, or unless the decedent's will directs that his estate be subject to the laws of this State.
(b) The status of a personal representative and the powers and duties pertaining to the office are fully established by informal appointment. An appointment, and the office of personal representative created thereby, is subject to termination as provided in Sections 62-3-608 through 62-3-612, but is not subject to retroactive vacation.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 38; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-308. Informal appointment proceedings; proof and findings required.
(a) In informal appointment proceedings, the court must determine whether:
(1) the application for informal appointment of a personal representative is complete;
(2) the applicant has made oath or affirmation that the statements contained in the application are true to the best of his knowledge and belief;
(3) the applicant appears from the application to be an interested person as defined in Section 62-1-201;
(4) on the basis of the statements in the application, venue is proper;
(5) any will to which the requested appointment relates has been formally or informally probated; but this requirement does not apply to the appointment of a special administrator;
(6) any notice required by Section 62-3-204 has been given;
(7) from the statements in the application, the person whose appointment is sought has priority entitling him to the appointment.
(b) Unless Section 62-3-612 controls, the application must be denied if it indicates that a personal representative who has not filed a written statement of resignation as provided in Section 62-3-610 has been appointed in this or another county of this State, that (unless the applicant is the domiciliary personal representative or his nominee) the decedent was not domiciled in this State and that a personal representative whose appointment has not been terminated has been appointed by a court in the state of domicile, or that other requirements of this section have not been met.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-309. Informal appointment proceedings; court not satisfied.
If the court is not satisfied that a requested informal appointment of a personal representative should be made because of failure to meet the requirements of Sections 62-3-307 and 62-3-308 or, for any other reason, he may decline the application. A declination of informal appointment is not an adjudication and does not preclude appointment in formal proceedings.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-310. Informal appointment proceedings; notice requirements.
The applicant must give notice of his intention to seek an appointment informally to any person having equal right to appointment not waived in writing and filed with the court. The notice shall state that, if no objection or nomination of another or no competing application or petition for appointment is filed with the court within thirty days from mailing of the application and notice, the applicant may be appointed informally as the personal representative. If an objection, nomination, application, or petition is filed within the thirty day period, the court shall decline the initial application pursuant to Section 62-3-309. The court may require a formal proceeding to appoint someone of equal or lesser priority.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-311. Informal appointment unavailable in certain cases.
If an application for informal appointment indicates the existence of a possible unrevoked testamentary instrument which may relate to property subject to the laws of this State, and which is not filed for probate in this court, the court shall decline the application.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 4
Formal Testacy and Appointment Proceedings
SECTION 62-3-401. Formal testacy proceedings; nature; when commenced.
A formal testacy proceeding is litigation to determine whether a decedent left a valid will. A formal testacy proceeding must be commenced by an interested person filing and serving a summons and a petition as described in Section 62-3-402(a) in which he requests that the court, after notice and hearing, enter an order probating a will, or a petition to set aside an informal probate of a will or to prevent informal probate of a will which is the subject of a pending application, or a petition in accordance with Section 62-3-402(b) for an order that the decedent died intestate.
A petition may seek formal probate of a will without regard to whether the same or a conflicting will has been informally probated. A formal testacy proceeding may, but need not, involve a request for appointment of a personal representative.
During the pendency of a formal testacy proceeding, the court shall not act upon any application for informal probate of any will of the decedent or any application for informal appointment of a personal representative of the decedent.
Unless a petition in a formal testacy proceeding also requests confirmation of the previous informal appointment, a previously appointed personal representative, after receipt of notice of the commencement of a formal probate proceeding, must refrain from exercising his power to make any further distribution of the estate during the pendency of the formal proceeding. A petitioner who seeks the appointment of a different personal representative in a formal proceeding also may request an order restraining the acting personal representative from exercising any of the powers of his office and requesting the appointment of a special administrator. In the absence of a request, or if the request is denied, the commencement of a formal proceeding has no effect on the powers and duties of a previously appointed personal representative other than those relating to distribution.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 8, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-402. Formal testacy or appointment proceedings; petition; contents.
(a) Petitions for formal probate of a will, or for adjudication of intestacy with or without request for appointment of a personal representative, must be directed to the court, request a judicial order after notice and hearing, and contain further statements as indicated in this section. A petition for formal probate of a will:
(1) requests an order as to the testacy of the decedent in relation to a particular instrument which may or may not have been informally probated and determining the heirs;
(2) contains the statements required for informal applications as stated in the six subitems under Section 62-3-301(a)(1), and the statements required by subitems (ii) and (iii) of Section 62-3-301(a)(2);
(3) states whether the original of the last will of the decedent is in the possession of the court or accompanies the petition.
If the original will is neither in the possession of the court nor accompanies the petition and no authenticated copy of a will probated in another jurisdiction accompanies the petition, the petition also must state the contents of the will, and indicate that it is lost, destroyed, or otherwise unavailable.
(b) A petition for adjudication of intestacy and appointment of an administrator in intestacy must request a judicial finding and order that the decedent left no will and determining the heirs, contain the statements required by (1) and (4) of Section 62-3-301(a) and indicate whether administration under Part 5 [Sections 62-3-501 et seq.] is sought. A petition may request an order determining intestacy and heirs without requesting the appointment of an administrator, in which case, the statements required by subitem (ii) of Section 62-3-301(a)(4) above may be omitted.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-403. Notice of hearing on petition.
(a) Upon commencement of a formal testacy proceeding or at any time after that, the court shall fix a time and place of hearing. Notice must be given in the manner prescribed by Section 62-1-401 by the petitioner to the persons herein enumerated and to any additional person who has filed a demand for notice under Section 62-3-204. The following persons must be properly served with summons and petition: the surviving spouse, children, and other heirs of the decedent (regardless of whether the decedent died intestate and determined as if the decedent died intestate), the devisees, and personal representatives named in any will that is being, or has been, probated, or offered for informal or formal probate in the county, or that is known by the petitioner to have been probated, or offered for informal or formal probate elsewhere, and any personal representative of the decedent whose appointment has not been terminated.
(b) If it appears by the petition or otherwise that the fact of the death of the alleged decedent may be in doubt, or on the written demand of any interested person, a copy of the summons, petition, and notice of the hearing on the petition shall be sent by registered mail to the alleged decedent at his last known address. The court shall direct the petitioner to report the results of, or make and report back concerning, a reasonably diligent search for the alleged decedent in any manner that may seem advisable, including any or all of the following methods:
(1) by inserting in one or more suitable periodicals a notice requesting information from any person having knowledge of the whereabouts of the alleged decedent;
(2) by notifying law enforcement officials and public welfare agencies in appropriate locations of the disappearance of the alleged decedent;
(3) by engaging the services of an investigator.
The costs of any search so directed shall be paid by the petitioner if there is no administration or by the estate of the decedent in case there is administration.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 39; 2010 Act No. 244, § 9, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-404. Written objections to probate.
Any party to a formal proceeding who opposes the probate of a will for any reason shall state in his pleadings his objections to probate of the will.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-405. Uncontested cases; hearings and proof.
If a petition in a testacy proceeding is unopposed, the court may order probate or intestacy on the strength of the pleadings if satisfied that the conditions of Section 62-3-409 have been met or conduct a hearing in open court and require proof of the matters necessary to support the order sought. If evidence concerning execution of the will is necessary, the affidavit (including an affidavit of self-proof executed in compliance with Section 62-2-503) or testimony of one of any attesting witnesses to the instrument is sufficient. If the affidavit or testimony of an attesting witness is not available, execution of the will may be proved by other evidence or affidavit.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 21; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-406. Testimony of attesting witnesses.
In a contested case in which the proper execution of a will is at issue:
(1) if the will is self-proved pursuant to Section 62-2-503, the will satisfies the requirements for execution, subject to rebuttal, without the testimony of any attesting witness, upon filing the will and the acknowledgment and affidavits annexed or attached to it;
(2) if the will is notarized pursuant to Section 62-2-503(c), but not self-proved, there is a rebuttable presumption that the will satisfies the requirements for execution upon filing the will;
(3) if the will is witnessed pursuant to Section 62-2-502, but not notarized or self-proved, the testimony of at least one of the attesting witnesses is required to establish proper execution if the witness is within this State, competent, and able to testify. Proper execution may be established by other evidence, including an affidavit of an attesting witness. An attestation clause that is signed by the attesting witnesses raises a rebuttable presumption that the events recited in the clause occurred.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 22; 1988 Act No. 659, § 16; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-407. Burdens in contested cases.
In contested cases, petitioners who seek to establish intestacy have the burden of establishing prima facie proof of death, venue, and heirship. Proponents of a will have the burden of establishing prima facie proof of due execution in all cases and, if they are also petitioners, prima facie proof of death and venue. Contestants of a will have the burden of establishing undue influence, fraud, duress, mistake, revocation, or lack of testamentary intent or capacity. Parties have the ultimate burden of persuasion as to matters with respect to which they have the initial burden of proof. If a will is opposed by the petition for probate of a later will revoking the former, it must be determined first whether the later will is entitled to probate, and if a will is opposed by a petition for a declaration of intestacy, it must be determined first whether the will is entitled to probate.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 23; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-408. Effect of final order in another jurisdiction.
A final order of a court of another state determining testacy, or the validity or construction of a will made in a proceeding involving notice to and an opportunity for contest by all interested persons, must be accepted as determinative by the courts of this State if it includes, or is based upon, a finding that the decedent was domiciled at his death in the state where the order was made.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-409. Order; foreign will.
Upon proof of service of the summons and petition, and after any hearing and notice that may be necessary, if the court finds that the testator is dead, venue is proper, and that the proceeding was commenced within the limitation prescribed by Section 62-3-108, it shall determine the decedent's domicile at death, his heirs (regardless of whether the decedent died intestate and determined as if the decedent died intestate), and his state of testacy. Any will found to be valid and unrevoked must be formally probated. Termination of any previous informal appointment of a personal representative, which may be appropriate in view of the relief requested and findings, is governed by Section 62-3-612. The petition must be dismissed or appropriate amendment allowed if the court is not satisfied that the alleged decedent is dead. A will from a place which does not provide for probate of a will after death may be proved for probate in this State by a duly authenticated certificate of its legal custodian that the copy introduced is a true copy and that the will is not ineligible for probate under the law of the other place.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 40; 2010 Act No. 244, § 10, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-410. Probate of more than one instrument.
(A) If two or more instruments are offered for probate before a final order is entered in a formal testacy proceeding, more than one instrument may be probated if neither expressly revokes the other or contains provisions which work a total revocation by implication. If more than one instrument is probated, the order shall indicate what provisions control in respect to the nomination of an executor, if any. The order may, but need not, indicate how any provisions of a particular instrument are affected by the other instrument.
(B) After a final order in a testacy proceeding has been entered, no petition for probate of any other instrument of the decedent may be entertained, except incident to a petition to vacate or modify a previous probate order and subject to the time limits of Section 62-3-412.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-411. Partial intestacy.
If it becomes evident in the course of a formal testacy proceeding that, though one or more instruments are entitled to be probated, the decedent's estate is or may be partially intestate, the court shall enter an order to that effect.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-412. Effect of order; vacation.
Subject to appeal and subject to vacation as provided herein and in Section 62-3-413, a formal testacy order under Sections 62-3-409 through 62-3-411, including an order that the decedent left no valid will and determining heirs, is final as to all persons with respect to all issues concerning the decedent's estate that the court considered or might have considered incident to its rendition relevant to the question of whether the decedent left a valid will, and to the determination of heirs, except that:
(1) The court shall entertain a petition for modification or vacation of its order and probate of another will of the decedent if it is shown that the proponents of the later-offered will were unaware of its existence at the time of the earlier proceeding or were unaware of the earlier proceeding and were given no notice thereof, except by publication.
(2) If intestacy of all or part of the estate has been ordered, the determination of heirs of the decedent may be reconsidered if it is shown that one or more persons were omitted from the determination and it is also shown that the persons were unaware of their relationship to the decedent, were unaware of his death, or were given no notice of any proceeding concerning his estate, except by publication.
(3) A petition for vacation under either (1) or (2) above must be filed prior to the earlier of the following time limits:
(i) If a personal representative has been appointed for the estate, the time of entry of any order approving final distribution of the estate.
(ii) Whether or not a personal representative has been appointed for the estate of the decedent, the time prescribed by Section 62-3-108 when it is no longer possible to initiate an original proceeding to probate a will of the decedent.
(iii) Twelve months after the entry of the order sought to be vacated.
(4) The order originally rendered in the testacy proceeding may be modified or vacated, if appropriate under the circumstances by the order of probate of the later-offered will or the order redetermining heirs.
(5) The finding of the fact of death is conclusive as to the alleged decedent only if notice of the hearing on the petition in the formal testacy proceeding was sent by registered or certified mail addressed to the alleged decedent at his last known address and the court finds that a search under Section 62-3-403(b) was made. If the alleged decedent is not dead, even if notice was sent and search was made, he may recover estate assets in the hands of the personal representative. In addition to any remedies available to the alleged decedent by reason of any fraud or intentional wrongdoing, the alleged decedent may recover any estate or its proceeds from distributees that is in their hands, or the value of distributions received by them, to the extent that any recovery from distributees is equitable in view of all of the circumstances.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 41; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-413. Vacation of order for other cause.
For good cause shown, an order in a formal testacy proceeding may be modified or vacated within the time allowed for appeal.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-414. Formal proceedings concerning appointment of personal representative.
(a) A formal proceeding for adjudication regarding the priority or qualification of one who is an applicant for appointment as a personal representative, or of one who previously has been appointed a personal representative in informal proceedings, if an issue concerning the testacy of the decedent is or may be involved, is governed by Section 62-3-402, as well as by this section. In other cases, the petition shall contain or adopt the statements required by Section 62-3-301(a)(1) and describe the question relating to priority or qualification of the personal representative which is to be resolved. If the proceeding precedes any appointment of a personal representative, it shall stay any pending informal appointment proceedings as well as any commenced thereafter. If the proceeding is commenced after appointment, the previously appointed personal representative, after receipt of notice thereof, shall refrain from exercising any power of administration except as necessary to preserve the estate or unless the court orders otherwise.
(b) After service of the summons and petition to interested persons, including all persons interested in the administration of the estate as successors under the applicable assumption concerning testacy, any previously appointed personal representative and any person having or claiming priority for appointment as a personal representative, the court shall determine who is entitled to appointment under Section 62-3-203, make a proper appointment, and, if appropriate, terminate any prior appointment found to have been improper as provided in cases of removal under Section 62-3-611.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 11, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 5
Administration Under Part 5
SECTION 62-3-501. Nature of proceeding.
Administration under Part 5 [Sections 62-3-501 et seq.] is a single in rem proceeding to secure complete administration and settlement of a decedent's estate under the continuing authority of the court which extends until entry of an order approving distribution of the estate and discharging the personal representative or other order terminating the proceeding. A personal representative under Part 5 [Sections 62-3-501 et seq.] is responsible to the court, as well as to the interested persons, and is subject to directions concerning the estate made by the court on its own motion or on the motion of any interested party. Except as otherwise provided in this part, or as otherwise ordered by the court, a personal representative under Part 5 [Sections 62-3-501 et seq.] has the same duties and powers as a personal representative who is not subject to administration under Part 5 [Sections 62-3-501 et seq.].
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-502. Petition; order.
A petition for administration under Part 5 [Sections 62-3-501 et seq.] may be filed by any interested person or by a personal representative at any time, a prayer for administration under Part 5 [Sections 62-3-501 et seq.] may be joined with a petition in a testacy or appointment proceeding, or the court may order administration under Part 5 [Sections 62-3-501 et seq.] on its own motion. If the testacy of the decedent and the priority and qualification of any personal representative have not been adjudicated previously, the petition for administration under Part 5 [Sections 62-3-501 et seq.] shall include the matters required of a petition in a formal testacy proceeding and the notice requirements and procedures applicable to a formal testacy proceeding apply. If not previously adjudicated, the court shall adjudicate the testacy of the decedent and questions relating to the priority and qualifications of the personal representative in any case involving a request for administration under Part 5 [Sections 62-3-501 et seq.], even though the request for administration under Part 5 [Sections 62-3-501 et seq.] may be denied. After service of the summons and petition and upon notice to interested persons, the court shall order administration under Part 5 [Sections 62-3-501 et seq.] of a decedent's estate: (1) if the decedent's will directs administration under Part 5 [Sections 62-3-501 et seq.], it shall be ordered unless the court finds that circumstances bearing on the need for administration under Part 5 [Sections 62-3-501 et seq.] have changed since the execution of the will and that there is no necessity for administration under Part 5 [Sections 62-3-501 et seq.]; (2) if the decedent's will directs no administration under Part 5 [Sections 62-3-501 et seq.], then administration shall be ordered only upon a finding that it is necessary for protection of persons interested in the estate; or (3) in other cases if the court finds that administration under Part 5 [Sections 62-3-501 et seq.] is necessary under the circumstances.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 12, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-503. Effect on other proceedings.
(a) The pendency of a proceeding for administration under Part 5 [Sections 62-3-501 et seq.] of a decedent's estate stays action on any informal application then pending or thereafter filed.
(b) If a will has been previously probated in informal proceedings, the effect of the filing of a petition for administration under Part 5 [Sections 62-3-501 et seq.] is as provided for formal testacy proceedings by Section 62-3-401.
(c) After service of the summons and petition upon the personal representative and notice of the filing of a petition for administration under Part 5 [Sections 62-3-501 et seq.], a personal representative who has been appointed previously shall not exercise his power to distribute any estate. The filing of the petition does not affect his other powers and duties unless the court restricts the exercise of any of them pending full hearing on the petition.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 13, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-504. Powers of personal representative.
Unless restricted by the court, a personal representative under Part 5 [Sections 62-3-501 et seq.] has, without interim orders approving exercise of a power, all powers of personal representatives under this Code, but he shall not exercise his power to make any distribution of the estate without prior order of the court. Any other restriction on the power of a personal representative which may be ordered by the court must be endorsed on his letters of appointment and any court certification thereof, and unless so endorsed is ineffective as to persons dealing in good faith with the personal representative.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-505. Interim orders; distribution and closing orders.
Unless otherwise ordered by the court, administration under Part 5 [Sections 62-3-501 et seq.] is terminated by order in accordance with time restrictions, notices, and contents of orders prescribed for proceedings under Section 62-3-1001. Interim orders approving or directing partial distributions or granting other relief may be issued by the court at any time during the pendency of an administration under Part 5 [Sections 62-3-501 et seq.] on the application of the personal representative or any interested person.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 6
Personal Representative; Appointment, Control, and Termination of Authority
SECTION 62-3-601. Qualification.
Prior to receiving letters, a personal representative shall qualify by filing with the appointing court any required bond and a statement of acceptance of the duties of the office.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-602. Acceptance of appointment; consent to jurisdiction.
By accepting appointment, a personal representative submits personally to the jurisdiction of the court in any proceeding relating to the estate that may be instituted by any interested person. Notice of any proceeding shall be delivered to the personal representative, or mailed to him by ordinary first class mail at his address as listed in the application or petition for appointment or as thereafter reported to the court and to his address as then known to the petitioner.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-603. Bond not required without court order; exceptions; waiver of bond requirement.
(A) Except as may be required pursuant to Section 62-3-605 or upon the appointment of a special administrator, a personal representative is not required to file a bond if:
(1) all heirs and devisees agree to waive the bond requirement;
(2) the personal representative is the sole heir or devisee;
(3) the personal representative is a state agency, bank, or trust company, unless the will expressly requires a bond; or
(4) the personal representative is named in the will, unless the will expressly requires a bond.
If, pursuant to Section 62-3-203(a), the court appoints as personal representative a nominee of a personal representative named in a will, the court may in its discretion decide not to require bond.
(B) Where a bond is required of the personal representative or administrator of an estate by law or by the will, it may be waived under the following conditions:
(1) the personal representative or administrator by affidavit at the time of applying for appointment as such certifies to the court that the gross value of the estate will be less than twenty thousand dollars, that the assets of the probate estate are sufficient to pay all claims against the estate, and that the personal representative or administrator agrees to be personally liable to any beneficiary or other person having an interest in the estate for any negligence or intentional misconduct in the performance of his duties as personal representative or administrator; and
(2) all known beneficiaries and other persons having an interest in the estate execute a written statement on a form prescribed by the court that they agree to the bond being waived. This form must be filed with the court simultaneously with the affidavit required by item (1) above. A creditor for purposes of this item (2) is not considered a person having an interest in the estate.
The provisions of this subsection (B) are supplemental and in addition to any other provisions of law permitting the waiving or reducing of a bond. Any bond required by Section 62-3-605 may not be waived under the provisions of this section.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 24; 1988 Act No. 659, § 17; 1989 Act No. 53, § 1; 1990 Act No. 521, § 42; 1994 Act No. 470, § 1; 1997 Act No. 152, § 13; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-604. Bond amount; security; procedure; reduction.
If bond is required and the provisions of the will or order do not specify the amount, unless stated in his application or petition, the person qualifying shall file a statement under oath with the court indicating his best estimate of the value of the personal estate of the decedent and of the income expected from the personal estate during the next year, and he shall execute and file a bond with the court, or give other suitable security, in an amount not less than the estimate. The court shall determine that the bond is duly executed by a corporate surety, or one or more individual sureties whose performance is secured by pledge of personal property, mortgage on real property, or other adequate security. The court may permit the amount of the bond to be reduced by the value of assets of the estate deposited with a domestic financial institution (as defined in Section 62-6-101) in a manner that prevents their unauthorized disposition. Upon application by the personal representative or another interested person or upon the court's own motion, the court may increase or reduce the amount of the bond, release sureties, dispense with security or securities, permit the substitution of another bond with the same or different sureties or dispense with the bond.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 14, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-605. Demand for bond by interested person.
Any person apparently having an interest in the estate worth in excess of five thousand dollars, or any creditor having a claim in excess of five thousand dollars, may make a written demand that a personal representative give bond. The demand must be filed with the court and a copy mailed to the personal representative, if appointment and qualification have occurred. Thereupon, bond is required in an amount determined by the court as sufficient to protect the interest of the person or creditor demanding bond, but the requirement ceases if the person or creditor demanding bond ceases to have an interest in the estate worth in excess of five thousand dollars or a claim in excess of five thousand dollars. After he has received notice and until the filing of the bond or cessation of the requirement of bond, the personal representative shall refrain from exercising any powers of his office except as necessary to preserve the estate or to pay the person or creditor demanding bond. Failure of the personal representative to meet a requirement of bond by giving suitable bond within thirty days after receipt of notice is cause for his removal and appointment of a successor personal representative unless good cause is shown for the delay.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 25; 1990 Act No. 521, § 43; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-606. Terms and conditions of bonds.
(a) The following requirements and provisions apply to any bond required by this part:
(1) Bonds shall name the judge of the court as obligee for the benefit of the persons interested in the estate and shall be conditioned upon the faithful discharge by the fiduciary of all duties according to law.
(2) Unless otherwise provided by the terms of the approved bond, sureties are jointly and severally liable with the personal representative and with each other. The address of sureties shall be stated in the bond.
(3) By executing an approved bond of a personal representative, the surety consents to the jurisdiction of the court which issued letters to the primary obligor in any proceedings pertaining to the fiduciary duties of the personal representative and naming the surety as a party. Notice of any proceeding shall be delivered to the surety or mailed to him by registered or certified mail at his address as listed with the court where the bond is filed and to his address as then known to the petitioner.
(4) On petition of a successor personal representative, any other personal representative of the same decedent, or any interested person, a proceeding in the court may be initiated against a surety for breach of the obligation of the bond of the personal representative.
(5) The bond of the personal representative is not void after the first recovery but may be proceeded against from time to time until the whole penalty is exhausted.
(b) No action or proceeding may be commenced against the surety on any matter as to which an action or proceeding against the primary obligor is barred by adjudication or limitation.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-607. Order restraining personal representative.
(a) Upon application of any interested person, the court by temporary order may restrain a personal representative from performing specified acts of administration, disbursement or distribution, or exercise of any powers or discharge of any duties of his office, or make any other order to secure proper performance of his duty, if it appears to the court that the personal representative otherwise may take some action which would jeopardize unreasonably the interest of the applicant or of some other interested person. Persons with whom the personal representative may transact business may be made parties.
(b) The matter shall be set for hearing within ten days or at such other times as the parties may agree. Notice as the court directs shall be given to the personal representative and his attorney of record, if any, and to any other parties named defendant in the application.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 15, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-608. Termination of appointment.
Termination of appointment of a personal representative occurs as indicated in Sections 62-3-609 to 62-3-612, inclusive. Termination ends the right and power pertaining to the office of personal representative as conferred by this Code or any will, except that a personal representative, at any time prior to distribution or until restrained or enjoined by court order, may perform acts necessary to protect the estate and may deliver the assets to a successor representative. Termination does not discharge a personal representative from liability for transactions or omissions occurring before termination, or relieve him of the duty to preserve assets subject to his control, to account therefor, and to deliver the assets. Termination does not affect the jurisdiction of the court over the personal representative, but terminates his authority to represent the estate in any pending or future proceeding.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-609. Death or disability terminates appointment.
The death of a personal representative or the appointment of a conservator or guardian for the person of a personal representative terminates his appointment. Until appointment and qualification of a successor or special representative to replace the deceased or protected representative, the representative of the estate of the deceased or protected personal representative, if any, has the duty to protect the estate possessed and being administered by his decedent or ward at the time his appointment terminates, has the power to perform acts necessary for protection, and shall account for and deliver the estate assets to a successor or special personal representative upon his appointment and qualification.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-610. Order closing estate terminates appointment.
(a) Unless otherwise provided, an order closing an estate as provided in Section 62-3-1001 terminates an appointment of a personal representative and relieves the personal representative's attorney of record of any further duties to the court.
(b) A personal representative may resign his position by filing a written statement of resignation with the court and providing twenty days' written notice to the persons known to be interested in the estate. If no one applies or petitions for appointment of a successor representative within the time indicated in the notice, the filed statement of resignation is ineffective as a termination of appointment and in any event is effective only upon the appointment and qualification of a successor representative and delivery of the assets to him. When the resignation is effective, the personal representative's attorney of record shall be relieved of any further duties to the court.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 44; 1997 Act No. 152, § 14; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-611. Petition for removal; cause; procedure.
(a) A person interested in the estate may petition for removal of a personal representative for cause at any time. Upon filing of the petition, the court shall fix a time and place for hearing. Notice shall be given by the petitioner to the personal representative, and to other persons as the court may order. Except as otherwise ordered as provided in Section 62-3-607, after service of the summons and petition upon the personal representative and receipt of notice of removal proceedings, the personal representative shall not act except to account, to correct maladministration, or preserve the estate. If removal is ordered, the court also shall direct by order the disposition of the assets remaining in the name of, or under the control of, the personal representative being removed.
(b) Cause for removal exists when removal would be in the best interests of the estate, or if it is shown that a personal representative or the person seeking his appointment intentionally misrepresented material facts in the proceedings leading to his appointment, or that the personal representative has disregarded an order of the court, has become incapable of discharging the duties of his office, or has mismanaged the estate or failed to perform any duty pertaining to the office. Unless the decedent's will directs otherwise, a personal representative appointed at the decedent's domicile, incident to securing appointment of himself or his nominee as ancillary personal representative, may obtain removal of another who was appointed personal representative in this State to administer local assets.
(c) The termination of appointment under this section shall relieve the personal representative's attorney of record of any further duties to the court.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 16, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-612. Change of testacy status.
Except as otherwise ordered in formal proceedings, the probate of a will subsequent to the appointment of a personal representative in intestacy or under a will which is superseded by formal probate of another will, or the vacation of an informal probate of a will subsequent to the appointment of the personal representative thereunder, does not terminate the appointment of the personal representative although his powers may be reduced as provided in Section 62-3-401. Termination occurs upon appointment in informal or formal appointment proceedings of a person entitled to appointment under the later assumption concerning testacy. If no request for new appointment is made within thirty days after expiration of time for appeal from the order in formal testacy proceedings, or from the informal probate, changing the assumption concerning testacy, the previously appointed personal representative upon request may be appointed personal representative under the subsequently probated will, or as in intestacy as the case may be.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-613. Successor personal representative.
Parts 3 and 4 of this article [Sections 62-3-301 et seq. and Sections 62-3-401 et seq.] govern proceedings for appointment of a personal representative to succeed one whose appointment has been terminated. After appointment and qualification, a successor personal representative may be substituted in all actions and proceedings to which the former personal representative was a party, and no notice, process, or claim which was given or served upon the former personal representative need be given to or served upon the successor in order to preserve any position or right the person giving the notice or filing the claim may thereby have obtained or preserved with reference to the former personal representative. Except as otherwise ordered by the court, the successor personal representative has the powers and duties in respect to the continued administration which the former personal representative would have had if his appointment had not been terminated.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-614. Special administrator; appointment.
A special administrator may be appointed:
(1) informally by the court on the application of an interested person when necessary:
(a) to protect the estate of a decedent prior to the appointment of a general personal representative or if a prior appointment has been terminated as provided in Section 62-3-609;
(b) for a creditor of the decedent's estate to institute any proceeding under Section 62-3-803; or
(c) to take appropriate actions involving estate assets;
(2) in a formal proceeding by order of the court on the petition of any interested person and finding, after notice and hearing, that appointment is necessary to preserve the estate or to secure its proper administration including its administration in circumstances where a general personal representative cannot or should not act. If it appears to the court that an emergency exists, appointment may be ordered without notice.
HISTORY: 1986 Act No. 539, § 1; 1997 Act No. 152, § 15; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-615. Special administrator; who may be appointed.
(a) If a special administrator is to be appointed pending the probate of a will which is the subject of a pending application or petition for probate, the person named executor in the will shall be appointed if available and qualified.
(b) In other cases, any proper person may be appointed special administrator.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-616. Special administrator; appointed informally; powers and duties.
A special administrator appointed by the court in informal proceedings pursuant to Section 62-3-614(1) has the duty to collect and manage the assets of the estate, to preserve them, to account therefor, and to deliver them to the general personal representative upon his qualification. The special administrator has the power of a personal representative under this Code necessary to perform his duties.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-617. Special administrator; formal proceedings; powers and duties.
A special administrator appointed by order of the court in any formal proceeding has the power of a general personal representative except as limited in the appointment and duties as prescribed in the order. The appointment may be for a specified time, to perform particular acts, or on other terms as the court may direct.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-618. Termination of appointment; special administrator.
The appointment of a special administrator terminates in accordance with the provisions of the order of appointment or on the appointment of a general personal representative. In other cases, the appointment of a special administrator is subject to termination as provided in Sections 62-3-608 through 62-3-611.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-619. "Executor de son tort" defined.
Any person who obtains, receives, or possesses property of whatever kind, belonging to the decedent, by means of fraud or without paying valuable consideration equivalent to the value of the property, shall be charged and chargeable as executor of his own wrong (executor de son tort) with respect to the goods and debts. The value of the property is charged to the executor de son tort. Likewise, the value of the property shall be deducted from any distribution or payment of any claim or commission to which the executor de son tort is entitled from the estate.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-620. Order for executor de son tort to account for deceased's property; decree for damages.
Acting sua sponte or upon the petition of any interested person, the probate judge of the county in which a deceased person was domiciled at the time of his death may order the executor de son tort to account for the property in his possession. Upon a finding that the property has been converted, wasted or otherwise damaged through improper interference, the court may assess damages including attorney's fees and costs in the amount determined by the court not to exceed the value of the property charged to the executor de son tort.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-621. Rights under Section 62-3-620 survive death of executor de son tort.
The rights of the probate court and interested parties set forth in Section 62-3-620 shall survive the death of the executor de son tort.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 7
Duties and Powers of Personal Representatives
SECTION 62-3-701. Time of accrual of duties and powers.
The duties and powers of a personal representative commence upon his appointment. The powers of a personal representative relate back in time to give acts by the person appointed which are beneficial to the estate occurring prior to appointment the same effect as those occurring thereafter. Prior to appointment, a person named personal representative in a will may protect property of the decedent's estate and carry out written instructions of the decedent relating to his body, funeral, and burial arrangements. A personal representative may ratify and accept acts on behalf of the estate done by others where the acts would have been proper for a personal representative.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-702. Priority among different letters.
A person to whom general letters are issued first has exclusive authority under the letters until his appointment is terminated or modified. If, through error, general letters are afterwards issued to another, the first appointed representative may recover any property of the estate in the hands of the representative subsequently appointed, but the acts of the latter done in good faith before notice of the first letters are not void for want of validity of appointment.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-703. General duties; relation and liability to persons interested in estate; standing to sue.
(a) A personal representative is a fiduciary who shall observe the standards of care described by Section 62-7-804. A personal representative has a duty to settle and distribute the estate of the decedent in accordance with the terms of a probated and effective will and this code, and as expeditiously and efficiently as is consistent with the best interests of the estate. He shall use the authority conferred upon him by this code, the terms of the will, and any order in proceedings to which he is party for the best interests of successors to the estate.
(b) A personal representative shall not be surcharged for acts of administration or distribution if the conduct in question was authorized at the time. Subject to other obligations of administration, an informally probated will is authority to administer and distribute the estate according to its terms. Upon expiration of the relevant claim period, an order of appointment of a personal representative, whether issued in informal or formal proceedings, is authority to distribute apparently intestate assets to the heirs of the decedent if, at the time of distribution, the personal representative has not received actual notice of a pending testacy proceeding, a proceeding to vacate an order entered in an earlier testacy proceeding, a formal proceeding questioning his appointment or fitness to continue, or a proceeding for administration under Part 5. Nothing in this section affects the duty of the personal representative to administer and distribute the estate in accordance with the rights of claimants, the surviving spouse, any minor and dependent children, and any pretermitted child of the decedent as described elsewhere in this Code.
(c) Except as to proceedings which do not survive the death of the decedent, a personal representative of a decedent domiciled in this State at his death has the same standing to sue and be sued in the courts of this State and the courts of any other jurisdiction as his decedent had immediately prior to death.
HISTORY: 1986 Act No. 539, § 1; 2005 Act No. 66, § 5; 2010 Act No. 244, § 44, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-704. Personal representative to proceed with court sanction.
A personal representative shall proceed expeditiously with the settlement and distribution of a decedent's estate under the supervision of the court, as follows:
(a) Immediately after his appointment he shall publish the notice to creditors required by Section 62-3-801.
(b) Within ninety days after his appointment he shall file with the court the inventory and appraisement required by Section 62-3-706.
(c) Upon the expiration of the relevant period, as set forth in Section 62-3-807, the personal representative shall proceed to allow or disallow claims and pay the claims allowed against the estate, as provided in Section 62-3-807.
(d) Upon the expiration of the relevant period, as set forth in Section 62-3-1001, the personal representative shall file the accounting, proposal for distribution, petition for settlement of the estate, proofs required by Section 62-3-1001, and proof of publication of notice to creditors.
(e) Within the time set forth in Section 62-3-806(a), serve upon all claimants a notice stating that their claim has been allowed or disallowed pursuant to that section.
(f) The time periods stated herein for completing the above requirements are not intended to supplant any other time periods stated elsewhere in this Code. The court may on its own motion, or on the motion of the personal representative or of any interested person, extend the time for completing any of the requirements of administration contained in Article 3 [Section 62-3-1001, et seq.] including any of the above requirements, and especially including the requirement to account, under Section 62-3-1001, in cases of estates which remain significantly unadministered as of the expiration of the relevant time period, either as to the marshalling of assets or as to the allowance of claims.
(g) If a personal representative or trustee neglects or refuses to comply with any provision of Section 62-3-706 he is subject to the contempt power of the court. The probate court, after a hearing and any notice the court may require, may issue its order imposing the sentence, fine, or penalty as it sees fit and remove the personal representative and appoint another personal representative.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 26; 1990 Act No. 521, § 45; 1993 Act No. 181, § 1608; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-705. Duty of personal representative; information to heirs and devisees.
Not later than thirty days after his appointment every personal representative, except any special administrator, shall give information of his appointment to the heirs (regardless of whether the decedent died intestate and determined as if the decedent died intestate) and devisees, including, if there has been no formal testacy proceeding and if the personal representative was appointed on the assumption that the decedent died intestate, the devisees in any will mentioned in the application for appointment of a personal representative. The information must be delivered or sent by ordinary mail to each of the heirs and devisees whose address is reasonably available to the personal representative. The duty does not extend to require information to persons who have been adjudicated in a prior formal testacy proceeding to have no interest in the estate. The information must include the name and address of the personal representative, indicate that it is being sent to persons who have or may have some interest in the estate being administered, indicate whether bond has been filed, and describe the court where papers relating to the estate are on file. The personal representative's failure to give this information is a breach of his duty to the persons concerned but does not affect the validity of his appointment, his powers, or other duties. A personal representative may inform other persons of his appointment by delivery or ordinary first class mail.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 46; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-706. Duty of personal representative; inventory and appraisement.
(A) Within ninety days after his appointment, a personal representative, who is not a special administrator or a successor to another representative who has previously discharged this duty, shall:
(1) prepare an inventory and appraisement of probate property owned by the decedent at the time of his death, listing it with reasonable detail, and indicating as to each listed item, its fair market value as of the date of the decedent's death, and the type and amount of any encumbrance that may exist with reference to any item;
(2) file the original of the inventory and appraisement with the court; and
(3) mail a copy of the filed inventory and appraisement to interested persons who have filed a demand for notice of the filing of the inventory pursuant to Section 62-3-204.
(B) Within ninety days of a demand by an interested person for an inventory of nonprobate property, the personal representative shall:
(1) prepare a list of the property owned by the decedent at the time of his death that is not probate property, so far as is known to the personal representative which may, at the discretion of the personal representative, include the value and nature of the decedent's interest in the property on the date of the decedent's death;
(2) mail a copy of the list to each interested person who has requested the list; and
(3) file proof of the mailing with the probate court.
(C) The court, upon application of the personal representative, may extend the time for filing or making either the inventory and appraisement or list of nonprobate property provided for in this section.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 27; 1990 Act No. 521, § 47; 1993 Act No. 181, § 1609; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-707. Employment of appraisers.
The personal representative may obtain a qualified and disinterested appraiser to assist him in ascertaining the fair market value as of the date of the decedent's death of any asset. Different persons may be employed to appraise different kinds of assets included in the estate. The names and addresses of any appraiser must be indicated on the inventory and appraisement or by supplemental inventory and appraisement with the item or items he appraised. On application of any interested person, the court may require that one or more qualified appraisers be appointed to ascertain the fair market value of all or any part of the estate or may approve one or more qualified appraisers.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 48; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-708. Duty of personal representative; supplementary inventory.
If any property not included in the original inventory and appraisement comes to the knowledge of a personal representative or if the personal representative learns that the value or description indicated in the original inventory for any item is erroneous or misleading, he shall submit a supplementary, amended or corrected inventory or appraisement showing the market value as of the date of the decedent's death of the new item or the revised market value or descriptions, the appraisers or other data relied upon, if any, and restating the unchanged information from the original inventory and appraisement and furnish copies to persons who receive the original inventory, and to interested persons who have requested or demanded the new information.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-709. Duty of personal representative; possession of estate.
Except as otherwise provided by a decedent's will, every personal representative has a right to, and shall take possession or control of, the decedent's property, except that any real property or tangible personal property may be left with or surrendered to the person presumptively entitled thereto unless or until, in the judgment of the personal representative, possession of the property by him will be necessary for purposes of administration. The request by a personal representative for delivery of any property possessed by an heir or devisee is conclusive evidence, in any action against the heir or devisee for possession thereof, that the possession of the property by the personal representative is necessary for purposes of administration. The personal representative shall pay taxes on, and take all steps reasonably necessary for the management, protection, and preservation of, the estate in his possession. He may maintain an action to recover possession of property or to determine the title thereto.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-710. Power to avoid transfers.
The property liable for the payment of unsecured debts of a decedent includes all property transferred by him by any means which is in law void or voidable as against his creditors, and subject to prior liens, the right to recover this property, so far as necessary for the payment of unsecured debts of the decedent, is exclusively in the personal representative.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-711. Powers of personal representatives; in general.
(a) Until termination of his appointment or unless otherwise provided in Section 62-3-910, a personal representative has the same power over the title to property of the estate that an absolute owner would have, in trust however, for the benefit of the creditors and others interested in the estate. Except as otherwise provided in subsection (b), this power may be exercised without notice, hearing, or order of court.
(b) Except where the will of the decedent authorizes to the contrary, a personal representative may not sell real property of the estate except as authorized pursuant to the procedures described in Sections 62-3-911 or Sections 62-3-1301 et seq. and shall refrain from selling tangible or intangible personal property of the estate (other than securities regularly traded on national or regional exchanges and produce, grain, fiber, tobacco, or other merchandise of the estate for which market values are readily ascertainable) having an aggregate value of ten thousand dollars or more without prior order of the court which may be issued upon application of the personal representative and after notice or consent as the court deems appropriate.
(c) If the will of a decedent devises real property to a personal representative or authorizes a personal representative to sell real property (the title to which was not devised to the personal representative), then subject to Section 62-3-713, the personal representative, acting in trust for the benefit of the creditors and other interested persons in the estate, may execute a deed in favor of a purchaser for value, who takes title to the real property in accordance with the provisions of Section 62-3-910(B).
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 28; 2000 Act No. 398, § 4; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-712. Improper exercise of power; breach of fiduciary duty.
If the exercise of power concerning the estate is improper, the personal representative is liable to interested persons for damage or loss resulting from breach of his fiduciary duty to the same extent as a trustee of an express trust. The rights of purchasers and others dealing with a personal representative shall be determined as provided in Sections 62-3-713 and 62-3-714.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-713. Sale, encumbrance, or transaction involving conflict of interest; voidable; exceptions.
Any sale or encumbrance to the personal representative, his spouse, agent or attorney, or any corporation or trust in which he has a substantial beneficial interest, or any transaction which is affected by a substantial conflict of interest on the part of the personal representative, is voidable by any person interested in the estate except one who has consented after fair disclosure unless:
(1) the will or a contract entered into by the decedent expressly authorized the transaction; or
(2) the transaction is approved by the court after notice to interested persons.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-714. Persons dealing with personal representative; protection.
A person who in good faith either assists a personal representative or deals with him for value is protected as if the personal representative properly exercised his power. The fact that a person knowingly deals with a personal representative does not alone require the person to inquire into the existence of a power or the propriety of its exercise. Except for restrictions on powers of personal representatives under Part 5 [Sections 62-3-501 et seq.] which are endorsed on letters as provided in Section 62-3-504, no provision in any will or order of court purporting to limit the power of a personal representative is effective except as to persons with actual knowledge thereof. A person is not bound to see to the proper application of estate assets paid or delivered to a personal representative. The protection here expressed extends to instances in which some procedural irregularity or jurisdictional defect occurred in proceedings leading to the issuance of letters, including a case in which the alleged decedent is found to be alive. The protection here expressed is not by substitution for that provided by comparable provisions of the laws relating to commercial transactions and laws simplifying transfers of securities by fiduciaries.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-715. Transactions authorized for personal representatives; exceptions.
Except as restricted or otherwise provided by the will or by an order in a formal proceeding and subject to the restrictions imposed in Section 62-3-711(b) and to the priorities stated in Section 62-3-902, a personal representative, acting reasonably for the benefit of the interested persons, may properly:
(1) retain assets owned by the decedent pending distribution or liquidation including those in which the representative is personally interested or which are otherwise improper for trust investment;
(2) receive assets from fiduciaries or other sources;
(3) perform, compromise, or refuse performance of the decedent's contracts that continue as obligations of the estate, as he may determine under the circumstances. In performing enforceable contracts by the decedent to convey or lease land, the personal representative, among other possible courses of action, may:
(i) execute and deliver a deed of conveyance for cash payment of all sums remaining due or the purchaser's note for the sum remaining due secured by a mortgage or deed of trust on the land; or
(ii) deliver a deed in escrow with directions that the proceeds, when paid in accordance with the escrow agreement, be paid to the successors of the decedent, as designated in the escrow agreement.
Execution and delivery of a deed pursuant to this subsection affects title to the subject real property to the same extent as execution and delivery of a deed by the personal representative in other cases authorized by this Code;
(4) satisfy written charitable pledges of the decedent irrespective of whether the pledges constituted binding obligations of the decedent or were properly presented as claims, if in the judgment of the personal representative the decedent would have wanted the pledges completed under the circumstances;
(5) if funds are not needed to meet debts and expenses currently payable and are not immediately distributable, deposit or invest liquid assets of the estate, including monies received from the sale of other assets, in federally insured interest-bearing accounts, readily marketable secured loan arrangements or other prudent investments which would be reasonable for use by trustees generally;
(6) subject to the restrictions imposed in Section 62-3-711(b), acquire or dispose of an asset, including land in this or another state, for cash or on credit, at public or private sale; and manage, develop, improve, exchange, partition, change the character of, or abandon an estate asset;
(7) make ordinary or extraordinary repairs or alterations in buildings or other structures, demolish any improvements, raze existing, or erect new party walls or buildings;
(8) satisfy and settle claims and distribute the estate as provided in this Code;
(9) enter for any purpose into a lease as lessor or lessee, with or without option to purchase or renew, but not for a term extending beyond the period of administration and, with respect to a lease with option to purchase, subject to the restrictions imposed in Section 62-3-711(b);
(10) enter into a lease or arrangement for exploration and removal of minerals or other natural resources or enter into a pooling or unitization agreement;
(11) vote stocks or other securities in person or by general or limited proxy;
(12) pay calls, assessments, and other sums chargeable or accruing against or on account of securities, unless barred by the provisions relating to claims;
(13) hold a security in the name of a nominee or in other form without disclosure of the interest of the estate but the personal representative is liable for any act of the nominee in connection with the security so held;
(14) insure the assets of the estate against damage, loss, and liability and himself against liability as to third persons;
(15) effect a fair and reasonable compromise with any debtor or obligor, or extend, renew, or in any manner modify the terms of any obligation owing to the estate. If the personal representative holds a mortgage, pledge, lien, or other security interest upon property of another persons, he may, in lieu of foreclosure, accept a conveyance or transfer of encumbered assets from the owner thereof in satisfaction of the indebtedness secured by lien;
(16) pay taxes, assessments, compensation of the personal representative, and other expenses incident to the administration of the estate;
(17) sell, or exercise stock subscription or conversion rights; consent, directly or through a committee or other agent, to the reorganization, consolidation, merger, dissolution, or liquidation of a corporation or other business enterprise;
(18) allocate items of income or expense to either estate income or principal, as permitted or provided by law;
(19) employ persons, including attorneys, auditors, investment advisors, or agents, even if they are associated with the personal representative, to advise or assist the personal representative in the performance of his administrative duties; act without independent investigation upon their recommendations; and instead of acting personally, employ one or more agents to perform any act of administration, whether or not discretionary;
(20) prosecute or defend claims, or proceedings in any jurisdiction for the protection of the estate and of the personal representative in the performance of his duties;
(21) subject to the restrictions imposed in Section 62-3-711(b), sell, mortgage, or lease any real or personal property of the estate or any interest therein for cash, credit, or for part cash and part credit, and with or without security for unpaid balances;
(22) continue any unincorporated business or venture in which the decedent was engaged at the time of his death (i) in the same business form for a period of not more than four months from the date of appointment of a general personal representative if continuation is a reasonable means of preserving the value of the business including good will; (ii) in the same business form for any additional period of time that may be approved by order of the court in a formal proceeding to which the persons interested in the estate are parties; or (iii) throughout the period of administration if the business is incorporated by the personal representative and if none of the probable distributees of the business who are competent adults object to its incorporation and retention in the estate;
(23) make payment in cash or in kind, or partly in cash and partly in kind, upon any division or distribution of the estate (including the satisfaction of any pecuniary distribution) without regard to the income tax basis of any specific property allocated to any beneficiary and value and appraise any asset and distribute such asset in kind at its appraised value;
(24) with the approval of the probate court or the circuit court, compromise and settle claims and actions for wrongful death, pain and suffering or both, and all claims and actions based on causes of actions surviving, to personal representatives, arising, asserted, or brought under or by virtue of any statute or act of this State, any state of the United States, the United States, or any foreign country;
(25) donate a qualified conservation easement or fee simple gift of land for conservation on any real property of the decedent in order to obtain the benefit of the estate tax exclusion allowed under Internal Revenue Code Section 2031(c) as defined in Section 12-6-40(A), and the state income tax credit allowed under Section 12-6-3515, if the personal representative has the written consent of all of the heirs, beneficiaries, and devisees whose interests are affected by the donation. Upon petition of the personal representative, the probate court may consent on behalf of any unborn, unascertained, or incapacitated heirs, beneficiaries, or devisees whose interests are affected by the donation after determining that the donation of the qualified real property interest shall not adversely affect them or would most likely be agreed to by them if they were before the court and capable of consenting. A guardian ad litem must be appointed to represent the interest of any unborn, unascertained, or incapacitated persons. Similarly, and for the same purposes and under the same conditions, mutatis mutandis, a trustee may make such a donation for the settlor;
(26) the personal representative has the power to access the decedent's files and accounts in electronic format, including the power to obtain the decedent's user names and passwords.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, §§ 29, 30; 1990 Act No; 521, § 49; 2000 Act No. 283, § 1(E); 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-716. Powers and duties of successor personal representative.
A successor personal representative has the same power and duty as the original personal representative to complete the administration and distribution of the estate, as expeditiously as possible, but he shall not exercise any power expressly made personal to the executor named in the will.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-717. Corepresentatives; when joint action required.
If two or more persons are appointed corepresentatives and unless the will provides otherwise, the concurrence of all is required on all acts connected with the administration and distribution of the estate. This restriction does not apply when any corepresentative receives and receipts for property due the estate, when the concurrence of all cannot readily be obtained in the time reasonably available for emergency action necessary to preserve the estate. When a corepresentative has been delegated to act for the others, written notice of the delegation signed by the others and setting forth the duties delegated must be filed with the court. Persons dealing with a corepresentative if actually unaware that another has been appointed to serve with him or if advised by the personal representative with whom they deal that he has authority to act alone for any of the reasons mentioned herein, are as fully protected as if the persons with whom they dealt had been the sole personal representative.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-718. Powers of surviving personal representative.
Unless the terms of the will otherwise provide, every power exercisable by personal corepresentatives may be exercised by the one or more remaining after the appointment of one or more is terminated and, if one of two or more nominated as coexecutors is not appointed, those appointed may exercise all the powers incident to the office.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-719. Compensation of personal representative.
(a) Unless otherwise approved by the court for extraordinary services, a personal representative shall receive for his care in the execution of his duties a sum from the probate estate funds not to exceed five percent of the appraised value of the personal property of the probate estate plus the sales proceeds of real property of the probate estate received on sales directed or authorized by will or by proper court order, except upon sales to the personal representative as purchaser. The minimum commission payable is fifty dollars, regardless of the value of the personal property of the estate.
(b) Additionally, a personal representative may receive not more than five percent of the income earned by the probate estate in which he acts as fiduciary. No such additional commission is payable by an estate if the probate judge determines that a personal representative has acted unreasonably in the accomplishment of the assigned duties, or that unreasonable delay has been encountered.
(c) The provisions of this section do not apply in a case where there is a contract providing for the compensation to be paid for such services, or where the will otherwise directs, or where the personal representative qualified to act before June 28, 1984.
(d) A personal representative also may renounce his right to all or any part of the compensation. A written renunciation of fee may be filed with the court.
(e) If more than one personal representative is serving an estate, the court in its discretion shall apportion the compensation among the personal representatives, but the total compensation for all personal representatives of an estate must not exceed the maximum compensation allowable under subsections (a) and (b) for an estate with a sole personal representative.
(f) For purposes of this section, "probate estate" means the decedent's property passing under the decedent's will plus the decedent's property passing by intestacy. This subsection is intended to be declaratory of the law and governs the compensation of personal representatives currently serving and personal representatives serving at a later time.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 50; 1997 Act No. 152, § 16; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-720. Expenses in estate litigation.
If any personal representative or person nominated as personal representative defends or prosecutes any proceeding in good faith, whether successful or not, he is entitled to receive from the estate his necessary expenses and disbursements including reasonable attorneys' fees incurred.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-721. Proceedings for review of employment of agents and compensation of personal representatives and employees of estate.
(a) After notice to all interested persons, on petition of an interested person or on appropriate motion if administration is under Part 5 [Sections 62-3-501 et seq.], the propriety of employment of any person by a personal representative including any attorney, auditor, investment advisor, or other specialized agent or assistant, the reasonableness of the compensation of any person so employed, or the reasonableness of the compensation determined by the personal representative for his own services, may be reviewed by the court. Any person who has received excessive compensation from an estate for services rendered may be ordered to make appropriate refunds.
(b) Upon the settlement of their accounts by personal representatives the court shall allow each appraiser appointed by the court a reasonable daily fee for each day spent on appraising the property of the estate and also mileage at the same rate that members of state boards, commissions, and committees receive for each mile actually traveled in going to and from the place where the property ordered to be appraised is situated. In determining the reasonableness of the fee to each appraiser the court shall consider the value of the estate, the actual time consumed by the appraisers in the performance of their duties, and other such circumstances and conditions surrounding the appraisal as the court deems appropriate.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 8
Creditors' Claims
SECTION 62-3-801. Notice to creditors.
(a) Unless notice has already been given under this section, a personal representative upon his appointment must publish a notice to creditors once a week for three successive weeks in a newspaper of general circulation in the county announcing his appointment and address and notifying creditors of the estate to present their claims within eight months after the date of the first publication of the notice or be forever barred.
(b) A personal representative may give written notice by mail or other delivery to any creditor, notifying the creditor to present his claim within one year of the decedent's death, or within sixty days from the mailing or other delivery of such notice, whichever is earlier, or be forever barred. Written notice is the notice described in (a) above or a similar notice.
(c) The personal representative is not liable to any creditor or to any successor of the decedent for giving or failing to give notice under this section.
(d) Notwithstanding subsections (a) and (b), notice to creditors under this section is not required if a personal representative is not appointed to administer the decedent's estate during the one year period following the death of the decedent.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 31; 1990 Act No. 521, § 51; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-802. Statutes of limitations.
(a) Unless an estate is insolvent, the personal representative, with the consent of all successors whose interests would be affected, may waive any defense of limitations available to the estate. If the defense is not waived, no claim which was barred by any statute of limitations at the time of the decedent's death shall be allowed or paid.
(b) The running of any statute of limitations measured from some other event than death or the giving of notice to creditors is suspended during the eight months following the decedent's death but resumes thereafter as to claims not barred pursuant to the sections which follow.
(c) For purposes of any statute of limitations, the proper presentation of a claim under Section 62-3-804 is equivalent to commencement of a proceeding on the claim.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 32; 1990 Act No. 521, § 52; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-803. Limitations on presentation of claims.
(a) All claims against a decedent's estate which arose before the death of the decedent, including claims of the State and any political subdivision thereof, whether due or to become due, absolute or contingent, liquidated or unliquidated, founded on contract, tort, or other legal basis, if not barred earlier by another statute of limitations or nonclaim statute; are barred against the estate, the personal representative, the decedent's heirs and devisees, and nonprobate transferees of the decedent; unless presented within the earlier of the following:
(1) one year after the decedent's death; or
(2) the time provided by Section 62-3-801(b) for creditors who are given actual notice, and within the time provided in Section 62-3-801(a) for all creditors barred by publication.
(b) A claim described in subsection (a) which is barred by the nonclaim statute of the decedent's domicile before the giving of notice to creditors in this State is barred in this State.
(c) All claims against a decedent's estate which arise at or after the death of the decedent, including claims of the State and any subdivision thereof, whether due or to become due, absolute or contingent, liquidated or unliquidated, founded on contract, tort, or other legal basis, are barred against the estate, the personal representative, and the heirs and devisees of the decedent, unless presented as follows:
(1) a claim based on a contract with the personal representative within eight months after performance by the personal representative is due; or
(2) any other claim, within the later of eight months after it arises, or the time specified in subsection (a)(1).
(d) Nothing in this section shall be construed as placing a limitation on the time for:
(1) commencing a proceeding to enforce a mortgage, pledge, lien, or other security interest upon property of the estate;
(2) to the limits of the insurance protection only, commencing a proceeding to establish liability of the decedent or the personal representative for which he is protected by liability insurance; or
(3) collecting compensation for services rendered to the estate or reimbursement for expenses advanced by the personal representative or by the attorney or accountant for the personal representative of the estate.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 33; 1990 Act No. 521, § 53; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-804. Manner of presentation of claims.
Claims against a decedent's estate must be presented as follows:
(1)(a) The claimant may deliver or mail to the personal representative a written statement of the claim indicating its basis, the name and address of the claimant, and the amount claimed, and must file a written statement of the claim, in the form prescribed by rule, with the probate court in which the decedent's estate is under administration. The claim is considered presented upon the filing of the statement of claim with the court. If a claim is not yet due, the date when it will become due must be stated. If the claim is contingent or unliquidated, the nature of the uncertainty must be stated. If the claim is secured, the security must be described. Failure to describe fully the security, the nature of any uncertainty, and the due date of a claim not yet due does not invalidate the presentation made.
(b) In addition to the requirements in subsection (1)(a), a creditor seeking appointment as personal representative pursuant to Section 62-3-203(a)(6) must attach the written statement of the claim to the application or petition for appointment. For purposes of Section 62-3-803, the claim is considered to be presented when the application or petition for appointment is filed with the written statement of the claim attached.
(2) Subject to subsection (5), once a claim is presented in accordance with subsection (1), a claimant may at any time thereafter commence a legal proceeding against the personal representative by the filing of a summons and petition for allowance of claim or complaint in any court where the personal representative may be subjected to jurisdiction, seeking payment of the claim by the decedent's estate, and serving the same upon the personal representative. If the legal proceeding is not commenced in the probate court, the claimant must provide written notice to the probate court in which the decedent's estate is under administration that a legal proceeding has commenced for allowance of the claim, setting forth the court in which the legal proceeding is pending. Thereafter, the probate court shall not authorize the closing of the decedent's estate until the legal proceeding has ended.
(3) In lieu of the procedure provided in subsections (1) and (2), and subject to subsection (6), a claimant may commence a legal proceeding against the personal representative, by the filing of a summons and petition for allowance of claim or complaint in any court where the personal representative may be subjected to jurisdiction, seeking payment of his claim by the estate, and serving the same upon the personal representative. The commencement of the legal proceeding under this subsection must occur within the time limit for presenting the claim as set forth in Section 62-3-803. If the legal proceeding is not commenced in the probate court, the claimant must file a written statement of the claim with the probate court in which the decedent's estate is under administration providing substantially the same information as the statement in subsection (1), along with a statement that a legal proceeding to enforce the claim has commenced, and identifying the court where the proceeding is pending. Thereafter, the probate court shall not permit the closing of the decedent's estate until the legal proceeding has ended.
(4) Notwithstanding any other provision of this section, no presentation of a claim is required in regard to matters claimed in proceedings against the decedent which were pending at the time of the decedent's death.
(5) Notwithstanding any other provision of this section, no proceeding for enforcement or allowance of a claim or collection of a debt may be commenced more than thirty days after the personal representative has mailed a notice of disallowance or partial disallowance of the claim in accordance with the provisions of Section 62-3-806. However, in the case of a claim which is not presently due or which is contingent or unliquidated, the personal representative may consent to an extension of the thirty day period, or to avoid injustice the court, on petition presented to the court prior to the expiration of the thirty-day period, may order an extension of the thirty-day period, but in no event shall the extension run beyond the applicable statute of limitations.
(6) Notwithstanding any other provision of this section, no claim against a decedent's estate may be presented or legal action commenced against a decedent's estate prior to the appointment of a personal representative to administer the decedent's estate.
(7)(a) A legal proceeding pending on the date of a decedent's death in which the decedent was a necessary party shall be suspended until a personal representative is appointed to administer the decedent's estate, unless a court otherwise orders.
(b) Pursuant to Section 62-3-104, this subsection does not apply to a proceeding by a secured creditor of a decedent to enforce the secured creditor's right to its security. It does apply to a proceeding for a deficiency judgment against a decedent or the estate of a decedent.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, §§ 34, 35; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-805. Classification of claims.
(a) If the applicable assets of the estate are insufficient to pay all claims in full, the personal representative shall make payment in the following order:
(1) costs and expenses of administration, including attorney's fees, and reasonable funeral expenses;
(2) debts and taxes with preference under federal law;
(3) reasonable and necessary medical expenses, hospital expenses, and personal care expenses of the last illness of the decedent, including compensation of persons attending the decedent prior to death;
(4) debts and taxes with preference under other laws of this State, in the order of their priority, including medical assistance paid under Title XIX State Plan for Medical Assistance as provided for in Section 43-7-460;
(5) all other claims.
(b) Except as is provided under subsection (a)(4), no preference shall be given in the payment of any claim over any other claim of the same class, and a claim due and payable shall not be entitled to a preference over claims not due.
(c) Any person advancing or lending money to a decedent's estate for the payment of a specific claim shall, to the extent of the loan, have the same priority for payment as the claimant paid with the proceeds of the loan.
HISTORY: 1986 Act No. 539, § 1; 1994 Act No. 481, § 8; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-806. Allowance of claims.
(a) As to claims presented in the manner described in Section 62-3-804(1) within the time limit prescribed in Section 62-3-803, within sixty days after the presentment of the claim, or within fourteen months after the death of the decedent, whichever is later, the personal representative must serve upon the claimant a notice stating the claim has been allowed or disallowed in whole or in part. Service of such notice shall be by United States mail, personal service, or otherwise as permitted by rule and a copy of the notice shall be filed with the probate court along with proof of delivery setting forth the date of mailing or other service on the claimant. A notice of disallowance or partial disallowance of a claim must contain a warning that the claim will be barred to the extent disallowed unless the claimant commences a proceeding for allowance of the claim in accordance with Section 62-3-804(2) within thirty days of the mailing or other service of the notice of disallowance or partial disallowance. Every claim which is disallowed in whole or in part by the personal representative is barred so far as not allowed unless the claimant commences a proceeding for allowance of the claim in accordance with Section 62-3-804(2) not later than thirty days after the mailing or other service of the notice of disallowance or partial disallowance by the personal representative. For good cause shown, the court may reasonably extend the time for filing the notice of allowance or disallowance of a properly filed claim.
(b) The personal representative of a decedent's estate may commence a proceeding to obtain probate court approval of the allowance, in whole or part, of any claim or claims presented in the manner described in Section 62-3-804(1), within the time limit prescribed in Section 62-3-803, and not barred by subsection (a). The proceeding may be commenced by the filing of a summons and petition with the probate court, and service of the same upon the claimant or claimants whose claims are in issue; and such other interested parties as the probate court may direct by order entered at the time the proceeding is commenced. Notice of hearing on the petition shall be given to interested parties in accordance with Section 62-1-401.
(c) A judgment in a proceeding in another court against a personal representative to enforce a claim against a decedent's estate is an allowance of the claim. Upon obtaining such a judgment a claimant must file a certified copy of its judgment with the probate court in which the decedent's estate is being administered.
(d) Unless otherwise provided in any judgment in another court entered against the personal representative and except for claims under 62-3-803, allowed claims bear interest at the legal rate (as determined according to Section 34-31-20(A)) for the period commencing upon the later of fourteen months after the date of the decedent's death or the last date upon which the claim could have been properly presented under Section 62-3-803, unless based on a contract making a provision for interest, in which case the claim bears interest in accordance with the terms of the contract.
(e) Allowance of a claim is evidence the personal representative accepts the claim as a valid debt of the decedent's estate. Allowance of a claim may not be construed to imply the estate will have sufficient assets with which to pay the claim.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, §§ 36, 37; 1988 Act No. 659, § 19; 2010 Act No. 244, § 17, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-807. Payment of claims.
(a) Prior to the closing of the estate and no later than fourteen months after the decedent's death, the personal representative must proceed to pay the claims allowed against the estate in the order of priority prescribed, and after making provision for the homestead, for exempt property under Section 62-2-401, for claims already presented which have not been allowed or whose disallowance is the subject of a legal proceeding, or the time to file such a proceeding has not expired, and for unbarred claims which may yet be presented, including costs and expenses of administration. Upon application of the personal representative and for good cause shown, the probate court may extend the time for payment of creditor claims.
(b) Upon the expiration of the applicable time limitation provided in Section 62-3-803 for the presentation of claims, any claimant whose claim has been allowed, or partially allowed, under Section 62-3-806 may petition the probate court, or file an appropriate motion if the administration is under Part 5, for an order directing the personal representative to pay the claim, to the extent allowed, and to the extent assets of the estate are available for payment without impairing the ability of the personal representative to fulfill the other obligations of the decedent's estate.
(c) The personal representative at any time may pay any just claim which has not been barred, with or without formal presentation, but he is personally liable to any other claimant whose claim is allowed and who is injured by such payment if:
(1) the payment was made before the expiration of the time limit set forth in Section 62-3-803 for the presentation of a claim, and the personal representative failed to require the payee to give adequate security for the refund of any of the payment necessary to pay other claimants; or
(2) the payment was made, due to the negligence or wilful fault of the personal representative, in such manner as to deprive the injured claimant of his priority.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 38; 1990 Act No. 521, § 54; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-808. Individual liability of personal representative.
(a) Unless otherwise provided in the contract, a personal representative is not individually liable on a contract properly entered into in his fiduciary capacity in the course of administration of the estate unless he fails to reveal his representative capacity or identify the estate in the contract.
(b) A personal representative is individually liable for obligations arising from ownership or control of the estate or for torts committed in the course of administration of the estate only if he is personally at fault.
(c) Claims based on contracts entered into by a personal representative in his fiduciary capacity, on obligations arising from ownership or control of the estate or on torts committed in the course of estate administration may be asserted against the estate by proceeding against the personal representative in his fiduciary capacity, whether or not the personal representative is individually liable therefor.
(d) Issues of liability as between the estate and the personal representative individually may be determined in a proceeding for accounting, surcharge, or indemnification or other appropriate proceeding.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-809. Secured claims.
Payment of a secured claim is upon the basis of the amount allowed if the creditor surrenders his security; otherwise, payment is upon the basis of one of the following:
(1) if the creditor exhausts his security before receiving payment, upon the amount of the claim allowed less the fair market value of the security as agreed by the parties, or as determined by the court; or
(2) if the creditor does not have the right to exhaust his security or has not done so, upon the amount of the claim allowed less the value of the security determined by converting it into money according to the terms of the agreement pursuant to which the security was delivered to the creditor, or by the creditor and personal representative by agreement, arbitration, compromise, or litigation.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-810. Claims not due; contingent or unliquidated claims.
(a) If a claim which will become due at a future time or a contingent or unliquidated claim becomes due or certain before the distribution of the estate, and if the claim has been allowed or established by a proceeding, it is paid in the same manner as presently due and absolute claims of the same class.
(b) In other cases the personal representative or, on petition of the personal representative or the claimant in a special proceeding for the purpose, the court may provide for payment as follows:
(1) if the claimant consents, he may be paid the present or agreed value of the claim, taking any uncertainty into account;
(2) arrangement for future payment, or possible payment, on the happening of the contingency or on liquidation may be made by creating a trust, giving a mortgage or other security interest, obtaining a bond or security from a distributee, or otherwise.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-811. Counterclaims.
In allowing a claim, the personal representative may deduct any counterclaim which the estate has against the claimant. In determining a claim against an estate, a court shall reduce the amount allowed by the amount of any counterclaims allowed and, if such counterclaims exceed the claim, render a judgment against the claimant in the amount of the excess. A counterclaim, liquidated or unliquidated, may arise from a transaction other than that upon which the claim is based. A counterclaim may give rise to relief exceeding in amount or different in kind from that sought in the claim.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-812. Execution and levies prohibited.
No execution may issue upon nor may any levy be made against any property of the estate under any judgment against a decedent or a personal representative, but this section shall not be construed to prevent the enforcement of mortgages, pledges, liens, or other security interests upon real or personal property in an appropriate proceeding.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-813. Compromise of claims.
When a claim against the estate has been presented in any manner, the personal representative may, if it appears for the best interest of the estate, compromise the claim, whether due or not due, absolute or contingent, liquidated or unliquidated.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-814. Encumbered assets.
If any assets of the estate are encumbered by mortgage, pledge, lien, or other security interest, the personal representative may pay the encumbrance or any part thereof, renew, or extend any obligation secured by the encumbrance or convey or transfer the assets to the creditor in satisfaction of his lien, in whole or in part, whether or not the holder of the encumbrance has presented a claim, if it appears to be for the best interest of the estate. Payment of an encumbrance does not increase the share of the distributee entitled to the encumbered assets unless the distributee is entitled to exoneration.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-815. Administration in more than one state; duty of personal representative.
(a) All assets of estates being administered in this State are subject to all claims, allowances, and charges existing or established against the personal representative wherever appointed.
(b) If the estate either in this State or as a whole is insufficient to cover all family exemptions and allowances determined by the law of the decedent's domicile, prior charges and claims, after satisfaction of the exemptions, allowances, and charges, each claimant whose claim has been allowed either in this State or elsewhere in administrations of which the personal representative is aware, is entitled to receive payment of an equal proportion of his claim. If a preference or security in regard to a claim is allowed in another jurisdiction but not in this State, the creditor so benefited is to receive dividends from local assets only upon the balance of his claim after deducting the amount of the benefit.
(c) In case the family exemptions and allowances, prior charges, and claims of the entire estate exceed the total value of the portions of the estate being administered separately and this State is not the state of the decedent's last domicile, the claims allowed in this State shall be paid their proportion if local assets are adequate for the purpose, and the balance of local assets shall be transferred to the domiciliary personal representative. If local assets are not sufficient to pay all claims allowed in this State the amount to which they are entitled, local assets shall be marshaled so that each claim allowed in this State is paid its proportion as far as possible, after taking into account all dividends on claims allowed in this State from assets in other jurisdictions.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-816. Final distribution to domiciliary representative.
The estate of a nonresident decedent being administered by a personal representative appointed in this State shall, if there is a personal representative of the decedent's domicile willing to receive it, be distributed to the domiciliary personal representative for the benefit of the successors of the decedent unless: (1) by virtue of the decedent's will, if any, and applicable choice of law rules, the successors are identified pursuant to the local law of this State without reference to the local law of the decedent's domicile; (2) the personal representative of this State, after reasonable inquiry is unaware of the existence or identity of a domiciliary personal representative; or (3) the court orders otherwise in a proceeding for a closing order under Section 62-3-1001 or incident to the closing of an administration under Part 5 [Sections 62-3-501 et seq.]. In other cases, distribution of the estate of a decedent shall be made in accordance with the other parts of this article [Sections 62-3-101 et seq.].
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 9
Special Provisions Relating to Distribution
SECTION 62-3-901. Successors' rights if no administration.
In the absence of administration, the devisees are entitled to the estate in accordance with the terms of a probated will and the heirs in accordance with the laws of intestate succession. Devisees may establish title by the probated will to devised property. Persons entitled to property by exemption or intestacy may establish title thereto by proof of the decedent's ownership, his death, and their relationship to the decedent. Successors take subject to all charges incident to administration, including the claims of creditors and subject to the rights of others resulting from abatement, retainer, advancement, ademption, and elective share.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 39; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-902. Distribution; order in which assets appropriated; abatement.
(a) Except as provided in subsection (b), and except as provided in connection with the share of the surviving spouse who elects to take an elective share, shares of distributees abate, without any preference or priority as between real and personal property, in the following order: (1) property not disposed of by the will; (2) residuary devises; (3) general devises; (4) specific devises. For purposes of abatement, a general devise charged on any specific property or fund is a specific devise to the extent of the value of the property on which it is charged, and upon the failure or insufficiency of the property on which it is charged, a general devise to the extent of the failure or insufficiency. Abatement within each classification is in proportion to the amounts of property each of the beneficiaries would have received if full distribution of the property had been made in accordance with the terms of the will.
(b) If the will expresses an order of abatement, or if the testamentary plan or the express or implied purpose of the devise would be defeated by the order of abatement stated in subsection (a), as, for instance, in case the will was executed before the effective date of this Code, the shares of the distributees abate as may be found necessary to give effect to the intention of the testator.
(c) If the subject of a preferred devise is sold or used incident to administration, abatement shall be achieved by appropriate adjustments in, or contribution from, other interests in the remaining assets.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-903. Right of retainer.
The amount of a liquidated indebtedness of a successor to the estate if due, or its present value if not due, shall be offset against the successor's interest; but the successor has the benefit of any defense which would be available to him in a direct proceeding for recovery of the debt.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-905. Penalty clause for contest.
A provision in a will purporting to penalize any interested person for contesting the will or instituting other proceedings relating to the estate is unenforceable if probable cause exists for instituting proceedings.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-906. Distribution in kind; valuation; method.
(a) Unless a contrary intention is indicated by the will, such as the grant to the personal representative of a power of sale, the distributable assets of a decedent's estate must be distributed in kind to the extent possible through application of the following provisions:
(1) A specific devisee is entitled to distribution of the thing devised to him, and a spouse or child who has selected particular assets of an estate as provided in Section 62-2-401 shall receive the items selected.
(2) Any devise payable in money may be satisfied by value in kind provided:
(i) the person entitled to the payment has not demanded payment in cash;
(ii) the property distributed in kind is valued at fair market value as of the date of its distribution; and
(iii) no residuary devisee has requested that the asset in question remain a part of the residue of the estate.
(3) For the purpose of valuation under item (2), securities regularly traded on recognized exchanges, if distributed in kind, are valued at the price for the last sale of like securities traded on the business day prior to distribution, or if there was no sale on that day, at the median between amounts bid and offered at the close of that day. Assets consisting of sums owed the decedent or the estate by solvent debtors as to which there is no known dispute or defense are valued at the sum due with accrued interest or discounted to the date of distribution. For assets which do not have readily ascertainable values, a valuation as of a date not more than thirty days prior to the date of distribution, if otherwise reasonable, controls. For purposes of facilitating distribution, the personal representative may ascertain the value of the assets as of the time of the proposed distribution in any reasonable way, including the employment of qualified appraisers, even if the assets may have been previously appraised.
(4) The personal property of the residuary estate must be distributed in kind if there is no objection to the proposed distribution and it is practicable to distribute undivided interests. Subject to the provisions of Section 62-3-711(b), in other cases, personal property of the residuary estate may be converted into cash for distribution.
(b) After the probable charges against the estate are known, the personal representative may mail or deliver a proposal for distribution to all persons who have a right to object to the proposed distribution, notifying such persons of the pending termination of the right to object to the proposed distribution. The right of any distributee to object to the proposed distribution on the basis of the kind or value of asset he is to receive, if not waived earlier in writing, terminates if he fails to object in writing received by the personal representative within thirty days after mailing or delivery of the proposal.
(c) When a personal representative or a trustee is empowered under the will or trust of a decedent to satisfy a pecuniary devise or transfer in trust, in kind with assets at their value for federal estate tax purposes, the fiduciary, in order to implement the devise or transfer in trust, shall, unless the governing instrument provides otherwise, distribute assets, including cash, fairly representative of appreciation or depreciation in the value of all property thus available for distribution in satisfaction of the pecuniary devise or transfer.
(d) Personal representatives and trustees are authorized to enter into agreements with beneficiaries and with governmental authorities, agreeing to make distribution in accordance with the terms of Section 62-3-906 for any purpose which they consider to be in the best interests of the estate, including the purpose of protecting and preserving the federal estate tax marital deduction as applicable to the estate, and the guardian or conservator of a surviving beneficiary or the personal representative of a deceased beneficiary is empowered to enter into such agreements for and on behalf of the beneficiary or the deceased beneficiary.
(e) The provisions of Section 62-3-906 are not intended to change the present laws applicable to fiduciaries, but are statements of the fiduciary principles applicable to these fiduciaries and are declaratory of these laws.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 41; 2000 Act No. 398, § 5; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-907. Distribution in kind; evidence.
(A) If distribution in kind is made, the personal representative must execute a deed of distribution with respect to real property and such other necessary or appropriate instrument of conveyance with respect to personal property, assigning, transferring, or releasing the assets to the distributee as evidence of the distributee's title to the property.
(B) If the decedent dies intestate or devises real property to a distributee, the personal representative's execution of a deed of distribution of real property constitutes a release of the personal representative's power over the title to the real property, which power is equivalent to that of an absolute owner, in trust, however, for the benefit of the creditors and others interested in the estate, provided by Section 62-3-711(a). The deed of distribution affords the distributee and his purchasers or encumbrancers the protection provided in Sections 62-3-908 and 62-3-910.
(C) If the decedent devises real property to a personal representative, either in a specific or residuary devise, the personal representative's execution of a deed of distribution of the real property constitutes a transfer of the title to the real property from the personal representative to the distributee, as well as a release of the personal representative's power over the title to the real property, which power is equivalent to that of an absolute owner, in trust, however, for the benefit of the creditors and others interested in the estate, provided by Section 62-3-711(a). The deed of distribution affords the distributee, and his purchasers or encumbrancers, the protection provided in Sections 62-3-908 and 62-3-910.
(D) The personal representative's execution of an instrument or deed of distribution of personal property constitutes a transfer of the title to the personal property from the personal representative to the distributee, as well as a release of the personal representative's power over the title to the personal property, which power is equivalent to that of an absolute owner, in trust, however, for the benefit of the creditors and others interested in the estate, provided by Section 62-3-711(a).
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 42; 2000 Act No. 398, § 6; 2002 Act No. 174, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-908. Distribution; right or title of distributee.
Proof that a distributee has received an instrument or deed of distribution of assets in kind whether real or personal property, or payment in distribution, from a personal representative is conclusive evidence that the distributee has succeeded to the interest of the estate in the distributed assets, as against all persons interested in the estate, except that the personal representative may recover the assets or their value if the distribution was improper. An improper distribution includes, but is not limited to, those instances where the instrument or deed of distribution is found to be inconsistent with the provisions of the will or statutes governing intestacy.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 43; 2000 Act No. 398, § 7; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-909. Improper distribution; liability of distributee.
Unless the distribution or payment no longer can be questioned because of adjudication, estoppel, or limitation, a distributee of property improperly distributed or paid, or a claimant who was improperly paid, is liable to return the property improperly received and its income since distribution if he has the property. If he does not have the property, then he is liable to return the value as of the date of disposition of the property improperly received and its income and gain received by him.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-910. Purchasers from distributees or personal representatives protected.
(A) If property distributed in kind (whether real or personal property) or a mortgage or other security interest therein is acquired for value by a purchaser from or lender to a distributee who has received an instrument or deed of distribution from the personal representative, or is so acquired by a purchaser from or lender to a transferee from such distributee, the purchaser or lender takes title free of rights of any interested person in the estate and incurs no personal liability to the estate, or to any interested persons, whether or not the distribution was proper or supported by court order or the authority of the personal representative was terminated before execution of the instrument or deed. This section protects a purchaser from or lender to a distributee who, as personal representative, has executed a deed of distribution to himself, as well as a purchaser from or lender to any other distributee or his transferee. To be protected under this provision, a purchaser or lender need not inquire whether a personal representative acted properly in making the distribution in kind, even if the personal representative and the distributee are the same person, or whether the authority of the personal representative had terminated before the distribution. Any instrument described in this section on which the deed recording fee prescribed by Chapter 24, Title 12, has been paid, and which has been recorded is prima facie evidence that the sale was made for value.
(B) If a will devises real property to a personal representative or authorizes a personal representative to sell real property (the title to which was not devised to the personal representative), a purchaser for value who receives a deed from the personal representative takes title to the real property free of rights of any heirs or devisees or other interested person in the estate and incurs no personal liability to the estate or to any heir or devisee or other interested person in the estate. The purchaser is protected whether or not the sale was proper and regardless of whether the heirs or devisees to whom title devolved pursuant to Section 62-3-101 executed or consented to the deed; however, creditors, and others interested in the estate have a right of recourse against the personal representative under Section 62-3-712 if the sale constitutes a breach of the personal representative's fiduciary duty. This section protects a purchaser of real property from a personal representative who has title to the real property or who has sold real property to the purchaser pursuant to an authorization in the will. To be protected under this provision, a purchaser need not inquire whether a personal representative acted properly in making the sale, even if the personal representative and the purchaser are the same person, or whether the authority of the personal representative had terminated before the sale. Any instrument described in this section on which the deed recording fee prescribed by Chapter 24, Title 12 has been paid, and which has been recorded is prima facie evidence that the sale was made for value.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 44; 2000 Act No. 398, § 8; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-911. Partition for purpose of distribution.
For purposes of this section, "interested heirs or devisees" means those heirs or devisees who are entitled to an interest in the real or personal property that is subject to partition pursuant to this section. When two or more heirs or devisees are entitled to distribution of undivided interests in any personal or real property of the estate, the personal representative or one or more of the interested heirs or devisees may petition the court prior to the closing of the estate, to make partition. After service of summons and petition and after notice to the interested heirs or devisees, the court shall partition the property in the manner provided in this section.
(1) The court shall partition the property in kind if it can be fairly and equitably partitioned in kind.
(2) If the property cannot be fairly and equitably partitioned in kind, the court shall direct the personal representative to sell the property and distribute the proceeds subject to the following provisions of this item.
(a) The court shall provide for the nonpetitioning interested heirs or devisees who wish to purchase the property to notify the court of that interest no later than ten days prior to the date set for a hearing on the partition. The nonpetitioning interested heirs or devisees shall be allowed to purchase the interests in the property as provided in this section whether default has been entered against them or not.
(b) In the circumstances described in subitem (a) of this section, and in the event the interested heirs or devisees cannot reach agreement as to the price, the value of the interest or interests to be sold shall be determined by one or more competent appraisers, as the court shall approve, appointed for that purpose by the court. The appraisers appointed pursuant to this section shall make their report in writing to the court within thirty days after their appointment. The costs of the appraisers appointed pursuant to this section shall be taxed as a part of the cost of court to those seeking to purchase the interests of the heirs or devisees in the property described in the petition for partition.
(c) In the event that the interested heirs or devisees object to the value of the property interests as determined by the appointed appraisers, those heirs or devisees shall have ten days from the date of filing of the report to file written notice of objection to the report and request a hearing before the court on the value of the interest or interests. An evidentiary hearing limited to the proposed valuation of the property interests of the interested heirs or devisees shall be conducted, and an order as to the valuation of the interests of the interested heirs and devisees shall be issued.
(d) After the valuation of the interests in the property is completed as provided in subitems (b) or (c) of this item, the interested heirs or devisees seeking to purchase the interests of the other interested heirs or devisees shall have forty-five days to pay the price set as the value of those interests to be purchased, in such shares and proportions, and in such manner, as the court shall determine. Upon the payment, the court shall direct the personal representative to execute and deliver the proper instruments transferring title to the purchasers.
(e) In the event that the interested heirs or devisees seeking to purchase the partitioned property fail to pay the purchase price as provided in subitem (d) of this item, the court shall proceed according to the traditional practices of circuit courts in partition sales.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 56; 2010 Act No. 244, § 18, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-912. Private agreements among successors to decedent binding on personal representative.
Subject to the rights of creditors and taxing authorities, competent successors may agree among themselves to alter the interests, shares, or amounts to which they are entitled under the will of the decedent, or under the laws of intestacy, in any way that they provide in a written contract executed by all who are affected by its provisions. The personal representative shall abide by the terms of the agreement subject to his obligation to administer the estate for the benefit of creditors, to pay all taxes and costs of administration, and to carry out the responsibilities of his office for the benefit of any successors of the decedent who are not parties. Personal representatives of decedents' estates are not required to see to the performance of trusts if the trustee thereof is another person who is willing to accept the trust. Accordingly, trustees of a testamentary trust are successors for the purposes of this section. Nothing herein relieves trustees of any duties owed to beneficiaries of trusts.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-913. Distributions to trustee.
(a) Before distributing to a trustee, the personal representative may require that the trust be registered if the state in which it is to be administered provides for registration and that the trustee inform the beneficiaries as provided in Section 62-7-813.
(b) If the trust instrument does not excuse the trustee from giving bond, the personal representative may petition the appropriate court to require that the trustee post bond if he apprehends that distribution might jeopardize the interests of persons who are not able to protect themselves, and he may withhold distribution until the court has acted.
(c) No inference of negligence on the part of the personal representative shall be drawn from his failure to exercise the authority conferred by subsections (a) and (b).
HISTORY: 1986 Act No. 539, § 1; 2005 Act No. 66, § 6; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-914. Disposition of unclaimed assets.
(a) If after the expiration of eight months from the appointment of the personal representative of a decedent it appears to the satisfaction of the court by whom the appointment was granted that the personal representative of the estate is unable to ascertain the whereabouts of a person entitled to be heir or devisee of the estate or whether a person who, if living, would be entitled as heir or devisee of this estate is dead or alive, the court may issue a notice addressed to all persons interested in the estate as heirs or devisees calling on the person whose whereabouts or the fact of whose death is unknown, his personal representatives, or heirs or devisees, to appear before the court on a certain day and hour as specified in this notice and to show cause why the personal representative should not be ordered to distribute the estate as if the person whose whereabouts or the fact of whose death is unknown had died before the decedent, and notifying all persons entitled to the estate as heir or devisee, or otherwise, to appear on a designated day and time before the court to intervene for their interest in the estate. The day fixed in the notice, on which cause must be shown, must not be less than one month after the date of the first publication of the notice.
(b) The notice must be published once a week for three successive weeks in a newspaper published in the county in which the court is held. The court has the right, in its discretion, to order the notice to be published once a week for three successive weeks in one other newspaper published in another place most likely to give notice to interested persons.
(c) The publication of the notice as prescribed in subsection (b) must be proved by filing with the court copies of the newspapers containing the publication of the notice or the affidavit of the publishers or printers of the respective newspapers.
(d) At the time fixed in the notice for cause to be shown, due proof of publication having been made and filed as required by subsection (c), if no person appears as required, the court must decree distribution of the estate to be made as if the person whose whereabouts or the fact of whose death is unknown had died before the decedent. Distribution by the personal representative is a full and complete discharge to the personal representative.
(e) At the time fixed in the notice for cause to be shown, due proof of publication having been made and filed as required by subsection (c), if the person whose whereabouts or the fact of whose death was unknown appears, all further proceedings must be discharged.
(f) If the identity of the person appearing is disputed by the personal representative, an heir or devisee of the decedent or the legal representatives of an heir or devisee, the court must proceed to hear and determine the controversy. If the controversy is determined against the person appearing, distribution of the estate must be made as prescribed in subsection (d); but if the controversy is determined in favor of the party appearing, he is considered to be the person whose whereabouts or the fact of whose death was unknown. The determination in either case is subject to appeal as provided in Section 62-1-308.
(g) At the expiration of the time fixed in the notice for cause to be shown, due proof of publication having been made and filed as required by subsection (c), if a person appears claiming to be heir, devisee, or personal representative of the person whose whereabouts or the fact of whose death is unknown or to be otherwise entitled to his estate and claiming a distributive share in the decedent's estate, the court shall proceed to hear and determine whether the person whose whereabouts or the fact of whose death is unknown died before or after the decedent, and if the determination is that the person whose whereabouts or the fact of whose death is unknown died before the decedent, distribution of the decedent's estate must be made accordingly; but if the court determines that the person whose whereabouts or the fact of whose death is unknown died after the death of the decedent, the distributive share of the person must be paid and delivered by the personal representative to the person legally entitled to receive it, the determination in either case, is subject to appeal as provided in Section 62-1-308.
(h) Instead of the procedure required in this section, an unclaimed devise or intestate share of five thousand dollars or less may be paid or transferred by the personal representative to the South Carolina State Treasurer.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 45; 1990 Act No. 521, §§ 57, 58, 103; 1997 Act No. 152, § 17; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-915. Distribution to person under disability.
A personal representative may discharge his obligation to distribute to any person under legal disability by distributing to his conservator or any other person authorized by this Code or otherwise to give a valid receipt and discharge for the distribution.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-916. Apportionment of estate taxes.
(a) For purposes of this section:
(1) "Estate" means the gross estate of a decedent as determined for the purpose of federal estate tax and the estate tax payable to this State.
(2) "Person" means any individual, partnership, association, joint stock company, corporation, government, political subdivision, governmental agency, or local governmental agency.
(3) "Persons interested in the estate" means any person entitled to receive, or who has received, from a decedent or by reason of the death of a decedent any property or interest therein included in the decedent's estate. It includes a personal representative, conservator, and trustee.
(4) "State" means any state, territory, or possession of the United States, the District of Columbia, and the Commonwealth of Puerto Rico.
(5) "Tax" means the federal estate tax and the basic and any additional estate tax imposed by the State of South Carolina and interest and penalties imposed in addition to the tax.
(6) "Fiduciary" means personal representative or trustee.
(b)(1) To the extent that a provision of a decedent's will expressly and unambiguously directs the apportionment of an estate tax, the tax must be apportioned accordingly.
(2) Any portion of an estate tax not apportioned pursuant to item (1) must be apportioned in accordance with any provision of a revocable trust of which the decedent was the settlor which expressly and unambiguously directs the apportionment of an estate tax. If conflicting apportionment provisions appear in two or more revocable trust instruments, the provision in the most recently dated instrument prevails. For purposes of this item:
(A) a trust is revocable if it was revocable immediately after the trust instrument was executed, even if the trust subsequently becomes irrevocable; and
(B) the date of an amendment to a revocable trust instrument is the date of the amended instrument only if the amendment contains an apportionment provision.
(3) Any tax not apportioned in items (1) or (2) shall be apportioned among all persons interested in the estate. The apportionment is to be made in the proportion that the value of the interest of each person interested in the estate bears to the total value of the interests of all persons interested in the estate. The values used in determining the tax are to be used for that purpose. If pursuant to items (1) and (2) the decedent's will or revocable trust directs a method of apportionment of tax different from the method described in this Code, the method described in the will or revocable trust controls.
(c)(1) The court in which venue lies for the administration of the estate of a decedent, on petition for the purpose, may determine the apportionment of the tax.
(2) If the court finds that it is inequitable to apportion interest and penalties in the manner provided in subsection (b), because of special circumstances, it may direct apportionment thereof in the manner it finds equitable.
(3) If the court finds that the assessment of penalties and interest assessed in relation to the tax is due to delay caused by the negligence of the fiduciary, the court may charge him with the amount of the assessed penalties and interest.
(4) In any action to recover from any person interested in the estate the amount of the tax apportioned to the person in accordance with this Code, the determination of the court in respect thereto shall be prima facie correct.
(5) The expenses reasonably incurred by the fiduciary and by any other person interested in the estate in connection with the determination of the amount and apportionment of the tax shall be apportioned as provided in subsection (b) and charged and collected as a part of the tax apportioned. If the court finds it is inequitable to apportion the expenses as provided in subsection (b), it may direct apportionment thereof equitably.
(d)(1) The personal representative or other person in possession of the property of the decedent required to pay the tax may withhold from any property distributable to any person interested in the estate, upon its distribution to him, the amount of tax attributable to his interest. If the property in possession of the personal representative or other person required to pay the tax and distributable to any person interested in the estate is insufficient to satisfy the proportionate amount of the tax determined to be due from the person, the personal representative or other person required to pay the tax may recover the deficiency from the person interested in the estate. If the property is not in the possession of the personal representative or the other person required to pay the tax, the personal representative or the other person required to pay the tax may recover from any person interested in the estate the amount of the tax apportioned to the person in accordance with this section.
(2) If property held by the personal representative is distributed prior to final apportionment of the tax, the distributee shall provide a bond or other security for the apportionment liability in the form and amount prescribed by the personal representative.
(e)(1) In making an apportionment, allowances shall be made for any exemptions granted, any classification made of persons interested in the estate, and for any deductions and credits allowed by the law imposing the tax.
(2) Any exemption or deduction allowed by reason of the relationship of any person to the decedent or by reason of the purposes of the gift inures to the benefit of the person bearing such relationship or receiving the gift; but if an interest is subject to a prior present interest which is not allowable as a deduction, the tax apportionable against the present interest shall be paid from principal.
(3) Any deduction for property previously taxed and any credit for gift taxes or death taxes of a foreign country paid by the decedent or his estate inures to the proportionate benefit of all persons liable to apportionment.
(4) Any credit for inheritance, succession, or estate taxes or taxes in the nature thereof applicable to property or interest includable in the estate, inures to the benefit of the persons or interests chargeable with the payment thereof to the extent proportionately that the credit reduces the tax.
(5) To the extent that property passing to or in trust for a surviving spouse or any charitable, public, or similar purpose is not an allowable deduction for purposes of the tax solely by reason of an inheritance tax or other death tax imposed upon and deductible from the property, the property is not included in the computation provided for in subsection (b) hereof, and to that extent no apportionment is made against the property. The sentence immediately preceding does not apply to any case if the result would be to deprive the estate of a deduction otherwise allowable under Section 2053(d) of the Internal Revenue Code of 1954, as amended, of the United States, relating to deduction for state death taxes on transfers for public, charitable, or religious uses.
(f) No interest in income and no estate for years or for life or other temporary interest in any property or fund is subject to apportionment as between the temporary interest and the remainder. The tax on the temporary interest and the tax, if any, on the remainder is chargeable against the corpus of the property or funds subject to the temporary interest and remainder.
(g) Neither the personal representative nor other person required to pay the tax is under any duty to institute any action to recover from any person interested in the estate the amount of the tax apportioned to the person until the expiration of the three months next following final determination of the tax. A personal representative or other person required to pay the tax who institutes the action within a reasonable time after the three months' period is not subject to any liability or surcharge because any portion of the tax apportioned to any person interested in the estate was collectible at a time following the death of the decedent but thereafter became uncollectible. If the personal representative or other person required to pay the tax cannot collect from any person interested in the estate the amount of the tax apportioned to the person, the amount not recoverable shall be equitably apportioned among the other persons interested in the estate who are subject to apportionment.
(h) A personal representative acting in another state or a person required to pay the tax domiciled in another state may institute an action in the courts of this State and may recover a proportionate amount of the federal estate tax, of an estate tax payable to another state or of a death duty due by a decedent's estate to another state, from a person interested in the estate who is either domiciled in this State or who owns property in this State subject to attachment or execution. For the purposes of the action, the determination of apportionment by the court having jurisdiction of the administration of the decedent's estate in the other state is prima facie correct.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, §§ 59, 60; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 10
Closing Estates
SECTION 62-3-1001. Required filings with court; petition for order compelling personal representative to perform duties; court orders.
(a) Within the later of: (i) the expiration of the applicable time limitation for any creditor to commence a proceeding contesting a disallowance of a claim pursuant to Section 62-3-806 (a); (ii) the time when all legal proceedings commenced for allowance of a claim have ended in accordance with Sections 62-3-804 and 62-3-806; and (iii) if a state or federal estate tax return was filed, within ninety days after the receipt or a state or federal estate tax closing letter, whichever is later, a personal representative shall file with the court:
(1) a full accounting in writing of his administration, unless the accounting is waived pursuant to subsection (e);
(2) a proposal for distribution of assets not yet distributed, unless the proposal for distribution of assets is waived pursuant to subsection (e);
(3) an application for settlement of the estate to consider the final accounting or approve an accounting and distribution and adjudicate the final settlement and distribution of the estate; and
(4) proof that a notice of right to demand hearing and copies of the accounting, the proposal for distribution, and the application for settlement of the estate have been sent to all interested persons including all creditors or other claimants of whom the personal representative is aware whose claims are neither paid nor barred, unless the notice of right to demand hearing is waived pursuant to subsection (e).
(b) If the personal representative does not timely perform his duties pursuant to subsection (a), and all interested persons have not waived the requirement pursuant to subsection (e), an interested person may petition for an order compelling the personal representative to perform his duties pursuant to subsection (a). After notice and hearing in accordance with Section 62-1-401, the court may issue an order requiring the personal representative to perform his duties pursuant to subsection (a).
(c) After thirty days from the filing by the personal representative of proof that a notice of right to demand hearing has been sent to all persons entitled to the notice pursuant to subsection (a), or at any time after the filing of the application of settlement if notice of right to demand hearing has been waived pursuant to subsection (e), the court may enter an order or orders approving settlement and directing or approving distribution of the estate, terminating the appointment of the personal representative, and discharging the personal representative from further claim or demand of any interested person. However, if an interested person files with the court a written demand for hearing within thirty days after the personal representative files proof that a notice of right to demand hearing has been sent to all persons entitled to the notice pursuant to subsection (a), the court may enter its order or orders only after notice to all interested persons in accordance with Section 62-1-401 and hearing.
(d) If one or more heirs or devisees were omitted as parties in, or were not given notice of, a previous formal testacy proceeding, the court, on proper petition for an order of complete settlement of the estate pursuant to this section, and after notice of hearing to the omitted or unnotified persons and other interested parties determined to be interested on the assumption that the previous order concerning testacy is conclusive as to those given notice of the earlier proceeding, may determine testacy as it affects the omitted persons and confirm or alter the previous order of testacy as it affects all interested persons as appropriate in the light of the new proofs. In the absence of objection by an omitted or unnotified person, evidence received in the original testacy proceeding constitutes prima facie proof of due execution of a will previously admitted to probate, or of the fact that the decedent left no valid will if the prior proceedings determined this fact.
(e) Notwithstanding the provisions of this section, a personal representative shall not be required to file an accounting in writing of his administration, a proposal for distribution of assets not yet distributed, or a notice of right to demand hearing if and to the extent these filings are waived by all interested persons.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 46; 1990 Act No. 521, § 61; 1991 Act No. 143, § 1; 1997 Act No. 152, § 18; 2010 Act No. 244, § 19, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1002. Payment of taxes; certificate from Department of Revenue.
No final accounting of a fiduciary shall be allowed by the probate court unless such account shows, and the judge of such court finds, that all taxes imposed by the provisions of Chapter 6, Title 12 upon such fiduciary, which have become payable, have been paid, and that all taxes which may become due are secured by bond, deposit, or otherwise. The certificate of the South Carolina Department of Revenue and the receipt for the amount of the tax therein certified shall be conclusive as to the payment of the tax to the extent of such certificate.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 47; 1990 Act No. 521, § 62; 1993 Act No. 181, § 1610; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1003. Payment of taxes; filing federal estate tax return.
No final accounting of a personal representative in any probate proceeding who is required to file a federal estate tax return may be allowed and approved by the court before whom the proceeding is pending unless the court finds that any tax imposed on the property by Chapter 16, Title 12, including applicable interest, has been paid in full or that no such tax is due.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 48; 1990 Act No. 521, § 63; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1004. Liability of distributees to claimants.
After assets of an estate have been distributed and subject to Section 62-3-1006, an undischarged claim not barred may be prosecuted in a proceeding against one or more distributees. No distributee shall be liable to claimants for amounts received as exempt property or for amounts in excess of the value of his distribution as of the time of distribution. As between distributees, each shall bear the cost of satisfaction of unbarred claims as if the claim had been satisfied in the course of administration. Any distributee who shall have failed to notify other distributees of the demand made upon him by the claimant in sufficient time to permit them to join in any proceeding in which the claim was asserted against him loses his right of contribution against other distributees.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1005. Rights of successors and creditors.
Unless previously barred by adjudication and except as provided in any accounting, the rights of successors and of creditors whose claims have not otherwise been barred against the personal representative for breach of fiduciary duty are barred unless a proceeding to assert the same is commenced within six months after the filing of the application for settlement of the estate, required by Section 62-3-1001. The rights thus barred do not include rights to recover from a personal representative for fraud, misrepresentation, or inadequate disclosure related to the settlement of the decedent's estate.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 64; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1006. Limitations on actions and proceedings against distributees.
Unless previously adjudicated in a formal testacy proceeding or in a proceeding settling the accounts of a personal representative or otherwise barred, the claim of any claimant to recover from a distributee who is liable to pay the claim, and the right of any heir or devisee, or of a successor personal representative acting in their behalf, to recover property improperly distributed or the value thereof from any distributee is forever barred at the later of (i) if a claim by a creditor of the decedent, at one year after the decedent's death, and (ii) any other claimant and any heir or devisee, at the later of three years after the decedent's death or one year after the time of distribution thereof. This section does not bar an action to recover property or value received as the result of fraud.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 65; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1007. Certificate discharging liens securing fiduciary performance.
After his appointment has terminated, the personal representative, his sureties, or any successor of either, upon the filing of a verified application showing, so far as is known by the applicant, that no action concerning the estate is pending in any court, is entitled to receive a certificate from the court that the personal representative appears to have fully administered the estate in question. The certificate evidences discharge of any lien on any property given to secure the obligation of the personal representative in lieu of bond or any surety, but does not preclude action against the personal representative or the surety.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1008. Subsequent administration.
If other property of the estate is discovered after an estate has been settled and the personal representative discharged or for other good cause, the court upon application of any interested person and upon notice as it directs may appoint the same or a successor personal representative to administer the subsequently opened estate. If a new appointment is made, unless the court orders otherwise, the provisions of this Code apply as appropriate; but no claim previously barred may be asserted in the subsequent administration.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 49; 2010 Act No. 244, § 20, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 11
Compromise of Controversies
SECTION 62-3-1101. Effect of approval of agreements involving trusts, inalienable interests, or interests of third persons.
A compromise of a controversy as to admission to probate of an instrument offered for formal probate as the will of a decedent, the construction, validity, or effect of a probated will, the rights or interests in the estate of the decedent, of a successor, or the administration of the estate, if approved by the court after hearing, is binding on all the parties including those unborn, unascertained, or who could not be located. An approved compromise is binding even though it may affect a trust or an inalienable interest. A compromise does not impair the rights of creditors or of taxing authorities who are not parties to it. A compromise approved pursuant to this section is not a settlement of a claim subject to the provisions of Section 62-5-433.
HISTORY: 1986 Act No. 539, § 1; 1997 Act No. 152, § 19; 2010 Act No. 244, § 21, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1102. Procedure for securing court approval of compromise.
The procedure for securing court approval of a compromise is as follows:
(1) The terms of the compromise shall be set forth in an agreement in writing which shall be executed by all competent persons and parents acting for any minor child having beneficial interests or having claims which will or may be affected by the compromise. Execution is not required by any person whose identity cannot be ascertained or whose whereabouts is unknown and cannot reasonably be ascertained.
(2) Any interested person, including the personal representative or a trustee, then may submit the agreement to the court for its approval and for execution by the personal representative, the trustee of every affected testamentary trust, and other fiduciaries and representatives.
(3) Upon application to the court and after notice to all interested persons or their representatives, including the personal representative of the estate and all affected trustees of trusts, the court, if it finds that the contest or controversy is in good faith and that the effect of the agreement upon the interests of persons represented by fiduciaries or other representatives is just and reasonable, shall make an order approving the agreement and directing all fiduciaries subject to its jurisdiction to execute the agreement. Minor children represented only by their parents may be bound only if their parents join with other competent persons in execution of the compromise. Upon the making of the order and the execution of the agreement, all further disposition of the estate is in accordance with the terms of the agreement.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 22, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 12
Collection of Personal Property by Affidavit and Summary Administration Procedure for Small Estates
SECTION 62-3-1201. Collection of personal property by affidavit.
(a) Thirty days after the death of a decedent, any person indebted to the decedent or having possession of tangible personal property or an instrument evidencing a debt, obligation, stock, or chose in action belonging to the decedent shall make payment of the indebtedness or deliver the tangible personal property or the instrument evidencing the debt, obligation, stock, or chose in action to a person claiming to be the successor of the decedent upon being presented an affidavit made by or on behalf of the successor. Before this affidavit may be presented to collect the decedent's personal property, it must:
(1) state that the value of the entire probate estate (the decedent's property passing under the decedent's will plus the decedent's property passing by intestacy), wherever located, less liens and encumbrances, does not exceed twenty-five thousand dollars;
(2) state that thirty days have elapsed since the death of the decedent;
(3) state that no application or petition for the appointment of a personal representative is pending or has been granted in any jurisdiction;
(4) state that the claiming successor, which for the purposes of this section includes a person who remitted payment for reasonable funeral expenses, is entitled to payment or delivery of the property;
(5) be approved and countersigned by the probate judge of the county of the decedent's domicile at the time of his death, or if the decedent was not domiciled in this State, in the county in which the property of the decedent is located, and only upon the judge's satisfaction that the successor is entitled to payment or delivery of the property; and
(6) be filed in the probate court for the county of the decedent's domicile at the time of his death, or, if the decedent was not domiciled in this State, in the county in which property of the decedent is located.
(b) A transfer agent of any security shall change the registered ownership on the books of a corporation from the decedent to the successor or successors upon the presentation of an affidavit as provided in subsection (a).
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 50; 1990 Act No. 521, §§ 66, 67; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1202. Effect of affidavit.
The person paying, delivering, transferring, or issuing personal property or the evidence thereof pursuant to affidavit is discharged and released to the same extent as if he dealt with a personal representative of the decedent. He is not required to see to the application of the personal property or evidence thereof or to inquire into the truth of any statement in the affidavit. Any person who receives or is presented with a valid affidavit executed pursuant to Section 62-3-1201 and who has not received actual written notice of its revocation or termination must not fail to deliver the property identified in the affidavit, provided it contains the following provision: "No person who may act in reliance on this affidavit shall incur any liability to the estate of the decedent." Any person to whom payment, delivery, transfer, or issuance is made is answerable and accountable therefor to any personal representative of the estate or to any other person having a superior right.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1203. Small estates; summary administrative procedure.
(a) If it appears from the inventory and appraisal that the value of the entire probate estate (the decedent's property passing under the decedent's will plus the decedent's property passing by intestacy), less liens and encumbrances, does not exceed twenty-five thousand dollars and exempt property, costs and expenses of administration, reasonable funeral expenses, and reasonable and necessary medical and hospital expenses of the last illness of the decedent, the personal representative, after publishing notice to creditors pursuant to Section 62-3-801, but without giving additional notice to creditors, may immediately disburse and distribute the estate to the persons entitled thereto and file a closing statement as provided in Section 62-3-1204.
(b) If it appears from an appointment proceeding that (1) the appointed personal representative, individually or in the capacity of a fiduciary, is either the sole devisee under the probated will of a testate decedent or the sole heir of an intestate decedent, or (2) the appointed personal representatives, individually or in their capacity as a fiduciary, are the sole devisees under the probated will of a testate decedent or the sole heirs of an intestate decedent, the personal representative, after publishing notice to creditors as under Section 62-3-801, but without giving additional notice to creditors may immediately disburse and distribute the estate to the persons entitled thereto and file a closing statement as provided in Section 62-3-1204.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 69; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1204. Small estates; closing by sworn statement of personal representative.
(a) Unless prohibited by order of the court and except for estates being administered under Part 5 (Sections 62-3-501 et seq.), after filing an inventory with the court, and paying any court fees due, the personal representative may close an estate administered under the summary procedures of Section 62-3-1203 by filing with the court, at any time after disbursement and distribution of the estate, a verified statement stating that:
(1) either
(i) to the best knowledge of the personal representative, the value of the entire probate estate (the decedent's property passing under the decedent's will plus the decedent's property passing by intestacy), less liens and encumbrances, did not exceed twenty-five thousand dollars and exempt property, costs, and expenses of administration, reasonable funeral expenses, and reasonable and necessary medical and hospital expenses of the last illness of the decedent; or
(ii) the estate qualifies for summary administration according to the provisions of subsection (b) of Section 62-3-1203;
(2) the personal representative has fully administered the estate by disbursing and distributing it to the persons entitled thereto;
(3) the personal representative has sent a copy of the closing statement to all distributees of the estate and to all creditors or other claimants of whom the personal representative is aware and whose claims are neither paid nor barred and has furnished a full account in writing of his administration to the distributees whose interests are affected.
(b) If no unresolved claims, actions or proceedings involving the personal representative are pending in any court one year after the date of the decedent's death, the appointment of the personal representative terminates.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 70; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 13
Sale of Real Estate by Probate Court
SECTION 62-3-1301. Only procedure for sale of lands by court.
The provisions of this Part are hereby declared to be the only procedure for the sale of lands by the court, except where the will of the decedent authorizes to the contrary.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 51; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1302. Sale of real estate.
The court may, as herein provided, authorize the sale of the real property of a decedent.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 52; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1303. Issuance of summons upon petition for sale.
At any time after the qualification of the personal representative, on petition to the court by an interested person requesting the sale of real property of the decedent, a summons shall be issued to the personal representative (if not the petitioner), the heirs at law of the decedent (if the decedent died intestate or the time to challenge a will admitted to probate has not expired), the devisees under the decedent's will (if any), any person who has properly presented a claim against the estate which remains unresolved, any interested person effected by the proceeding, and any other person as required by the court in its discretion.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 53; 1990 Act No. 521, § 71; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1304. Form of summons.
The form of such summons must be in like form as summonses for civil actions in the circuit courts.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 54; 1990 Act No. 521, § 72; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1305. Service of summons and petition.
To such summons a copy of the petition must be attached and copies of the summons and petition served on the personal representative (if not the petitioner), the heirs at law of the decedent (if the decedent died intestate or the time to challenge a will admitted to probate has not expired), the devisees under the decedent's will (if any), any person who has properly presented a claim against the estate which remains unresolved, any interested person effected by the proceeding, and any other interested person as required by the court in its discretion, in like manner as summonses and complaints are served in civil actions in the circuit courts. If there are minors the court shall appoint guardians ad litem who must be served with copies of the summons and petition and the appointment, and who must acknowledge acceptance of their appointment as guardians ad litem to the probate court prior to being served with the summons and petition. Nothing herein precludes the parties interested in the proceeding from accepting service of the summons and petition and consenting to the sale as prayed for in the petition.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 55; 1990 Act No. 521, § 73; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1306. Execution of process by sheriff; fees.
The sheriffs of the several counties in this State are required to serve all processes which may be issued, if so ordered by the court under the provisions of this Part, for which they shall receive the same fees as are allowed them by law for similar services, which must be paid from the proceeds of sale or by the petitioner.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 56; 1990 Act No. 521, § 74; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1307. Publication as to nonresidents and parties with unknown residences.
If there is any party who resides beyond the limits of this State or whose residence is unknown and who does not consent in writing to the sale, the court may authorize publication of the summons as provided by this Code and if such party does not appear and show sufficient cause within the time named in the summons the court shall enter of record his consent as confessed and proceed with the sale.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 57; 1990 Act No. 521, § 75; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1308. Filing notice of pendency of action.
Upon the filing of the petition, the petitioner shall file in the office of the clerk of the circuit court a notice of pendency of action authorized by Sections 15-11-10 to 15-11-50 and upon the filing of such notice it has the same force and effect as notice of pendency of action filed in an action in the circuit court.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 58; 1990 Act No. 521, § 76; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1309. Time for answer.
The time to answer a summons and petition for sale of real property of a decedent is the same as the time to answer in any civil litigation case. Interested persons who wish to file an answer or return to the petition must do so in writing in the same manner as an answer to a complaint in other civil litigation cases. In addition the court may hear motions and accept such subsequent pleadings as would be heard or accepted in other civil litigation cases. After the filing and service of the summons and petition and the time for filing responsive pleadings has elapsed, the court will convene a hearing on the merits of the petition. If based on the evidence presented at the hearing the court finds the real property should be sold it shall then, in its discretion, either (a) order the personal representative to sell the same at private sale upon such terms and conditions as the court may impose; or (b) proceed to sell the same upon the next or some subsequent convenient sales day after publishing a notice of such sale three weeks prior thereto in some paper published in the county. Upon the sale being made, after the payment of the costs and expenses thereof, the proceeds of the sale will be paid over to the personal representative. The personal representative shall administer such proceeds in like manner as proceeds of personal property coming into his hands. Nothing in this part may be construed to abridge homestead exemptions. Notice of hearings in regard to the petition will be provided to interested persons in accordance with Section 62-1-401.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 59; 1990 Act No. 521, § 77; 2010 Act No. 244, § 23, eff June 7, 2010; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1310. Bond for handling of proceeds by personal representative.
The regular bond of the personal representative must protect the creditors, heirs, devisees, or other interested persons, if any, in the handling of the proceeds of sale by the personal representative, but in case no such bond has been given, the court may require the giving of a bond by such personal representative as provided in Sections 62-3-603, 62-3-604, and 62-3-605.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 60; 1990 Act No. 521, § 78; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1311. Filing of papers; requirement of returns.
The court shall file and keep the original petition with due proof of service thereon and all original papers connected with the sale and shall require from such personal representative his final account showing the distribution of the funds received by him.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 61; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-3-1312. Entry of releases of liens on property sold.
In case any lands of the deceased subject to the lien of any judgment, mortgage, or other lien is sold under the provisions of this Part the court may enter a release of the lands so sold upon the records in the office of the clerk of court or register of deeds of the county from the lien of such judgment, mortgage, or other lien and in case such mortgage, judgment, or other lien debt has been paid in full out of the proceeds of the sale of such lands the court may have cancellation of the same entered on the record thereof. The foregoing does not relieve any judgment, mortgage, or other lien creditor of the duty, as provided otherwise by law, of releasing or canceling such liens. Each release satisfaction or cancellation provided for herein must refer by proper notation to the file number of such estate in the court. The provisions of this section do not apply when the order of sale directs the sale of any lands which must be sold subject to any existing mortgage, judgment, or other lien, but only when such lands are sold freed and discharged from all such liens.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 62; 1990 Act No. 521, § 79; 1997 Act No. 34, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.TITLE 62. SOUTH CAROLINA PROBATE CODE
CHAPTER 4. Local and Foreign Personal Representatives; Ancillary Administration
Part 1
Definitions
SECTION 62-4-101. Definitions.
In this article [Sections 62-4-101 et seq.]:
(1) "Local administration" means administration by a personal representative appointed in this State pursuant to appointment proceedings described in Article 3 [Sections 62-3-101 et seq.].
(2) "Local personal representative" includes any personal representative appointed in this State pursuant to appointment proceedings described in Article 3 [Sections 62-3-101 et seq.] and excludes foreign personal representatives who acquire the power of a local personal representative pursuant to Section 62-4-205.
(3) "Resident creditor" means a person domiciled in, or doing business in, this State who is, or could be, a claimant against an estate of a nonresident decedent.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 2
Powers of Foreign Personal Representatives
SECTION 62-4-201. Payment of debt and delivery of property to domiciliary foreign personal representative without local administration.
At any time after the expiration of sixty days from the death of a nonresident decedent, any person indebted to the estate of the nonresident decedent or having possession or control of personal property, or of an instrument evidencing a debt, obligation, stock, or chose in action belonging to the estate of the nonresident decedent may pay the debt, deliver the personal property, or the instrument evidencing the debt, obligation, stock, or chose in action, to the domiciliary foreign personal representative of the nonresident decedent upon being presented with proof of his appointment and an affidavit made by or on behalf of the representative stating:
(1) the date of the death of the nonresident decedent;
(2) that no local administration, or application or petition therefor, is pending in this State;
(3) that the domiciliary foreign personal representative is entitled to payment or delivery.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-4-202. Payment or delivery discharges.
Payment or delivery made in good faith on the basis of the proof of authority and affidavit releases the debtor or person having possession of the personal property or of the instrument evidencing a debt, obligation, stock, or chose in action to the same extent as if payment or delivery had been made to a local personal representative.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 63; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-4-203. Resident creditor notice.
Payment or delivery under Section 62-4-201 may not be made if a resident creditor of the nonresident decedent has given written notice to the debtor of the nonresident decedent or the person having possession of the personal property or of the instrument evidencing a debt, obligation, stock, or chose in action belonging to the nonresident decedent that the debt should not be paid nor the property delivered to the domiciliary foreign personal representative.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 64; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-4-204. Proof of authority; bond.
If no local administration or application or petition therefor is pending in this State, a domiciliary foreign personal representative may file with a court in this State in a county in which property belonging to the decedent is located, authenticated copies of his appointment and of the will, if any. The filing of a bond shall not be required unless the court in its discretion orders it.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-4-205. Powers.
A domiciliary foreign personal representative who has complied with Section 62-4-204 may exercise as to assets (including real and personal property) in this State all powers of a local personal representative and may maintain actions and proceedings in this State subject to any conditions imposed upon nonresident parties generally.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 80; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-4-206. Power of representatives in transition.
The power of a domiciliary foreign personal representative under Section 62-4-201 or 62-4-205 shall be exercised only if there is no administration or application therefor pending in this State. An application or petition for local administration of the estate terminates the power of the foreign personal representative to act under Section 62-4-205, but the local court may allow the foreign personal representative to exercise limited powers to preserve the estate. No person who, before receiving actual notice of a pending local administration, has changed his position in reliance upon the powers of a foreign personal representative shall be prejudiced by reason of the application or petition for, or grant of, local administration. The local personal representative is subject to all duties and obligations which have accrued by virtue of the exercise of the powers by the foreign personal representative and may be substituted for him in any action or proceedings in this State.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-4-207. Ancillary and other local administrations; governing provision.
In respect to a nonresident decedent, the provisions of Article 3 [Sections 62-3-101 et seq.] govern (1) proceedings, if any, in a court of this State for probate of the will, appointment, removal, supervision, and discharge of the local personal representative, and any other order concerning the estate; and (2) the status, powers, duties, and liabilities of any local personal representative and the rights of claimants, purchasers, distributees, and others in regard to a local administration. The initiation of a proceeding under Article 3 (Sections 62-3-101 et seq.) is the appropriate procedure for an ancillary administration relating to the real property of a nonresident decedent located in this State and is an alternative to the procedures available to a foreign personal representative under Sections 62-4-201 through 62-4-206.
HISTORY: 1986 Act No. 539, § 1; 2000 Act No. 398, § 9; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 3
Jurisdiction Over Foreign Personal Representatives
SECTION 62-4-301. Jurisdiction by act of foreign personal representative.
A foreign personal representative submits personally to the jurisdiction of the courts of this State in any proceeding relating to the estate by (1) filing authenticated copies of his appointment as provided in Section 62-4-204, (2) receiving payment of money or taking delivery of personal property under Section 62-4-201, or (3) doing any act as a personal representative in this State which would have given the State jurisdiction over him as an individual. Jurisdiction under (2) is limited to the money or value of personal property collected.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-4-302. Jurisdiction by act of decedent.
In addition to jurisdiction conferred by Section 62-4-301, a foreign personal representative is subject to the jurisdiction of the courts of this State to the same extent that his decedent was subject to jurisdiction immediately prior to death.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
SECTION 62-4-303. Service on foreign personal representative.
(a) Service of process may be made upon the foreign personal representative by registered or certified mail, addressed to his last reasonably ascertainable address, requesting a return receipt signed by addressee only. Notice by ordinary first class mail is sufficient if registered or certified mail service to the addressee is unavailable. Service may be made upon a foreign personal representative in the manner in which service could have been made under other laws of this State on either the foreign personal representative or his decedent immediately prior to death.
(b) If service is made upon a foreign personal representative as provided in subsection (a), he shall be allowed thirty days within which to appear or respond.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.
Part 4
Judgments and Personal Representatives
SECTION 62-4-401. Effect of adjudication for or against personal representative.
An adjudication rendered in any jurisdiction in favor of or against any personal representative of the estate is as binding on the local personal representative as if he were a party to the adjudication; provided, however, that notice and the opportunity to defend must be given to the local representative in order that the judgment be collectible.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 1, eff January 1, 2014.TITLE 62. SOUTH CAROLINA PROBATE CODE
CHAPTER 5. Protection of Persons Under Disability and Their Property
Part 1
General Provisions
SECTION 62-5-101. Definitions and use of terms.
Unless otherwise apparent from the context, in this article:
(1) "Adult" means an individual who has attained the age of eighteen or who, if under eighteen, is married or has been emancipated by a court of competent jurisdiction.
(2) "Alleged incapacitated individual" means:
(a) an adult for whom a protective order is sought;
(b) an adult for whom the appointment of a guardian is sought; or
(c) an adult for whom a determination of incapacity is sought.
(3) "Conservator" means a person appointed by the court to manage the estate of a protected person.
(4) "Counsel for alleged incapacitated individual" means a person authorized to practice law in the State of South Carolina who represents the alleged incapacitated individual in a guardianship proceeding or a protective proceeding. Counsel shall represent the expressed wishes of the alleged incapacitated individual to the extent consistent with the rules regulating the practice of law in the State of South Carolina.
(5) "Court" means the probate court.
(6) "Disabled" means the medically determinable physical or mental impairment of a minor or an adult as defined by 42 U.S.C. Section 1382c, as amended.
(7) "Emergency" means circumstances that are likely to result in substantial harm to the alleged incapacitated individual's health, safety, or welfare or in substantial economic loss to the alleged incapacitated individual.
(8) "Foreign conservator" means a conservator or a person with the powers of a conservator of another jurisdiction.
(9) "Guardian" means a person appointed by the court as guardian, but excludes one who is a guardian ad litem. A guardian shall make decisions regarding the ward's health, education, maintenance, and support.
(10) "Guardian ad litem" means a person licensed in the State of South Carolina in law, social work, nursing, medicine, or psychology, or who has completed training to the satisfaction of the court, and who has been appointed by the court to advocate for the best interests of the alleged incapacitated individual.
(11) "Guardianship proceeding" means a formal proceeding to determine if an adult or a minor within one hundred eighty days of turning eighteen is an incapacitated individual or in which an order for the appointment of a guardian for an adult or a minor within one hundred eighty days of turning eighteen is sought or has been issued.
(12) "Incapacitated individual" means an individual who, for reasons other than minority, has been adjudicated as incapacitated.
(13) "Incapacity" means the inability to effectively receive, evaluate, and respond to information or make or communicate decisions such that a person, even with appropriate, reasonably available support and assistance cannot:
(a) meet the essential requirements for his physical health, safety, or self-care, necessitating the need for a guardian; or
(b) manage his property or financial affairs or provide for his support or for the support of his legal dependents, necessitating the need for a protective order.
(14) "Less restrictive alternative" means the provision of support and assistance as defined in this section which maximizes the alleged incapacitated individual's capacity for self-determination and autonomy in lieu of a guardianship or conservatorship.
(15) "Net aggregate amount" means the total sum of payments due to a minor or incapacitated individual after subtracting all outstanding reimbursements and relevant deductions.
(16) "Party" means the alleged incapacitated individual, ward, protected person, petitioner, guardian, conservator, or any other person allowed by the court to be a party in a guardianship proceeding or protective proceeding, including those listed in Section 62-5-303, Section 62-5-402, and Section 62-5-403.
(17) "Person" means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government or governmental subdivision, agency, or instrumentality, public corporation, or any other legal or commercial entity.
(18) "Protected person" means an individual for whom a conservator has been appointed or other protective order has been issued.
(19) "Protective order" means an order appointing a conservator or relating to the management of the property of:
(a) an incapacitated individual;
(b) a minor;
(c) a person who is confined, detained by a foreign power, or who has disappeared; or
(d) a person who is disabled and in need of a court order to create and establish a special needs trust for such person's benefit.
(20) "Protective proceeding" means a judicial proceeding in which a protective order is sought or has been issued.
(21) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.
(22) "State" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, a federally recognized Indian tribe, or any territory or insular possession subject to the jurisdiction of the United States.
(23) "Supports and assistance" includes:
(a) systems in place for the alleged incapacitated individual to make decisions in advance or to have another person to act on his behalf, including, but not limited to, having an agent under a durable power of attorney, a health care power of attorney, a trustee under a trust, a representative payee to manage social security funds, a Declaration of Desire for Natural Death (living will), a designated health care decision maker under Section 44-66-30, or an educational representative designated under Section 59-33-310 to Section 59-33-370; and
(b) reasonable accommodations that enable the alleged incapacitated individual to act as the principal decision-maker, including, but not limited to, using technology and devices; receiving assistance with communication; having additional time and focused discussion to process information; providing tailored information oriented to the comprehension level of the alleged incapacitated individual; and accessing services from community organizations and governmental agencies.
(24) "Ward" means an adult for whom a guardian has been appointed.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 81; 2008 Act No. 303, § 1, eff June 11, 2008; 2010 Act No. 244, § 24, eff June 7, 2010. Formerly Code 1976 §§ 62-5-101 and 62-5-106, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019; 2023 Act No. 10 (S.341), § 1, eff May 8, 2023.
SECTION 62-5-102. Consolidation of proceedings.
When both guardianship proceedings and protective proceedings as to the same person are commenced or pending in the same court, the proceedings may be consolidated.
HISTORY: 1986 Act No. 539, § 1; 1988 Act No. 659, § 5; 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-103. Facility of payment or delivery.
(A) A person under a duty to pay or deliver money or personal property to a minor or incapacitated individual may perform this duty in amounts not exceeding a net aggregate amount of fifteen thousand dollars each year by paying or delivering the money or property to the conservator for the minor or incapacitated person, if the person under a duty to pay or deliver money or personal property has actual knowledge that a conservator has been appointed or an appointment is pending. If the person under a duty to pay or deliver money or personal property to a minor or incapacitated person does not have actual knowledge that a conservator has been appointed or that appointment of a conservator is pending, the person may pay or deliver the money or property in amounts not exceeding a net aggregate of fifteen thousand dollars each year to:
(1) a person having the care and custody of the minor or incapacitated individual with whom the minor or incapacitated individual resides;
(2) a guardian of the minor or an incapacitated individual; or
(3) a financial institution incident to a deposit in a federally insured savings account in the sole name of the minor or for the minor under the Uniform Transfers to Minors Act and giving notice of the deposit to the minor.
(B) The persons, other than a financial institution under subsection (A)(3) above, receiving money or property for a minor or incapacitated individual, serve as fiduciaries subject to fiduciary duties, and are obligated to apply the money for the benefit of the minor or incapacitated individual with due regard to:
(1) the size of the estate, the probable duration of the minority or incapacity, and the likelihood that the minor or incapacitated individual, at some future time, may be able to manage his affairs and his estate;
(2) the accustomed standard of living of the minor or incapacitated individual and members of his household; and
(3) other funds or resources used or available for the support or any obligation to provide support for the minor or incapacitated individual.
(C) The persons may not pay themselves except by way of reimbursement for out-of-pocket expenses for goods and services necessary for the minor's or incapacitated individual's support. Money or other property received on behalf of a minor or incapacitated individual may not be used by a person to discharge a legal or customary obligation of support that may exist between that person and the minor or incapacitated individual. Excess sums must be preserved for future benefit of the minor or incapacitated individual, and any balance not used and property received for the minor or incapacitated individual must be turned over to the minor when he attains majority or is emancipated by court order; or, to the incapacitated individual when he has been readjudicated as no longer incapacitated. Persons who pay or deliver in accordance with provisions of this section are not responsible for the proper application of the money or personal property. If the net aggregate amount exceeds fifteen thousand dollars, a conservatorship shall be required.
(D) An employer may fulfill his duties to a minor or incapacitated individual by delivering a check to or depositing payment into an account in the name of the minor or incapacitated employee.
HISTORY: 1986 Act No. 539, § 1; 1988 Act No. 659, § 20; 1990 Act No. 521, § 82; 1997 Act No. 152, § 20; 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019; 2022 Act No. 128 (H.3821), § 4, eff April 4, 2022.
SECTION 62-5-104. Director of Department of Mental Health or his designee may act as conservator.
If a patient of a state mental health facility has no legally appointed conservator, the Director of the Department of Mental Health or his designee, may receive and accept, for the use and benefit of the patient, assets which may be due the patient by inheritance, gift, pension, or otherwise with a net aggregate amount not exceeding fifteen thousand dollars in one calendar year. The director or his designee may act as conservator for the patient and his endorsement or receipt discharges the obligor for any assets received. Upon receipt, the director or his designee shall apply the assets for the proper maintenance, use, and benefit of the patient. In the event the patient dies leaving an unexpended balance of assets in the hands of the director or his designee, the director or his designee shall apply the balance first to the funeral expenses of the patient, and any balance remaining must be held by the director or his designee for a period of six months; if within that period, the director or his designee is not contacted by the personal representative of the deceased patient, the balance of the assets may be applied to the maintenance and medical care account of the deceased patient. The director or his designee must, within thirty days following the death of the patient, notify the court in the county in which the patient resided at the time of admission to the department's facility of the death of the patient and provide a list of any property belonging to the patient and held by the department. Upon appointment of a conservator for a patient of a state mental health facility, the director shall deliver any assets of the protected person to the conservator and provide an accounting of the management of those assets.
HISTORY: 1986 Act No. 539, § 1; 1993 Act No. 83, § 1; 1993 Act No. 181, § 1611. Formerly Code 1976 § 62-5-105, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-105. Costs and expenses; attorney's fees.
(A) In a formal proceeding, the court, as justice and equity may require, may award costs and expenses, including reasonable attorney's fees, to any party, to be paid by another party or from the assets of a ward or protected person who is the subject of a formal proceeding.
(B) If not otherwise compensated for services rendered, the court-appointed guardian ad litem, counsel for the alleged incapacitated individual, counsel for the minor, and designated examiner are entitled to reasonable compensation, as determined by the court.
(C) Unless the court issues an order stating otherwise, petitioners are responsible for their own attorney's fees and costs, as well as the other costs and expenses of the action.
HISTORY: 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-106. Responsibilities and duties of guardian ad litem; reports.
(A) Once a guardian ad litem is appointed by the court, pursuant to Section 62-5-303B or Section 62-5-403B, the responsibilities and duties of the guardian ad litem include, but are not limited to:
(1) acting in the best interest of the alleged incapacitated individual;
(2) conducting an independent investigation to determine relevant facts and filing a written report with recommendations at least forty-eight hours prior to the hearing, unless excused or required earlier by the court. The investigation must include items listed in subitems (a) through (i) and also may include items listed in subitems (j) through (m), as appropriate or as ordered by the court:
(a) obtaining and reviewing relevant documents;
(b) meeting with the alleged incapacitated individual, at least once within thirty days following appointment, or within such time as the court may direct;
(c) investigating the residence or proposed residence of the alleged incapacitated individual;
(d) interviewing all parties;
(e) discerning the wishes of the alleged incapacitated individual;
(f) identifying less restrictive alternatives to guardianship and conservatorship;
(g) reviewing a criminal background check on the proposed guardian or conservator;
(h) reviewing a credit report on the proposed conservator;
(i) interviewing the person whose appointment is sought to ascertain the:
(i) proposed fiduciary's knowledge of the fiduciary's duties, requirements, and limitations; and
(ii) steps the proposed fiduciary intends to take or has taken to identify and meet the needs of the alleged incapacitated individual;
(j) consulting with persons who have a significant interest in the welfare of the alleged incapacitated individual or knowledge relevant to the case;
(k) contacting the Department of Social Services to investigate any action concerning the alleged incapacitated individual or the proposed fiduciary;
(l) determining the financial capabilities and integrity of the proposed conservator including, but not limited to:
(i) previous experience in managing assets similar to the type and value of the alleged incapacitated individual's assets;
(ii) plans to manage the alleged incapacitated individual's assets; and
(iii) whether the proposed conservator has previously borrowed funds or received financial assistance or benefits from the alleged incapacitated individual;
(m) interviewing any persons known to the guardian ad litem having knowledge of the alleged incapacitated individual's financial circumstances or the integrity and financial capabilities of the conservator, or both, and reviewing pertinent documents;
(3) advocating for the best interests of the alleged incapacitated individual by making specific recommendations regarding resources as may be appropriate and available to benefit the alleged incapacitated individual, the appropriateness of the appointment of a guardian or conservator, and any limitations to be imposed;
(4) avoiding conflicts of interest, impropriety, or self-dealing. A guardian ad litem shall not accept or maintain appointment if the performance of his duties may be materially limited by responsibilities to another person or by his own interests;
(5) participating in all court proceedings including discovery unless all parties waive the requirement to appear or the court otherwise excuses participation;
(6) filing with the court and delivering to each party a copy of the guardian ad litem's report; and
(7) moving for any necessary temporary relief to protect the alleged incapacitated individual from abuse, neglect, abandonment, or exploitation, or to address other emergency needs of the alleged incapacitated individual.
(B) Notes of a guardian ad litem are discoverable only upon a showing that the party seeking discovery has substantial need of the materials in the preparation of his case and that the party is unable without undue hardship to obtain the substantial equivalent of the materials by other means.
(C) The report of the guardian ad litem shall include all relevant information obtained in his investigation. The report shall contain facts including:
(1) the date and place of the meeting with the alleged incapacitated individual;
(2) a description of the alleged incapacitated individual;
(3) known medical diagnoses of the alleged incapacitated individual including the nature, cause, and degree of the incapacity and the basis for the findings;
(4) description of the condition of the alleged incapacitated individual's current place of residence including address and factors affecting safety;
(5) identification of persons with significant interest in the welfare of the alleged incapacitated individual;
(6) any prior action by the Department of Social Services or law enforcement concerning the alleged incapacitated individual or the proposed fiduciary of which the guardian ad litem is aware;
(7) a statement as to any prior relationship between the guardian ad litem and the petitioner, alleged incapacitated individual, or other party to the action;
(8) a description of the current care and treatment needs of the alleged incapacitated individual; and
(9) any other information relevant to the matter.
(D) The report shall contain recommendations including:
(1) whether a guardian or conservator is needed;
(2) the propriety and suitability of the proposed fiduciary after consideration of his geographic location, his familial or other relationship, his ability to carry out the duties of the proposed fiduciary, his commitment to promoting the welfare of the alleged incapacitated individual, his financial capabilities and integrity, his potential conflicts of interests, the wishes of the alleged incapacitated individual, and the recommendations of the relatives of the alleged incapacitated individual;
(3) approval or disapproval by the alleged incapacitated individual of the proposed fiduciary;
(4) an evaluation of the future care and treatment needs of the alleged incapacitated individual;
(5) if there is a proposed residential plan for the alleged incapacitated individual, whether that plan is in the best interest of the alleged incapacitated individual;
(6) a recommendation regarding any rights in Section 62-5-304A, which should be retained by the alleged incapacitated individual;
(7) whether the matter should be heard in a formal hearing even if all parties are in agreement; and
(8) any other recommendations relevant to the matter.
(E) The court in its discretion may extend or limit the responsibilities or authority of the guardian ad litem.
HISTORY: 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-107. Finding of incapacity.
Unless an order of the court specifies otherwise, a finding of incapacity is not a determination that the protected person or ward lacks testamentary capacity or the capacity to create, amend, or revoke a revocable trust.
HISTORY: 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-108. Temporary orders and hearings.
(A) The process for emergency orders without notice, emergency hearings, duration, and security is as follows:
(1) Emergency orders without notice must not be issued unless the moving party files a summons, motion for emergency order with supporting affidavit(s), verified pleading, notice of emergency hearing, and any other document required by the court. The verified pleading, motions, and affidavits shall set forth specific facts supporting the allegation that an immediate and irreparable injury, loss, or damage will result before notice can be served on adverse parties and a hearing held pursuant to subsection (B).
(a) If emergency relief is required to protect the welfare of an alleged incapacitated individual, the moving party must present an affidavit from a physician who has performed an examination within thirty days prior to the filing of the action, a motion for the appointment of counsel if counsel has not been retained, and a motion for the appointment of a proposed qualified individual to serve as guardian ad litem.
(b) If the emergency relief requested is an order for:
(i) appointment of a temporary guardian, conservator, guardian ad litem, or other fiduciary; or
(ii) the removal of an existing guardian, conservator, or other fiduciary, and the appointment of a substitute, then the moving party must submit evidence of the suitability and creditworthiness of the proposed fiduciary.
(2) If the motion for an emergency order is not granted, the moving party may seek temporary relief after notice pursuant to subsection (B) or proceed to a final hearing.
(3) If the motion for an emergency order is granted, the date and hour of its issuance must be endorsed on the order. The date and time for the emergency hearing must be entered on the notice of hearing and it must be no later than ten days from the date of the order or as the court determines is reasonable for good cause shown.
(4) The moving party shall serve all pleadings on the alleged incapacitated individual, ward or protected person and other adverse parties immediately after issuance of the emergency order.
(5) If the moving party does not appear at the emergency hearing, the court may dissolve the emergency order without notice.
(6) Evidence admitted at the hearing may be limited to pleadings and supporting affidavits. Upon good cause shown or at the court's direction, additional evidence may be admitted.
(7) On two days' notice to the party who obtained the emergency order without notice or on such shorter notice to that party as the court may prescribe, the adverse party may appear and move for the emergency order's dissolution or modification, and in that event, the court shall proceed to hear and determine the motion as expeditiously as possible and may consolidate motions.
(8) No emergency order for conservatorship must be issued except upon the court receiving adequate assurances the assets will be protected, which may include providing of security by the moving party in a sum the court deems proper for costs and damages incurred by any party who without just cause is aggrieved as a result of the emergency order. A surety upon a bond or undertaking submits to the jurisdiction of the court.
(9) The court may take whatever actions it deems necessary to protect assets, including, but not limited to, issuing an order to freeze accounts.
(B) The process for temporary orders and temporary hearings with notice is as follows:
(1) A temporary order must not be issued without notice to the adverse party.
(2) An order for a temporary hearing must not be issued unless the moving party files a summons, motion for temporary hearing with supporting affidavits, and a petition or other appropriate pleading setting forth specific facts supporting the allegation that immediate relief is needed during the pendency of the action, and an affidavit of service of the notice of the temporary hearing to adverse parties.
(a) If temporary relief is required to protect the welfare of an alleged incapacitated individual, in addition to the requirements set forth above in subsection (B)(2), the moving party shall present an affidavit from a physician who has performed an examination within forty-five days prior to the filing of the action, a motion for the appointment of counsel if counsel has not been retained, and a motion for appointment of a proposed qualified individual to serve as guardian ad litem.
(b) If the temporary relief requested is an order for:
(i) appointment of a temporary guardian, conservator, guardian ad litem, or other fiduciary; or
(ii) removal of an existing guardian, conservator or other fiduciary, and the appointment of a substitute, in addition to the requirements set forth in subsection (B)(2) and (a), as applicable, the moving party shall submit evidence of the suitability and creditworthiness of the proposed fiduciary.
(3) If the motion for temporary relief is not granted, the action will remain on the court docket for a final hearing.
(4) If the motion for temporary relief is granted, the court shall enter a date and time for the temporary hearing on the notice of hearing.
(5) The moving party shall serve pleadings on the alleged incapacitated individual, ward or protected person, and other adverse parties. Service must be made no later than ten days prior to the temporary hearing or as the court determines is reasonable for good cause shown.
(6) Temporary orders resulting from the hearing shall expire six months from the date of issuance unless otherwise specified in the order.
(C) In an emergency, the court may exercise the power of a guardian with or without notice if the court makes emergency findings as required by the Adult Health Care Consent Act, Section 44-66-30.
(D) After preliminary hearing upon such notice as the court deems reasonable, and if the petition requests temporary relief, the court has the power to preserve and apply the property of the alleged incapacitated individual as may be required for his benefit or the benefit of his dependents. Notice of the court's actions shall be given to interested parties as soon thereafter as possible.
(E) A hearing concerning the need for appointment of a permanent guardian must be a hearing de novo as to all issues before the court.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 483, § 3; 1997 Act No. 152, § 22; 2000 Act No. 398, § 10; 2010 Act No. 244, § 29, eff June 7, 2010. Formerly Code 1976 §§ 62-5-310 and 62-5-408, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
Part 2
Jurisdiction
SECTION 62-5-201. Jurisdiction.
Exclusive jurisdiction of the court is set forth in Sections 62-1-302 and 62-5-701 as to appointment of a guardian or issuance of a protective order. Pursuant to the court's authority to appoint a guardian, and Section 62-5-309, the guardian has the authority to maintain custody of the person of the ward and to establish the ward's place of abode, unless otherwise specified in the court's order. Other than the proceeding set forth in Section 62-5-303(C), the court does not have jurisdiction over the care, custody, and control of the person of a minor, but does have jurisdiction over the property of a minor if the court determines that the minor owns property that requires management or protection.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 66; 1988 Act No. 659, § 5. Formerly Code 1976 §§ 62-5-102 and 62-5-201, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019; 2023 Act No. 10 (S.341), § 2, eff May 8, 2023.
Part 3
Guardians of Incapacitated Individuals
SECTION 62-5-301. Testamentary nomination of guardian for incapacitated individual.
(A) The parent of an alleged incapacitated individual may by will nominate a guardian for an alleged incapacitated individual. A testamentary nomination by a parent gives the nominee priority pursuant to Section 62-5-308 in any proceeding to determine incapacity and appoint a guardian. A testamentary nomination by a parent gives priority to the nominee to make health care decisions for the alleged incapacitated individual pursuant to Section 44-66-30. Such nomination creates priority under Sections 62-5-308 and 44-66-30 when the will is informally or formally probated, if prior to the will being probated, both parents are deceased or the surviving parent is adjudged incapacitated. If both parents are deceased, the nomination by the parent who died later has priority unless it is terminated by the denial of probate in formal proceedings.
(B) The spouse of an alleged incapacitated individual may by will nominate a guardian for an alleged incapacitated individual. A testamentary nomination by a spouse gives the nominee priority pursuant to Section 62-5-308 in any proceeding to determine incapacity and appoint a guardian. A testamentary nomination by a spouse gives priority to the nominee to make health care decisions for the alleged incapacitated individual pursuant to Section 44-66-30. Such nomination creates priority under Sections 62-5-308 and 44-66-30 when the will is informally or formally probated. An effective nomination by a spouse has priority over a nomination by a parent unless the nomination is terminated by the denial of probate in formal proceedings.
(C) This State shall recognize a testamentary nomination under a will probated at the testator's domicile in another state.
HISTORY: 1986 Act No. 539, § 1; 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-302. Venue.
Venue for guardianship proceedings is in the place where the alleged incapacitated individual or ward resides or is present. If the alleged incapacitated individual or ward is committed to an institution pursuant to an order of a court of competent jurisdiction, venue also is in the county in which that court sits.
HISTORY: 1986 Act No. 539, § 1; 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-303. Procedure for court appointment of a guardian; summons and petition.
(A) A person seeking a finding of incapacity, appointment of a guardian, or both, must file a summons and petition. When more than one petition is pending in the same court, the proceedings may be consolidated.
(B) The petition shall set forth, to the extent known or reasonably ascertainable, the following information:
(1) interest of the petitioner;
(2) name, age, current address, and contact information of the alleged incapacitated individual, who must be designated as a respondent;
(3) physical location of the alleged incapacitated individual during the six-month period immediately preceding the filing of the summons and petition; and, if the alleged incapacitated individual was not physically present in South Carolina for that period, sufficient information upon which the court may make a determination that it has initial jurisdiction pursuant to Section 62-5-707;
(4) to the extent known and reasonably ascertainable, the names and addresses of the following persons, who must be designated as corespondents:
(a) the alleged incapacitated individual's spouse and adult children; or, if none, his parents; or, if none, at least one of his adult relatives within the nearest degree of kinship;
(b) a person known to have been appointed as agent for the alleged incapacitated individual under a general durable power of attorney or health care power of attorney;
(c) a person who has equal or greater priority for appointment pursuant to Section 62-5-308 as the person whose appointment is sought in the petition; and
(d) a person, other than an unrelated employee or health care worker, who is known or reasonably ascertainable by the petitioner to have materially participated in caring for the alleged incapacitated individual within the six-month period preceding the filing of the petition;
(5) name and address of the proposed guardian and the basis of his priority for appointment;
(6) reasons why a guardianship is necessary, including why less restrictive alternatives are not available or appropriate, and a brief description of the nature and extent of the alleged incapacity;
(7) a statement of any rights that a petitioner is requesting be removed from the alleged incapacitated individual, any restrictions to be placed on the alleged incapacitated individual, and any restrictions sought to be imposed on the guardian's powers and duties; and
(8) to the extent known and reasonably ascertainable, a general statement of the alleged incapacitated individual's assets, with an estimate of value, and the source and amount of any income of the alleged incapacitated individual.
(C) A person may initiate guardianship proceedings by filing a summons and petition for guardianship of a minor child up to one hundred eighty days prior to the date the child reaches the age of eighteen if the petitioner anticipates the minor child will require a guardian upon attaining the age of eighteen. The court has jurisdiction over the proceedings in this subsection beginning one hundred eighty days prior to the date the child reaches the age of eighteen. The minor shall be provided all due process rights conferred upon an alleged incapacitated individual pursuant to this chapter including, but not limited to, the appointment of an attorney and a guardian ad litem. An order appointing a guardian pursuant to this subsection shall be issued upon the minor's eighteenth birthday or as soon thereafter as possible.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 25, eff June 7, 2010; 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019; 2023 Act No. 10 (S.341), § 3, eff May 8, 2023.
SECTION 62-5-303A. Procedure for court appointment of a guardian; service.
(A) As soon as reasonably possible after the filing of the summons and petition, the petitioner shall serve:
(1) a copy of the summons, petition, and a notice of right to counsel upon the alleged incapacitated individual;
(2) a copy of the summons and petition upon all corespondents and the petitioner in any pending guardianship proceeding; and
(3) any affidavits or physician's reports filed with the petition.
(B) If service is not accomplished within one hundred twenty days after the filing of the action, the court may dismiss the action without prejudice.
(C) The notice of right to counsel shall advise the alleged incapacitated individual of the right to counsel of his choice and shall state that if the court has not received notice of appearance by counsel selected by the alleged incapacitated individual within fifteen days from the filing of proof of service, the court will appoint counsel. In appointing counsel, the court shall consider the expressed preferences of the alleged incapacitated individual.
(D) The date for the alleged incapacitated individual to file a responsive pleading shall run from the later of the date the court appoints counsel for the alleged incapacitated individual or from the date the court receives notice of appearance by counsel selected by the alleged incapacitated individual.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 483, § 2; 2010 Act No. 244, §§ 25, 28, eff June 7, 2010. Formerly Code §§ 62-5-303 and 62-5-309, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-303B. Procedure for court appointment of a guardian; appointments of counsel, guardians ad litem, and an examiner.
(A) Upon receipt by the court of proof of service of the summons, petition, and notice of right to counsel upon the alleged incapacitated individual, the court shall:
(1) upon the expiration of fifteen days from filing the proof of service on the alleged incapacitated individual, if no notice of appearance has been filed by counsel retained by the alleged incapacitated individual, appoint counsel;
(2) no later than thirty days from the filing of the proof of service on the alleged incapacitated individual, appoint:
(a) a guardian ad litem for the alleged incapacitated individual who shall have the duties and responsibilities set forth in Section 62-5-106; and
(b) one examiner, who must be a physician, to examine the alleged incapacitated individual and file a notarized report setting forth his evaluation of the condition of the alleged incapacitated individual in accordance with the provisions set forth in Section 62-5-303D. Unless the guardian ad litem or the alleged incapacitated individual objects, if a physician's notarized report is filed with the petition and served upon the alleged incapacitated individual and all interested parties with the petition, then the court may appoint such physician as the examiner. Upon the court's own motion or upon request of the initial examiner, the alleged incapacitated individual, or his guardian ad litem, the court may appoint a second examiner, who must be a physician, nurse, social worker, or psychologist.
(B) At any time during the proceeding, if requested by a guardian ad litem who is not an attorney, the court may appoint counsel for the guardian ad litem.
(C) At the attorney's discretion, the attorney for the alleged incapacitated individual may file a motion requesting that the court relieve him as the attorney if the alleged incapacitated individual is incapable of communicating, with or without reasonable accommodations, his wishes, interests, or preferences regarding the appointment of a guardian. The attorney must file an affidavit in support of the motion. If the court is satisfied that the alleged incapacitated individual is incapable of communicating, with or without reasonable accommodations, his wishes, interests, or preferences regarding the appointment of a guardian, then the court may relieve the attorney from his duties as attorney for the alleged incapacitated individual. If the former attorney requests to be appointed as the guardian ad litem, the court may appoint him to serve as the guardian ad litem. An attorney cannot serve as both an attorney and as a guardian ad litem in a guardianship action.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 25, eff June 7, 2010. Formerly Code 1976 § 62-5-303, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-303C. Procedure for court appointment of a guardian; hearing.
(A) As soon as the interests of justice may allow, but after the time for filing a response to the petition has elapsed as to all parties, the court shall hold a hearing on the merits of the petition. The alleged incapacitated individual, all parties, and any person who has filed a demand for notice, shall be given notice of the hearing. The alleged incapacitated individual is entitled to be present at the hearing, to conduct discovery, and to review all evidence bearing upon his condition. The hearing may be closed at the request of the alleged incapacitated individual or his guardian ad litem. The alleged incapacitated individual may waive notice of a hearing and his presence at the hearing. If there is an agreement among all the parties and the guardian ad litem's report indicates that a hearing would not further the interests of justice, the alleged incapacitated individual may waive his right to a hearing. If the alleged incapacitated individual waives his right to a hearing, the court may:
(1) require a formal hearing;
(2) require an informal proceeding as the court shall direct; or
(3) proceed without a hearing.
(B) If no formal hearing is held, the court shall issue a temporary consent order, which shall expire in thirty days. A ward, under a temporary order, may request a formal hearing at any time during the thirty-day period. At the end of the thirty-day period, if the ward has not requested a formal hearing, the court shall issue an order upon such terms agreed to by the parties and the guardian ad litem.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 483, § 2; 2010 Act No. 244, §§ 25, 28, eff June 7, 2010. Formerly Code §§ 62-5-303 and 62-5-309, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-303D. Procedure for court appointment of a guardian; report evaluating condition of alleged incapacitated individual.
(A) Each examiner shall complete a notarized report setting forth an evaluation of the condition of the alleged incapacitated individual. The original report must be filed with the court by the court's deadline, but not less than forty-eight hours prior to any hearing in which the report is introduced as evidence. For good cause, the court may admit an examiner's report filed less than forty-eight hours prior to the hearing. All parties are entitled to review the reports after filing, which must be admissible as evidence. The evaluation shall contain, to the best of the examiner's knowledge and belief:
(1) a description of the nature and extent of the incapacity, including specific functional impairments;
(2) a diagnosis and assessment of the alleged incapacitated individual's mental and physical condition, including whether he is taking any medications that may affect his actions;
(3) an evaluation of the alleged incapacitated individual's ability to exercise the rights set forth in Section 62-5-304A;
(4) when consistent with the scope of the examiner's license, an evaluation of the alleged incapacitated individual's ability to learn self-care skills, adaptive behavior, and social skills, and a prognosis for improvement;
(5) the date of all examinations and assessments upon which the report is based;
(6) the identity of the persons with whom the examiner met or consulted regarding the alleged incapacitated individual's mental or physical condition; and
(7) the signature and designation of the professional license held by the examiner.
(B) Unless otherwise directed by the court, the examiner may rely upon an examination conducted within the ninety-day period immediately preceding the filing of the petition. In the absence of bad faith, an examiner appointed by the court pursuant to Section 62-5-303B, is immune from civil liability for breach of patient confidentiality made in furtherance of his duties.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 25, eff June 7, 2010. Formerly Code 1976 § 62-5-303, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-304. Order of appointment; alternatives; limitations on guardian's powers.
(A) The court shall exercise its authority to encourage maximum self-reliance and independence of the incapacitated individual and issue orders only to the extent necessitated by the incapacity of the individual.
(B) The court may appoint a guardian if clear and convincing evidence shows that the individual is incapacitated and the appointment of a guardian is necessary to provide continuing care and supervision of the incapacitated individual. The court may:
(1) enter an appropriate order;
(2) treat the petition as one for a protective order and proceed accordingly; or
(3) dismiss the proceeding.
(C) The court may appoint co-guardians if the appointment is in the best interest of the incapacitated individual. The compensation of co-guardians in the aggregate shall not exceed the compensation that would have been allowed to a sole guardian. Unless the order of appointment provides otherwise:
(1) each co-guardian has authority to act independently; and
(2) if a co-guardian dies, the other co-guardian has continuing authority to act alone.
(D) The court, on its own motion or on the petition or motion of the incapacitated individual or other interested person, may limit the powers of a guardian and create a limited guardianship. A limitation on the statutory power of a guardian of an incapacitated individual shall be endorsed on the guardian's letters. A limitation may be removed, modified, or restored pursuant to Sections 62-5-307 and 62-5-307A.
(E) Unless the court order specifies otherwise:
(1) appointment of a guardian terminates an agent's powers under a health care power of attorney or durable power of attorney for matters within the scope of the guardianship; and
(2) the guardian shall act consistently with the most recent advance directive executed by the ward prior to an adjudication of incapacity.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 483, § 1; 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-304A. Rights and powers of ward and guardian.
(A) The court shall set forth the rights and powers removed from the ward. To the extent rights are not removed, they are retained by the ward. Such rights and powers include the rights and powers to:
(1) marry or divorce;
(2) reside in a place of the ward's choosing, and consent or withhold consent to any residential or custodial placement;
(3) travel without the consent of the guardian;
(4) give, withhold, or withdraw consent and make other informed decisions relative to medical, mental, and physical examinations, care, treatment and therapies;
(5) make end-of-life decisions including, but not limited to, a 'do not resuscitate' order or the application of any medical procedures intended solely to sustain life, and consent or withhold consent to artificial nutrition and hydration;
(6) consent or refuse to consent to hospitalization and discharge or transfer to a residential setting, group home, or other facility for additional care and treatment;
(7) authorize disclosures of confidential information;
(8) operate a vehicle;
(9) vote;
(10) be employed without the consent of a guardian;
(11) consent to or refuse educational services;
(12) participate in social, religious or political activities;
(13) buy, sell, or transfer real or personal property or transact business of any type including, but not limited to, those powers conferred upon the conservator under Section 62-5-422;
(14) make, modify, or terminate contracts;
(15) bring or defend any action at law or equity; and
(16) any other rights and powers that the court finds necessary to address.
(B) The court shall set forth the rights and powers vested in the guardian. These rights and powers include, but are not limited to, the rights and powers to:
(1) determine the place where the ward shall reside and consent or withhold consent to any residential or custodial placement;
(2) consent to travel;
(3) consent or refuse to consent to visitation with family, friends and others;
(4) give, withhold, or withdraw consent and make other informed decisions relative to medical, mental, and physical examinations, care, treatment and therapies;
(5) make end-of-life decisions, including, but not limited, to a "do not resuscitate" order or the application of any medical procedures intended solely to sustain life, and consent or withhold consent to artificial nutrition and hydration;
(6) consent or refuse to consent to hospitalization and discharge or transfer to a residential setting, group home, or other facility for additional care and treatment;
(7) authorize disclosures of confidential information;
(8) consent to or refuse educational services;
(9) consent to employment;
(10) make, modify, or terminate contracts related to the duties of the guardian;
(11) bring or defend any action at law or equity; and
(12) exercise any other rights and powers that the court finds necessary to address.
(C) Nothing in this section must be construed as removing any rights guaranteed by the Bill of Rights for Residents of Long-Term Care Facilities under Chapter 81, Title 44.
(D) The attorney-client privilege between the ward and the ward's counsel must not be removed by the appointment of a guardian.
HISTORY: 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-305. Acceptance of appointment; consent to jurisdiction.
By accepting appointment, a guardian submits personally to the jurisdiction of the court in any proceeding relating to the guardianship that may be instituted by any interested person. Notice of any proceeding must be given or waived pursuant to Sections 62-1-401 and 62-1-402.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 26, eff June 7, 2010; 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-306. Termination of guardianship for incapacitated person; accounting of funds.
(A) Upon the death of the ward, the guardian shall notify the court and file a death certificate confirming the ward's death. The court may then issue an order terminating the guardianship and the appointment of the guardian.
(B) If there is no conservatorship for the ward, the guardian may file an application for specific authority to use the ward's funds for the final disposition of the ward's remains. If the application is granted by the court, the guardian shall file an accounting of those funds within ten days from the date of approval, along with a proof of delivery showing he has delivered a copy of the accounting to the last known address of the person named as Personal Representative in the ward's will. If the guardian cannot locate the will after reasonable effort, he shall send a copy of the accounting to the last known address for at least one of the ward's closest adult relatives. Upon approval of the accounting, the court will issue an order terminating the guardianship and the appointment.
(C) Termination of the appointment does not affect the guardian's liability for prior acts nor his obligation to account for any funds or assets of the ward.
HISTORY: 1986 Act No. 539, § 1; 2008 Act No. 303, § 1, eff June 11, 2008. Formerly Code 1976 §§ 62-5-106 and 62-5-306, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-307. Informal request for relief.
(A) The ward or another person interested in his welfare, may make an informal request for relief by submitting a written request to the court. The court may take such action as considered reasonable and appropriate to protect the ward.
(B) A person making an informal request submits personally to the jurisdiction of the court.
HISTORY: 1986 Act No. 539, § 1; 2008 Act No. 303, § 1, eff June 11, 2008; 2010 Act No. 244, § 27, eff June 7, 2010. Formerly Code 1976 §§ 62-5-106 and 62-5-307, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-307A. Removal of guardian; termination of incapacity.
(A) Upon filing of a summons and petition with the appointing court, the ward or any person interested in his welfare may, for good cause, request an order to:
(1) prove by a preponderance of the evidence that the ward is no longer incapacitated. The petition may request a court order limiting the scope of the guardianship and the authority of the guardian or a termination of the guardianship and the appointment of the guardian. The court may specify a minimum period, not exceeding one year, during which no application or petition for readjudication may be filed without leave of court;
(2) appoint a successor guardian due to death, incapacity, resignation, or dereliction of duty of the guardian. The appointment of a successor guardian does not affect the guardian's liability for prior acts nor his obligation to account for any funds or assets of the ward. The petition shall name a willing and qualified person to serve as successor guardian in the petition or set forth why no such successor is available; or
(3) modify the provisions of an existing court order.
(B) After filing and service of the summons and petition, the court may appoint a guardian ad litem and may appoint counsel for the ward, unless the ward has private counsel, and such examiners as are needed to evaluate and confirm the allegations of the petition.
(C) On its own motion, the court may initiate appropriate proceedings under this section as considered necessary to promote the best interests of the ward.
(D) An attorney who has been asked by the ward to represent him in an action under this section may file a motion with the court for permission to represent the ward.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 27, eff June 7, 2010. Formerly Code 1976 § 62-5-307, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-308. Guardian; qualifications; priorities.
(A) In appointing a guardian, the court shall consider persons who are otherwise qualified in the following order of priority:
(1) a person previously appointed guardian, other than a temporary or emergency guardian, currently acting for the ward in this State or elsewhere;
(2) a person nominated to serve as guardian by the alleged incapacitated individual if he has sufficient mental capacity to make a reasoned choice;
(3) an agent designated in a power of attorney by the alleged incapacitated individual, whose authority includes powers relating to the care of the alleged incapacitated individual;
(4) the spouse of the alleged incapacitated individual or a person nominated as testamentary guardian in the will of the alleged incapacitated individual's deceased spouse;
(5) an adult child of the alleged incapacitated individual;
(6) a parent of the alleged incapacitated individual or a person nominated as testamentary guardian in the will of the alleged incapacitated individual's deceased parent;
(7) the person nearest in kinship to the alleged incapacitated individual who is willing to accept the appointment;
(8) a person with whom the alleged incapacitated individual resides outside of a health care facility, group home, homeless shelter, or prison;
(9) a person nominated by a health care facility caring for the alleged incapacitated individual; and
(10) any other person considered suitable by the court.
(B) A person whose priority is based upon his status under subsections (A)(1), (3), (4), (5), (6), or (7) may nominate in writing a person to serve in his or her stead. With respect to persons having equal priority, the court shall select the person it considers best qualified to serve as guardian. The court, acting in the best interest of the alleged incapacitated individual, may decline to appoint a person having higher priority and appoint a person having lesser priority or no priority.
(C) Other than as provided in Section 62-5-108, a probate judge or an employee of the court shall not serve as a guardian of a ward; except, a probate judge or an employee of the court may serve as a guardian of a family member if such service does not interfere with the proper performance of the probate judge's or the employee's official duties. For purposes of this subsection, "family member" means a spouse, parent, child, brother, sister, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, grandparent, or grandchild.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 483, § 4. Formerly Code 1976 § 62-5-311, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-309. Delegation of guardian's powers.
(A) Subject to the rights and powers retained by the ward and except as modified by order of the court, the guardian has the following duties, rights, and powers:
(1) to the extent that it is consistent with the terms of any order by a court of competent jurisdiction relating to detention or commitment of the ward, maintaining custody of the ward and the ability to establish the ward's place of abode within or without this State;
(2) if entitled to custody of his ward, providing for the care, comfort, and maintenance of the ward; the guardian is entitled to receive reasonable compensation for his services and for room and board furnished to the ward as approved by the court;
(3) arranging for appropriate habilitation and rehabilitation services and educational, social, and vocational services to assist the ward in the development of maximum self-reliance and independence;
(4) taking reasonable care of his ward's clothing, furniture, vehicles, and other personal effects, and commencing protective proceedings if other property of his ward is in need of protection;
(5) providing any consents, denials, or approvals necessary to enable the ward to receive or refuse to receive medical or other professional care, counsel, treatment, or service, including institutional care. If there is no conservator and placement or care of the ward requires the execution of an admission agreement or other documents for the ward's placement in a facility, the guardian may execute such documents on behalf of the ward, without incurring personal liability;
(6) if no conservator for the estate of the ward is appointed or if the guardian is also conservator:
(a) instituting proceedings to compel any person under a duty to support the ward or to pay sums for the welfare of the ward to perform his duty;
(b) receiving money and tangible property deliverable to the ward and applying the money and property for support, care, and education of the ward; however, he may not use funds from his ward's estate for room and board or services that he, his spouse, parent, or child have furnished the ward unless a charge for the services or room and board is approved by order of the court made upon notice to at least one of the next of kin of the ward, if notice is possible. He must exercise care to conserve any excess for the ward's needs; and
(c) exercising the ward's rights as trust beneficiary to the extent provided in Article 7, Title 62;
(7) reporting the condition of his ward and of the estate that has been subject to his possession or control to the court, as required by the court or court rule, but at least on an annual basis;
(8) if a conservator has been appointed:
(a) paying over to the conservator all of the ward's estate received by the guardian in excess of those funds expended to meet current expenses for support, care, and education of the ward and accounting to the conservator for funds expended; and
(b) requesting the conservator to expend the ward's estate by payment to the guardian or to third persons or institutions for the ward's care and maintenance;
(9) if co-guardians have been appointed, keeping the other co-guardian informed of all relevant information regarding the care and custody of the ward, including, but not limited to, the identity of the ward's care providers, medical providers, or similar professionals and informing the other co-guardian when scheduling medical appointments for the ward; and
(10) exercising any other power, right, or duty ordered by the court.
(B) A guardian, within thirty days of his appointment, shall file a plan of care. The plan must be based on the actual needs of the ward, taking into consideration the best interest of the ward. The guardian shall revise the plan as the needs and circumstances of the ward require. The guardian shall include in the plan a statement of the extent to which the ward may be able to develop or recover ability for independent decision making and any proposed steps to develop or restore the ward's ability for independent decision making. The court shall approve, disapprove, or modify the plan in informal or formal proceedings, as the court deems appropriate. Nothing herein shall require the court to oversee the plan of care.
(C) A guardian, by a properly executed special power of attorney, may delegate to another person, for a period not to exceed sixty days, any of his powers regarding the care and custody of the ward. The original power of attorney must be filed with the court having jurisdiction over the guardianship.
(D) A guardian is not legally obligated to provide for the ward from the guardian's funds solely by reason of his appointment as guardian.
(E) A guardian is not liable to a third person for acts of the ward solely by reason of the guardianship relationship and is not liable for injury to the ward resulting from the wrongful conduct of a third person providing medical or other care, treatment or service for the ward except to the extent that the guardian failed to exercise reasonable care in choosing the provider.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 65; 1997 Act No. 152, § 21. Formerly Code 1976 §§ 62-5-104 and 62-5-312, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-310. Proceedings subsequent to appointment; venue.
(A) The court that appointed the guardian shall maintain jurisdiction over the guardianship until such time as:
(1) the proceeding is terminated following the death of the ward;
(2) the proceeding is terminated pursuant to a readjudication of incapacity;
(3) the court transfers the proceeding to another county's jurisdiction;
(4) the court transfers the proceedings to another state.
(B) If the court with competent jurisdiction determines that venue would be more appropriate:
(1) in another county of this State, the court shall notify the court in the other county and, after consultation with that court, determine whether to retain jurisdiction or transfer the proceedings to the other court, whichever is in the best interest of the ward. A copy of an order accepting a resignation or removing a guardian must be sent to the court in which acceptance of appointment is filed; or
(2) in another state, the first court shall follow the procedures set forth in Section 62-5-714.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-313, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
Part 4
Protection of Property of Persons Under Disability and Minors
SECTION 62-5-401. Venue.
Subject to the provisions of Section 62-5-701, et seq., venue for proceedings under this part is:
(1) in the county where the alleged incapacitated individual resides; or
(2) if the alleged incapacitated individual does not reside in this State, in any county in the state where the alleged incapacitated individual has property or has the right to take legal action.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-403, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-402. Protective proceedings; minors.
(A) The appointment of a conservator or issuance of a protective order may be made in relation to the estate and affairs of a minor if:
(1) a minor owns real or personal property that requires management or protection;
(2) a minor has or may have business affairs that may be adversely affected by a lack of effective management; or
(3) it is necessary to obtain and administer funds for the health, education, maintenance, and support of the minor.
(B) The appointment of a conservator or issuance of a protective order for a minor may be made in the following manner:
(1) By filing a verified application setting forth the following information:
(a) the interest of the applicant;
(b) the name, age, current address, and contact information for the minor;
(c) physical location of the minor during the six-month period immediately preceding the filing of the application and if the minor was not present in South Carolina for that period, sufficient information upon which the court may determine it has initial jurisdiction;
(d) the name and address of the non-applicant parent of the minor, the person with whom the minor resides, and other persons as the court directs;
(e) any person who has equal or greater priority for appointment as the person whose appointment is sought pursuant to Section 62-5-408;
(f) the name and address of the person whose appointment is sought and the basis of priority for appointment;
(g) the reason why the appointment is necessary; and
(h) an estimate of the value of the minor's assets and the source of the minor's income, if any.
(2) Upon consideration of the application and in the court's discretion, with or without a hearing, if the court concludes it is in the best interests of the minor, the court shall issue its order of appointment or protective order.
(C) The court may at any time require the filing of a summons and petition for the appointment of a conservator or for issuance of a protective order, and the appointment or order must be made in the following manner:
(1) the petition shall set forth the information required in subsection (B);
(2) the summons and petition must be served on the minor, the minor's parents whose identity and whereabouts are known or reasonably ascertainable, the person or persons having custody of the minor, and other persons the court directs; and
(3) after the time has elapsed for the filing of a response to the petition and a hearing, if the court concludes it is in the best interests of the minor, the court shall issue its order of appointment or a protective order.
(D) Except upon a finding of good cause, the court shall require the conservator to furnish bond, or establish a restricted account, or both pursuant to Section 62-5-409.
(E) If a minor is receiving needs-based government benefits the court may limit access to the minor's funds to prohibit payments that would disqualify the minor from receipt of benefits.
(F) At any time and in any proceeding if the court determines the interests of the minor are not or may not be adequately represented, it may appoint a guardian ad litem to represent the minor.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, §§ 30, 33, eff June 7, 2010. Formerly Code 1976 §§ 62-5-401 and 62-5-407, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-403. Protective proceedings; incapacitated and disabled persons.
(A) A person seeking a finding of incapacity, appointment of a conservator, or issuance of a protective order must file a summons and petition if:
(1) the individual is unable to manage his property or affairs effectively for reasons of incapacity, confinement, detention by a foreign power, or disappearance; and
(a) the individual has an agent pursuant to a durable power of attorney and the actions necessary to prevent waste or dissipation of the individual's property are not being adequately performed by or are beyond the authority of the agent; or
(b) the individual has no agent under a durable power of attorney and owns property that will be wasted or dissipated or which is needed for the health, education, maintenance, or support of the individual or those entitled to his support, and protection is necessary to obtain or administer the funds.
(2) a protective order is necessary to create a special needs trust for an individual who is disabled in accordance with Social Security Administration guidelines.
(B) The petition shall set forth, to the extent known or reasonably ascertainable, the following information:
(1) interest of the petitioner;
(2) name, age, current address, and contact information of the alleged incapacitated individual, who must be designated as the respondent;
(3) physical location of the alleged incapacitated individual during the six-month period immediately preceding the filing of the summons and petition; and, if the alleged incapacitated individual was not physically present in South Carolina for that period, sufficient information upon which the court may make a determination that it has initial jurisdiction pursuant to Section 62-5-707;
(4) to the extent known and reasonably ascertainable, the names and addresses of the following persons, who must be designated corespondents:
(a) the alleged incapacitated individual's spouse and any adult children; or if none, his parents; or if none, at least one of his adult relatives with the nearest degree of kinship;
(b) a person known to have been appointed as agent under a general durable power of attorney or health care power of attorney;
(c) a person who has equal or greater priority for appointment pursuant to Section 62-5-408 as the person whose appointment is sought in the petition;
(d) a person other than an unrelated employee or health care worker who is known or reasonably ascertainable by the petitioner to have materially participated in the caring for the alleged incapacitated individual within the six-month period preceding the filing of the petition; and
(e) the person entitled to notice on behalf of the VA, if the alleged incapacitated individual is receiving VA benefits;
(5) name and address of the proposed conservator and the basis of his priority for appointment;
(6) reason why conservatorship is necessary, including why less restrictive alternatives are not available and appropriate, and a brief description of the nature and extent of the alleged incapacity;
(7) a statement of any rights the petitioner is requesting be removed from the alleged incapacitated individual, any restrictions to be placed on the alleged incapacitated individual, and any restrictions sought to be imposed on the conservator's powers and duties;
(8) a general statement of the alleged incapacitated individual's assets, with an estimated value, and the source and amount of any income of the alleged incapacitated individual; and
(9) whether the alleged incapacitated individual has been rated incapable of handling his estate and monies on examination by the VA and, if so, shall state the name and address of the person to be notified on behalf of the VA.
(C) An alleged incapacitated individual seeking the appointment of a conservator or issuance of a protective order may file a summons and petition with the information specified in subsection (B).
(D) When more than one petition is pending in the same court, the proceedings may be consolidated.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 30, eff June 7, 2010; 2016 Act No. 278 (S.777), § 3, eff June 9, 2016. Formerly Code 1976 §§ 62-5-401 and 62-5-404, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-403A. Service of summons and petition.
(A) As soon as reasonably possible after the filing of the summons and petition, the petitioner shall serve:
(1) a copy of the summons, petition, and a notice of right to counsel upon the alleged incapacitated individual;
(2) a copy of the summons and petition upon all corespondents and the petitioner in any pending conservatorship or protective proceeding; and
(3) any affidavits or physicians' reports filed with the petition.
(B) If service is not accomplished within one hundred twenty days after the filing of the action, the court may dismiss the action without prejudice.
(C) The notice of right to counsel shall advise the alleged incapacitated individual of the right to counsel of his choice and shall state that if the court has not received a notice of appearance by counsel selected by the alleged incapacitated individual within fifteen days from the filing of the proof of service, the court will appoint counsel. In appointing counsel, the court may consider the expressed preferences of the alleged incapacitated individual.
(D) The date for the alleged incapacitated individual to file a responsive pleading shall run from the later of the date the court appoints counsel for the alleged incapacitated individual or from the date the court receives notice of appearance by counsel selected by the alleged incapacitated individual.
HISTORY: 1986 Act No. 539, § 1; 1997 Act No. 152, § 23; 2010 Act No. 244, § 32, eff June 7, 2010; 2016 Act No. 278 (S.777), § 4, eff June 9, 2016. Formerly Code 1976 § 62-5-405, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-403B. Appointment of counsel and guardian ad litem.
(A) Except in cases governed by Section 62-5-431 relating to veterans benefits, upon receipt by the court of proof of service of the summons, petition, and notice of right to counsel upon the alleged incapacitated individual, the court shall:
(1) upon the expiration of fifteen days from the filing of the proof of service on the alleged incapacitated individual, if no notice of appearance has been filed by counsel retained by the alleged incapacitated individual, appoint counsel;
(2) no later than thirty days from the filing of the proof of service on the alleged incapacitated individual, appoint:
(a) a guardian ad litem for the alleged incapacitated individual who has the duties and responsibilities set forth in Section 62-5-106;
(b) except in cases governed by Section 62-5-431 relating to benefits from the VA, one examiner, who must be a physician, to examine the alleged incapacitated individual and file a notarized report setting forth his evaluation of the condition of the alleged incapacitated individual in accordance with the provisions set forth in Section 62-5-403D. Unless the guardian ad litem or the alleged incapacitated individual objects, if a physician's notarized report is filed with the petition and served upon the alleged incapacitated individual and all interested parties with the petition, then the court may appoint that physician as the examiner. Upon the court's own motion or upon request of the initial examiner, the alleged incapacitated individual, or his guardian ad litem, the court may appoint a second examiner, who must be a physician, nurse, social worker, or psychologist. No appointment of examiners is required when the basis for the petition is that the individual is confined, detained, or missing.
(B) At any time during the proceeding, if requested by a guardian ad litem who is not an attorney, the court may appoint counsel for the guardian ad litem.
(C) At the attorney's discretion, the attorney for the alleged incapacitated individual may file a motion requesting that the court relieve him as the attorney if the alleged incapacitated individual is incapable of communicating, with or without reasonable accommodations, his wishes, interests, or preferences regarding the appointment in a protective proceeding. The attorney must file an affidavit in support of the motion. If the court is satisfied that the alleged incapacitated individual is incapable of communicating, with or without reasonable accommodations, his wishes, interests, or preferences regarding the appointment in a protective proceeding, then the court may relieve the attorney from his duties as attorney for the alleged incapacitated individual. If the former attorney requests to be appointed as the guardian ad litem, the court may appoint him to serve as the guardian ad litem. An attorney cannot serve as both an attorney and as a guardian ad litem in a protective proceeding.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 33, eff June 7, 2010; 2016 Act No. 278 (S.777), § 5, eff June 9, 2016. Formerly Code 1976 § 62-5-407, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-403C. Hearing; waiver.
(A) As soon as the interests of justice may allow, but after the time for filing a response to the petition has elapsed as to all parties, the court shall hold a hearing on the merits of the petition. The alleged incapacitated individual, all parties, and any person who has filed a request or demand for notice must be given notice of the hearing. The alleged incapacitated individual is entitled to be present at the hearing, to conduct discovery, and to review all evidence bearing upon his condition. The hearing may be closed at the request of the alleged incapacitated individual or his guardian ad litem. The alleged incapacitated individual may waive notice of a hearing and his presence at the hearing. If there is an agreement among all the parties and the guardian ad litem's report indicates that a hearing would not further the interests of justice, the alleged incapacitated individual may waive his right to a hearing. If the alleged incapacitated individual waives his right to a hearing, the court may:
(1) require a formal hearing;
(2) require an informal proceeding as the court shall direct; or
(3) proceed without a hearing.
(B) If no formal hearing is held, the court shall issue a temporary consent order, which shall expire in thirty days. A protected person, under a temporary order, may request a formal hearing at any time during the thirty-day period. At the end of the thirty-day period, if the protected person has not requested a formal hearing, the court shall issue an order upon such terms agreed to by the parties and the guardian ad litem.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 67; 1997 Act No. 152, § 23; 2010 Act No. 244, §§ 32, 33, eff June 7, 2010; 2016 Act No. 278 (S.777), §§ 4, 5, eff June 9, 2016. Formerly Code 1976 §§ 62-5-405, 62-5-406, and 62-5-407, renumbered and amended by 2017 Act No. 87, § 5.A, eff January 1, 2019.
SECTION 62-5-403D. Report of examiner.
(A) Each examiner shall complete a notarized report setting forth an evaluation of the condition of the alleged incapacitated individual. The original report must be filed with the court by the court's deadline, but not less than forty-eight hours prior to any hearing in which the report will be introduced as evidence. For good cause, the court may admit an examiner's report filed less than forty-eight hours prior to the hearing. All parties are entitled to review the reports, which are admissible as evidence. The evaluation shall contain, to the best of the examiner's knowledge and belief:
(1) a description of the nature and extent of the incapacity, including specific functional impairments;
(2) a diagnosis and assessment of the alleged incapacitated individual's mental and physical condition, including whether he is taking any medications that may affect his actions;
(3) an evaluation of the alleged incapacitated individual's ability to exercise the rights set forth in Section 62-5-407;
(4) when consistent with the scope of the examiner's license, an evaluation of the alleged incapacitated individual's ability to learn self-care skills, adaptive behavior, and social skills, and a prognosis for improvement;
(5) the date of all examinations and assessments upon which the report is based;
(6) the identity of the persons with whom the examiner met or consulted regarding the alleged incapacitated individual's mental or physical condition; and
(7) the signature and designation of the professional license held by the examiner.
(B) Unless otherwise directed by the court, the examiner may rely upon an examination conducted within the ninety-day period immediately preceding the filing of the petition. In the absence of bad faith, an examiner appointed by the court pursuant to Section 62-5-403B is immune from civil liability for any breach of patient confidentiality made in furtherance of his duties.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 33, eff June 7, 2010; 2016 Act No. 278 (S.777), § 5, eff June 9, 2016. Formerly Code 1976 § 62-5-407, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-404. Protective proceedings; limited conservatorship.
(A) Upon a finding by clear and convincing evidence that a basis for an appointment or protective order exists with respect to a minor, the court has all those powers over the estate and affairs of the minor that are necessary for the best interests of the minor and members of his household.
(B) Upon finding by clear and convincing evidence that a basis for an appointment or protective order exists for reasons other than minority, the court has the powers over the incapacitated individual's real and personal property and financial affairs which the incapacitated individual could exercise if not under disability, except the power to make a will or amend a revocable trust.
(C) The court, on its own motion or on the petition or motion of the incapacitated individual or any other person, may limit the powers of a conservator. A limitation on the statutory power of a conservator must be endorsed upon the conservator's letters. A limitation may be removed, modified, or restored pursuant to Section 62-5-428. Notwithstanding the foregoing, the failure to endorse any limitation upon the conservator's letters shall not relieve the conservator of the limitation imposed by order of the court.
HISTORY: 1986 Act No. 539, § 1; 2000 Act No. 398, § 10. Formerly Code 1976 §§ 62-5-408 and 62-5-426, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-405. Protective arrangements.
(A) When it is established in a formal proceeding that a basis exists for affecting a protective arrangement that concerns the property and affairs of a minor or an incapacitated individual, the court may:
(1) without appointing a conservator, authorize, direct, or ratify any provision within a protective arrangement that is in the best interest of the minor or incapacitated individual. A protective arrangement includes, but is not limited to, the payment, delivery, deposit, or retention of funds or property; the sale, mortgage, lease, or other transfer of property; the entry into an annuity contract, a contract for life care, a deposit contract, or a contract for training and education; or the addition to or establishment of a suitable trust.
(2) authorize a conservator or a special conservator to exercise the power to perform the following acts:
(a) make gifts as the court, in its discretion, believes would be made by the protected person;
(b) convey or release the protected person's contingent and expectant interests in property including material property rights and any right of survivorship incident to joint tenancy;
(c) create or amend revocable trusts or create irrevocable trusts of property of the protected person's estate that may extend beyond the protected person's disability or life, including the creation or funding of a special needs trust or a pooled fund trust for disabled individuals;
(d) fund trusts;
(e) exercise the protected person's right to elect options and change beneficiaries under insurance and annuity policies and to surrender policies for their cash value;
(f) exercise the protected person's right to an elective share in the estate of a deceased spouse;
(g) renounce any interest by testate or intestate succession or by inter vivos transfer;
(h) ratify any such actions taken on behalf of the protected person.
(B) When acting as conservator or when approving a conservator's or special conservator's action, the court may consider the:
(1) wishes of the protected person;
(2) financial needs and legal obligations of the protected person and those who are dependent upon him for support;
(3) tax consequences;
(4) protected person's eligibility or potential eligibility for governmental assistance;
(5) protected person's previous pattern of giving or level of support;
(6) protected person's gifting and estate plan; and
(7) protected person's life expectancy and the probable duration of incapacity.
(C) Prior to issuing a protective order, the court shall consider whether appointment of a conservator is necessary. The court shall set forth specific findings upon which the court bases its order authorizing a protective arrangement. For purposes of issuing a consent order, counsel may consent on behalf of the protected person.
(D) The petitioner shall serve all heirs and devisees of the incapacitated individual whose identity and whereabouts are reasonably ascertainable with the petition seeking a protective order to perform one or more actions set forth in subsection (A)(2).
HISTORY: 1986 Act No. 539, § 1; 2000 Act No. 398, § 10. Formerly Code 1976 §§ 62-5-408 and 62-5-409, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-406. Reserved.
HISTORY: Former Section, titled Protective proceedings; request for notice; interested person, had the following history: 1986 Act No. 539, § 1; 1987 Act No. 171, § 67. Reserved by 2017 Act No. 87, § 5.A, eff January 1, 2019. See now, Code 1976 § 62-5-403C.
SECTION 62-5-407. Order of appointment; rights and powers of protected person.
(A) The court shall exercise its authority to encourage maximum self-reliance and independence of the protected person and issue orders only to the extent necessitated by the protected person's mental and adaptive limitations.
(B) The court shall set forth the rights and powers removed from the protected person. To the extent rights are not removed, they are retained by the protected person. Such rights and powers include the rights and powers to:
(1) buy, sell, or transfer real or personal property or transact business of any type including, but not limited to, those powers conferred upon the conservator under Section 62-5-422;
(2) make, modify, or terminate contracts; or
(3) bring or defend any action at law or equity.
(C) Nothing in this section shall prevent the protected person from notifying the court that he is being unjustly denied a right or privilege or requesting removal of the conservator or termination of the conservatorship pursuant to Section 62-5-428.
(D) Unless a court order specifies otherwise, the appointment of a conservator terminates the parts of the power of attorney that relate to matters within the scope of the conservatorship. The authority of an agent to make health care decisions or authority granted by advance directives regarding health care is not altered or changed by the appointment of a conservator.
HISTORY: 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-408. Conservator; qualifications; priorities.
(A) In appointing a conservator, the court shall consider persons who are otherwise qualified in the following order of priority:
(1) a person previously appointed conservator, other than a temporary or emergency conservator, a guardian of property, or other like fiduciary for the protected person by another court of competent jurisdiction;
(2) a person nominated to serve as conservator by the alleged incapacitated individual if made prior to his incapacity, or if he is fourteen or more years of age and has sufficient mental capacity to make a reasoned choice;
(3) an agent designated in a power of attorney relating to the management of the alleged incapacitated individual's real or personal property, financial affairs, or assets;
(4) the spouse of the alleged incapacitated individual;
(5) an adult child of the alleged incapacitated individual;
(6) a parent of the alleged incapacitated individual;
(7) the person nearest in kinship to the alleged incapacitated individual who is willing to accept the appointment;
(8) a person with whom the alleged incapacitated individual resides outside of a health care facility, group home, homeless shelter, or prison;
(9) a person nominated by a health care facility caring for the alleged incapacitated individual; and
(10) any other person deemed suitable by the court.
(B) A person whose priority is based upon his status under subsections (A)(1), (3), (4), (5), (6), or (7) may nominate in writing a person to serve in his or her stead. With respect to persons having equal priority, the court shall select the person it considers best qualified to serve as conservator. The court, acting in the best interest of the alleged incapacitated individual, may decline to appoint a person having higher priority and appoint a person having lesser priority or no priority.
(C) Except when authorizing, directing, or ratifying the implementations of provisions of protective arrangements, pursuant to Section 62-5-405, a probate judge or an employee of the court shall not serve as a conservator of an estate of a protected person; except, a probate judge or an employee of the court may serve as a conservator of the estate of a family member if such service does not interfere with the proper performance of the probate judge's or the employee's official duties. For purposes of this subsection, "family member" means a spouse, parent, child, brother, sister, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, grandparent, or grandchild.
HISTORY: 1986 Act No. 539, § 1; 1995 Act No. 15, § 4. Formerly Code 1976 § 62-5-410, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-409. Bond.
Except upon a finding of good cause, the court shall require a conservator to furnish a bond conditioned upon faithful discharge of all duties of the conservator according to law and the court must approve all sureties. When bond is required, the conservator shall file a statement under oath with the court indicating his best estimate of the value of the personal estate of the protected person and of the income expected from the personal estate during the next calendar year, and he shall execute and file a bond with the court, or give other suitable security, in an amount not less than the estimate. The court shall determine that the bond is duly executed by a corporate surety or one or more individual sureties whose performance is secured by pledge of personal property, mortgage on real property, or other adequate security. The court may permit the amount of the bond to be reduced by the value of assets of the estate deposited with a domestic financial institution, as defined in Section 62-6-101, in a manner that prevents their unauthorized disposition. The court may authorize an unrestricted account to be used by the conservator for expenses on behalf of the protected person, and all activity in such an account must be reported by the conservator as required by the court. Upon application of the conservator or another interested person, or upon the court's own motion, the court may:
(1) order the creation, modification, or termination of an account;
(2) increase or reduce the amount of the bond;
(3) release sureties;
(4) dispense with security or securities; or
(5) permit the substitution of another bond with the same or different sureties.
HISTORY: 1986 Act No. 539, § 1; 1988 Act No. 659, § 7; 2010 Act No. 244, § 34, eff June 7, 2010. Formerly Code 1976 § 62-5-411, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-410. Terms and requirements of bonds.
(A) The following requirements and provisions apply to any bond required under Section 62-5-409:
(1) Sureties must be jointly and severally liable with the conservator and with each other.
(2) By executing an approved bond of a conservator, the surety consents to the jurisdiction of the court in any proceeding pertaining to the fiduciary duties of the conservator and naming the surety as a party defendant. Notice of any proceeding must be delivered to the surety or mailed to him by registered or certified mail at his address that is listed with the court where the bond is filed or to his address as then known to the petitioner.
(3) After service of a summons and petition by a successor conservator, or upon the court's own motion, a proceeding may be initiated against a surety for breach of the obligation of the bond of the conservator.
(4) Subject to applicable statutes of limitation, the bond of the conservator is not void after the first recovery, but may be proceeded against from time to time until the whole penalty is exhausted.
(B) No proceeding may be commenced against the surety on any matter as to which an action or proceeding against the primary obligor is barred by adjudication or limitation.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 35, eff June 7, 2010. Formerly Code 1976 § 62-5-412, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-411. Acceptance of appointment; consent to jurisdiction.
By accepting appointment, a conservator submits personally to the jurisdiction of the court in any proceeding relating to the conservatorship estate. Notice of any proceeding must be given or waived pursuant to Sections 62-1-401 and 62-1-402.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-413, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-412. Compensation and expenses.
Any conservator or special conservator appointed in a protective proceeding is entitled to reasonable compensation from the protected person's estate, as determined by the court.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-414, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-413. Informal request for relief.
(A) The protected person or another person interested in his welfare, may make an informal request for relief by submitting a written request to the court. The court may take such action as considered reasonable and appropriate to protect the protected person.
(B) A person making an informal request submits personally to the jurisdiction of the court.
HISTORY: 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-414. General duty of conservator; financial plan.
(A) In the exercise of his powers, a conservator is to act as a fiduciary and shall observe the standards of care applicable to trustees.
(B) The court may require a conservator to file a financial plan for managing, expending, and distributing the assets of the protected person's estate. The plan must be tailored for the protected person and the conservator shall revise the plan as the needs and circumstances of the protected person require. The court shall approve, disapprove, or modify the plan in any proceeding as the court determines is necessary based upon the qualifications of the fiduciary. Nothing herein shall require the court to oversee or approve the conservator's investment choices. The conservator shall provide a copy of the plan to the protected person's guardian, if any, or the protected person.
(C) The conservator shall include in the financial plan:
(1) a statement of the extent to which the protected person may be able to develop or restore his ability to manage his property;
(2) an estimate of whether the assets are sufficient to meet the current and future needs of the protected person;
(3) projections of expenses and resources; and
(4) an estimate of how the financial plan may alter the overall estate plan of the protected person, including assets titled with rights of survivorship.
(D) In investing an estate, selecting assets of the estate for distribution, and using powers of revocation or withdrawal available for the use and benefit of the protected person or his dependents and exercisable by the conservator, a conservator shall take into account any estate plan of the protected person known to the conservator and is entitled to examine the protected person's will or revocable trust and any contract, transfer or joint ownership arrangement with the provisions for payment or transfer of benefits at his death to others which the protected person may have originated.
HISTORY: 1986 Act No. 539, § 1; 2000 Act No. 398 § 10; 2005 Act No. 66, § 7. Formerly Code 1976 §§ 62-5-408 and 62-5-417, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-415. Inventory and records.
Within thirty days of appointment, the conservator shall prepare and file with the court a complete inventory of the estate of the protected person, together with the conservator's oath or affirmation that it is complete and accurate to the best of the conservator's knowledge, information, and belief. The court may grant an extension to file the inventory. The conservator shall provide a copy of the inventory to the protected person's guardian, if any, and any other persons the court may direct.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-418, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-416. Reporting requirements.
(A) A conservator shall report to the court regarding his administration of the estate annually and upon the conservator's resignation or removal, the termination of the protected person's minority or disability, the death of the protected person, and at other times as the court directs.
(B) The report must include:
(1) an accounting of receipts and disbursements for the accounting period;
(2) a list of the assets of the estate under the conservator's control and the location of the assets;
(3) any recommendations for changes in the financial plan; and
(4) the conservator's opinion regarding the continued need for the conservatorship and the scope of the conservatorship.
(C) The conservator shall provide a copy of the report to the protected person if he has attained the age of fourteen years and has sufficient mental capacity to understand the report, and to any parent with whom the protected person resides or guardian of the protected person.
(D) The court may appoint a guardian ad litem to review a report or plan, interview the protected person or conservator, and make any other investigation the court directs.
(E) The court may order a conservator to submit the assets of the estate to an appropriate examination in any manner directed by the court.
(F) The conservator or the protected person may petition in formal proceedings pursuant to Section 62-5-428 for an order:
(1) allowing or requiring an intermediate or final report of a conservator and adjudicating liabilities disclosed in the accountings; or
(2) allowing or requiring a final report and adjudicating unsettled liabilities relating to the conservatorship.
HISTORY: 1986 Act No. 539, § 1; 2010 Act No. 244, § 37, eff June 7, 2010. Formerly Code 1976 § 62-5-419, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-417. Conservators; title by appointment.
The appointment of a conservator vests in him title as trustee to all property of the protected person, presently held or thereafter acquired, including title to any property previously held by custodians or agents, unless otherwise provided in the court's order. Neither the appointment of a conservator nor the establishment of a trust in accordance with Article 6, Chapter 6, Title 44 is a transfer or alienation by the protected person of his rights or interest, within the meaning of any federal or state statute or regulation, insurance policy, pension plan, contract, will, or trust instrument imposing restrictions upon or penalties for transfer or alienation by the protected person of his rights or interest.
HISTORY: 1986 Act No. 539, § 1; 1993 Act No. 164, Part II, § 74B. Formerly Code 1976 § 62-5-420, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-418. Fiduciary letters of conservatorship.
(A) Fiduciary letters of conservatorship are evidence of transfer of all title of the assets of a protected person to the conservator unless otherwise provided in the court's order. An order terminating a conservatorship transfers all assets of the estate from the conservator to the protected person or his successors. Fiduciary letters and terminations of appointment must be filed and recorded in the office where conveyances of real estate are recorded for the county in which the protected person resides and in the counties of this State or other jurisdictions where the protected person owns real estate.
(B) Conservators may file fiduciary letters of conservatorship with credit reporting agencies or other entities or persons, as appropriate.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-421, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-419. Sale or encumbrance involving conflict of interest.
Pursuant to the procedures set forth in Section 62-5-428(B), the conservator shall obtain the court's prior approval of any transaction that is affected by a conflict of interest, including, but not limited to, a sale or encumbrance of assets of the protected person to or in favor of a conservator; an immediate family member of a conservator; an agent or attorney of conservator; or any corporation, trust, or other entity in which the conservator has a substantial beneficial interest.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-422, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-420. Persons dealing with conservators; protection.
A person, who in good faith either assists a conservator or deals with him for value in any transaction, other than those requiring a court order as required in this part is protected as if the conservator properly exercised the power. The fact that a person knowingly deals with a conservator does not alone require the person to inquire into the existence of a power or the propriety of its exercise, except that restrictions on powers of conservators which are endorsed on letters as provided in Section 62-5-404 or Section 62-5-428 are effective as to third persons. A person is not bound to see to the proper application of estate assets paid or delivered to a conservator. This protection extends to instances in which some procedural irregularity or jurisdictional defect occurred in proceedings leading to the issuance of letters. This protection is not a substitution for that provided by comparable provisions of the laws relating to commercial transactions and laws simplifying transfers of securities by fiduciaries.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-423, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-421. Interest of protected person not transferable or assignable.
(A) Except as otherwise provided in subsections (B) and (C), the interest of a protected person in property vested in a conservator is not transferable or assignable by the protected person.
(B) A person without knowledge of the conservatorship who in good faith and for security or substantially equivalent value receives delivery from a protected person of tangible personal property of a type normally transferred by delivery of possession is protected.
(C) A third party who deals with the protected person in good faith with respect to property vested in a conservator is entitled to any protection provided by law.
HISTORY: 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-422. Powers of conservator in administration.
(A) Except as otherwise qualified or limited by court order, a conservator, acting reasonably in the best interest of the protected person and in efforts to accomplish the purpose for which he was appointed, may act without court approval to:
(1) invest and reinvest funds of the estate as would a trustee;
(2) collect, hold, and retain assets of the estate including land in another state, until, in his judgment, disposition of the assets should be made, and retain assets even though they include an asset in which the conservator personally is interested;
(3) receive additions to the estate;
(4) deposit estate funds in a financial institution including a financial institution operated by the conservator;
(5) make ordinary or extraordinary repairs or alterations to buildings or other structures, demolish, improve, raze or erect existing or new party walls or buildings;
(6) vote a security in person or by general or limited proxy;
(7) pay calls, assessments, and other sums chargeable or accruing against or on account of securities;
(8) sell or exercise stock subscription or conversion rights; consent directly or through a committee or other agent, to the reorganization, consolidation, merger, dissolution, or liquidation of a corporation or other business enterprise whose stock or shares are publicly held;
(9) hold a security in the name of a nominee or in other form without disclosure of the conservatorship so that title to the security may pass by delivery, but the conservator is liable for an act of the nominee in connection with the stock so held;
(10) insure the assets of the estate against damage or loss, and the conservator against liability with respect to third persons;
(11) borrow money to be repaid from estate assets or otherwise; advance money for the protection of the estate or the protected person and for all expenses, losses, and liability sustained in the administration of the estate or because of the holding or ownership of estate assets; and the conservator shall have a lien on the estate as against the protected person for advances so made;
(12) pay or contest a claim except as limited by Section 62-5-433; settle a claim by or against the estate of the protected person by compromise, arbitration, or otherwise except as limited by Section 62-5-433; and release, in whole or in part, a claim belonging to the estate to the extent that the claim is uncollectible;
(13) pay taxes, assessments, and other expenses incurred in the collection, care, administration, and protection of the estate;
(14) allocate items of income or expense to either estate income or principal, as provided by law, including creation of reserves out of income for depreciation, obsolescence, or amortization, or for depletion in mineral or timber properties;
(15) pay a sum distributable to a protected person or his dependent without liability to the conservator, by paying the sum to the protected person or the distributee or by paying the sum for the use of the protected person or the distributee either to his guardian or, if none, to a relative or other person with custody of his person;
(16) employ persons including attorneys, auditors, investment advisors, or agents even though they are associated with the conservator to advise or assist the conservator in the performance of his administrative duties; to act upon their recommendation without independent investigation; and instead of acting personally, to employ one or more agents to perform an act of administration, whether or not discretionary;
(17) prosecute or defend actions, claims, or proceedings in any jurisdiction for the protection of estate assets and of the conservator in the performance of his duties;
(18) execute and deliver all instruments that will accomplish or facilitate the exercise of the powers vested in the conservator;
(19) review the originals and obtain photocopies of the protected person's fully executed estate planning documents, including those documents referenced in Section 62-5-425;
(20) enter into a lease of a residence for the protected person for a term not exceeding one year;
(21) access, monitor, suspend, or terminate the protected person's digital assets and accounts in electronic format, including the power to obtain information as to the protected person's account number, user name and agreement, online tools, addresses, or other unique subscriber or account identifiers, including passwords, and any catalogue of electronic communications considered necessary by the conservator for administration of the conservatorship, consistent with the provisions of Part 10, Article 2, Title 62; and
(22) exercise the protected person's rights as trust beneficiary to the extent provided in Article 7, Title 62.
(B) A conservator acting reasonably and in the best interest of the protected person to accomplish the purpose for which he was appointed, may file an application with the court pursuant to Section 62-5-428(A) requesting authority to:
(1) continue or participate in the operation of any unincorporated business or other enterprise;
(2) acquire an undivided interest in an estate asset in which the conservator, in a fiduciary capacity, holds an undivided interest;
(3) buy and sell an estate asset, including land in this State or in another jurisdiction for cash or on credit, at public or private sale; and to manage, develop, improve, exchange, partition, change the character of, or abandon an estate asset;
(4) subdivide, develop, or dedicate land to public use; make or obtain the vacation of plats and adjust boundaries; adjust differences in valuation on exchange or partition by giving or receiving considerations; or dedicate easements to public use without consideration;
(5) enter into a lease as lessor or lessee, other than a residential lease described in Section 62-5-422(A);
(6) enter into a lease or arrangement for exploration and removal of minerals or other natural resources or enter into a pooling or unitization agreement;
(7) grant an option involving disposition of an estate asset or to take an option for the acquisition of any asset;
(8) undertake another act considered necessary or reasonable by the conservator and the court for the preservation and management of the estate;
(9) make charitable gifts pursuant to the protected person's gifting and estate plan if the estate is sufficient to provide for the health, education, support, and maintenance of the protected person and his dependents;
(10) encumber, mortgage, or pledge an asset for a term extending within or beyond the term of the conservatorship;
(11) pay a reasonable fee to the conservator, special conservator, guardian ad litem, attorney, examiner, or physician for services rendered;
(12) adopt an appropriate budget for routine expenditures of the protected person;
(13) reimburse the conservator for monies paid to or on behalf of the protected person;
(14) exercise or release the protected person's powers as personal representative, custodian for minors, conservator, or donee of a power of appointment; and
(15) exercise options to purchase securities or other property.
(C) A conservator may request instructions concerning his fiduciary responsibility and may file an application for ratification of actions taken in good faith or for the expenditure of funds of the protected person; the court may approve or deny an application pursuant to subsection (B) above, or may require the commencement of formal proceedings.
(D) The attorney-client privilege between the protected person and the protected person's counsel must not be removed by the appointment of a conservator.
HISTORY: 1986 Act No. 539, § 1; 1988 Act No. 659, § 8; 1997 Act No. 152, § 24; 2000 Act No. 398, § 10. Formerly Code 1976 §§ 62-5-408 and 62-5-424, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-423. Distributive duties and powers of conservator.
(A) A conservator may expend or distribute sums from the estate without further court authorization for the health, education, maintenance, and support of the protected person and his dependents in accordance with the following principles:
(1) The expenditures must be consistent with a prior court-approved financial plan.
(2) The conservator shall consider recommendations relating to the appropriate standard of health, education, maintenance, and support for the protected person made by a parent or guardian. The conservator may not be surcharged for sums paid to persons or organizations furnishing health, education, maintenance, or support to the protected person pursuant to the recommendations of a parent or guardian unless the conservator has actual knowledge that the parent or guardian is deriving personal financial benefit from these payments, including relief from any personal duty of support, or unless the recommendations are clearly not in the best interests of the protected person.
(3) The conservator shall consider:
(a) the size of the estate, the probable duration of the conservatorship, and the likelihood that the protected person, at some future time, may be fully able to manage his affairs and the estate that has been conserved for him;
(b) the accustomed standard of living of the protected person and members of his household; and
(c) other funds or sources used for the support of the protected person.
(4) Funds expended under this subsection may be paid by the conservator to any person, including the protected person, as reimbursement for expenditures or in advance for services to be rendered to the protected person when it is reasonable to expect that they will be performed and where advance payments are customary or reasonably necessary under the circumstances.
(5) If the conservator determines that it is reasonably necessary to supply funds to the protected person, the conservator may provide these funds to the protected person through reasonable financial methods, including, but not limited to, checks, currency, debit card, or allowance. All funds so provided must be reported on the accountings as required by the court.
(B) After paying outstanding expenses of administration and any claims approved by the court, after meeting the requirements of Section 62-5-416, and after complying with any additional requirements established by the court, the conservator shall pay over and distribute all remaining funds and properties as follows:
(1) when a person who is incapacitated solely by reason of minority attains the age of eighteen or is emancipated by a court order, to the now-adult or emancipated protected person as soon as practical, unless a:
(a) protective order has been issued because the protected person is incapacitated; or
(b) protective proceeding or other petition with regard to the protected person is pending; a protected person under the age of eighteen who is married shall remain a minor for purposes of this subsection until attaining the age of eighteen or being emancipated by court order;
(2) upon an adjudication restoring capacity, to the former protected person as soon as practical;
(3) upon a determination by the court that the protected person's estate has a net aggregate amount of less than fifteen thousand dollars to or for the protected person as soon as practical pursuant to Section 62-5-103; or
(4) if a protected person dies, to the protected person's duly appointed personal representative or as ordered by the court.
HISTORY: 1986 Act No. 539, § 1; 1990 Act No. 521, § 83; 1997 Act No. 152, § 25; 2000 Act No. 398, § 10. Formerly Code 1976 §§ 62-5-408 and 62-5-425, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-424. Reserved.
HISTORY: Former Section, titled Powers of conservator in administration, had the following history: 1986 Act No. 539, § 1; 1988 Act No. 659, § 8; 1997 Act No. 152, § 24. Reserved by 2017 Act No. 87, § 5.A, eff January 1, 2019. See now, Code 1976 § 62-5-422.
SECTION 62-5-425. Preservation of estate plan.
In investment and distribution of estate assets or in the use or withdrawal of a power of revocation, and in titling accounts, the conservator and the court must consider any:
(A) known estate plan, including a revocable trust having the protected person as settlor; or
(B) instrument, including, but not limited to, a contract, transfer, or joint ownership arrangement originated by the protected person which provides a benefit at death to another as referenced in Section 62-5-422.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-427, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-426. Claims against protected person.
(A) The probate court has exclusive jurisdiction over claims against the protected person arising from the internal affairs of the conservatorship which may be commenced in the following manner:
(1) A claimant may deliver or mail to the conservator a written statement of the claim indicating its basis, the name and address of the claimant, and the amount claimed.
(2) A claim is considered presented on the receipt of the written statement of claim by the conservator.
(3) Every claim that is disallowed in whole or part by the conservator is barred so far as not allowed unless the claimant files and properly serves a summons and petition for allowance no later than thirty days after the mailing of the notice of disallowance or partial disallowance if the notice warns the claimant of the impending bar.
(B) Except as limited by Section 62-5-433, the probate court has jurisdiction concurrent with the circuit court in matters involving a request for a judicial determination as to the external affairs of a conservatorship, including actions by or against creditors or debtors of conservatorships and other actions or proceedings involving conservators and third parties. If a creditor has notice of the appointment of a conservator, all pleadings must be served by or on the conservator. Within thirty days after the conservator files, or becomes aware of, any court action in which the protected person is a party, the conservator must notify the court where the conservatorship is being administered if the outcome may constitute a claim against the estate. The conservator may request instructions from the court as necessary.
(C) If it appears that the conservatorship assets are likely to be exhausted before all existing claims are paid, preference must be given to prior claims for the care, maintenance, and education of the protected person or his dependents and existing claims for expenses of administration.
HISTORY: 1986 Act No. 539, § 1; 1988 Act No. 659, § 6; 1997 Act No. 152, § 26; 2010 Act No. 244, §§ 31, 38, eff June 7, 2010. Formerly Code 1976 §§ 62-5-402 and 62-5-428, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-427. Individual liability of conservator.
(A) Unless otherwise provided in a contract, a conservator is not individually liable on a contract properly entered into in his fiduciary capacity during the administration of the estate unless he fails to reveal his representative capacity and fails to identify the estate in the contract.
(B) The conservator is individually liable for obligations arising from ownership or control of property of the estate or for torts committed during the administration of the estate only if he is personally at fault.
(C) Claims based on contracts entered into by a conservator in his fiduciary capacity, on obligations arising from ownership or control of the estate, or on torts committed during the administration of the estate may be asserted against the estate by proceeding against the conservator in his fiduciary capacity, whether or not the conservator is individually liable.
(D) A question of liability between the estate and the conservator individually may be determined in a proceeding for accounting, surcharge, indemnification, or other appropriate proceeding.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-429, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-428. Actions for requests subsequent to appointment; procedures.
(A)(1) Upon filing of an application with the appointing court, the protected person, the conservator, or interested person may request an order:
(a) requiring, increasing, or reducing bond or security;
(b) requiring an accounting;
(c) terminating a conservatorship when the estate has a net aggregate amount of less than fifteen thousand dollars;
(d) terminating a conservatorship and approving a final accounting at the death of the protected person;
(e) terminating a conservatorship and approving a final accounting when a protected person who is incapacitated solely by reason of minority attains the age of eighteen or is emancipated by court order;
(f) approving payment of the protected person's funeral expenses;
(g) accepting the resignation of or removing the conservator for good cause and appointing a temporary or successor conservator, if necessary;
(h) adjudicating the restoration of the protected person's capacity.
(2) The court may approve or deny the application without notice, require notice to such persons as the court directs, or may require the commencement of a formal proceeding pursuant to Section 62-5-428(B).
(3) If the court determines that the protected person's estate has a net aggregate amount of less than fifteen thousand dollars, the court may in its discretion, terminate the conservatorship.
(4) If a protected person dies, the conservator shall deliver to the court for safekeeping any will of the deceased protected person which may have come into the conservator's possession, inform the personal representative or a beneficiary named in the will of the delivery, and retain the estate for delivery to a duly appointed personal representative of the deceased protected person or other persons entitled to delivery. If, after thirty days from the death of the protected person, no person has been appointed personal representative and no application or petition for appointment is pending in the court, the conservator may apply for appointment as personal representative. A person must not be disqualified as a personal representative of a deceased protected person solely by reason of his having been appointed or acting as conservator for that protected person.
(B)(1) Upon filing of a summons and petition with the appointing court, the protected person, the conservator, or interested person may request an order:
(a) terminating a conservatorship;
(b) requiring distributions from the protected person's estate after the conservator has denied the request;
(c) upon the death of a conservator, appointing a successor conservator, if necessary;
(d) limiting or expanding the conservatorship;
(e) authorizing a transaction involving a conflict of interest pursuant to Section 62-5-419;
(f) reviewing the denial of an application pursuant to Section 62-5-422(C); or
(g) granting other appropriate relief.
(2) The procedure for obtaining orders subsequent to appointment is as follows:
(a) The summons and petition shall state the relief sought and the reasons the relief is necessary and must be served upon the protected person; the conservator; the guardian, if any; the spouse; adult children; and parents of the protected person whose whereabouts are reasonably ascertainable; and, if there is no spouse, adult child, or parent, any person who has equal or greater priority for appointment; any person with whom the protected person resides outside of a health care facility, group home, homeless shelter, or prison; and the Secretary of the Department of Veterans Affairs if the conservatorship is for the purpose of receiving veterans benefits.
(b) After filing and service of the summons and petition, the court may appoint a guardian ad litem and may appoint counsel for the protected person, unless the protected person has private counsel, and such examiners as are needed to evaluate and confirm the allegations of the petition.
(c) As soon as the interests of justice may allow, but after the time for response to the petition has elapsed as to all parties served, the court shall hold a hearing on the merits of the petition. The protected person and all parties not in default must be given notice of the hearing. If all parties not in default waive a hearing, the court may issue a consent order.
(d) The court may issue interim orders, for a period not to exceed ninety days, until a hearing is held and a final order is issued.
(C) The court may specify a minimum period, not exceeding one year, during which no application or petition for readjudication may be filed without leave of court. Subject to this restriction, the protected person or the conservator may petition the court for a termination of incapacity or of the protective order, which must be proved by a preponderance of the evidence.
(D) An attorney who has been asked by the protected person to represent him in an action under this section may file a motion with the court for permission to represent the protected person.
HISTORY: 1986 Act No. 539, § 1; 2008 Act No. 303, § 1, eff June 11, 2008; 2010 Act No. 244, § 36, 39, eff June 7, 2010. Formerly Code 1976 §§ 62-5-106, 62-5-415, 62-5-416, 62-5-426, and 62-5-430, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-429. Payment of debt and delivery of property to foreign conservator without local proceedings.
(A) A person indebted to a protected person, or having possession of property of or an instrument evidencing a debt, stock, or chose in action belonging to a protected person may pay or deliver to a conservator, guardian of the estate, or other like fiduciary appointed by a court of the state of residence of the protected person, upon being presented with proof of his appointment and an affidavit made by him or on his behalf stating that:
(1) no protective proceeding relating to the protected person is pending in this State; and
(2) the foreign conservator is entitled to payment or to receive delivery.
(B) If the person to whom the affidavit is presented is not aware of a protective proceeding pending in this State, payment or delivery in response to the demand and affidavit discharges the debtor or possessor.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-431, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-430. Foreign conservator; proof of authority; bond; powers.
(A) If a conservator has not been appointed in this State and a petition for a protective order is not pending in this State, a conservator appointed in another state, after giving notice to the appointing court of an intent to register, may register the protective order in this State by filing as a foreign judgment in the court, in any appropriate county of this State certified copies of the order and letters of office, and any bond. The court shall treat this as the filing of authenticated or certified records and shall charge fees set forth in Section 8-21-770 for the filing of these documents. The court will then issue a certificate of filing as proof of the filing. The conservator shall file the certificate of filing, along with a copy of the letters of office, in the office of the register of deeds of that county.
(B) Upon registration of a protective order from another state, the conservator may exercise in this State all powers authorized in the order of appointment except as prohibited under the laws of this State, including maintaining actions and proceedings in this State and, if the guardian or conservator is not a resident of this State, subject to any conditions imposed upon nonresident parties.
(C) A court of this State may grant any relief available under this article and other laws of this State to enforce a registered order.
HISTORY: 1986 Act No. 539, § 1. Formerly Code 1976 § 62-5-432, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-431. Payment of benefits from U.S. Department of Veterans Affairs to a minor or an incapacitated person; definitions.
(A) For purposes of this section:
(1) "Estate" and "income" include only monies received from the VA, all real and personal property acquired in whole or in part with these monies, and all earnings, interest, and profits.
(2) "Benefits" means all monies payable by the United States through the VA.
(3) "Secretary" means the Secretary of the United States Department of Veterans Affairs (VA) or his successor.
(4) "Protected person" means a beneficiary of the VA.
(5) "Conservator" has the same meaning as provided in Section 62-1-201 but only as to benefits from the VA.
(B) Whenever, pursuant to a law of the United States or regulation of the VA, the Secretary requires that a conservator be appointed for a protected person before payment of benefits, the appointment must be made in the manner provided in this part, except to the extent this section requires otherwise. The petition shall show that the person to be protected has been rated incapable of handling his estate and monies on examination by the VA in accordance with the laws and regulations governing the VA.
(C) When a petition is filed for the appointment of a conservator and a certificate of the secretary or his representative is filed setting forth the fact that the appointment of a conservator is a condition precedent to the payment of benefits due the protected person by the VA, the certificate is prima facie evidence of the necessity for the appointment and no examiner's report is required.
(D) Except as provided or as otherwise permitted by the VA, a person may not serve as conservator of a protected person if the proposed conservator at that time is acting simultaneously as conservator for five protected persons. Upon presentation of a petition by an attorney for the VA alleging that a person is serving simultaneously as a conservator for more than five protected persons and requesting that person's termination as a conservator for that reason, upon proof substantiating the petition, the court shall restrain that person from acting as a conservator for the affected protected person and shall require a final accounting from the conservator. After the appointment of a successor conservator if one is warranted under the circumstances, the court shall terminate the appointment of the person as conservator in all requested cases. The limitations of this section do not apply when the conservator is a bank or trust company.
(E) The conservator shall file an inventory, accountings, exhibits or other pleadings with the court and with the VA as provided by law or VA regulation. The conservator is required to furnish the inventory and accountings to the VA.
(F) Every conservator shall invest the surplus funds in his protected person's estate in securities, or otherwise, as allowed by law, and in which the conservator has no interest. These funds may be invested, without prior court authorization, in direct interest-bearing obligations of this State or of the United States and in obligations in which the interest and principal are both unconditionally guaranteed by the United States Government.
(G) Whenever a copy of a public record is required by the VA to be used in determining the eligibility of a person to participate in benefits made available by the VA, the official charged with the custody of the public record shall provide a certified copy of the record, without charge, to an applicant for the benefits, a person acting on his behalf, or a representative of the VA.
(H) With regard to a minor or a mentally incompetent person to whom, or on whose behalf, benefits have been paid or are payable by the VA, the secretary is and must be a necessary party in a:
(1) proceeding brought for the appointment, confirmation, recognition, or removal of a conservator;
(2) suit or other proceeding, whether formal or informal, arising out of the administration of the person's estate; and
(3) proceeding which is for the removal of the disability of minority or of mental incompetency of the person.
(I) In a case or proceeding involving property or funds of a protected person not derived from the VA, the VA is not a necessary party, but may be an interested party in the proceedings.
(J) For services as conservator of funds paid from the VA, a conservator may be paid an amount not to exceed five percent of the income of the protected person during any year. If extraordinary services are rendered by a conservator, the court may, upon application of the conservator and notice to the VA, authorize additional compensation payable from the estate of the protected person. No compensation is allowed on the corpus of an estate derived from payments from the VA. The conservator may be allowed reimbursement from the estate of the protected person for reasonable premiums paid to a corporate surety upon the bond furnished by the conservator.
HISTORY: 2016 Act No. 278 (S.777), § 1, eff June 9, 2016. Formerly Code 1976 § 62-5-436, renumbered and amended by 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-432. Special needs trust.
(A) The court has authority to create and establish a special needs trust for an incapacitated individual in compliance with 42 U.S.C. Section 1396p(d)(4)(A), as amended, and to order the placement of the incapacitated individual's funds into such a trust or into a pooled trust in compliance with 42 U.S.C. Section 1396p(d)(4)(C), as amended, for the benefit of incapacitated individuals under its authority to issue protective orders pursuant to the procedure set forth in Section 62-5-401, et seq.
(B) In the case of a disabled minor, the court has authority to create and establish a special needs trust in compliance with 42 U.S.C. Section 1396p(d)(4)(A), as amended, if the court determines it is in the disabled minor's best interest. The court also has the authority to order the placement of the minor's funds into a special needs trust or into a pooled trust in compliance with 42 U.S.C. Section 1396p(d)(4)(C), as amended, for the benefit of a minor under its authority to implement provisions of protective orders pursuant to the procedure set forth in Section 62-5-401, et seq., even though the terms of the trust extend beyond the age of majority.
HISTORY: 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
SECTION 62-5-433. Definitions; procedures for settlement of claims in favor of or against minors or incapacitated persons.
(A)(1) For purposes of this section and for any claim exceeding twenty-five thousand dollars in favor of or against any minor or incapacitated individual, "court" means the circuit court of the county in which the minor or incapacitated individual resides or the circuit court in the county in which the suit is pending. For purposes of this section and for any claim not exceeding twenty-five thousand dollars in favor of or against any minor or incapacitated individual, "court" means either the circuit court or the probate court of the county in which the minor or incapacitated individual resides or the circuit court or probate court in the county in which the suit is pending.
(2) "Claim" means the net or actual amount accruing to or paid by the minor or incapacitated individual as a result of the settlement.
(3) "Petitioner" means either a conservator appointed by the court for the minor or incapacitated individual or the guardian or guardian ad litem of the minor or incapacitated individual if a conservator has not been appointed.
(B) The settlement of a claim over twenty-five thousand dollars in favor of or against a minor or incapacitated individual for the payment of money or the possession of personal property must be effected on his behalf in the following manner:
(1) The petitioner must file with the court a verified petition setting forth all of the pertinent facts concerning the claim, payment, attorney's fees, and expenses, if any, and the reasons why, in the opinion of the petitioner, the proposed settlement should be approved. For all claims that exceed twenty-five thousand dollars, the verified petition must include a statement by the petitioner that, in his opinion, the proposed settlement is in the best interests of the minor or incapacitated individual.
(2) If, upon consideration of the petition and after hearing the testimony as it may require concerning the matter, the court concludes that the proposed settlement is proper and in the best interests of the minor or incapacitated individual, the court shall issue its order approving the settlement and authorizing the petitioner to consummate it and, if the settlement requires the payment of money or the delivery of personal property for the benefit of the minor or incapacitated individual, to receive the money or personal property and execute a proper receipt and release or covenant not to sue therefor, which is binding upon the minor or incapacitated individual.
(3) The order authorizing the settlement must require that payment or delivery of the money or personal property be made through the conservator. If a conservator has not been appointed, the petitioner, upon receiving the money or personal property, shall pay and deliver it to the court pending the appointment and qualification of a duly appointed conservator. If a party subject to the court order fails or refuses to pay the money or deliver the personal property as required by the order, he is liable and punishable as for contempt of court, but failure or refusal does not affect the validity or conclusiveness of the settlement.
(C) The settlement of a claim that does not exceed twenty-five thousand dollars in favor of or against a minor or incapacitated individual for the payment of money or the possession of personal property may be effected in any of the following manners:
(1) If a conservator has been appointed, he may settle the claim without court authorization or confirmation, as provided in Section 62-5-424, or he may petition the court for approval, as provided in items (1), (2), and (3) of subsection (B). If the settlement requires the payment of money or the delivery of personal property for the benefit of the minor or incapacitated individual, the conservator shall receive the money or personal property and execute a proper receipt and release or covenant not to sue therefor, which is binding upon the minor or incapacitated individual.
(2) If a conservator has not been appointed, the guardian or guardian ad litem must petition the court for approval of the settlement, as provided in items (1) and (2) of subsection (B), and without the appointment of a conservator. The payment or delivery of money or personal property to or for a minor or incapacitated individual must be made in accordance with Section 62-5-103. If a party subject to the court order fails or refuses to pay the money or deliver the personal property, as required by the order and in accordance with Section 62-5-103, he is liable and punishable as for contempt of court, but failure or refusal does not affect the validity or conclusiveness of the settlement.
(D) The settlement of a claim that does not exceed two thousand five hundred dollars in favor of or against a minor or incapacitated individual for the payment of money or the possession of personal property may be effected by the parent or guardian of the minor or incapacitated individual without court approval of the settlement and without the appointment of a conservator. If the settlement requires the payment of money or the delivery of personal property for the benefit of the minor or incapacitated individual, the parent or guardian shall receive the money or personal property and execute a proper receipt and release or covenant not to sue therefor, which is binding upon the minor or incapacitated individual. The payment or delivery of money or personal property to or for a minor or incapacitated individual must be made in accordance with Section 62-5-103.
HISTORY: 1988 Act No. 659, § 9; 1990 Act No. 521, §§ 84-86; 2000 Act No. 398, § 1; 2017 Act No. 87 (S.415), § 5.A, eff January 1, 2019.
Part 5
Health Care Powers of Attorney
SECTION 62-5-500. Short title.
This part may be cited as the "South Carolina Statutory Health Care Power of Attorney Act".
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-501. Definitions.
As used in this part:
(1) "Agent" or "health care agent" means an individual designated in a health care power of attorney to make health care decisions on behalf of a principal.
(2) "Declaration of a desire for a natural death" or "declaration" means a document executed in accordance with the South Carolina Death with Dignity Act or a similar document executed in accordance with the law of another state.
(3) "Health care" means a procedure to diagnose or treat a human disease, ailment, defect, abnormality, or complaint, whether of physical or mental origin. It also includes the provision of intermediate or skilled nursing care; services for the rehabilitation of injured, disabled, or sick persons; and placement in or removal from a facility that provides these forms of care.
(4) "Health care power of attorney" means a durable power of attorney executed in accordance with this part.
(5) "Health care provider" means a person, health care facility, organization, or corporation licensed, certified, or otherwise authorized or permitted by the laws of this State to administer health care.
(6) "Life-sustaining procedure" means a medical procedure or intervention that serves only to prolong the dying process. Life-sustaining procedures do not include the administration of medication or other treatment for comfort care or alleviation of pain. The principal shall indicate in the health care power of attorney whether the provision of nutrition and hydration through medically or surgically implanted tubes is desired.
(7) "Permanent unconsciousness" means a medical diagnosis, consistent with accepted standards of medical practice, that a person is in a persistent vegetative state or some other irreversible condition in which the person has no neocortical functioning, but only involuntary vegetative or primitive reflex functions controlled by the brain stem.
(8) "Nursing care provider" means a nursing care facility or an employee of the facility.
(9) "Principal" means an individual who executes a health care power of attorney. A principal must be eighteen years of age or older and of sound mind.
(10) "Separated" means that the principal and his or her spouse are separated pursuant to one of the following:
(a) entry of a pendente lite order in a divorce or separate maintenance action;
(b) formal signing of a written property or marital settlement agreement;
(c) entry of a permanent order of separate maintenance and support or of a permanent order approving a property or marital settlement agreement between the parties.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-502. Health care power of attorney is a durable power of attorney; applicability of part.
(a) A health care power of attorney is a durable power of attorney. Statutory provisions that refer to a durable power of attorney or judicial interpretations of the law relating to durable powers of attorney apply to a health care power of attorney to the extent that they are not inconsistent with this part.
(b) This section does not affect the right of a person to execute a durable power of attorney relating to health care pursuant to other provisions of law but which does not conform to the requirements of this section. If a durable power of attorney for health care executed under this part or under the laws of another state does not conform to the requirements of this section, the provisions of this section do not apply to it. However, a court is not precluded from determining that the law applicable to nonconforming durable powers of attorney for health care is the same as the law set forth in this section for health care powers of attorney.
(c) To the extent not inconsistent with this part, the provisions of the Adult Health Care Consent Act apply to the making of decisions by a health care agent and the implementation of those decisions by health care providers.
(d) In determining the effectiveness of a health care power of attorney, mental incompetence is to be determined according to the standards and procedures for inability to consent pursuant to Section 44-66-20(8), except that certification of mental incompetence by the agent may be substituted for certification by a second physician. If the certifying physician states that the principal's mental incompetence precludes the principal from making all health care decisions or all decisions concerning certain categories of health care, and that the principal's mental incompetence is permanent or of extended duration, no further certification is necessary in regard to the stated categories of health care decisions during the stated duration of mental incompetence unless the agent or the attending physician believes the principal may have regained capacity.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-503. Requirements for health care power of attorney.
(a) A health care power of attorney must:
(1) be substantially in the form set forth in Section 62-5-504;
(2) be dated and signed by the principal or in the principal's name by another person in the principal's presence and by his direction;
(3) be signed by at least two persons, each of whom witnessed either the signing of the health care power of attorney or the principal's acknowledgment of his signature on the health care power of attorney. Each witness must state in a declaration as set forth in Section 62-5-504 that, at the time of the execution of the health care power of attorney, to the extent the witness has knowledge, the witness is not related to the principal by blood, marriage, or adoption, either as a spouse, lineal ancestor, descendant of the parents of the principal, or spouse of any of them; not directly financially responsible for the principal's medical care; not entitled to a portion of the principal's estate upon his decease under a will of the principal then existing or as an heir by intestate succession; not a beneficiary of a life insurance policy of the principal; and not appointed as health care agent or successor health care agent in the health care power of attorney; and that no more than one witness is an employee of a health care facility in which the principal is a patient, no witness is the attending physician or an employee of the attending physician, or no witness has a claim against the principal's estate upon his decease;
(4) state the name and address of the agent. A health care agent must be an individual who is eighteen years of age or older and of sound mind. A health care agent may not be a health care provider, or an employee of a provider, with whom the principal has a provider-patient relationship at the time the health care power of attorney is executed, or an employee of a nursing care facility in which the principal resides, or a spouse of the health care provider or employee, unless the health care provider, employee, or spouse is a relative of the principal.
(b) The validity of a health care power of attorney is not affected by the principal's failure to initial any of the choices provided in Section 4, 6, or 7 of the Health Care Power of Attorney form or to name successor agents. If the principal fails to indicate either of the statements in Section 7 concerning provision of artificial nutrition and hydration, the agent does not have authority to direct that nutrition and hydration necessary for comfort care or alleviation of pain be withheld or withdrawn.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-504. Form of health care power of attorney.
A health care power of attorney executed on or after January 1, 2007, must be substantially in the following form:
INFORMATION ABOUT THIS DOCUMENT
THIS IS AN IMPORTANT LEGAL DOCUMENT. BEFORE SIGNING THIS DOCUMENT, YOU SHOULD KNOW THESE IMPORTANT FACTS:
1. THIS DOCUMENT GIVES THE PERSON YOU NAME AS YOUR AGENT THE POWER TO MAKE HEALTH CARE DECISIONS FOR YOU IF YOU CANNOT MAKE THE DECISION FOR YOURSELF. THIS POWER INCLUDES THE POWER TO MAKE DECISIONS ABOUT LIFE-SUSTAINING TREATMENT. UNLESS YOU STATE OTHERWISE, YOUR AGENT WILL HAVE THE SAME AUTHORITY TO MAKE DECISIONS ABOUT YOUR HEALTH CARE AS YOU WOULD HAVE.
2. THIS POWER IS SUBJECT TO ANY LIMITATIONS OR STATEMENTS OF YOUR DESIRES THAT YOU INCLUDE IN THIS DOCUMENT. YOU MAY STATE IN THIS DOCUMENT ANY TREATMENT YOU DO NOT DESIRE OR TREATMENT YOU WANT TO BE SURE YOU RECEIVE. YOUR AGENT WILL BE OBLIGATED TO FOLLOW YOUR INSTRUCTIONS WHEN MAKING DECISIONS ON YOUR BEHALF. YOU MAY ATTACH ADDITIONAL PAGES IF YOU NEED MORE SPACE TO COMPLETE THE STATEMENT.
3. AFTER YOU HAVE SIGNED THIS DOCUMENT, YOU HAVE THE RIGHT TO MAKE HEALTH CARE DECISIONS FOR YOURSELF IF YOU ARE MENTALLY COMPETENT TO DO SO. AFTER YOU HAVE SIGNED THIS DOCUMENT, NO TREATMENT MAY BE GIVEN TO YOU OR STOPPED OVER YOUR OBJECTION IF YOU ARE MENTALLY COMPETENT TO MAKE THAT DECISION.
4. YOU HAVE THE RIGHT TO REVOKE THIS DOCUMENT, AND TERMINATE YOUR AGENT'S AUTHORITY, BY INFORMING EITHER YOUR AGENT OR YOUR HEALTH CARE PROVIDER ORALLY OR IN WRITING.
5. IF THERE IS ANYTHING IN THIS DOCUMENT THAT YOU DO NOT UNDERSTAND, YOU SHOULD ASK A SOCIAL WORKER, LAWYER, OR OTHER PERSON TO EXPLAIN IT TO YOU.
6. THIS POWER OF ATTORNEY WILL NOT BE VALID UNLESS TWO PERSONS SIGN AS WITNESSES. EACH OF THESE PERSONS MUST EITHER WITNESS YOUR SIGNING OF THE POWER OF ATTORNEY OR WITNESS YOUR ACKNOWLEDGMENT THAT THE SIGNATURE ON THE POWER OF ATTORNEY IS YOURS.
THE FOLLOWING PERSONS MAY NOT ACT AS WITNESSES:
A. YOUR SPOUSE, YOUR CHILDREN, GRANDCHILDREN, AND OTHER LINEAL DESCENDANTS; YOUR PARENTS, GRANDPARENTS, AND OTHER LINEAL ANCESTORS; YOUR SIBLINGS AND THEIR LINEAL DESCENDANTS; OR A SPOUSE OF ANY OF THESE PERSONS.
B. A PERSON WHO IS DIRECTLY FINANCIALLY RESPONSIBLE FOR YOUR MEDICAL CARE.
C. A PERSON WHO IS NAMED IN YOUR WILL, OR, IF YOU HAVE NO WILL, WHO WOULD INHERIT YOUR PROPERTY BY INTESTATE SUCCESSION.
D. BENEFICIARY OF A LIFE INSURANCE POLICY ON YOUR LIFE.
E. THE PERSONS NAMED IN THE HEALTH CARE POWER OF ATTORNEY AS YOUR AGENT OR SUCCESSOR AGENT.
F. YOUR PHYSICIAN OR AN EMPLOYEE OF YOUR PHYSICIAN.
G. A PERSON WHO WOULD HAVE A CLAIM AGAINST ANY PORTION OF YOUR ESTATE (PERSONS TO WHOM YOU OWE MONEY).
IF YOU ARE A PATIENT IN A HEALTH FACILITY, NO MORE THAN ONE WITNESS MAY BE AN EMPLOYEE OF THAT FACILITY.
7. YOUR AGENT MUST BE A PERSON WHO IS 18 YEARS OF AGE OR OLDER AND OF SOUND MIND. IT MAY NOT BE YOUR DOCTOR OR ANY OTHER HEALTH CARE PROVIDER THAT IS NOW PROVIDING YOU WITH TREATMENT; OR AN EMPLOYEE OF YOUR DOCTOR OR PROVIDER; OR A SPOUSE OF THE DOCTOR, PROVIDER, OR EMPLOYEE; UNLESS THE PERSON IS A RELATIVE OF YOURS.
8. YOU SHOULD INFORM THE PERSON THAT YOU WANT HIM OR HER TO BE YOUR HEALTH CARE AGENT. YOU SHOULD DISCUSS THIS DOCUMENT WITH YOUR AGENT AND YOUR PHYSICIAN AND GIVE EACH A SIGNED COPY. IF YOU ARE IN A HEALTH CARE FACILITY OR A NURSING CARE FACILITY, A COPY OF THIS DOCUMENT SHOULD BE INCLUDED IN YOUR MEDICAL RECORD.
HEALTH CARE POWER OF ATTORNEY
(S.C. STATUTORY FORM)
1. DESIGNATION OF HEALTH CARE AGENT
I, _______________________________________, hereby appoint:
(Principal)
(Agent's Name) _____________________________
(Agent's Address) ____________________________
Telephone: home: __________ work: __________ mobile: ______ as my agent to make health care decisions for me as authorized in this document.
Successor Agent: If an agent named by me dies, becomes legally disabled, resigns, refuses to act, becomes unavailable, or if an agent who is my spouse is divorced or separated from me, I name the following as successors to my agent, each to act alone and successively, in the order named:
A. First Alternate Agent:
Address: __________________________
Telephone: home: ________ work: ________ mobile: ________
B. Second Alternate Agent:
Address: ____________________________________________
Telephone: home: ________ work: ________ mobile: ________
Unavailability of Agent(s): If at any relevant time the agent or successor agents named here are unable or unwilling to make decisions concerning my health care, and those decisions are to be made by a guardian, by the Probate Court, or by a surrogate pursuant to the Adult Health Care Consent Act, it is my intention that the guardian, Probate Court, or surrogate make those decisions in accordance with my directions as stated in this document.
2. EFFECTIVE DATE AND DURABILITY
By this document I intend to create a durable power of attorney effective upon, and only during, any period of mental incompetence, except as provided in Paragraph 3 below.
3. HIPAA AUTHORIZATION
When considering or making health care decisions for me, all individually identifiable health information and medical records may be released without restriction to my health care agent(s) and/or my alternate health care agent(s) named above including, but not limited to, (i) diagnostic, treatment, other health care, and related insurance and financial records and information associated with any past, present, or future physical or mental health condition including, but not limited to, diagnosis or treatment of HIV/AIDS, sexually transmitted disease(s), mental illness, and/or drug or alcohol abuse and (ii) any written opinion relating to my health that such health care agent(s) and/or alternate health care agent(s) may have requested. Without limiting the generality of the foregoing, this release authority applies to all health information and medical records governed by the Health Insurance Portability and Accountability Act of 1996 (HIPAA), 42 U.S.C. 1320d and 45 C.F.R. 160-164; is effective whether or not I am mentally competent; has no expiration date; and shall terminate only in the event that I revoke the authority in writing and deliver it to my health care provider.
4. AGENT'S POWERS
I grant to my agent full authority to make decisions for me regarding my health care. In exercising this authority, my agent shall follow my desires as stated in this document or otherwise expressed by me or known to my agent. In making any decision, my agent shall attempt to discuss the proposed decision with me to determine my desires if I am able to communicate in any way. If my agent cannot determine the choice I would want made, then my agent shall make a choice for me based upon what my agent believes to be in my best interests. My agent's authority to interpret my desires is intended to be as broad as possible, except for any limitations I may state below.
Accordingly, unless specifically limited by the provisions specified below, my agent is authorized as follows:
A. To consent, refuse, or withdraw consent to any and all types of medical care, treatment, surgical procedures, diagnostic procedures, medication, and the use of mechanical or other procedures that affect any bodily function, including, but not limited to, artificial respiration, nutritional support and hydration, and cardiopulmonary resuscitation.
B. To authorize, or refuse to authorize, any medication or procedure intended to relieve pain, even though that use may lead to physical damage, addiction, or hasten the moment of, but not intentionally cause, my death.
C. To authorize my admission to or discharge, even against medical advice, from a hospital, nursing care facility, or similar facility or service.
D. To take another action necessary to making, documenting, and assuring implementation of decisions concerning my health care, including, but not limited to, granting a waiver or release from liability required by a hospital, physician, nursing care provider, or other health care provider; signing any documents relating to refusals of treatment or the leaving of a facility against medical advice, and pursuing any legal action in my name, and at the expense of my estate to force compliance with my wishes as determined by my agent, or to seek actual or punitive damages for the failure to comply.
E. The powers granted above do not include the following powers or are subject to the following rules or limitations: ____________________________________________________
5. ORGAN DONATION (INITIAL ONLY ONE)
My agent may ___; may not ___ consent to the donation of all or any of my tissue or organs for purposes of transplantation.
6. EFFECT ON DECLARATION OF A DESIRE FOR A NATURAL DEATH (LIVING WILL)
I understand that if I have a valid Declaration of a Desire for a Natural Death, the instructions contained in the Declaration will be given effect in any situation to which they are applicable. My agent will have authority to make decisions concerning my health care only in situations to which the Declaration does not apply.
7. STATEMENT OF DESIRES CONCERNING LIFE-SUSTAINING TREATMENT
With respect to any Life-Sustaining Treatment, I direct the following:
(INITIAL ONLY ONE OF THE FOLLOWING 3 PARAGRAPHS)
A. ___ GRANT OF DISCRETION TO AGENT. I do not want my life to be prolonged nor do I want life-sustaining treatment to be provided or continued if my agent believes the burdens of the treatment outweigh the expected benefits. I want my agent to consider the relief of suffering, my personal beliefs, the expense involved and the quality as well as the possible extension of my life in making decisions concerning life-sustaining treatment.
OR
B. ___ DIRECTIVE TO WITHHOLD OR WITHDRAW TREATMENT. I do not want my life to be prolonged and I do not want life-sustaining treatment:
1. if I have a condition that is incurable or irreversible and, without the administration of life-sustaining procedures, expected to result in death within a relatively short period of time; or
2. if I am in a state of permanent unconsciousness.
OR
C. ___ DIRECTIVE FOR MAXIMUM TREATMENT. I want my life to be prolonged to the greatest extent possible, within the standards of accepted medical practice, without regard to my condition, the chances I have for recovery, or the cost of the procedures.
8. STATEMENT OF DESIRES REGARDING TUBE FEEDING
With respect to Nutrition and Hydration provided by means of a nasogastric tube or tube into the stomach, intestines, or veins, I wish to make clear that in situations where life-sustaining treatment is being withheld or withdrawn pursuant to Paragraph 7:
(INITIAL ONLY ONE OF THE FOLLOWING 3 PARAGRAPHS):
A. ___ GRANT OF DISCRETION TO AGENT. I do not want my life to be prolonged by tube feeding if my agent believes the burdens of tube feeding outweigh the expected benefits. I want my agent to consider the relief of suffering, my personal beliefs, the expense involved, and the quality as well as the possible extension of my life in making this decision.
OR
B. ___ DIRECTIVE TO WITHHOLD OR WITHDRAW TUBE FEEDING. I do not want my life prolonged by tube feeding.
OR
C. ___ DIRECTIVE FOR PROVISION OF TUBE FEEDING. I want tube feeding to be provided within the standards of accepted medical practice, without regard to my condition, the chances I have for recovery, or the cost of the procedure, and without regard to whether other forms of life-sustaining treatment are being withheld or withdrawn.
IF YOU DO NOT INITIAL ANY OF THE STATEMENTS IN PARAGRAPH 8, YOUR AGENT WILL NOT HAVE AUTHORITY TO DIRECT THAT NUTRITION AND HYDRATION NECESSARY FOR COMFORT CARE OR ALLEVIATION OF PAIN BE WITHDRAWN.
9. ADMINISTRATIVE PROVISIONS
A. I revoke any prior Health Care Power of Attorney and any provisions relating to health care of any other prior power of attorney.
B. This power of attorney is intended to be valid in any jurisdiction in which it is presented.
BY SIGNING HERE I INDICATE THAT I UNDERSTAND THE CONTENTS OF THIS DOCUMENT AND THE EFFECT OF THIS GRANT OF POWERS TO MY AGENT.
I sign my name to this Health Care Power of Attorney on this
___ day of __________, 20 __. My current home address is:
________________________________________________
Principal's Signature: ______________________________
Print Name of Principal: ____________________________
I declare, on the basis of information and belief, that the person who signed or acknowledged this document (the principal) is personally known to me, that he/she signed or acknowledged this Health Care Power of Attorney in my presence, and that he/she appears to be of sound mind and under no duress, fraud, or undue influence. I am not related to the principal by blood, marriage, or adoption, either as a spouse, a lineal ancestor, descendant of the parents of the principal, or spouse of any of them. I am not directly financially responsible for the principal's medical care. I am not entitled to any portion of the principal's estate upon his decease, whether under any will or as an heir by intestate succession, nor am I the beneficiary of an insurance policy on the principal's life, nor do I have a claim against the principal's estate as of this time. I am not the principal's attending physician, nor an employee of the attending physician. No more than one witness is an employee of a health care facility in which the principal is a patient. I am not appointed as Health Care Agent or Successor Health Care Agent by this document.
Witness No. 1
Signature: _________________________ Date: ______________
Print Name: ____________________ Telephone: ______________
Address: ______________________________________________
Witness No. 2
Signature: _________________________ Date: _______________
Print Name: ____________________ Telephone: _____________
Address: ______________________________________________
(This portion of the document is optional and is not required to create a valid health care power of attorney.)
STATE OF SOUTH CAROLINA
COUNTY OF _____________________
The foregoing instrument was acknowledged before me by Principal on _______________, 20 _________
Notary Public for South Carolina
My Commission Expires: ______________________
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; 2016 Act No. 279 (S.778), § 2, eff January 1, 2017.
SECTION 62-5-505. Health care agent powers.
A health care agent has, in addition to the powers set forth in the health care power of attorney, the following specific powers to:
(1) have access to the principal's medical records and information to the same extent that the principal would have access, including the right to disclose the contents to others;
(2) contract on the principal's behalf for placement in a health care or nursing care facility or for health care related services, without the agent incurring personal financial liability for the contract;
(3) hire and fire medical, social service, and other support personnel responsible for the principal's care;
(4) have the same health care facility or nursing care facility visitation rights and privileges of the principal as are permitted to immediate family members or spouses.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-506. Compensation of agent; liability for costs of care or services.
(a) The agent is not entitled to compensation for services performed under the health care power of attorney, but the agent is entitled to reimbursement for all reasonable expenses incurred as a result of carrying out the health care power of attorney or the authority granted by this section.
(b) The agent's consent to health care or to the provision of services to the principal does not cause the agent to be liable for the costs of the care or services.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-507. Pregnancy of principal.
If a principal has been diagnosed as pregnant, life-sustaining procedures may not be withheld or withdrawn pursuant to the health care power of attorney during the course of the principal's pregnancy. This subsection does not otherwise affect the agent's authority to make decisions concerning the principal's obstetrical and other health care during the course of the pregnancy.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-508. Duty of health care or nursing care provider.
A health care provider or nursing care provider having knowledge of the principal's health care power of attorney has a duty to follow directives of the agent that are consistent with the health care power of attorney to the same extent as if they were given by the principal. If it is uncertain whether a directive is consistent with the health care power of attorney, the health care provider, nursing care provider, agent, or other interested person may apply to the probate court for an order determining the authority of the agent to give the directive.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-509. Duty of agent.
An agent acting pursuant to a health care power of attorney shall make decisions concerning the principal's health care in accordance with the principal's directives in the health care power of attorney and with any other statements of intent by the principal that are known to the agent and are not inconsistent with the directives in the health care power of attorney. If a principal has a valid Declaration of a Desire for a Natural Death pursuant to Chapter 77, Title 44, then the declaration must be given effect in any situation to which it is applicable. The agent named in the health care power of attorney has authority to make decisions only in situations to which the declaration does not apply. However, nothing in this section prevents the principal or a person designated by the principal in the declaration from revoking the declaration pursuant to Section 44-77-80.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-510. Immunity from liability.
(a) A person who relies in good faith upon a person's representation that he is the person named as agent in a health care power of attorney is not subject to civil or criminal liability or disciplinary action for recognizing the agent's authority.
(b) A health care provider or nursing care provider who in good faith relies on a health care decision made by an agent or successor agent is not subject to civil or criminal liability or disciplinary action on account of relying on the decision.
(c) An agent who in good faith makes a health care decision pursuant to a health care power of attorney is not subject to civil or criminal liability on account of the substance of the decision.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-511. Appointment of successor agents.
(a) The principal may appoint one or more successor agents in the health care power of attorney in the event an agent dies, becomes legally disabled, resigns, refuses to act, is unavailable, or, if the agent is the spouse of the principal, becomes divorced or separated from the principal. A successor agent will succeed to all duties and powers given to the agent in the health care power of attorney.
(b) If no agent or successor agent is available, willing, and qualified to make a decision concerning the principal's health care, the decision must be made according to the provisions of and by the person authorized by the Adult Health Care Consent Act.
(c) All directives, statements of personal values, or statements of intent made by the principal in the health care power of attorney must be treated as exercises of the principal's right to direct the course of his health care. Decisions concerning the principal's health care made by a guardian, by the probate court, or by a surrogate pursuant to the Adult Health Care Consent Act, must be made in accordance with the directions stated in the health care power of attorney.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-512. Revocation of health care power of attorney.
(a) A health care power of attorney may be revoked in the following ways:
(1) by a writing, an oral statement, or any other act constituting notification by the principal to the agent or to a health care provider responsible for the principal's care of the principal's specific intent to revoke the health care power of attorney; or
(2) by the principal's execution of a subsequent health care power of attorney or the principal's execution of a subsequent durable power of attorney pursuant to Article 8, Title 62, if the durable power of attorney states an intention that the health care power of attorney be revoked or if the durable power of attorney is inconsistent with the health care power of attorney.
(b) A health care provider who is informed of or provided with a revocation of a health care power of attorney immediately must record the revocation in the principal's medical record and notify the agent, the attending physician, and all other health care providers or nursing care providers who are responsible for the principal's care.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-513. Execution of health care power of attorney; signing requirement; mercy killing not approved; absence of health care power of attorney.
(a) The execution and effectuation of a health care power of attorney does not constitute suicide for any purpose.
(b) A person may not be required to sign a health care power of attorney in accordance with this section as a condition for coverage under an insurance contract or for receiving medical treatment or as a condition of admission to a health care or nursing care facility.
(c) Nothing in this section may be construed to authorize or approve mercy killing or to permit any affirmative or deliberate act or omission to end life other than to permit the natural process of dying.
(d) The absence of a health care power of attorney by an adult patient does not give rise to a presumption of his intent to consent to or refuse death prolonging procedures. Nothing in this section impairs other legal rights or legal responsibilities which a person may have to effect the provision or the withholding or withdrawal of life-sustaining procedures in a lawful manner.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-514. Criminal liability.
If a person coerces or fraudulently induces another person to execute a health care power of attorney, falsifies or forges a health care power of attorney, or wilfully conceals, cancels, obliterates, or destroys a revocation of a health care power of attorney, and the principal dies as a result of the withdrawal or withholding of treatment pursuant to the health care power of attorney, that person is subject to prosecution in accordance with the criminal laws of this State.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-515. Informing another person regarding this part not prohibited.
Nothing in this part prohibits a person from informing another person of the existence of this part, delivering to another person a copy of this part or a form for a health care power of attorney, or counseling another person in good faith concerning the execution of a health care power of attorney.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-516. Civil liability.
(a) If a person wilfully conceals, cancels, defaces, obliterates, or damages a health care power of attorney without the principal's consent, or falsifies or forges a revocation of a health care power of attorney, or otherwise prevents the implementation of the principal's wishes as stated in a health care power of attorney, that person breaches a duty owed to the principal and is responsible for payment of any expenses or other damages incurred as a result of the wrongful act.
(b) A physician or health care facility electing for any reason not to follow an agent's instruction that life-sustaining procedures be withheld or withdrawn as authorized in the health care power of attorney shall make a reasonable effort to locate a physician or health care facility that will follow the instruction and has a duty to transfer the patient to that physician or facility. If a nurse or other employee of a health care provider or nursing care provider gives notice that the employee does not wish to participate in the withholding or withdrawal of life-sustaining procedures as directed by an agent, a reasonable effort shall be made by the physician and the health care provider or nursing care provider to effect the withholding or withdrawal of life-sustaining procedures without the participation of the employee.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-517. Document or writing deemed to comply with requirements of this part.
(a) A document or writing containing the following provisions is deemed to comply with the requirements of this part:
(1) the name and address of the person who meets the requirements of Section 62-5-503 and is authorized to make health care related decisions if the principal becomes mentally incompetent;
(2) the types of health care related decisions that the health care agent is authorized to make;
(3) the signature of the principal;
(4) the signature of at least two persons who witnessed the principal's signature and who meet the requirements of Section 62-5-503; and
(5) the attestation of a notary public.
(b) Additionally, a document that meets the above requirements and also provides expressions of the principal's intentions or wishes with respect to the following health care issues authorizes the health care agent to act in accordance with these provisions:
(1) organ donations;
(2) life-sustaining treatment;
(3) tube feeding;
(4) other kinds of medical treatment that the principal wishes to have or not to have;
(5) comfort and treatment issues;
(6) provisions for interment or disposal of the body after death; and
(7) any written statements that the principal may wish to have communicated on his behalf.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
SECTION 62-5-518. Validity of a durable power of attorney.
The validity of a durable power of attorney that authorizes an attorney to make health care decisions regarding the principal which is properly executed pursuant to this part before or after the effective date of this act is not affected by the amendments contained in this act.
HISTORY: 1992 Act No. 306, § 1; 2005 Act No. 172, § 1; 2006 Act No. 365, § 1; 2008 Act No. 303, §§ 2, 3, eff June 11, 2008; 2010 Act No. 244, § 41, eff June 7, 2010; formerly 1976 Code § 62-5-504; 2016 Act No. 279, § 2, eff January 1, 2017.
Part 6
Uniform Veterans' Guardianship Act [Repealed]
Part 7
South Carolina Adult Guardianship and Protective Proceedings Jurisdiction Act
SECTION 62-5-700. Short title.
This act may be cited as the "South Carolina Adult Guardianship and Protective Proceedings Jurisdiction Act".
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-701. Exclusive jurisdiction.
Notwithstanding another provision of law, this part provides the exclusive jurisdictional basis for a court of this State to appoint a guardian or issue a protective order for an adult.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-702. Definitions.
In addition to the terms defined in Part 1, Article 5, Title 62, the following terms, as used in the part, apply:
(1) "Court" means a probate court in this State or a court in another state with the same jurisdiction as a probate court in this State.
(2) "Guardianship order" means an order appointing a guardian.
(3) "Home state" means the state in which the alleged incapacitated individual was physically present, including a period of temporary absence, for at least six consecutive months immediately preceding the filing of a petition for the appointment of a guardian or protective order; or if none, the state in which the alleged incapacitated individual was physically present, including a period of temporary absence, for at least six consecutive months ending with the six months prior to the filing of the petition.
(4) "Significant-connection state" means a state, other than the home state, with which an alleged incapacitated individual has a significant connection other than mere physical presence and in which substantial evidence concerning the alleged incapacitated individual is available. In determining, pursuant to Sections 62-5-707 and 62-5-714, whether an alleged incapacitated individual has a significant connection with a particular state, the court shall consider the:
(a) location of the alleged incapacitated individual's family and other persons required to be notified of the guardianship or protective proceeding;
(b) length of time the alleged incapacitated individual at any time was physically present in the state and the duration of any absence;
(c) location of the alleged incapacitated individual's property; and
(d) extent to which the alleged incapacitated individual has ties to the state such as voting registration, state or local tax return filing, vehicle registration, driver's license, social relationship, and receipt of services.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-703. Treatment of foreign countries.
The court may treat a foreign country as if it were a state for the purpose of applying this part.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-704. Court communication with court in another state; record required; exceptions; participation of parties.
(A) The court may communicate with a court in another state concerning a proceeding arising pursuant to this article. The court shall allow the parties to participate in a discussion between courts on the merits of a proceeding. Except as otherwise provided in subsection (B), the court shall make a record of the communication. When a discussion on the merits of a proceeding between courts is held, the record must show that the parties were given an opportunity to participate, must summarize the issues discussed, and must list the participants to the discussion. In all other matters except as provided in subsection (B), the record may be limited to the fact that the communication occurred.
(B) Courts may communicate concerning schedules, calendars, court records, and other administrative matters without making a record. A court may allow the parties to a proceeding to participate in any communications held pursuant to this subsection.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-705. Requests to court of another state; requests from court of another state.
(A) In a guardianship or protective proceeding in this State, the court may request the appropriate court of another state to do any of the following:
(1) hold an evidentiary hearing;
(2) order a person in that state to produce evidence or give testimony pursuant to procedures of that state;
(3) order that an evaluation or assessment be made of the alleged incapacitated individual;
(4) order an appropriate investigation of a person involved in a proceeding;
(5) forward to the court a certified copy of the transcript or other record of a hearing pursuant to item (1) or another proceeding, evidence otherwise produced pursuant to item (2), and an evaluation or assessment prepared in compliance with an order pursuant to item (3) or (4);
(6) issue an order necessary to assure the appearance in the proceeding of a person whose presence is necessary for the court to make a determination, including the alleged incapacitated individual or the ward or protected person; and
(7) issue an order authorizing the release of medical, financial, criminal, or other relevant information in that state, including protected health information as defined in 45 C.F.R. Section 164.504.
(B) If a court of another state in which a guardianship or protective proceeding is pending requests assistance of the kind provided in subsection (A), the court has jurisdiction for the limited purpose of granting the request or making reasonable efforts to comply with the request.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-706. Testimony of witness located in another state.
(A) In a guardianship or protective proceeding, in addition to other procedures that may be available, testimony of a witness who is located in another state may be offered by deposition or other means allowable in this State for testimony taken in another state. The court on its own motion may order that the testimony of a witness be taken in another state and may prescribe the manner in which and the terms upon which the testimony is to be taken.
(B) In a guardianship or protective proceeding, a court in this State may permit a witness located in another state to be deposed or to testify by telephone or audiovisual or other electronic means. The court shall cooperate with the court of the other state in designating an appropriate location for the deposition or testimony.
(C) Documentary evidence transmitted from another state to a court of this State by technological means that does not produce an original writing may not be excluded from evidence on an objection based on the means of transmission.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-707. Jurisdiction of court.
The court has jurisdiction to appoint a guardian or issue a protective order for an alleged incapacitated individual if:
(A) this State is the alleged incapacitated individual's home state;
(B) on the date the petition is filed, this State is a significant-connection state; and
(1) the alleged incapacitated individual does not have a home state or a court of the alleged incapacitated individual's home state has declined to exercise jurisdiction because this State is a more appropriate forum; or
(2) the alleged incapacitated individual has a home state, a petition for an appointment or order is not pending in a court of that state or another significant-connection state and, before the court makes the appointment or issues the order:
(a) a petition for an appointment or order is not filed in the alleged incapacitated individual's home state;
(b) an objection to the court's jurisdiction is not filed by a person required to be notified of the proceeding; and
(c) the court concludes that it is an appropriate forum pursuant to the factors provided in Section 62-5-710(C);
(C) this State does not have jurisdiction pursuant to either subsections (A) or (B), the alleged incapacitated individual's home state and all significant-connection states have declined to exercise jurisdiction because this State is the more appropriate forum, and jurisdiction in this State is consistent with the constitutions of this State and the United States; or
(D) the requirements for special jurisdiction pursuant to Section 62-5-708 are met.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-708. Special jurisdiction.
(A) The court lacking jurisdiction pursuant to Sections 62-5-707 (A) through (C) has special jurisdiction to do any of the following:
(1) appoint a guardian in an emergency pursuant to this article for a term not exceeding ninety days for an alleged incapacitated individual who is physically present in this State;
(2) issue a protective order with respect to real or tangible personal property located in this State; or
(3) appoint a guardian or conservator for an incapacitated individual or protected person for whom a provisional order to transfer the proceeding from another state has been issued pursuant to procedures similar to Section 62-5-714.
(B) If a petition for the appointment of a guardian in an emergency is brought in this State pursuant to this article and this State was not the alleged incapacitated individual's home state on the date the petition was filed, the court shall dismiss the proceeding at the request of the court of the home state, if any, whether dismissal is requested before or after the emergency appointment.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-709. Exclusive and continuing jurisdiction; exception.
Except as otherwise provided in Section 62-5-708, a court that has appointed a guardian or issued a protective order consistent with this article has exclusive and continuing jurisdiction over the proceeding until it is terminated by the court or the appointment or order has expired by its own terms.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-710. Declining jurisdiction; more appropriate forum; dismissal or stay of proceeding.
(A) The court having jurisdiction pursuant to Section 62-5-707 to appoint a guardian or issue a protective order may decline to exercise its jurisdiction if it determines at any time that a court of another state is a more appropriate forum.
(B) If the court declines to exercise its jurisdiction pursuant to subsection (A), it either shall dismiss or stay the proceeding. The court may impose any condition the court considers just and proper, including the condition that a petition for the appointment of a guardian or issuance of a protective order be filed promptly in another state.
(C) In determining whether it is an appropriate forum, the court shall consider all relevant factors, including:
(1) the expressed preference of the alleged incapacitated individual;
(2) whether abuse, neglect, or exploitation of the alleged incapacitated individual has occurred or is likely to occur and which state could best protect the alleged incapacitated individual from the abuse, neglect, or exploitation;
(3) the length of time the alleged incapacitated individual was physically present in or was a legal resident of this or another state;
(4) the distance of the alleged incapacitated individual from the court in each state;
(5) the financial circumstances of the alleged incapacitated individual's estate;
(6) the nature and location of the evidence;
(7) the ability of the court in each state to decide the issue expeditiously and the procedures necessary to present evidence;
(8) the familiarity of the court of each state with the facts and issues in the proceeding; and
(9) if an appointment is made, the court's ability to monitor the conduct of the guardian or conservator.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-711. Jurisdiction acquired due to unjustifiable conduct; assessment of reasonable expenses against responsible party.
(A) If at any time the court determines that it acquired jurisdiction to appoint a guardian or issue a protective order because of unjustifiable conduct, the court may:
(1) decline to exercise jurisdiction;
(2) exercise jurisdiction for the limited purpose of fashioning an appropriate remedy to ensure the health, safety, and welfare of the alleged incapacitated individual or the protection of the alleged incapacitated individual's property or prevent a repetition of the unjustifiable conduct, including staying the proceeding until a petition for the appointment of a guardian or issuance of a protective order is filed in a court of another state having jurisdiction; or
(3) continue to exercise jurisdiction after considering:
(a) the extent to which the alleged incapacitated individual and all persons required to be notified of the proceedings have acquiesced in the exercise of the court's jurisdiction;
(b) whether it is a more appropriate forum than the court of any other state pursuant to the factors provided in Section 62-5-710(C); and
(c) whether the court of any other state would have jurisdiction under factual circumstances in substantial conformity with the jurisdictional standards of Section 62-5-708.
(B) If the court determines that it acquired jurisdiction to appoint a guardian or issue a protective order because a party seeking to invoke its jurisdiction engaged in unjustifiable conduct, it may assess against that party necessary and reasonable expenses, including attorney's fees, investigative fees, court costs, communication expenses, witness fees and expenses, and travel expenses. The court may not assess fees, costs, or expenses of any kind against this State or a governmental subdivision, agency, or instrumentality of this State unless authorized by law other than this article.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-712. Notice requirements to alleged incapacitated individual's home state.
If a petition for the appointment of a guardian or issuance of a protective order is brought in this State and this State was not the alleged incapacitated individual's home state on the date the petition was filed, in addition to complying with the notice requirements of this State, notice of the petition must be given to those persons who would be entitled to notice of the petition if a proceeding were brought in the alleged incapacitated individual's home state. The notice must be given in the same manner as notice is required to be given in this State.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-713. Rules for dealing with conflicting petitions in this and another state.
Except for a petition for the appointment of a guardian in an emergency or issuance of a protective order limited to property located in this State pursuant to Section 62-5-708(A)(1) or (2), if a petition for the appointment of a guardian or issuance of a protective order is filed in this State and in another state and neither petition has been dismissed or withdrawn, the following rules apply:
(A) if the court has jurisdiction pursuant to Section 62-5-707, it may proceed with the case unless a court in another state acquires jurisdiction under provisions similar to Section 62-5-707 before the appointment or issuance of the order; or
(B) if the court does not have jurisdiction pursuant to Section 62-5-707, whether at the time the petition is filed or at any time before the appointment or issuance of the order, the court shall stay the proceeding and communicate with the court in the other state. If the court in the other state has jurisdiction, the court in this State shall dismiss the petition unless the court in the other state determines that the court in this State is a more appropriate forum.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-714. Petition to transfer guardianship or conservatorship to another state; notice; hearing; provisional and final orders.
(A) A guardian or conservator appointed in this State may petition the court to transfer the guardianship or conservatorship to another state.
(B) Notice of a petition pursuant to subsection (A) must be given to the persons that would be entitled to notice of a petition in this State for the appointment of a guardian or conservator.
(C) On the court's own motion or on request of the guardian or conservator, the ward or protected person, or other person required to be notified of the petition, the court shall hold a hearing on a petition filed pursuant to subsection (A), except that a hearing must not be required if a consent order is signed by all parties who have pled, defended, or otherwise participated in the proceeding, as provided by the South Carolina Rules of Civil Procedure.
(D) The court shall issue an order provisionally granting a petition to transfer a guardianship and shall direct the guardian to petition for guardianship in the other state if the court is satisfied that the guardianship will be accepted by the court in the other state and the court finds that:
(1) the ward is physically present in or is reasonably expected to move permanently to the other state;
(2) an objection to the transfer has not been made or, if an objection has been made, the objector has not established that the transfer would be contrary to the interests of the ward; and
(3) plans for care and services for the ward in the other state are reasonable and sufficient.
(E) The court shall issue a provisional order granting a petition to transfer a conservatorship and shall direct the conservator to petition for conservatorship in the other state if the court is satisfied that the conservatorship will be accepted by the court of the other state and the court finds that:
(1) the protected person is physically present in or is reasonably expected to move permanently to the other state, or the protected person has a significant connection to the other state considering the factors provided in Section 62-5-707;
(2) an objection to the transfer has not been made or, if an objection has been made, the objector has not established that the transfer would be contrary to the interests of the protected person; and
(3) adequate arrangements will be made for management of the protected person's property.
(F) The court shall issue a final order confirming the transfer and terminating the guardianship or conservatorship upon its receipt of:
(1) a provisional order accepting the proceeding from the court to which the proceeding is to be transferred which is issued under provisions similar to Section 62-5-715; and
(2) the documents required to terminate a guardianship or conservatorship in this State.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-715. Confirmation of transfer from another state; petition to accept guardianship or conservatorship; determination of needed modification.
(A) To confirm transfer of a guardianship or conservatorship to this State under provisions similar to Section 62-5-714, the guardian or conservator must petition the court in this State to accept the guardianship or conservatorship. The petition must include a certified copy of the other state's provisional order of transfer.
(B) Notice of a petition pursuant to subsection (A) must be given to those persons that would be entitled to notice if the petition were a petition for the appointment of a guardian or issuance of a protective order in both the transferring state and this State. The notice must be given in the same manner as notice is required to be given in this State.
(C) On the court's own motion or on request of the guardian or conservator, the ward or protected person, or other person required to be notified of the proceeding, the court shall hold a hearing on a petition filed pursuant to subsection (A), except that a hearing must not be required if a consent order is signed by all parties who have pled, defended, or otherwise participated in the proceeding, as provided by the South Carolina Rules of Civil Procedure.
(D) The court shall issue an order provisionally granting a petition filed pursuant to subsection (A) unless:
(1) an objection is made and the objector establishes that transfer of the proceeding would be contrary to the interests of the ward or protected person; or
(2) the guardian or conservator is ineligible for appointment in this State.
(E) The court shall issue a final order accepting the proceeding and appointing the guardian or conservator as guardian or conservator in this State upon its receipt of a final order from the court from which the proceeding is being transferred, when that final order is issued pursuant to provisions similar to Section 62-5-714 transferring the proceeding to this State.
(F) Not later than ninety days after issuance of a final order accepting transfer of a guardianship or conservatorship, the court shall determine whether the guardianship or conservatorship needs to be modified to conform to the laws of this State.
(G) In granting a petition pursuant to this section, the court shall recognize a guardianship or conservatorship order from the other state, including the determination of the ward or protected person's incapacity and the appointment of the guardian or conservator.
(H) The denial by the court of a petition to accept a guardianship or conservatorship transferred from another state does not affect the ability of the guardian or conservator to seek appointment as guardian or conservator in this State pursuant to another provision of this article if the court has jurisdiction to make an appointment other than by reason of the provisional order of transfer.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.
SECTION 62-5-716. Registration of orders from another state; powers in this state.
(A) If a guardian has been appointed in another state and a petition for the appointment of a guardian is not pending in this State, the guardian appointed in the other state, after giving notice to the appointing court of an intent to register, may register the guardianship order in this State by filing as a foreign judgment in the court, in any appropriate county of this State, certified copies of the order and letters of office. The court shall treat this as the filing of authenticated or certified records and shall charge the fees set forth in Section 8-21-770. The court will then issue a certificate of registration. The guardian shall file the certificate, along with a copy of his fiduciary letters of office in county real estate records.
(B) If a conservator has been appointed in another state and a petition for a protective order is not pending in this State, the conservator appointed in the other state, after giving notice to the appointing court of an intent to register, may register the protective order in this State by filing as a foreign judgment in the Probate Court, in any county in which property belonging to the protected person is located, certified copies of the order and letters of office and of any bond. The court shall treat this as the filing of authenticated or certified records and shall charge the fees set forth in Section 8-21-770 for the filing of such documents. The court will then issue a certificate of registration. The conservator shall file the certificate, along with a copy of the fiduciary letters in the county real estate records.
(C)(1) Upon registration of a guardianship or protective order from another state, the guardian or conservator may exercise in this State all powers authorized in the order of appointment except as prohibited under the laws of this State, including maintaining actions and proceedings in this State and, if the guardian or conservator is not a resident of this State, subject to any conditions imposed upon nonresident parties.
(2) A probate court of this State may grant any relief available pursuant to the provisions of this article and other laws of this State to enforce a registered order.
HISTORY: 2010 Act No. 213, § 1, eff January 1, 2011; 2017 Act No. 87 (S.415), § 5.B, eff January 1, 2019.TITLE 62. SOUTH CAROLINA PROBATE CODE
CHAPTER 6. Nonprobate Transfers
Part 1
Definitions and General Provisions
SECTION 62-6-101. Definitions.
In this subpart:
(1) "Account" means a contract of deposit between a depositor and a financial institution, and includes a checking account, savings account, certificate of deposit, share account, and other like arrangements.
(2) "Agent" means a person authorized to make account transactions for a party.
(3) "Beneficiary" means a person named as one to whom sums on deposit in an account are payable on request after the death of all parties or for whom a party is named as the trustee.
(4) "Financial institution" means any organization authorized to do business under state or federal laws relating to financial institutions, and includes a bank, trust company, savings bank, building and loan association, savings and loan company or association, and credit union.
(5) "Multiple-Party account" means an account payable on request to one or more of two or more parties, whether or not a right of survivorship is mentioned including, but not limited to, joint accounts or POD accounts.
(6) "Net contribution of a party" means the sum of all deposits to an account made by or for the party, less all payments from the account made to or for the party which have not been paid to or applied to the use of another party and a proportionate share of any charges deducted from the account, plus a proportionate share of any interest or dividends earned, whether or not included in the current balance. The term includes deposit life insurance proceeds added to the account by reason of death of the party whose net contribution is in question.
(7) "Party" means a person who, by the terms of an account, has a present right, subject to request, to payment from the account other than as a beneficiary or agent.
(8) "Payment" of sums on deposit includes withdrawal, payment to a party, or third person pursuant to a check or other request, and a pledge of sums on deposit by a party, or a set-off, reduction, or other disposition of all or part of an account pursuant to a pledge.
(9) "Proof of death" includes a death certificate or record or report which is prima facie proof of death under Section 62-1-507.
(10) "P.O.D. designation" means the designation of: (i) a beneficiary in an account payable on request to one party during the party's lifetime and on the party's death to one or more beneficiaries, or to one or more parties during their lifetimes and on death of all of them to one or more beneficiaries, or (ii) a beneficiary in an account in the name of one or more parties as trustee for one or more beneficiaries if the relationship is established by the terms of the account and there is no subject of the trust other than the sums on deposit in the account, whether or not payment to the beneficiary is mentioned.
(11) "Receive" as it relates to notice to a financial institution, means receipt in the office or branch office of the financial institution in which the account is established, but if the terms of the account require notice at a particular place, in the place required.
(12) "Request" means a request for payment complying with all terms of the account, including special requirements concerning necessary signatures and regulations of the financial institution. However, for purposes of this subpart, if terms of the account condition payment on advance notice, a request for payment is treated as immediately effective and a notice of intent to withdraw is treated as a request for payment.
(13) "Sums on deposit" means the balance payable on an account including interest and dividends earned, whether or not included in the current balance, and any deposit life insurance proceeds added to the account by reason of the death of a party.
(14) "Terms of the account" includes the deposit agreement and other terms and conditions, including the form, of the contract of deposit.
HISTORY: 1986 Act No. 539, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-102. Applicability of article.
This article does not apply to: (i) an account established for a partnership, joint venture, or other organization for a business purpose, (ii) an account controlled by one or more persons as an agent or trustee for a corporation, unincorporated association, or charitable or civic organization, or (iii) a fiduciary or trust account in which the relationship is established other than by the terms of the account.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-103. Accounts.
(a) An account may be for a single party or multiple parties. A multiple-party account may be with or without a right of survivorship between the parties. Subject to Section 62-6-202(c), either a single-party account or a multiple-party account may have a POD designation, an agency designation, or both.
(b) An account established after January 1, 2014, whether in the form prescribed in Section 62-6-104 or in any other form, is either a single-party account or a multiple-party account, with or without right of survivorship, and with or without a POD designation or an agency designation, within the meaning of this subpart, and is governed by this article.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-104. Short forms for single- and multiple-party accounts.
(a) A contract of deposit that contains provisions in substantially the following form establishes the type of account provided, and the account is governed by the provisions of this subpart applicable to an account of that type:
UNIFORM SINGLE-OR MULTIPLE-PARTY ACCOUNT FORM
PARTIES [Name One or More Parties]:
OWNERSHIP [Select One And Initial]:
__SINGLE-PARTY ACCOUNT
__MULTIPLE-PARTY ACCOUNT
Parties own account in proportion to net contributions unless there is clear and convincing evidence of a different intent.
RIGHTS AT DEATH [Select One And Initial]:
If Single-Party Account is chosen above, choose one of following:
__SINGLE-PARTY ACCOUNT
At death of party, ownership passes as part of party's estate.
__SINGLE-PARTY ACCOUNT WITH POD (PAY ON DEATH) DESIGNATION
[Name One Or More Beneficiaries]:
At death of party, ownership passes to POD beneficiaries and is not part of party's estate.
If Multiple-Party Account is chosen above, choose one of following:
__MULTIPLE-PARTY ACCOUNT WITH RIGHT OF SURVIVORSHIP
At death of party, ownership passes to surviving parties. The last surviving party owns the entire account. (Note: This can be overridden by clear and convincing evidence of a contrary intent.)
__MULTIPLE-PARTY ACCOUNT WITH RIGHT OF SURVIVORSHIP AND POD (PAY ON DEATH) DESIGNATION
[Name One Or More Beneficiaries]:
At death of last surviving party, ownership passes to POD beneficiaries and is not part of last surviving party's estate.
__MULTIPLE-PARTY ACCOUNT WITHOUT RIGHT OF SURVIVORSHIP
At death of party, deceased party's ownership passes as part of deceased party's estate.
DESIGNATION OF AGENT FOR ACCOUNT [Optional]
Agents may make account transactions for parties but have no ownership or rights at death unless named as POD beneficiaries.
[To Add Agency Designation To Account, Name One Or More Agents]:
[Select One And Initial]:
______AGENCY DESIGNATION SURVIVES DISABILITY OR INCAPACITY OF PARTIES
______AGENCY DESIGNATION TERMINATES ON DISABILITY OR INCAPACITY OF PARTIES
(b) A contract of deposit that does not contain provisions in substantially the form provided in subsection (a) is governed by the provisions of this article applicable to the type of account that most nearly conforms to the depositor's intent.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 70; 1990 Act No. 521, § 88; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-105. Designation of agent; authority of agent.
By a writing signed by all parties, the parties may designate as agent of all parties on an account a person other than a party. Unless the terms of an agency designation provide that the authority of the agent terminates on disability or incapacity of a party, the agent's authority survives disability and incapacity. The agent may act for a disabled or incapacitated party until the authority of the agent is terminated. Death of the sole party or last surviving party terminates the authority of an agent. The designated agent on an account is authorized to make all transactions on the account that the party can make, including, but not limited to, closing the account. An agent serving under a durable power of attorney can change, modify, or revoke an agent designated on an account.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-106. Applicability of Part 2.
The provisions of Part 2 concerning beneficial ownership as between parties or as between parties and beneficiaries apply only to controversies between those persons and their creditors and other successors, and do not apply to the right of those persons to payment as determined by the terms of the account. Part 3 governs the liability and set-off rights of financial institutions that make payments pursuant to it.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
Part 2
Ownership as Between Parties and Others
SECTION 62-6-201. Ownership during lifetime.
(A) During the lifetime of all parties, an account belongs to the parties in proportion to the net contribution of each to the sums on deposit, unless there is clear and convincing evidence of a different intent.
(B) A beneficiary in an account having a POD designation has no right to sums on deposit during the lifetime of any party.
(C) An agent in an account with an agency designation has no beneficial right to sums on deposit.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 69; 1976 Code § 62-6-103; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-202. Right of survivorship.
(a) Except as otherwise provided in this subpart, on death of a party sums on deposit in a multiple-party account belong to the surviving party or parties. If two or more parties survive and one is the surviving spouse of the decedent, the amount to which the decedent, immediately before death, was beneficially entitled under Section 62-6-201 belongs to the surviving spouse. If two or more parties survive and none is the surviving spouse of the decedent, the amount to which the decedent, immediately before death, was beneficially entitled under Section 62-6-201 belongs to the surviving parties in equal shares, and augments the proportion to which each survivor, immediately before the decedent's death, was beneficially entitled under Section 62-6-201, and the right of survivorship continues between the surviving parties.
(b) In an account with a POD designation:
(1) on death of one of two or more parties, the rights in sums on deposit are governed by subsection (a);
(2) on death of the sole party or the last survivor of two or more parties, sums on deposit belong to the surviving beneficiary or beneficiaries. If two or more beneficiaries survive, sums on deposit belong to them in equal and undivided shares, and there is no right of survivorship in the event of death of a beneficiary thereafter. If no beneficiary survives, sums on deposit belong to the estate of the last surviving party.
(c) Sums on deposit in a single-party account without a POD designation, or in a multiple-party account that, by the terms of the account, is without right of survivorship, are not affected by death of a party, but the amount to which the decedent, immediately before death, was beneficially entitled under Section 62-6-201 is transferred as part of the decedent's estate. A POD designation in a multiple-party account without right of survivorship is ineffective. For purposes of this section, designation of an account as a tenancy in common establishes that the account is without right of survivorship.
(d) The ownership right of a surviving party or beneficiary, or of the decedent's estate, in sums on deposit is subject to requests for payment made by a party before the party's death, whether paid by the financial institution before or after death, or unpaid. The surviving party or beneficiary, or the decedent's estate, is liable to the payee of an unpaid request for payment. The liability is limited to a proportionate share of the amount transferred under this section, to the extent necessary to discharge the request for payment.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 70; 1990 Act No. 521, § 88; 1976 Code § 62-6-104; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-203. Rights of parties and beneficiaries.
(a) Rights at death of a party under Section 62-6-202 are determined by the terms of the account at the death of the party. A party may alter the terms of the account by a notice signed by the party and given to the financial institution to change the terms of the account or to stop or vary payment under the terms of the account. To be effective the notice must be received by the financial institution during the party's lifetime.
(b) A right of survivorship arising from the express terms of the account under Section 62-6-202 may be altered by clear and convincing evidence, including but not limited to express provisions in a will.
(c) A multiple-party account of husband and wife is presumed to be joint with right of survivorship unless clear and convincing evidence shows survivorship was not the intent of the party.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-204. Transfers not testamentary.
A transfer resulting from the application of Section 62-6-202 is effective by reason of the terms of the account involved and this part and is not testamentary or subject to Articles 1 through 4 (estate administration) unless there is clear and convincing evidence that the deceased party did not intend for the account to be joint with right of survivorship.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-205. Rights of creditors.
Subject to the provisions contained in Section 62-3-916, no multiple-party account is effective against an estate of a deceased party to transfer to a survivor sums needed to pay debts, taxes, and expenses of administration, if other assets of the estate are insufficient. A surviving party or beneficiary who receives payment from a multiple-party account after the death of a deceased party is liable to account to his personal representative for amounts the decedent owned beneficially immediately before his death to the extent necessary to discharge the claims and charges mentioned above remaining unpaid after application of the decedent's estate. No proceeding to assert this liability may be commenced unless the personal representative has received a written demand by a creditor of the decedent, and no proceeding may be commenced later than one year following the death of the decedent. Sums recovered by the personal representative must be administered as part of the decedent's estate. This section does not affect the right of a financial institution to make payment on multiple-party accounts according to the terms of the account or make it liable to the estate of a deceased party unless, before payment, the institution has been served with an order of the probate court.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 71; 1976 Code § 62-6-107; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 3
Protection of Financial Institutions
SECTION 62-6-301. Contract of deposit for a multiple-party account.
A financial institution may enter into a contract of deposit for a multiple-party account to the same extent it may enter into a contract of deposit for a single-party account, and may provide for a POD designation and an agency designation in either a single-party account or a multiple-party account. A financial institution need not inquire as to the source of a deposit to an account or as to the proposed application of a payment from an account.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 72; 1976 Code § 62-6-108; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-302. Multiple-party accounts may be paid on request to one or more parties.
A financial institution, on request, may pay sums on deposit in a multiple-party account:
(1) to one or more of the parties, whether or not another party is disabled, incapacitated, or deceased when payment is requested and whether or not the party making the request survives another party;
(2) to the personal representative of a deceased party, if proof of death is presented to the financial institution showing that the deceased party was the survivor of all other persons named on the account either as a party or beneficiary, unless the account is without right of survivorship under Section 62-6-202; or
(3) in accordance with a court order directing the payment of the sums on deposit.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-303. Payment of POD account.
A financial institution, on request, may pay sums on deposit in an account with a POD designation:
(1) to one or more of the parties, whether or not another party is disabled, incapacitated, or deceased when the payment is requested and whether or not a party survives another party;
(2) to the beneficiary or beneficiaries, if proof of death is presented to the financial institution showing that the beneficiary or beneficiaries survived all persons named as parties;
(3) to the personal representative of a deceased party, if proof of death is presented to the financial institution showing that the deceased party was the survivor of all other persons named on the account either as a party or beneficiary; or
(4) in accordance with a court order directing the payment of the sums on deposit.
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 74; 1976 Code § 62-6-110; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-304. Payment to agent.
A financial institution, on request of an agent under an agency designation for an account, may pay to the agent sums on deposit in the account, whether or not a party is disabled, incapacitated, or deceased when the request is made or received, and whether or not the authority of the agent terminates on the disability or incapacity of a party.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-305. Payment to minors.
If a financial institution is required or permitted to make payment pursuant to this part to a minor designated as a beneficiary, payment shall be made as ordered by the court or may be made in accordance with Section 62-5-103.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-306. Discharge.
(a) Payment made pursuant to this subpart in accordance with the terms of the account discharges the financial institution from all claims for amounts so paid, whether or not the payment is consistent with the beneficial ownership of the account as between parties, beneficiaries, or their successors. Payment may be made whether or not a party, beneficiary, or agent is disabled, incapacitated, or deceased when payment is requested, received, or made.
(b) Protection under this section does not extend to payments made after a financial institution has received written notice from a party, or from an agent under a durable power of attorney or a conservator for a party, or from the personal representative of a deceased party, or surviving spouse of a deceased party, to the effect that payments in accordance with the terms of the account, including one having an agency designation, should not be permitted, and the financial institution has had a reasonable opportunity to act on it when the payment is made. Unless the notice is withdrawn by the person giving it, the successor of any deceased party must concur in a request for payment if the financial institution is to be protected under this section. Unless a financial institution has been served with process or a court order in an action or proceeding, no other notice or other information shown to have been available to the financial institution affects its right to protection under this section.
(c) A financial institution that receives written notice pursuant to this section or otherwise has reason to believe that a dispute exists as to the rights of the parties may refuse, without liability, to make payments in accordance with the terms of the account.
(d) Protection of a financial institution under this section does not affect the rights of parties in disputes between themselves or their successors concerning the beneficial ownership of sums on deposit in accounts or payments made from accounts.
HISTORY: 1986 Act No. 539, § 1; 1976 Code § 62-6-112; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-6-307. Set-off.
Without qualifying any other statutory right to set-off or lien and subject to any contractual provision, if a party to a multiple-party account is indebted to a financial institution, the financial institution has a right to set-off against the account in which the party has or had immediately before his death a present right of withdrawal. The amount of the account subject to set-off is that proportion to which the debtor is, or was immediately before his death, beneficially entitled, and in the absence of proof of net contributions, to an equal share with all parties having present rights of withdrawal.
HISTORY: 1986 Act No. 539, § 1; 1976 Code § 62-6-113; 2013 Act No. 100, § 2, eff January 1, 2014.TITLE 62. SOUTH CAROLINA PROBATE CODE
CHAPTER 7. South Carolina Trust Code
Part 1
General Provisions and Definitions
SECTION 62-7-101. Short title.
This article may be cited as the South Carolina Trust Code. In this article, unless the context clearly indicates otherwise, "Code" means the South Carolina Trust Code.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-102. Scope.
This article applies to express trusts, charitable or noncharitable, and trusts created pursuant to a statute, judgment, or decree that requires the trust to be administered in the manner of an express trust. The term 'express trust' includes both testamentary and inter vivos trusts, regardless of whether the trustee is required to account to the probate court, and includes, but is not limited to, all trusts defined in Section 62-1-201(49). This article does not apply to constructive trusts, resulting trusts, conservatorships administered by conservators as defined in Section 62-1-201(6), administration of decedent's estates, all multiple party accounts referred to in Section 62-6-101 et seq., custodial arrangements, business trusts providing for certificates to be issued to beneficiaries, common trust funds, voting trusts, security arrangements, liquidation trusts, and trusts for the primary purpose of paying debts, dividends, interest, salaries, wages, profits, pensions, or employee benefits of any kind, or any arrangement under which a person is nominee or escrowee for another.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-103. Definitions.
In this article:
(1) "Action," with respect to an act of a trustee, includes a failure to act.
(2) "Beneficiary" means a person that:
(A) has a present or future beneficial interest in a trust, vested or contingent; or
(B) in a capacity other than that of trustee, holds a power of appointment over trust property; or
(C) In the case of a charitable trust, has the authority to enforce the terms of the Trust.
(3) "Charitable trust" means a trust, or portion of a trust, created for a charitable purpose described in Section 62-7-405(a).
(4) "Conservator" means a person appointed by the court to administer the estate of a protected person.
(5) "Environmental law" means a federal, state, or local law, rule, regulation, or ordinance relating to protection of the environment.
(6) "Guardian" means a person appointed by the court to make decisions regarding the support, care, education, health, and welfare of a minor or adult individual. The term does not include a guardian ad litem or a statutory guardian.
(7) "Interests of the beneficiaries" means the beneficial interests provided in the terms of the trust.
(8) "Jurisdiction", with respect to a geographic area, includes a State or country.
(9) "Person" means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency, or instrumentality, public corporation, or any other legal or commercial entity.
(10) "Power of withdrawal" means a presently exercisable general power of appointment other than a power exercisable by a trustee which is limited by an ascertainable standard, or which is exercisable by another person only upon consent of the trustee or the person holding an adverse interest.
(11) "Property" means anything that may be the subject of ownership, whether real or personal, legal or equitable, or any interest therein.
(12) "Qualified beneficiary" means a living beneficiary who, on the date the beneficiary's qualification is determined:
(A) is a distributee or permissible distributee of trust income or principal;
(B) would be a distributee or permissible distributee of trust income or principal if the interests of the distributees described in subparagraph (A) terminated on that date, but the termination of those interests would not cause the trust to terminate; or
(C) would be a distributee or permissible distributee of trust income or principal if the trust terminated on that date.
(13) "Revocable", as applied to a trust, means revocable by the settlor without the consent of the trustee or a person holding an adverse interest.
(14) "Settlor" means a person, including a testator, who creates, or contributes property to, a trust. If more than one person creates or contributes property to a trust, each person is a settlor of the portion of the trust property attributable to that person's contribution except to the extent another person has the power to revoke or withdraw that portion. Neither the possession of, nor the lapse, release, or waiver of a power of withdrawal shall cause a holder of the power to be deemed to be a settlor of the trust, and property subject to such power is not susceptible to the power holder's creditors.
(15) "Spendthrift provision" means a term of a trust which restrains both voluntary and involuntary transfer of a beneficiary's interest.
(16) "State" means a State of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States. The term includes an Indian tribe or band recognized by federal law or formally acknowledged by a State.
(17) "Terms of a trust" means the manifestation of the settlor's intent regarding a trust's provisions as expressed in the trust instrument or as may be established by other evidence that would be admissible in a judicial proceeding.
(18) "Trust instrument" means an instrument executed by the settlor that contains terms of the trust, including any amendments thereto.
(19) "Trustee" includes an original, additional, and successor trustee, and a cotrustee, whether or not appointed or confirmed by a court.
(20) "Ascertainable standard" means an ascertainable standard relating to a trustee's individual's health, education, support, or maintenance within the meaning of Section 2041(b)(1)(A) or 2514(c)(1) of the Internal Revenue Code, as amended.
(21) "Distributee" means any person who receives property of a trust from a trustee, other than as creditor or purchaser.
(22) "Interested person" or "interested party" means any person or party deemed to be a necessary or proper party under Rule 19 of the South Carolina Rules of Civil Procedure.
(23) "Internal Revenue Code" means the Internal Revenue Code, as amended from time to time. Each reference to a provision of the Internal Revenue Code shall include any successor or amendment thereto.
(24) "Serious breach of trust" means either: a single act that causes significant harm or involves flagrant misconduct, or a series of smaller breaches, none of which individually justify removal when considered alone, but which do so when considered together.
(25) "Permissible distributee" means any person who or which on the date of qualification as a beneficiary is eligible to receive current distributions of property of a trust from a trustee, other than as a creditor or purchaser.
(26) "Trust investment advisor" is a person, committee of persons, or entity who is or who are given authority by the terms of a trust instrument to direct, consent to or disapprove a trustee's actual or proposed investment decisions.
(27) "Trust protector" is a person, committee of persons or entity who is or who are designated as a trust protector whose appointment is provided for in the trust instrument.
The terms and definitions contained in the South Carolina Probate Code that do not conflict with the terms defined in this section shall remain in effect for the South Carolina Trust Code.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-104. Knowledge.
(a) Subject to subsection (b), a person has knowledge of a fact if the person:
(1) has actual knowledge of it;
(2) has received a notice or notification of it; or
(3) from all the facts and circumstances known to the person at the time in question, has reason to know it.
(b) An organization that conducts activities through employees has notice or knowledge of a fact involving a trust only from the time the information was received by an employee having responsibility to act for the trust, or would have been brought to the employee's attention if the organization had exercised reasonable diligence. An organization exercises reasonable diligence if it maintains reasonable routines for communicating significant information to the employee having responsibility to act for the trust and there is reasonable compliance with the routines. Reasonable diligence does not require an employee of the organization to communicate information unless the communication is part of the individual's regular duties or the individual knows a matter involving the trust would be materially affected by the information.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-105. Default and mandatory rules.
(a) Except as otherwise provided in the terms of the trust, this article governs the duties and powers of a trustee, relations among trustees, and the rights and interests of a beneficiary.
(b) The terms of a trust prevail over any provision of this article except:
(1) the requirements for creating a trust;
(2) the duty of a trustee to act in good faith and in accordance with the purposes of the trust;
(3) the requirement that a trust and its terms be for the benefit of its beneficiaries, and that the trust have a purpose that is lawful and possible to achieve;
(4) the power of the court to modify or terminate a trust under Sections 62-7-410 through 62-7-416;
(5) the effect of a spendthrift provision and the rights of certain creditors and assignees to reach a trust as provided in Part 5;
(6) the limitations on the ability of a settlor's agent under a power of attorney to revoke, amend, or make distributions from a revocable trust pursuant to Section 62-7-602A;
(7) the power of the court under Section 62-7-708(b) to adjust a trustee's compensation specified in the terms of the trust which is unreasonably low or high;
(8) the effect of an exculpatory term under Section 62-7-1008;
(9) the rights under Sections 62-7-1010 through 62-7-1013 of a person other than a trustee or beneficiary;
(10) periods of limitation for commencing a judicial proceeding;
(11) the power of the court to take such action and exercise such jurisdiction as may be necessary in the interests of justice; and
(12) the subject matter jurisdiction of the court and venue for commencing a proceeding as provided in Sections 62-7-201 and 62-7-204.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 45, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-106. Common law of trusts; principles of equity.
The common law of trusts and principles of equity supplement this article, except to the extent modified by this article or another statute of this State.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-107. Governing law.
The meaning and effect of the terms of a trust are determined by:
(1) the law of the jurisdiction designated in the terms of the trust; or
(2) in the absence of a controlling designation in the terms of the trust, the law of the jurisdiction having the most significant relationship to the matter at issue.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-108. Principal place of administration.
(a) Unless otherwise designated by the terms of a trust, the principal place of administration of a trust is the trustee's usual place of business where the records pertaining to the trust are kept, or at the trustee's residence if he has no such place of business. In the case of cotrustees, the principal place of administration, if not otherwise designated in the trust instrument, is:
(1) the usual place of business of the corporate trustee if there is but one corporate cotrustee, or
(2) the usual place of business or residence of the individual trustee who is a professional fiduciary if there is but one such person and no corporate cotrustee, and otherwise
(3) the usual place of business or residence of any of the cotrustees as agreed upon by them.
(b) Without precluding other means for establishing a sufficient connection with the designated jurisdiction, terms of a trust designating the principal place of administration are valid and controlling if:
(1) a trustee's principal place of business is located in or a trustee is a resident of the designated jurisdiction; or
(2) all or part of the administration occurs in the designated jurisdiction.
(c) A trustee is under a continuing duty to administer the trust at a place appropriate to its purposes, its administration, and the interests of the beneficiaries.
(d) Without precluding the right of the court to order, approve, or disapprove a transfer, the trustee, in furtherance of the duty prescribed by subsection (c), may transfer the trust's principal place of administration to another State or to a jurisdiction outside of the United States.
(e) Unless otherwise designated in the trust, the trustee shall notify the qualified beneficiaries of a proposed transfer of a trust's principal place of administration not less than ninety days before initiating the transfer. The notice of proposed transfer must include:
(1) the name of the jurisdiction to which the principal place of administration is to be transferred;
(2) the address and telephone number at the new location at which the trustee can be contacted;
(3) an explanation of the reasons for the proposed transfer;
(4) the date on which the proposed transfer is anticipated to occur; and
(5) the date, not less than ninety days after the giving of the notice, by which the qualified beneficiary must notify the trustee of an objection to the proposed transfer.
(f) The authority of a trustee under this section to transfer a trust's principal place of administration terminates if a qualified beneficiary notifies the trustee of an objection to the proposed transfer on or before the date specified in the notice.
(g) In connection with a transfer of the trust's principal place of administration, the trustee may transfer some or all of the trust property to a successor trustee designated in the terms of the trust or appointed pursuant to Section 62-7-704.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-109. Methods and waiver of notice.
(a) Notice to a person under this article or the sending of a document to a person under this article must be accomplished in a manner reasonably suitable under the circumstances and likely to result in receipt of the notice or document. Permissible methods of notice or for sending a document include first-class mail, personal delivery, delivery to the person's last known place of residence or place of business, or a properly directed electronic message.
(b) Notice otherwise required under this article or a document otherwise required to be sent under this article need not be provided to a person whose identity or location is unknown to and not reasonably ascertainable by the trustee.
(c) Notice under this article or the sending of a document under this article may be waived by the person to be notified or sent the document.
(d) If notice of a hearing on any petition is required and, except for specific notice requirements as otherwise provided, the petitioner shall cause notice of the time and place of hearing of any petition to be given to any interested person or his attorney if he has appeared by attorney or requested that notice be sent to his attorney. Notice shall be given:
(1) by mailing a copy thereof at least twenty days before the time set for the hearing by certified, registered, or ordinary first class mail addressed to the person being notified at the post office address given in his request for notice, if any, or at his office or place of residence, if known;
(2) by delivering a copy thereof to the person being notified personally at least twenty days before the time set for the hearing; or
(3) if the address or identity of any person is not known and cannot be ascertained with reasonable diligence by publishing a copy thereof in the same manner as required by law in the case of the publication of a summons for an absent defendant in the court of common pleas.
(e) The court for good cause shown may provide for a different method or time of giving notice for any hearing.
(f) Proof of the giving of notice shall be made on or before the hearing and filed in the proceeding.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-110. Requirement of notice to others.
(a) Whenever notice to qualified beneficiaries of a trust is required under this article, the trustee must also give notice to any other beneficiary who has sent the trustee a request for notice.
(b) A charitable organization expressly designated to receive distributions under the terms of a charitable trust has the rights of a qualified beneficiary under this article if the charitable organization, on the date the charitable organization's qualification is being determined:
(A) is a distributee or permissible distributee of trust income or principal;
(B) would be a distributee or permissible distributee of trust income or principal upon the termination of the interests of other distributees or permissible distributees then receiving or eligible to receive distributions; or
(C) would be a distributee or permissible distributee of trust income or principal if the trust terminated on that date.
(c) A person appointed to enforce a trust created for the care of an animal or another noncharitable purpose as provided in Section 62-7-408 or 62-7-409 has the rights of a qualified beneficiary under this article.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-111. Nonjudicial settlement agreements.
(a) For purposes of this section, "interested persons" means persons whose consent would be required in order to achieve a binding settlement were the settlement to be approved by the court.
(b) Interested persons may enter into a binding nonjudicial settlement agreement with respect to only the following trust matters:
(1) the approval of a trustee's report or accounting;
(2) direction to a trustee to perform or refrain from performing a particular administrative act or the grant to a trustee of any necessary or desirable administrative power;
(3) the resignation or appointment of a trustee and the determination of a trustee's compensation;
(4) transfer of a trust's principal place of administration; and
(5) liability of a trustee for an action relating to the trust.
(c) Any interested person may request the court to approve a nonjudicial settlement agreement, to determine whether the representation as provided in Part 3 was adequate, and to determine whether the agreement contains terms and conditions the court could have properly approved.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-112. Rules of construction.
The rules of construction that apply in this State to the interpretation of and disposition of property by will also apply as appropriate to the interpretation of the terms of a trust and the disposition of the trust property.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 2
Judicial Proceedings
SECTION 62-7-201. Role of court in administration of trust.
(a) Subject to the provisions of Section 62-1-302(d), the probate court has exclusive jurisdiction of proceedings initiated by interested parties concerning the internal affairs of trusts. These proceedings must be formal as defined by Section 62-1-201(17) but consent petitions are not subject to the requirements of formal proceedings. Proceedings that may be maintained pursuant to this section are those concerning the administration and distribution of trusts, the declaration of rights, and the determination of other matters involving trustees and beneficiaries of trusts. These include, but are not limited to, proceedings to:
(1) ascertain beneficiaries, determine a question arising in the administration or distribution of a trust including questions of construction of trust instruments, instruct trustees, and determine the existence or nonexistence of any immunity, power, privilege, duty, or right;
(2) review and settle interim or final accounts;
(3) review the propriety of employment of a person by a trustee including an attorney, auditor, investment advisor or other specialized agent or assistant, and the reasonableness of the compensation of a person so employed, and the reasonableness of the compensation determined by the trustee for his own services. A person who has received excessive compensation from a trust may be ordered to make appropriate refunds. The provisions of this section do not apply to the extent there is a contract providing for the compensation to be paid for the trustee's services or if the trust directs otherwise; and
(4) appoint or remove a trustee.
(b) A proceeding under this section does not result in continuing supervisory proceedings. The management and distribution of a trust estate, submission of accounts and reports to beneficiaries, payment of trustee's fees and other obligations of a trust, acceptance and change of trusteeship, and other aspects of the administration of a trust shall proceed expeditiously consistent with the terms of the trust, free of judicial intervention and without order, approval, or other action of any court, subject to the jurisdiction of the court as invoked by interested parties or as otherwise exercised as provided by law or by the terms of the trust.
(c) The probate court has concurrent jurisdiction with the circuit courts of this State of actions and proceedings concerning the external affairs of trusts. These include, but are not limited to, the following proceedings:
(1) determine the existence or nonexistence of trusts created other than by will;
(2) actions by or against creditors or debtors of trusts; and
(3) other actions and proceedings involving trustees and third parties.
(d) The probate court has concurrent jurisdiction with the circuit courts of this State over attorney's fees. Attorney's fees may be set at a fixed or hourly rate or by contingency fee.
(e) The court will not, over the objection of a party, entertain proceedings under this section involving a trust registered or having its principal place of administration in another state, unless:
(1) when all appropriate parties could not be bound by litigation in the courts of the state where the trust is registered or has its principal place of administration; or
(2) when the interests of justice otherwise would seriously be impaired.
The court may condition a stay or dismissal of a proceeding under this section on the consent of any party to jurisdiction of the state in which the trust is registered or has its principal place of business, or the court may grant a continuance or enter any other appropriate order.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 46, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-202. Jurisdiction over trustee and beneficiary.
(a) By accepting the trusteeship of a trust having its principal place of administration in this State or by moving the principal place of administration to this State, the trustee submits personally to the jurisdiction of the courts of this State regarding any matter involving the trust.
(b) With respect to their interests in the trust, the beneficiaries of a trust having its principal place of administration in this State are subject to the jurisdiction of the courts of this State regarding any matter involving the trust. By accepting a distribution from such a trust, the recipient submits personally to the jurisdiction of the courts of this State regarding any matter involving the trust.
(c) This section does not preclude other methods of obtaining jurisdiction over a trustee, beneficiary, or other person receiving property from the trust.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-204. Venue.
(a) Except as otherwise provided in subsection (b), venue for a judicial proceeding involving a trust is in the county of this State in which the trust's principal place of administration is or will be located and, if the trust is created by will and the estate is not yet closed, in the county in which the decedent's estate is being administered.
(b) If a trust has no trustee, venue for a judicial proceeding for the appointment of a trustee is in a county in which any trust property is located or the county where the last trustee had its principal place of administration, and if the trust is created by will, in the county in which the decedent's estate was or is being administered.
(c) If proceedings concerning the same trust could be maintained in more than one place in South Carolina, the court in which the proceeding is first commenced has the exclusive right to proceed.
(d) If proceedings concerning the same trust are commenced in more than one court of South Carolina, the court in which the proceeding was first commenced shall continue to hear the matter, and the other courts shall hold the matter in abeyance until the question of venue is decided, and, if the ruling court determines that venue is properly in another court, it shall transfer the proceeding to the other court.
(e) If a court transfers venue of a proceeding concerning a trust to a court in another county, venue for that proceeding, and any subsequent matters concerning that proceeding, including appeals, shall be retained by the county to which the venue has been transferred.
(f) If a probate court judge is disqualified from matters concerning a trust proceeding, and venue has not been transferred to another county, a special probate court judge appointed for that proceeding has all of the powers and duties appertaining to the probate court judge of the county where the proceeding commenced, and venue for any subsequent matters concerning that proceeding, including appeals, remains with the county where that proceeding or file commenced.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 3
Representation
SECTION 62-7-301. When parties bound by others.
(a) For purposes of this part, "beneficiary representative" refers to a person who may represent and bind another person concerning the affairs of trusts.
(b) Notice to a beneficiary representative has the same effect as if notice were given directly to the represented person. Notice of a hearing on any petition in a judicial proceeding must be given pursuant to Section 62-7-109(d).
(c) The consent of a beneficiary representative is binding on the person represented unless the person represented objects to the representation before the consent would otherwise have become effective.
(d) Except as otherwise provided in Sections 62-7-411 and 62-7-602, a person who under this part may represent a settlor who lacks capacity may receive notice and give a binding consent on the settlor's behalf.
(e) In judicial proceedings, orders binding a beneficiary representative under this part bind the person(s) represented by that beneficiary representative.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-302. Representation by holder of general testamentary power of appointment.
To the extent there is no conflict of interest between the holder of a presently exercisable general power of appointment and the persons represented with respect to the particular question or dispute, the holder may represent and bind persons whose interests, as permissible appointees, takers in default, or otherwise, are subject to the power. The term "presently exercisable general power of appointment" includes a testamentary general power of appointment having no conditions precedent to its exercise other than the death of the holder, the validity of the holder's last Will and Testament, and the inclusion of a provision in the Will sufficient to exercise this power.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-303. Representation by fiduciaries and parents.
(a) To the extent there is no conflict of interest between the following beneficiary representatives and the person represented or among those being represented with respect to a particular question or dispute:
(1) a conservator may represent and bind the estate that the conservator controls to the extent of the powers and authority conferred upon conservators generally or by court order;
(2) a guardian may represent and bind the ward if a conservator of the ward's estate has not been appointed to the extent of the powers and authority conferred upon guardians generally or by court order;
(3) an agent may represent and bind the principal to the extent the agent has authority to act with respect to the particular question or dispute;
(4) a trustee may represent and bind the beneficiaries of the trust with respect to questions or disputes involving the trust;
(5) a personal representative of a decedent's estate may represent and bind persons interested in the estate with respect to questions or disputes involving the decedent's estate; and
(6) a person may represent and bind the person's minor or unborn issue if a conservator or guardian for the issue has not been appointed.
(b) The order in which the beneficiary representatives are listed above sets forth the priority each such beneficiary representative has relative to the others. In any judicial proceeding or upon petition to the court, the court for good cause may appoint a beneficiary representative having lower priority or a person having no priority.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 47, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-304. Representation by person having substantially identical interest.
Unless otherwise represented, a minor, incapacitated, or unborn individual, or a person whose identity or location is unknown and not reasonably ascertainable, may be represented by and bound by another having a substantially identical interest with respect to the particular question or dispute, but only to the extent there is no conflict of interest between the beneficiary representative and the person represented and provided the interest of the person represented is adequately represented by the beneficiary representative.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-305. Appointment of representative.
At any point in a judicial proceeding, a court may appoint a guardian ad litem to represent the interest of a minor, an incapacitated, unborn, or unascertained person, or a person whose identity or address is unknown, if the court determines that representation of the interest otherwise would be inadequate. If not precluded by conflict of interests, a guardian ad litem may be appointed to represent several persons or interests. The court shall set out its reasons for appointing a guardian ad litem as a part of the record of the proceeding.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 48, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 4
Creation, Validity, Modification, and Termination of Trusts
SECTION 62-7-401. Methods of creating trust.
(a)(1) A trust described in Section 62-7-102 may be created by:
(i) transfer of property to another person as trustee during the settlor's lifetime or by will or other disposition taking effect upon the settlor's death;
(ii) written declaration signed by the owner of property that the owner holds identifiable property as trustee; or
(iii) exercise of a power of appointment in favor of a trustee.
(2) To be valid, a trust of real property, created by transfer in trust or by declaration of trust, must be proved by some writing signed by the party creating the trust. A transfer in trust of personal property does not require written evidence, but must be proven by clear and convincing evidence, pursuant to Section 62-7-407.
(b) A trust that arises by act or operation of law does not require the existence of a writing.
(c) A revocable inter vivos trust may be created either by declaration of trust or by a transfer of property and is not rendered invalid because the settler retains substantial control over the trust including, but not limited to, (i) a right of revocation, (ii) substantial beneficial interests in the trust, or (iii) the power to control investments or reinvestments. This subsection does not prevent a finding that a revocable inter vivos trust, enforceable for other purposes, is illusory for purposes of determining a spouse's elective share rights pursuant to Article 2, Title 62. A finding that a revocable inter vivos trust is illusory and thus invalid for purposes of determining a spouse's elective share rights pursuant to Article 2, Title 62 does not render that revocable inter vivos trust invalid, but allows inclusion of the trust assets as part of the probate estate of the settlor only for the purpose of calculating the elective share. In that event, the trust property that passes or has passed to the surviving spouse, including a beneficial interest of the surviving spouse in that trust property, must be applied first to satisfy the elective share and to reduce contributions due from other recipient of transfers including the probate estate, and the trust assets are available for satisfaction of the elective share only to any remaining extent necessary pursuant to Section 62-2-207.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 181, § 2, eff May 28, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-402. Requirements for creation; merger of title.
(a) A trust is created only if:
(1) the settlor has capacity to create a trust;
(2) the settlor indicates an intention to create the trust;
(3) the trust has a definite beneficiary or is:
(A) a charitable trust;
(B) a trust for the care of an animal, as provided in Section 62-7-408; or
(C) a trust for a noncharitable purpose, as provided in Section 62-7-409;
(4) the trustee has duties to perform; and
(5) the same person is not the sole trustee and sole current and future beneficiary.
(b) If the trust agreement is in writing, the trust instrument may be signed by the settlor or in the settlor's name by some other person in the settlor's presence and by the settlor's direction.
(c) A beneficiary is definite if the beneficiary can be ascertained now or in the future, subject to any applicable rule against perpetuities.
(d) A power in a trustee to select a beneficiary from an indefinite class is valid. If the power is not exercised within a reasonable time, the power fails and the property subject to the power passes to the persons who would have taken the property had the power not been conferred.
(e) For purposes of Section 62-7-402(a)(5), if a person holds legal title to property in a fiduciary capacity and also has an equitable or beneficial title in the same property, either by transfer, by declaration, or by operation of law, no merger of the legal and equitable titles shall occur unless:
(1) the fiduciary is the sole fiduciary and is also the sole current and future beneficiary; and
(2) the legal title and the equitable title are of the same quality and duration.
If either one of these conditions is not met, no merger may occur and the fiduciary relationship does not terminate.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-403. Trusts created in other jurisdictions.
A trust not created by will is validly created if its creation complies with the law of the jurisdiction in which the trust instrument was executed, or the law of the jurisdiction in which, at the time of creation:
(1) the settlor was domiciled, had a place of abode, or was a national;
(2) a trustee was domiciled or had a place of business; or
(3) any trust property was located.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-404. Trust purposes.
A trust may be created only to the extent its purposes are lawful, not contrary to public policy, and possible to achieve. A trust and its terms must be for the benefit of its beneficiaries.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-405. Charitable purposes; enforcement.
(a) A charitable trust may be created for the relief of distress or poverty, the advancement of education or religion, the promotion of health, scientific, literary, benevolent, governmental or municipal purposes, or other purposes, the achievement of which purposes is beneficial to the community.
(b) If the terms of a charitable trust do not indicate a particular charitable purpose or beneficiary, the court may select one or more charitable purposes or beneficiaries. The selection must be consistent with the settlor's intention to the extent it can be ascertained.
(c) The settlor of a charitable trust, the trustee, and the Attorney General, among others may maintain a proceeding to enforce the trust.
(d) Unless otherwise required by statute or by rule or regulation of the Attorney General, the trustees of charitable trusts shall not be required to file with the Attorney General any copies of trusts instruments or reports concerning the activities of charitable trusts.
(e) The Attorney General may make such rules and regulations relating to the information to be contained with the filing of a trust as may be required.
(f) All trustees of any trust governed by the laws of this State whose governing instrument does not expressly provide that this section shall not apply to such trust are required to act or to refrain from acting so as not to subject the trust to the taxes imposed by Sections 4941, 4942, 4943, 4944, or 4945 of the Internal Revenue Code, or corresponding provisions of any subsequent United States internal revenue law.
(g) Nothing contained in Sections 33-31-150 and 33-31-151 may be construed to cause a forfeiture or reversion of any of the property of a trust which is subject to such Sections, or to make the purposes of the trust impossible of accomplishment.
HISTORY: 2005 Act No. 66, § 1; 2006 Act No. 330, § 1; 2006 Act No. 365, § 2; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-406. Creation of trust induced by fraud, duress, or undue influence.
A trust is voidable to the extent its creation was induced by fraud, duress, or undue influence.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-407. Evidence of oral trust.
Except as otherwise required by statute, a trust need not be evidenced by a trust instrument. The creation of an oral trust and its terms may be established only by clear and convincing evidence.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-408. Trust for care of animal.
(a) A trust may be created to provide for the care of an animal or animals alive or in gestation during the settlor's lifetime, whether or not alive at the time the trust is created. The trust terminates upon the death of the last surviving animal.
(b) A trust authorized by this section may be enforced by a person appointed in the terms of the trust or, if no person is so appointed, by a person appointed by the court. A person concerned for the welfare of the animal may request the court to appoint a person to enforce the trust or to remove a person appointed.
(c) Property of a trust authorized by this section may be applied only to its intended use, except to the extent the court determines that the value of the trust property exceeds the amount required for the intended use. Except as otherwise provided in the terms of the trust, property not required for the intended use must be distributed to the settlor, if then living, otherwise to the settlor's successors in interest.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-409. Noncharitable trust without ascertainable beneficiary.
Except as otherwise provided in this section or by another statute, the following rules apply:
(1) A trust may be created for a noncharitable purpose without a definite or definitely ascertainable beneficiary or for a noncharitable but otherwise valid purpose to be selected by the trustee. The trust may not be enforced for more than the period allowed under any rule against perpetuities applicable under South Carolina law, except for the care and maintenance of a cemetery or cemetery plots, graves, mausoleums, columbaria, grave markers, or monuments.
(2) A trust authorized by this section may be enforced by a person appointed in the terms of the trust or, if no person is so appointed, by a person appointed by the court.
(3) Property of a trust authorized by this section may be applied only to its intended use, except to the extent the court determines that the value of the trust property exceeds the amount required for the intended use. Except as otherwise provided in the terms of the trust, property not required for the intended use must be distributed to the settlor, if then living, otherwise to the settlor's successors in interest.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-410. Modification or termination of trust; proceedings for approval or disapproval.
(a) In addition to the methods of termination prescribed by Sections 62-7-411 through 62-7-414, a trust terminates to the extent the trust is revoked or expires pursuant to its terms.
(b) A proceeding to approve or disapprove a proposed modification or termination under Sections 62-7-411 through 62-7-416, or trust combination or division under Section 62-7-417, may be commenced by a trustee or beneficiary, and a proceeding to approve or disapprove a proposed modification or termination under Section 62-7-411 may be commenced by the settlor. The settlor of a charitable trust as well as the Attorney General, among others, may maintain a proceeding to modify the trust under Section 62-7-413.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-411. Modification or termination of noncharitable irrevocable trust by consent with court approval.
(a) A noncharitable irrevocable trust may be modified or terminated with court approval upon consent of the settlor and all beneficiaries, even if the modification or termination is inconsistent with a material purpose of the trust. A settlor's power to consent to a trust's modification or termination may be exercised by an agent under a power of attorney only to the extent expressly authorized by the power of attorney or the terms of the trust; by the settlor's conservator with the approval of the court supervising the conservator if an agent is not so authorized; or by the settlor's guardian with the approval of the court supervising the guardianship if an agent is not so authorized and a conservator has not been appointed.
(b) A noncharitable irrevocable trust may be terminated upon consent of all beneficiaries if the court concludes that continuance of the trust is not necessary to achieve any material purpose of the trust. A noncharitable irrevocable trust may be modified upon consent of all of the beneficiaries if the court concludes that modification is not inconsistent with a material purpose of the trust.
(c) Upon termination of a trust under subsection (a) or (b), the trustee shall distribute the trust property as ordered by the court.
(d) If not all of the beneficiaries consent to a proposed modification or termination of the trust under subsection (a) or (b), the modification or termination may be approved by the court if the court is satisfied that:
(1) if all of the beneficiaries had consented, the trust could have been modified or terminated under this section; and
(2) the interests of a beneficiary who does not consent will be adequately protected.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-412. Modification or termination because of unanticipated circumstances or inability to administer trust effectively.
(a) The court may modify the administrative or dispositive terms of a trust or terminate the trust if, because of circumstances not anticipated by the settlor, modification or termination will further the purposes of the trust. To the extent practicable, the modification must be made in accordance with the settlor's probable intention.
(b) The court may modify the administrative terms of a trust if continuation of the trust on its existing terms would be impracticable or wasteful or impair the trust's administration.
(c) Upon termination of a trust under this section, the trustee shall distribute the trust property as ordered by the court.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-413. Equitable deviation.
(a) Except as otherwise provided in subsection (b), if a particular charitable purpose becomes unlawful, impracticable, impossible to achieve, or wasteful:
(1) the trust does not fail, in whole or in part;
(2) the trust property does not revert to the settlor or the settlor's successors in interest; and
(3) the court may deviate from the terms of the trust to modify or terminate the trust by directing that the trust property be applied or distributed, in whole or in part, in a manner consistent with the settlor's charitable intent.
(b) A provision in the terms of a charitable trust that would result in distribution of the trust property to a noncharitable beneficiary prevails over the power of the court under subsection (a) to modify or terminate the trust only if, when the provision takes effect:
(1) the trust property is to revert to the settlor and the settlor is still living; or
(2) fewer than the number of years allowed under any rule against perpetuities applicable under South Carolina law, have elapsed since the date of the trust's creation.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-414. Modification or termination of uneconomic trust.
(a) After notice to the qualified beneficiaries, and without court approval, the trustee of a trust consisting of trust property having a total value less than one hundred thousand dollars may terminate the trust if the trustee concludes that the value of the trust property is insufficient to justify the cost of administration.
(b) The court may modify or terminate a trust or remove the trustee and appoint a different trustee if it determines that the value of the trust property is insufficient to justify the cost of administration.
(c) Upon termination of a trust under this section, the trustee shall distribute the trust property as ordered by the court or, if the court does not specify the manner of distribution, or if no court approval is required, in a manner consistent with the purposes of the trust.
(d) This section does not apply to an easement for conservation or preservation.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 49, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-415. Reformation to correct mistakes.
The court may reform the terms of a trust, even if unambiguous, to conform the terms to the settlor's intention if it is proved by clear and convincing evidence what the settlor's intention was and that the terms of the trust were affected by a mistake of fact or law, whether in expression or inducement.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-416. Modification to achieve settlor's tax objectives.
To achieve the settlor's tax objectives, the court may modify the terms of a trust in a manner that is not contrary to the settlor's probable intention. The court may provide that the modification has retroactive effect.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-417. Combination and division of trusts.
After notice to the qualified beneficiaries, a trustee may combine two or more trusts into a single trust or divide a trust into two or more separate trusts, if the result does not impair rights of any beneficiary or adversely affect achievement of the purposes of the trust.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-418. Estate and possession of trust estates shall be in beneficiaries.
(a) When any person shall be seized of any lands, tenements, rents, reversions, remainders, or other hereditaments to the use, confidence, or trust of any other person or of any body politic by reason of any bargain, sale, feoffment, covenant, contract, agreement, will, or otherwise, the person or body politic that shall have such use, confidence, or trust, in fee simple, fee tail, for term of life or for years or otherwise or any use, confidence, or trust in remainder or reversion, shall be deemed and adjudged in lawful seizing, estate and possession of and in such lands, tenements, rents, reversions, remainders, and hereditaments, with their appurtenances, to all intents, constructions, and purposes in law of and in such like estates as they shall have in use, trust, or confidence of or in them.
(b) When several persons shall be jointly seized of any lands, tenements, rents, reversions, remainders, or other hereditaments to the use, confidence, or trust of any of them that be so jointly seized, such person or persons who shall have any such use, confidence, or trust in any such lands, tenements, rents, reversions, remainders, or hereditaments shall have such estate, possession, and seizing of and in such lands, tenements, rents, reversions, remainders, and other hereditaments only to him or them that shall have any such use, confidence, or trust, in like nature, manner, form, condition, and course as he or they had before in the use, confidence, or trust of such lands, tenements, or hereditaments, saving and reserving to all and singular persons and bodies politic, their heirs and successors, other than such person or persons who are seized of such lands, tenements, or hereditaments to any use, confidence, or trust, all such right, title, entry, interest, possession, rents, and action as they or any of them had or might have had without this section and also saving to all and singular those persons and their heirs who are seized to any use all such former right, title, entry, interest, possession, rents, customs, services, and action as they or any of them might have had to his or their own proper use in or to any lands, tenements, rents, or hereditaments whereof they are seized to any other use, anything contained in this chapter to the contrary notwithstanding.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 5
Creditors' Claims; Spendthrift and Discretionary Trusts
SECTION 62-7-501. Rights of beneficiary's creditor or assignee.
(a) Except as provided in subsection (b), the court may authorize a creditor or assignee of the beneficiary to reach the beneficiary's interest by attachment of present or future distributions to or for the benefit of the beneficiary or other means. The court may limit the award to such relief as is appropriate under the circumstances.
(b) This section shall not apply and a trustee shall have no liability to any creditor of a beneficiary for any distributions made to or for the benefit of the beneficiary to the extent a beneficiary's interest:
(1) is protected by a spendthrift provision, or
(2) is a discretionary trust interest as referred to in S.C. Code Section 62-7-504.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-502. Spendthrift provision.
(a) A spendthrift provision is valid only if it restrains both voluntary and involuntary transfer of a beneficiary's interest.
(b) A term of a trust providing that the interest of a beneficiary is held subject to a "spendthrift trust", or words of similar import, is sufficient to restrain both voluntary and involuntary transfer of the beneficiary's interest.
(c) A beneficiary may not transfer an interest in a trust in violation of a valid spendthrift provision and, except as otherwise provided in this article, a creditor or assignee of the beneficiary may not reach the interest or a distribution by the trustee before its receipt by the beneficiary.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-503. Exceptions to spendthrift provision.
(a) In this section, "child" includes any person for whom an order or judgment for child support has been entered in this or another State.
(b) Even if a trust contains a spendthrift provision, a beneficiary's child who has a judgment or court order against the beneficiary for support or maintenance may obtain from a court an order attaching present or future distributions to or for the benefit of the beneficiary.
(c) The exception in subsection (b) is unenforceable against a special needs trust, supplemental needs trust, or similar trust established for a disabled person if the applicability of such a provision could invalidate such a trust's exemption from consideration as a countable resource for Medicaid or Supplemental Security Income (SSI) purposes or if the applicability of such a provision has the effect or potential effect of rendering such disabled person ineligible for any program of public benefit, including, but not limited to, Medicaid and SSI.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-504. Discretionary trusts; effect of standard.
(a) In this section, "child" includes any person for whom an order or judgment for child support has been entered in this or another state.
(b) Except as otherwise provided in subsection (c), a creditor of a beneficiary may not compel a distribution from a trust in which the beneficiary has a discretionary trust interest, even if:
(1) the discretion is expressed in the form of a standard of distribution; or
(2) the trustee has abused the discretion.
(c) To the extent a trustee has not complied with a standard of distribution or has abused a discretion:
(1) a distribution may be ordered by the court to satisfy a judgment or court order against the beneficiary for support or maintenance of the beneficiary's child; and
(2) the court shall direct the trustee to pay to the child such amount as is equitable under the circumstances but not more than the amount the trustee would have been required to distribute to or for the benefit of the beneficiary had the trustee complied with the standard or not abused the discretion.
(d) This section does not limit the right of a beneficiary to maintain a judicial proceeding against a trustee for an abuse of discretion or failure to comply with a standard for distribution; provided, however, this right may not be exercised by a creditor of the beneficiary.
(e) Whether or not a trust contains a spendthrift provision, a creditor of a beneficiary may not compel a distribution from insurance proceeds payable to the trustee as beneficiary to the extent state law exempts such insurance proceeds from creditors' claims.
(f) A creditor of a beneficiary who is also a trustee or cotrustee may not reach the trustee's beneficial interest or otherwise compel a distribution if the trustee's discretion to make distributions for the trustee's own benefit is limited by an ascertainable standard.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-505. Creditors' claims against settlor.
(a) Whether or not the terms of a trust contain a spendthrift provision, the following rules apply:
(1) During the lifetime of the settlor, the property of a revocable trust is subject to claims of the settlor's creditors.
(2) With respect to an irrevocable trust, a creditor or assignee of the settlor may reach the maximum amount that can be distributed to or for the settlor's benefit. If a trust has more than one settlor, the amount the creditor or assignee of a particular settlor may reach may not exceed the settlor's interest in the portion of the trust attributable to that settlor's contribution.
(3) After the death of a settlor, and subject to the settlor's right to direct the source from which liabilities will be paid, and except to the extent state or federal law exempts any property of the trust from claims, costs, expenses, or allowances, the property held in a revocable trust at the time of the settlor's death is subject to claims of the settlor's creditors, costs of administration of the settlor's estate, the expenses of the settlor's funeral and disposal of remains, and statutory allowances to a surviving spouse and children to the extent the settlor's probate estate is inadequate to satisfy those claims, costs, expenses, and allowances, unless barred by Section 62-3-801 et seq.
(b) For purposes of this section:
(1) a beneficiary who is a trustee of a trust, but who is not the settlor of the trust, cannot be treated in the same manner as the settlor of a revocable trust if the beneficiary-trustee's power to make distributions to the beneficiary-trustee is limited by an ascertainable standard related to the beneficiary-trustee's health, education, maintenance, and support;
(2) the assets in a trust that are attributable to a contribution to an inter vivos marital deduction trust described in either Section 2523(e) or (f) of the Internal Revenue Code of 1986, after the death of the spouse of the settlor of the inter vivos marital deduction trust are deemed to have been contributed by the settlor's spouse and not by the settlor.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 50, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-506. Overdue distribution.
Whether or not a trust contains a spendthrift provision, a creditor or assignee of a beneficiary may reach a mandatory distribution of income or principal, including a distribution upon termination of the trust, if the trustee has not made the distribution to the beneficiary within a reasonable time after the designated distribution date. For purposes of this section, a mandatory distribution is a distribution where the trustee has no discretion in determining whether the distribution shall be made or the amount or timing of such distribution.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-507. Personal obligations of trustee.
Trust property is not subject to personal obligations of the trustee, even if the trustee becomes insolvent or bankrupt.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 6
Revocable Trusts
SECTION 62-7-601. Capacity of settlor of revocable trust.
The capacity required to create, amend, revoke, or add property to a revocable trust, or to direct the actions of the trustee of a revocable trust, is the same as that required to make a will.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-602. Revocation or amendment of revocable trust.
(a) Unless the terms of a trust expressly provide that the trust is irrevocable, the settlor may revoke or amend the trust. This subsection does not apply to a trust created under an instrument executed before the effective date of this article.
(b) If a revocable trust is created or funded by more than one settlor:
(1) to the extent the trust consists of community property, the trust may be revoked by either spouse acting alone but may be amended only by joint action of both spouses; and
(2) to the extent the trust consists of property other than community property, each settlor may revoke or amend the trust with regard to the portion of the trust property attributable to that settlor's contribution; and
(3) upon the revocation or amendment of the trust by fewer than all of the settlors, the trustee shall promptly notify the other settlors of the revocation or amendment.
(c) The settlor may revoke or amend a revocable trust:
(1) by substantial compliance with a method provided in the terms of the trust; or
(2) if the terms of the trust do not provide a method or the method provided in the terms is not expressly made exclusive, by:
(A) a later will or codicil that expressly refers to the trust, manifesting clear and convincing evidence of the settlor's intent; or
(B) by oral statement to the trustee if the trust was created orally; or
(C) any other written method, other than a later will or codicil, delivered to the trustee and manifesting clear and convincing evidence of the settlor's intent.
(d) Upon revocation of a revocable trust, the trustee shall deliver the trust property as the settlor directs.
(e) [Reserved.]
(f) A conservator of the settlor or, if no conservator has been appointed, a guardian of the settlor may exercise a settlor's powers with respect to revocation, amendment, or distribution of trust property only with the approval of the court supervising the conservatorship or guardianship and with regard to the requirements of Section 62-5-408 (3)(c).
(g) A trustee who does not know that a trust has been revoked or amended is not liable to the settlor or settlor's successors in interest for distributions made and other actions taken on the assumption that the trust had not been amended or revoked.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-602A. Powers of agent acting pursuant to power of attorney.
(a) An agent acting pursuant to a power of attorney may exercise the following powers of the settlor with respect to a revocable trust only to the extent expressly authorized by the terms of the trust or the power of attorney:
(1) revocation of the trust;
(2) amendment of the trust;
(3) additions to the trust;
(4) direction to dispose of property of the trust;
(5) creation of the trust, notwithstanding the provisions of Section 62-7-402(a)(1) and (2).
(b) An agent acting pursuant to a power of attorney may exercise the following powers of the settlor with respect to an irrevocable trust only to the extent expressly authorized by the terms of the trust or the power of attorney:
(1) additions to the trust;
(2) creation of the trust, notwithstanding the provisions of Section 62-7-402(a)(1) and (2).
(c) The exercise of the powers described in subsection (a) and (b) shall not alter the amount of property beneficiaries are to receive on the settlor's death under the settlor's existing will or other estate planning documents or in the absence thereof in accordance with the law of intestate succession.
HISTORY: 2005 Act No. 66, § 1; 1976 Code § 62-7-602(e); 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-603. Settlor's powers.
While a trust is revocable, rights of the beneficiaries are subject to the control of, and the duties of the trustee are owed exclusively to, the settlor.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-604. Limitation on action contesting validity of revocable trust; distribution of trust property.
(a) A person must commence a judicial proceeding to contest the validity of a trust that was revocable at the settlor's death within the earlier of:
(1) one year after the settlor's death; or
(2) one hundred twenty days after the trustee sent the person a copy of the trust instrument and a notice informing the person of the trust's existence, of the trustee's name and address, and of the time allowed for commencing a proceeding.
(b) Upon the death of the settlor of a trust that was revocable at the settlor's death, the trustee may proceed to distribute the trust property in accordance with the terms of the trust. The trustee is not subject to liability for doing so unless:
(1) the trustee knows of a pending judicial proceeding contesting the validity of the trust; or
(2) a potential contestant has notified the trustee of a possible judicial proceeding to contest the trust and a judicial proceeding is commenced within one hundred twenty days after the contestant sent the notification.
(c) A beneficiary of a trust that is determined to have been invalid is liable to return any distribution received.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 51, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-605. Effect of penalty clause for contest.
A provision in a revocable trust purporting to penalize any interested person for contesting the validity of the trust or instituting other proceedings relating to the trust is unenforceable if probable cause exists for instituting proceedings.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-606. Anti-lapse provision in trust.
(A) Unless the trust expressly provides otherwise, if the beneficiary under a revocable trust, who is a great-grandparent or a lineal descendant of a great-grandparent of the settlor, is dead at the time of execution of the trust, fails to survive the settlor, or is treated as if he predeceased the settlor, the issue of the deceased beneficiary who survived the settlor take in place of the deceased beneficiary and if they are all of the same degree of kinship to the beneficiary they take equally, but if of unequal degree then those of more remote degree take by representation. One who would have been a beneficiary under a class gift if he had survived the settlor is treated as a beneficiary for purposes of this section whether his death occurred before or after the execution of the trust.
(B) Except as provided in subsection (A), if the disposition of any real or personal property under a revocable trust fails for any reason, this property becomes a part of the residue of the trust.
(C) Except as provided in subsection (A), if the residue under a revocable trust is distributed to two or more persons and the share of one of the residuary beneficiaries fails for any reason, his share passes to the other residuary beneficiary or to other residuary beneficiaries in proportion to their interests in the residue.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-607. Divorce or annulment as revoking revocable trust.
If after executing a revocable trust the settlor is divorced or the marriage annulled or the spouse is a party to a valid proceeding concluded by an order purporting to terminate all marital property rights or confirming equitable distribution between spouses, the divorce or annulment or order revokes any disposition or appointment of property including beneficial interests made by such trust to the spouse, any provision conferring a general or special power of appointment on the spouse, and any nomination of the spouse as trustee, unless the trust expressly provides otherwise. Property prevented from passing to a spouse because of revocation by divorce or annulment or order passes as if the spouse failed to survive the settlor, and other provisions conferring some power or office on this spouse are interpreted as if the spouse failed to survive the settlor. If these provisions for the spouse are revoked solely by this section, they are revived by the settlor's remarriage to the former spouse. For purposes of this section, divorce or annulment or order means any divorce or annulment or order which would exclude the spouse as a surviving spouse within the meaning of subsections (a) and (b) of Section 62-2-802. A decree of separate maintenance which does not terminate the status of husband and wife is not a divorce for purposes of this section. No change of marital circumstances other than as described in this section revokes a disposition to a spouse in a revocable trust.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 7
Office of Trustee
SECTION 62-7-701. Accepting or declining trusteeship.
(a) Except as otherwise provided in subsection (c), a person designated as trustee accepts the trusteeship:
(1) by substantially complying with a method of acceptance provided in the terms of the trust; or
(2) if the terms of the trust do not provide a method or the method provided in the terms is not expressly made exclusive, by accepting delivery of the trust property, exercising powers or performing duties as trustee, or otherwise indicating acceptance of the trusteeship.
(b) A person designated as trustee who has not yet accepted the trusteeship may reject the trusteeship. A designated trustee who does not accept the trusteeship within a reasonable time after knowing of the designation is deemed to have rejected the trusteeship.
(c) A person designated as trustee, without accepting the trusteeship, may:
(1) act to preserve the trust property if, within a reasonable time after acting, the person sends a rejection of the trusteeship to the settlor or, if the settlor is dead or lacks capacity, to a qualified beneficiary; and
(2) inspect or investigate trust property to determine potential liability under environmental or other law or for any other purpose.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-702. Trustee's bond.
(a) A trustee shall provide bond to secure the performance of the trustee's duties if:
(1) the terms of the governing instrument require the trustee to provide bond;
(2) a beneficiary requests the trustee to provide bond and the court finds the request to be reasonable; or
(3) the court finds that it is necessary for the trustee to provide bond in order to protect the interests of the beneficiaries who are not able to protect themselves and whose interests otherwise are not adequately represented.
However, in no event shall bond be required of a trustee, including a trustee appointed by the court, if the governing instrument directs otherwise. On petition of the trustee or other interested person, the court may excuse a requirement of bond, reduce the amount of the bond, release the surety, or permit the substitution of another bond with the same or different sureties.
(b) If bond is required, it shall be filed in the court in the place in which the trust has its principal place of administration in amounts and with sureties and liabilities consistent with the requirements of South Carolina Code Sections 62-3-604 relating to bonds of personal representatives.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-703. Cotrustees.
(a) Cotrustees who are unable to reach a unanimous decision may act by majority decision.
(b) If a vacancy occurs in a cotrusteeship, the remaining cotrustees may act for the trust.
(c) A cotrustee must participate in the performance of a trustee's function unless the cotrustee is unavailable to perform the function because of absence, illness, disqualification under other law, or other temporary incapacity or the cotrustee has properly delegated the performance of the function to another trustee.
(d) If a cotrustee is unavailable to perform duties because of absence, illness, disqualification under other law, or other temporary incapacity, and prompt action is necessary to achieve the purposes of the trust or to avoid injury to the trust property, the remaining cotrustee or a majority of the remaining cotrustees may act for the trust.
(e) A trustee may not delegate to a cotrustee the performance of a function the settlor reasonably expected the trustees to perform jointly. Unless a delegation was irrevocable, a trustee may revoke a delegation previously made.
(f) Except as otherwise provided in subsection (g), a trustee who does not join in an action of another trustee is not liable for the action.
(g) Each trustee shall exercise reasonable care to:
(1) prevent a cotrustee from committing a serious breach of trust; and
(2) compel a cotrustee to redress a serious breach of trust.
(h) A dissenting trustee who joins in an action at the direction of the majority of the trustees and who notified any cotrustee of the dissent at or before the time of the action is not liable for the action unless the action is a serious breach of trust.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-704. Vacancy in trusteeship; appointment of successor.
(a) A vacancy in a trusteeship occurs if:
(1) a person designated as trustee rejects the trusteeship;
(2) a person designated as trustee cannot be identified or does not exist;
(3) a trustee resigns;
(4) a trustee is disqualified or removed;
(5) a trustee dies; or
(6) a guardian or conservator is appointed for an individual serving as trustee.
(b) If one or more cotrustees remain in office, a vacancy in a trusteeship need not be filled. A vacancy in a trusteeship must be filled if the trust has no remaining trustee.
(c) A vacancy in a trusteeship of a noncharitable trust that is required to be filled must be filled in the following order of priority:
(1) by a person designated in the terms of the trust to act as successor trustee;
(2) by a person appointed by unanimous agreement of the qualified beneficiaries; or
(3) by a person appointed by the court.
(d) A vacancy in a trusteeship of a charitable trust that is required to be filled must be filled in the following order of priority:
(1) by a person designated in the terms of the trust to act as successor trustee;
(2) by a person selected by the charitable organizations expressly designated to receive distributions under the terms of the trust if the Attorney General concurs in the selection; or
(3) by a person appointed by the court.
(e) Whether or not a vacancy in a trusteeship exists or is required to be filled, the court may appoint an additional trustee or special fiduciary whenever the court considers the appointment necessary for the administration of the trust. The procedure for such appointment and the notice requirement shall be the same as set forth for special administrators under South Carolina Code Section 62-3-614.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-705. Resignation of trustee.
(a) A trustee may resign:
(1) upon at least 30 days notice in writing to the qualified beneficiaries, the settlor, if living, and all cotrustees; or
(2) with the approval of the court.
(b) In approving a resignation, the court may issue orders and impose conditions reasonably necessary for the protection of the trust property.
(c) Any liability of a resigning trustee or of any sureties on the trustee's bond for acts or omissions of the trustee is not discharged or affected by the trustee's resignation.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-706. Removal of trustee.
(a) For the reasons set forth in subsection (b), the settlor, a cotrustee, or a beneficiary may request the court to remove a trustee, or a trustee may be removed by the court on its own initiative.
(b) The court may remove a trustee if:
(1) the trustee has committed a serious breach of trust;
(2) lack of cooperation among cotrustees substantially impairs the administration of the trust;
(3) because of unfitness, unwillingness, or persistent failure of the trustee to administer the trust effectively, the court determines that removal of the trustee best serves the interests of the beneficiaries; or
(4) there has been a substantial change of circumstances or removal is requested by all of the qualified beneficiaries, the court finds that removal of the trustee best serves the interests of all of the beneficiaries and is not inconsistent with a material purpose of the trust, and a suitable cotrustee or successor trustee is available.
(c) Pending a final decision on a request to remove a trustee, or in lieu of or in addition to removing a trustee, the court may order such appropriate relief under Section 62-7-1001(b) as may be necessary to protect the trust property or the interests of the beneficiaries.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-707. Delivery of property by former trustee.
(a) Unless a cotrustee remains in office or the court otherwise orders, and until the trust property is delivered to a successor trustee or other person entitled to it, a trustee who has resigned or been removed has the duties of a trustee and the powers necessary to protect the trust property.
(b) A trustee who has resigned or been removed shall proceed expeditiously to deliver the trust property within the trustee's possession to the cotrustee, successor trustee, or other person entitled to it.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-708. Compensation of trustee.
(a) If the terms of a trust do not specify the trustee's compensation, a trustee is entitled to compensation that is reasonable under the circumstances.
(b) If the terms of a trust specify the trustee's compensation, the trustee is entitled to be compensated as specified, but the court may allow more or less compensation if:
(1) the duties of the trustee are substantially different from those contemplated when the trust was created; or
(2) the compensation specified by the terms of the trust would be unreasonably low or high.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-709. Reimbursement of expenses.
(a) A trustee is entitled to be reimbursed out of the trust property, with interest at the legal rate as appropriate, for:
(1) expenses that were properly incurred in the administration of the trust; and
(2) to the extent necessary to prevent unjust enrichment of the trust, expenses that were not properly incurred in the administration of the trust.
(b) An advance by the trustee of money for the protection of the trust gives rise to a lien against trust property to secure reimbursement with reasonable interest.
(c) A prospective trustee is entitled to be reimbursed from trust property for expenses reasonably incurred by the prospective trustee pursuant to Section 62-7-701(c) to protect or investigate the trust assets before deciding whether or not to accept the trusteeship.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 52, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 8
Duties and Powers of Trustee
SECTION 62-7-801. Duty to administer trust.
Upon acceptance of a trusteeship, the trustee shall administer the trust in good faith, in accordance with its terms and purposes and the interests of the beneficiaries, and in accordance with this article.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-802. Duty of loyalty.
(a) A trustee shall administer the trust solely in the interests of the beneficiaries.
(b) Subject to the rights of persons dealing with or assisting the trustee as provided in Section 62-7-1012, a sale, encumbrance, or other transaction involving the investment or management of trust property entered into by the trustee for the trustee's own personal account or which is otherwise affected by a conflict between the trustee's fiduciary and personal interests is voidable by a beneficiary affected by the transaction unless:
(1) the transaction was authorized by the terms of the trust;
(2) the transaction was approved by the court;
(3) the beneficiary did not commence a judicial proceeding within the time allowed by Section 62-7-1005;
(4) the beneficiary consented to the trustee's conduct, ratified the transaction, or released the trustee in compliance with Section 62-7-1009; or
(5) the transaction involves a contract entered into or claim acquired by the trustee before the person became or contemplated becoming trustee.
(c) A sale, encumbrance, or other transaction involving the investment or management of trust property is presumed to be affected by a conflict between personal and fiduciary interests if it is entered into by the trustee with:
(1) the trustee's spouse;
(2) the trustee's descendants, siblings, parents, or their spouses;
(3) an agent or attorney of the trustee;
(4) a corporation or other person or enterprise in which the trustee has such a substantial interest that it might affect the trustee's best judgment; and
(5) a corporation or other person or enterprise which has such a substantial interest in the trustee that it might affect the trustee's best judgment.
(d) A transaction between a trustee and a beneficiary that does not concern trust property but that occurs during the existence of the trust or while the trustee retains significant influence over the beneficiary and from which the trustee obtains an advantage is voidable by the beneficiary unless the trustee establishes that the transaction was fair to the beneficiary.
(e) A transaction not concerning trust property in which the trustee engages in the trustee's individual capacity involves a conflict between personal and fiduciary interests if the transaction concerns an opportunity properly belonging to the trust.
(f) An investment by a trustee in securities of an investment company or investment trust to which the trustee, or its affiliate, provides services in a capacity other than as trustee is not presumed to be affected by a conflict between personal and fiduciary interests if the investment otherwise complies with the prudent investor rule of Part 9. The trustee may be compensated by the investment company or investment trust for providing those services out of fees charged to the trust if the trustee at least annually notifies the persons entitled under Section 62-7-813 to receive a copy of the trustee's annual report of the rate and method by which the compensation was determined.
(g) In voting shares of stock or in exercising powers of control over similar interests in other forms of enterprise, the trustee shall act in the best interests of the beneficiaries. If the trust is the sole owner of a corporation or other form of enterprise, the trustee shall elect or appoint directors or other managers who will manage the corporation or enterprise in the best interests of the beneficiaries.
(h) This section does not preclude the following transactions, if fair to the beneficiaries:
(1) an agreement between a trustee and a beneficiary relating to the appointment or compensation of the trustee;
(2) payment of reasonable compensation to the trustee;
(3) a transaction between a trust and another trust, decedent's estate, or conservatorship of which the trustee is a fiduciary or in which a beneficiary has an interest;
(4) a deposit of trust money in a regulated financial-service institution operated by the trustee; or
(5) an advance by the trustee of money for the protection of the trust.
(i) The court may appoint a special fiduciary to make a decision with respect to any proposed transaction that might violate this section if entered into by the trustee.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-803. Impartiality.
If a trust has two or more beneficiaries, the trustee shall act impartially in investing, managing, and distributing the trust property, giving due regard to the beneficiaries' respective interests.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-804. Prudent administration.
A trustee shall administer the trust as a prudent person would, by considering the purposes, terms, distributional requirements, and other circumstances of the trust. In satisfying this standard, the trustee shall exercise reasonable care, skill, and caution.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-805. Costs of administration.
In administering a trust, the trustee may incur only costs that are reasonable in relation to the trust property, the purposes of the trust, and the skills of the trustee.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-806. Trustee's skills.
A trustee who has special skills or expertise, or is named trustee in reliance upon the trustee's representation that the trustee has special skills or expertise, shall use those special skills or expertise.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-807. Delegation by trustee.
(a) A trustee may delegate duties and powers that a prudent trustee of comparable skills could properly delegate under the circumstances. The trustee shall exercise reasonable care, skill, and caution in:
(1) selecting an agent;
(2) establishing the scope and terms of the delegation, consistent with the purposes and terms of the trust; and
(3) periodically reviewing the agent's actions in order to monitor the agent's performance and compliance with the terms of the delegation.
(b) In performing a delegated function, an agent owes a duty to the trust to exercise reasonable care to comply with the terms of the delegation.
(c) A trustee who complies with subsection (a) is not liable to the beneficiaries or to the trust for an action of the agent to whom the function was delegated.
(d) By accepting a delegation of powers or duties from the trustee of a trust that is subject to the law of this State, an agent submits to the jurisdiction of the courts of this State.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-808. Powers to direct.
(a) While a trust is revocable, the trustee may follow a direction of the settlor that is contrary to the terms of the trust.
(b) If the terms of a trust confer upon a person other than the settlor of a revocable trust power to direct certain actions of the trustee, the trustee shall act in accordance with an exercise of the power unless the attempted exercise is manifestly contrary to the terms of the trust or the trustee knows the attempted exercise would constitute a serious breach of a fiduciary duty that the person holding the power owes to the beneficiaries of the trust.
(c) The terms of a trust may confer upon a trustee or other person a power to direct the modification or termination of the trust.
(d) A person, other than a beneficiary, who holds a power to direct is presumptively a fiduciary who, as such, is required to act in good faith with regard to the purposes of the trust and the interests of the beneficiaries. The holder of a power to direct is liable for any loss that results from breach of a fiduciary duty.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-809. Control and protection of trust property.
A trustee shall take reasonable steps to take control of and protect the trust property.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-810. Recordkeeping and identification of trust property.
(a) A trustee shall keep adequate records of the administration of the trust.
(b) A trustee shall keep trust property separate from the trustee's own property.
(c) Except as otherwise provided in subsection (d), a trustee shall cause the trust property to be designated so that the interest of the trust, to the extent feasible, appears in records maintained by a party other than a trustee or beneficiary.
(d) If the trustee maintains records clearly indicating the respective interests, a trustee may invest as a whole the property of two or more separate trusts.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-811. Enforcement and defense of claims.
A trustee shall take reasonable steps to enforce claims of the trust and to defend claims against the trust.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-812. Exercise of powers by successor trustees; liability.
Unless directed otherwise by the court or by the trust instrument, a successor trustee appointed by the court or by the trust instrument succeeds to all the powers, duties, and discretionary authority given to the predecessor trustee. Upon reasonable request, a successor trustee is entitled to a statement of the accounts of the trust from a predecessor trustee. A successor trustee may accept the account rendered and shall be under no duty to examine the acts or omissions of the predecessor trustee and shall not be liable for failure to seek redress for any act or omission of the predecessor trustee. The trustee of a testamentary trust may accept the account rendered by a personal representative and shall be under no duty to examine the acts or omissions of the predecessor personal representative and shall not be liable for failure to seek redress for any act or omission of the predecessor personal representative.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-813. Duty to inform and report.
(a) Unless the terms of a trust expressly provide otherwise, while a trust is revocable the trustee's duties under this section are owed exclusively to the settlor.
(b) Unless the terms of a trust expressly provide otherwise, a trustee who accepts a trusteeship or undertakes the administration of an irrevocable trust created on or after the effective date of this article, or of a revocable trust which becomes irrevocable whether by the death of the settlor or by the terms of the trust on or after the effective date of this article, shall:
(1) within ninety days after the trustee accepts a trusteeship or undertakes administration of an irrevocable trust or a revocable trust that has become irrevocable whether by the death of the settlor or by the terms of the trust, notify the qualified beneficiaries, as defined in Section 62-7-103(12), of:
(A) the existence of the trust;
(B) the identity of the settlor or settlors;
(C) the trustee's name, address and telephone number;
(D) the right to request in writing a copy of the trust instrument; and
(E) the right to request in writing a copy of any trustee's report described in (c)(1) below;
(2) throughout the administration of the trust, keep the distributees and the permissible distributees, as defined in Section 62-7-103(21) and (25), reasonably informed about the administration of the trust and of the material facts necessary for them to protect their interests, provided that the attorney-client privilege between the trustee and the trustee's attorney is not violated;
(3) upon the reasonable written request of a beneficiary, other than a qualified beneficiary, unless unreasonable under the circumstances, provide to the beneficiary a copy of the trust instrument redacted to include only those provisions of the trust that are relevant to the beneficiary's interest in the trust, as the trustee determines and, unless unreasonable under the circumstances, respond to a beneficiary's written request for information related to the administration of the trust;
(4) notify the distributees and permissible distributees in advance of any change in the method or rate of the trustee's compensation; and
(5) notwithstanding any of the above, not be required to notify any beneficiary in advance of transactions relating to the trust property.
(c) Unless the terms of a trust expressly provide otherwise, a trustee who accepts a trusteeship or undertakes the administration of an irrevocable trust created on or after the effective date of this article, or of a revocable trust which becomes irrevocable on or after the effective date of this article, shall:
(1) have a continuing duty to:
(A) keep the distributees and permissible distributees, or other qualified beneficiaries who request information in writing, reasonably informed as to the administration of the trust; and
(B) send annually, and upon the termination of the trust, a written report of the trust property which may be in any format which provides the distributees and permissible distributees, or other qualified beneficiaries who have requested in writing, with information necessary to protect their interests. The report may include a copy of the fiduciary income tax return, or copies of bank or brokerage statements, or an informal list of assets and if feasible, the market values of those assets, the liabilities, the receipts and the disbursements, including the source and amount of the trustee's compensation;
(2) upon resignation of the trustee and unless a cotrustee remains in office, send a written report as described in (c)(1) to the distributees and permissible distributees; and in the case of the death or incapacity of a trustee, the report may be sent by the trustee's personal representative, conservator or guardian.
(d) To the extent that there is no conflict of interest, the trustee's duties to inform and report under subsections (b) and (c) are deemed satisfied if the information and report are given to the beneficiary's representative as described in Sections 62-7-302 through 62-7-305.
(e) Any distributee or permissible distributee may waive the right to a trustee's report and other information described under this section and, with respect to future reports and other information, withdraw a waiver previously given.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-814. Discretionary powers; tax savings.
(a) Notwithstanding the breadth of discretion granted to a trustee in the terms of the trust, including the use of such terms as "absolute", "sole", or "uncontrolled", the trustee shall exercise a discretionary power in good faith and in accordance with the terms and purposes of the trust and the interests of the beneficiaries.
(b) A power whose exercise is limited or prohibited by subsection (c) may be exercised by a majority of the remaining trustees whose exercise of the power is not so limited or prohibited. If the power of all trustees is so limited or prohibited, the court may appoint a special fiduciary with authority to exercise the power.
(c) Subject to subsection (d), and unless the application of this section is clearly and convincingly negated in the will, the trust document, terms of the trust, or a written instrument appointing a fiduciary, expressly indicating that a rule in this subsection does not apply, any power conferred upon the fiduciary, in his capacity as a fiduciary (and not including any power conferred upon him in his capacity as a beneficiary), which would, except for this section, constitute, in whole or in part, a general power of appointment cannot be exercised by him in favor of himself, his estate, his creditors, or the creditors of his estate.
(1) The fiduciary can, however, exercise the power in favor of someone other than himself, his estate, his creditors and the creditors of his estate.
(2) If a power comes within subsection (c) and the power is conferred upon two or more fiduciaries, it can be exercised by the fiduciary or the fiduciaries who are not disqualified from exercising the power as if they were the only fiduciary or fiduciaries.
(3) If all of the serving fiduciaries are disqualified from exercising a power, the court that would have jurisdiction to appoint a fiduciary under the instrument, if there were no fiduciary currently serving, shall exercise, or shall appoint a special fiduciary whose only power is to exercise the power that cannot be exercised by the other fiduciaries by reason of subsection (c).
(4) A trustee may not exercise a power to make discretionary distributions to satisfy a legal obligation of support that the trustee personally owes another person.
(d) Subsection (c) does not apply to:
(1) a power held by the settlor's spouse who is the trustee of a trust for which a marital deduction, as defined in Section 2056(b)(5) or 2523(e) of the Internal Revenue Code, as amended, was previously allowed;
(2) any trust during any period that the trust may be revoked or amended by its settlor; or
(3) a trust if contributions to the trust qualify for the annual exclusion under Section 2503(c) of the Internal Revenue Code as amended.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 53, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-815. General powers of trustee.
(a) A trustee, without authorization by the court, may exercise:
(1) powers conferred by the terms of the trust; and
(2) except as limited by the terms of the trust:
(A) all powers over the trust property which an unmarried competent owner has over individually owned property;
(B) any other powers appropriate to achieve the proper investment, management, and distribution of the trust property; and
(C) any other powers conferred by this part.
(b) The exercise of a power is subject to the fiduciary duties prescribed by this part.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-816. Specific powers of trustee.
Without limiting the authority conferred by Section 62-7-815, a trustee may:
(1) collect trust property and accept or reject additions to the trust property from a settlor or any other person;
(2) acquire or sell property, for cash or on credit, at public or private sale;
(3) exchange, partition, or otherwise change the character of trust property;
(4) deposit trust money in accounts—all types including margin accounts—in a regulated financial-service institution;
(5) borrow money, with or without security, and mortgage or pledge trust property for a period within or extending beyond the duration of the trust;
(6) with respect to an interest in a proprietorship, partnership, limited liability company, business trust, corporation, or other form of business or enterprise, create and/or continue a business or other enterprise and take any action that may be taken by shareholders, members, or property owners, including merging, dissolving, or otherwise changing the form of business organization or contributing additional capital;
(7) with respect to stocks or other securities, exercise the rights of an absolute owner, including the right to:
(A) vote, or give proxies to vote, with or without power of substitution, or enter into or continue a voting trust agreement;
(B) hold a security in the name of a nominee or in other form without disclosure of the trust so that title may pass by delivery;
(C) pay calls, assessments, and other sums chargeable or accruing against the securities, and sell or exercise stock subscription or conversion rights; and
(D) deposit the securities with a depositary or other regulated financial-service institution;
(8) with respect to an interest in real property, construct, or make ordinary or extraordinary repairs to, alterations to, or improvements in, buildings or other structures, demolish improvements, raze existing or erect new party walls or buildings, subdivide or develop land, dedicate land to public use or grant public or private easements, including by way of example qualified conservation and façade easements, and make or vacate plats and adjust boundaries;
(9) enter into a lease for any purpose as lessor or lessee, including a lease or other arrangement for exploration and removal of natural resources, with or without the option to purchase or renew, for a period within or extending beyond the duration of the trust;
(10) grant an option involving a sale, lease, or other disposition of trust property or acquire an option for the acquisition of property, including an option exercisable beyond the duration of the trust, and exercise an option so acquired;
(11) insure the property of the trust against damage or loss and insure the trustee, the trustee's agents, and beneficiaries against liability arising from the administration of the trust;
(12) abandon or decline to administer property of no value or of insufficient value to justify its collection or continued administration;
(13) with respect to possible liability for violation of environmental law:
(A) inspect or investigate property the trustee holds or has been asked to hold, or property owned or operated by an organization in which the trustee holds or has been asked to hold an interest, for the purpose of determining the application of environmental law with respect to the property;
(B) take action to prevent, abate, or otherwise remedy any actual or potential violation of any environmental law affecting property held directly or indirectly by the trustee, whether taken before or after the assertion of a claim or the initiation of governmental enforcement;
(C) decline to accept property into trust or disclaim any power with respect to property that is or may be burdened with liability for violation of environmental law;
(D) compromise claims against the trust which may be asserted for an alleged violation of environmental law; and
(E) pay the expense of any inspection, review, abatement, or remedial action to comply with environmental law;
(14) pay or contest any claim, settle a claim by or against the trust, and release, in whole or in part, a claim belonging to the trust;
(15) pay taxes, assessments, compensation of the trustee and of employees and agents of the trust, and other expenses incurred in the administration of the trust;
(16) exercise elections with respect to federal, state, and local taxes;
(17) select a mode of payment under any employee benefit or retirement plan, annuity, or life insurance payable to the trustee, exercise rights thereunder, including exercise of the right to indemnification for expenses and against liabilities, and take appropriate action to collect the proceeds;
(18) make loans out of trust property, including loans to a beneficiary on terms and conditions the trustee considers to be fair and reasonable under the circumstances, and the trustee has a lien on future distributions for repayment of those loans;
(19) pledge trust property to guarantee loans made by others to the beneficiary;
(20) appoint a trustee to act in another jurisdiction with respect to trust property located in the other jurisdiction, confer upon the appointed trustee all of the powers and duties of the appointing trustee, require that the appointed trustee furnish security, and remove any trustee so appointed;
(21) pay an amount distributable to a beneficiary who is under a legal disability or who the trustee reasonably believes is incapacitated, by paying it directly to the beneficiary or applying it for the beneficiary's benefit, or by:
(A) paying it to the beneficiary's agent under a Power of Attorney, to the beneficiary's conservator or, if the beneficiary does not have a conservator, to the beneficiary's guardian;
(B) paying it to the beneficiary's custodian under the Uniform Gifts or Transfers to Minors Act or custodial trustee under the Uniform Custodial Trust Act, and, for that purpose, creating a custodianship or custodial trust;
(C) if the trustee does not know of an agent under a Power of Attorney, conservator, guardian, custodian, or custodial trustee, paying it to an adult relative or other person having legal or physical care or custody of the beneficiary, to be expended on the beneficiary's behalf; or
(D) managing it as a separate fund on the beneficiary's behalf, subject to the beneficiary's continuing right to withdraw the distribution;
(22) on distribution of trust property or the division or termination of a trust, make distributions in divided or undivided interests, allocate particular assets in proportionate or disproportionate shares, value the trust property for those purposes, and adjust for resulting differences in valuation;
(23) resolve a dispute concerning the interpretation of the trust or its administration by mediation, arbitration, or other procedure for alternative dispute resolution;
(24) prosecute or defend an action, claim, or judicial proceeding in any jurisdiction to protect trust property and the trustee in the performance of the trustee's duties;
(25) sign and deliver contracts and other instruments that are useful to achieve or facilitate the exercise of the trustee's powers;
(26) on termination of the trust, exercise the powers appropriate to wind up the administration of the trust and distribute the trust property to the persons entitled to it;
(27) allocate items of income or expense to either trust income or principal, as permitted or provided by the trust instrument and applicable law, but this power shall not be construed as prescribing the method of accounting for principal and income; and
(28) to divide any trust into separate shares or separate trusts or to create separate trusts if the trustee reasonably deems it appropriate and the division or creation is consistent with the settlor's intent and facilitates the trust's administration without defeating or impairing the interests of the beneficiaries.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-816A. Authority to appoint the property of original trust to second trust.
(a) Unless the terms of the instrument expressly provide otherwise, a trustee with the discretion to make distributions of principal or income to or for the benefit of one or more beneficiaries of a trust, the original trust, may exercise that discretion by appointing all or part of the property subject to that discretion in favor of another trust for the benefit of one or more of those beneficiaries, the second trust. This power may be exercised without the approval of a court, but court approval is necessary if the terms of the original trust expressly prohibit the exercise of such power or require court approval.
(b) The trustee of the original trust may exercise this power whether or not there is a current need to distribute principal or income under any standard provided in the original trust. The trustee's special power to appoint trust principal or income in further trust under this section includes the power to create the second trust.
(c) The second trust may be a trust created under the same trust instrument as the original trust or under a different trust instrument, and the trustee of the second trust may be either the trustee of the original trust or another trustee.
(d) The terms of the second trust are subject to the following requirements:
(1) The beneficiaries of the second trust may include only beneficiaries of the original trust.
(2) A beneficiary who has only a future beneficial interest, vested or contingent, in the original trust cannot have the future beneficial interest accelerated to a present interest in the second trust.
(3) The terms of the second trust may not contain any provision nor reduce any fixed income, annuity, or unitrust interest of a beneficiary in the assets of an original trust document if the inclusion of the provision or reduction in the original trust document would have disqualified any assets of the original trust for any federal or state income, estate, or gift tax deduction received on account of any assets of the original trust, or if the inclusion of the provision or reduction in the original trust would have reduced the amount of any federal or state income, estate, or gift tax deduction received. In addition, the terms of the second trust may not reduce any retained interest of a beneficiary of the original trust if the interest is a qualified interest under Internal Revenue Code Section 2702.
(4) If contributions to the original trust have been excluded from the gift tax by the application of Internal Revenue Code Section 2503(b) and Section 2503(c), then the second trust shall provide that the beneficiary's remainder interest in the contributions shall vest and become distributable no later than the date upon which the interest would have vested and become distributable under the terms of the original trust.
(5) If a beneficiary of the original trust has a power of withdrawal over trust property, then either:
(A) the terms of the second trust must provide a power of withdrawal in the second trust identical to the power of withdrawal in the original trust; or
(B) sufficient trust property must remain in the original trust to satisfy the outstanding power of withdrawal.
(6) If the power to distribute principal or income in the original trust is subject to an ascertainable standard, then the power to distribute income or principal in the second trust must be subject to the same ascertainable standard as in the original trust and must be exercisable in favor of the same beneficiaries as in the original trust.
(7) The second trust may confer a power of appointment upon a beneficiary of the original trust to whom or for the benefit of whom the trustee has the power to distribute principal or income of the original trust. The permissible appointees of the power of appointment conferred upon a beneficiary may include persons who are not beneficiaries of the original or second trust.
(e) A trustee may not exercise the power to appoint principal or income under subsection (a) of this section if the trustee is a beneficiary of the original trust, but the remaining cotrustee or a majority of the remaining cotrustees may act for the trust. If all the trustees are beneficiaries of the original trust, then the court may appoint a special fiduciary with authority to exercise the power to appoint principal or income under subsection (a) of this section.
(f) The exercise of the power to appoint principal or income under subsection (a) of this section:
(1) is considered the exercise of a power of appointment, other than a power to appoint to the trustee, the trustee's creditors, the trustee's estate or the creditors of the trustee's estate;
(2) does not result in the trustee or cotrustees of the original trust being considered the settlor of the second trust;
(3) is not prohibited by a spendthrift provision or by a provision in the trust instrument that prohibits amendment or revocation of the trust.
(g) To effect the exercise of the power to appoint principal or income under subsection (a) of this section, all of the following apply:
(1) The exercise of the power to appoint must be made by an instrument in writing, signed and acknowledged by the trustee, setting forth the manner of the exercise of the power, including the terms of the second trust, and the effective date of the exercise of the power. The instrument must be filed with the records of the original trust.
(2) The trustee shall give written notice to all qualified beneficiaries of the original trust, at least ninety days prior to the effective date of the exercise of the power to appoint, of the trustee's intention to exercise the power. The notice must include a copy of the instrument described in item (1) of this subsection.
(3) If all qualified beneficiaries waive the notice period by a signed written instrument delivered to the trustee, the trustee's power to appoint principal or income is exercisable after notice is waived by all qualified beneficiaries, notwithstanding the effective date of the exercise of the power.
(h) The provisions of this section shall not be construed to create or imply a duty of the trustee to exercise the power to distribute principal or income, or to create an inference of impropriety made as a result of a trustee not exercising the power to appoint principal or income conferred under subsection (a) of this section. The provisions of this section shall not be construed to abridge the right of any trustee who has a power to appoint property in further trust that arises under the terms of the original trust or under any other section of this article or under another provision of law or under common law. The terms of an original trust may modify or waive the notice requirements under subsection (g), reduce or increase restrictions on altering the interests of beneficiaries under subsection (d), and may otherwise contain provisions that are inconsistent with the requirements of this section.
(i) A trustee or beneficiary may commence a proceeding to approve or disapprove a proposed exercise of the trustee's special power to appoint to another trust pursuant to subsection (a) of this section.
(j) The provisions of Section 62-7-109 regarding notices and the sending of documents to persons under this article apply for the purposes of notices and the sending of documents under this section.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-817. Distribution upon termination.
(a) Upon termination or partial termination of a trust, the trustee may send to the beneficiaries a proposal for distribution. The right of any beneficiary to object to the proposed distribution terminates if the beneficiary does not notify the trustee of an objection within 30 days after the proposal was sent but only if the proposal informed the beneficiary of the right to object and of the time allowed for objection.
(b) Upon the occurrence of an event terminating or partially terminating a trust, the trustee shall proceed expeditiously to distribute the trust property to the persons entitled to it, subject to the right of the trustee to retain a reasonable reserve for the payment of debts, expenses, and taxes.
(c) A release by a beneficiary of a trustee from liability for breach of trust is invalid to the extent:
(1) it was induced by improper conduct of the trustee; or
(2) the beneficiary, at the time of the release, did not know of the beneficiary's rights or of the material facts relating to the breach.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-818. Powers and discretions of a trust protector.
The powers and discretions of a trust protector are as provided in the governing instrument and may be exercised or not exercised, in the best interests of the trust, in the sole and absolute discretion of the trust protector and are binding on all other persons. These powers and discretion may include, but are not limited to, the following:
(1) modify or amend the trust instrument to achieve favorable tax status or respond to changes in the Internal Revenue Code, state law, or the rulings and regulations thereunder;
(2) increase or decrease the interests of any beneficiaries to the trust;
(3) modify the terms of any power of appointment granted by the trust. However, a modification or amendment may not grant a beneficial interest to any individual or class of individuals not specifically provided for under the trust instrument;
(4) remove and appoint a trustee, trust advisor, investment committee member, or distribution committee member;
(5) terminate the trust;
(6) veto or direct trust distributions;
(7) change situs or governing law of the trust, or both;
(8) appoint a successor trust protector;
(9) interpret terms of the trust instrument at the request of the trustee;
(10) advise the trustee on matters concerning a beneficiary; and
(11) amend or modify the trust instrument to take advantage of laws governing restraints on alienation, distribution of trust property, or the administration of the trust.
The powers referenced in items (5), (6) and (11) may be granted notwithstanding the provisions of Sections 62-7-410 through 62-7-412, inclusive.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-819. Powers of a trust investment advisor.
(a) Whenever a trust instrument provides that a trustee is to follow the direction of a trust investment advisor with respect to investment decisions or distribution decisions, then, except to the extent that the trust instrument provides otherwise, the trustee has no duty to:
(1) monitor the conduct of the trust investment advisor;
(2) provide advice to the trust investment advisor; or
(3) communicate with or warn or apprise any beneficiary or third party concerning instances in which the trustee would or might have exercised the trustee's own discretion in a manner different from the manner directed by the advisor.
(b) Absent clear and convincing evidence to the contrary, the actions of the trustee pertaining to matters within the scope of the trust investment advisor's authority, such as confirming that the trust investment advisor's directions have been carried out and recording and reporting actions taken at the trust investment advisor's direction, are presumed to be administrative actions taken by the trustee solely to allow the trustee to perform those duties assigned to the trustee under the governing instrument and these administrative actions are not deemed to constitute an undertaking by the trustee to monitor the trust investment advisor or otherwise participate in actions within the scope of the trust investment advisor's authority.
(c) For purposes of this section, "investment decision" means, with respect to any investment, the retention, purchase, sale, exchange, tender or other transaction affecting the ownership thereof, or rights therein.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
Part 9
South Carolina Uniform Principal and Income Act
SECTION 62-7-901. Short title.
This part may be cited as the South Carolina Uniform Principal and Income Act.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-902. Definitions.
As used in the South Carolina Uniform Principal and Income Act:
(1) "Accounting period" means a calendar year unless another twelve-month period is selected by a fiduciary. The term includes a portion of a calendar year or other twelve-month period that begins when an income interest begins or ends when an income interest ends.
(2) "Beneficiary" includes, in the case of a decedent's estate, an heir, legatee, and devisee and, in the case of a trust, an income beneficiary and a remainder beneficiary.
(3) "Fiduciary" means a personal representative or a trustee. The term includes an executor, administrator, successor personal representative, special administrator, and a person performing substantially the same function.
(4) "Income" means money or property that a fiduciary receives as current return from a principal asset. The term includes a portion of receipts from a sale, exchange, or liquidation of a principal asset, to the extent provided in Section 62-7-910 through Section 62-7-924.
(5) "Income beneficiary" means a person to whom net income of a trust is or may be payable.
(6) "Income interest" means the right of an income beneficiary to receive all or part of net income, whether the terms of the trust require it to be distributed or authorize it to be distributed in the trustee's discretion.
(7) "Mandatory income interest" means the right of an income beneficiary to receive net income that the terms of the trust require the fiduciary to distribute.
(8) "Net income" means the total receipts allocated to income during an accounting period minus the disbursements made from income during the period, plus or minus transfers under the South Carolina Uniform Principal and Income Act to or from income during the period.
(9) "Person" means any individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, or government, governmental subdivision, agency, or instrumentality; or public corporation, or other legal or commercial entity.
(10) "Principal" means property held in trust for distribution to a remainder beneficiary when the trust terminates.
(11) "Remainder beneficiary" means a person entitled to receive principal when an income interest ends.
(12) "Terms of a trust" means the manifestation of the intent of a settlor or decedent with respect to the trust, expressed in a manner that admits of its proof in a judicial proceeding, whether by written or spoken words or by conduct.
(13) "Trustee" includes an original, additional, or successor trustee, whether or not appointed or confirmed by a court.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 54, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-903. Allocation of receipts and disbursements.
(A) In allocating receipts and disbursements to or between principal and income, and with respect to any matter within the scope of Sections 62-7-905 through 62-7-909, a fiduciary:
(1) shall administer a trust or estate in accordance with the terms of the trust or the will, even if there is a different provision in the South Carolina Uniform Principal and Income Act;
(2) may administer a trust or estate by the exercise of a discretionary power of administration given to the fiduciary by the terms of the trust or the will, even if the exercise of the power produces a result different from a result required or permitted by the South Carolina Uniform Principal and Income Act;
(3) shall administer a trust or estate in accordance with the South Carolina Uniform Principal and Income Act if the terms of the trust or the will do not contain a different provision or do not give the fiduciary a discretionary power of administration; and
(4) shall add a receipt or charge a disbursement to principal to the extent that the terms of the trust and the South Carolina Uniform Principal and Income Act do not provide a rule for allocating the receipt or disbursement to or between principal and income.
(B) In exercising:
(1) the power to adjust pursuant to Section 62-7-904(A);
(2) a discretionary power in connection with the conversion or administration of a unitrust under Sections 62-7-904B through Section 62-7-904P; or
(3) a discretionary power of administration regarding a matter within the scope of the South Carolina Uniform Principal and Income Act, whether granted by the terms of a trust, a will, or the South Carolina Uniform Principal and Income Act,
a fiduciary shall administer a trust or estate impartially, based on what is fair and reasonable to all of the beneficiaries, except to the extent that the terms of the trust or the will clearly manifest an intention that the fiduciary shall or may favor one or more of the beneficiaries. A determination in accordance with the South Carolina Uniform Principal and Income Act is presumed to be fair and reasonable to all of the beneficiaries.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 55, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904. Adjustments between principal and income.
(A) A trustee may adjust between principal and income to the extent the trustee considers necessary if the trustee invests and manages trust assets as a prudent investor, the terms of the trust describe the amount that may or must be distributed to a beneficiary by referring to the trust's income, and the trustee determines, after applying the provisions in Section 62-7-903(A), that the trustee is unable to comply with Section 62-7-903(B). In lieu of exercising the power to adjust, the trustee may convert the trust to a unitrust as permitted under Sections 62-7-904A through 62-7-904P, in which case the unitrust amount becomes the net income of the trust.
(B) In deciding whether and to what extent to exercise the power to adjust in subsection (A), a trustee shall consider all factors relevant to the trust and its beneficiaries, including, but not limited to:
(1) the nature, purpose, and expected duration of the trust;
(2) the intent of the settlor;
(3) the identity and circumstances of the beneficiaries;
(4) the needs for liquidity, regularity of income, and preservation and appreciation of capital;
(5) the assets held in the trust and the extent to which they consist of financial assets, interests in closely held enterprises, tangible and intangible personal property, or real property and the extent to which an asset is used by a beneficiary, and whether an asset was purchased by the trustee or received from the settlor;
(6) the net amount otherwise allocated to income under other sections of the South Carolina Uniform Principal and Income Act and the increase or decrease in the value of the principal assets, which the trustee may estimate as to assets for which market values are not readily available;
(7) whether and to what extent the terms of the trust give the trustee the power to invade principal or accumulate income or prohibit the trustee from invading principal or accumulating income, and the extent to which the trustee has exercised a power from time to time to invade principal or accumulate income;
(8) the actual and anticipated effect of economic conditions on principal and income and effects of inflation and deflation; and
(9) the anticipated tax consequences of an adjustment.
(C) A trustee may not make an adjustment:
(1) that diminishes the income interest in a trust that requires all of the income to be paid at least annually to a surviving spouse and for which an estate tax or gift tax marital deduction is allowed, in whole or in part, if the trustee did not have the power to make the adjustment, but only to the extent that making such an adjustment would cause adverse tax consequences under applicable tax laws and regulations;
(2) that reduces the actuarial value of the income interest in a trust to which a person transfers property with the intent to qualify for a gift tax exclusion;
(3) that changes the amount payable to a beneficiary as a fixed annuity or a fixed fraction of the value of the trust assets;
(4) from any amount that is permanently set aside for charitable purposes under a will or the terms of a trust unless both income and principal are so set aside, but only to the extent that making such an adjustment would cause adverse tax consequences under applicable tax laws and regulations;
(5) if possessing or exercising the power to make an adjustment is determinative in causing an individual to be treated as the owner of all or part of the trust for income tax purposes and the individual would not be treated as the owner if the trustee did not possess the power to make an adjustment;
(6) if possessing or exercising the power to make an adjustment is determinative in causing all or part of the trust assets to be included for estate tax purposes in the estate of an individual who has the power to remove a trustee or appoint a trustee, or both, and the assets would not be included in the estate of the individual if the trustee did not possess the power to make an adjustment;
(7) if the trustee is a beneficiary of the trust;
(8) if the trustee is not a beneficiary, but the adjustment would benefit the trustee directly or indirectly, except that a trustee may make an adjustment that also benefits a beneficiary even if the terms of the trust provide for trustee compensation as a percentage of the trust's income; or
(9) if the trust has been converted to, and is then operating as a unitrust under Sections 62-7-904B through 62-7-904P.
(D) If subsection (C)(5), (6), (7), or (8) applies to a trustee and there is more than one trustee, a cotrustee to whom the provision does not apply may make the adjustment unless the exercise of the power by the remaining trustee or trustees is not permitted by the terms of the trust.
(E) A trustee may release the entire power of adjustment in subsection (A) or may release only the power to adjust from income to principal or the power to adjust from principal to income if the trustee is uncertain about whether possessing or exercising the power causes a result described in subsections (C)(1) through (6) or subsection (C)(8) or if the trustee determines that possessing or exercising the power will or may deprive the trust of a tax benefit or impose a tax burden not contemplated in subsection (C). The release may be permanent or for a specified period, including a period measured by the life of an individual.
(F) Terms of a trust that limit the power of a trustee to make an adjustment between principal and income do not affect the application of this section unless it is clear from the terms of the trust that the terms are intended to deny the trustee the power to adjust in subsection (A).
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 56, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904A. Judicial control of discretionary power.
(A) A court may not change a fiduciary's decision, or order a fiduciary to change its decision, to exercise or not to exercise a discretionary power conferred by the South Carolina Uniform Principal and Income Act unless it determines that the decision was an abuse of the fiduciary's discretion. A fiduciary's decision is not an abuse of discretion merely because the court would have exercised the power in a different manner or would not have exercised the power.
(B) The decisions subject to subsection (A) include, but are not limited to, a determination:
(1) pursuant to Section 62-7-904(A) of whether and to what extent an amount should be transferred from principal to income or from income to principal; and
(2) of the factors that are relevant to the trust and its beneficiaries, the extent to which they are relevant, and the weight, if any, to be given to the relevant factors, in deciding whether and to what extent to exercise the power in Section 62-7-904(A).
(C) If a court determines that a fiduciary has abused its discretion, the court may place the income and remainder beneficiaries in the positions they would have occupied if the fiduciary had not abused its discretion, according to the following rules:
(1) to the extent that the abuse of discretion has resulted in no distribution to a beneficiary or in a distribution that is too small, the court must order the fiduciary to distribute from the trust to the beneficiary an amount that the court determines will restore the beneficiary, in whole or in part, to the beneficiary's appropriate position;
(2) to the extent that the abuse of discretion has resulted in a distribution to a beneficiary that is too large, the court must place the beneficiaries, the trust, or both, in whole or in part, in their appropriate positions by ordering the fiduciary to withhold an amount from one or more future distributions to the beneficiary who received the distribution that was too large or ordering that beneficiary to return some or all of the distribution to the trust;
(3) to the extent that the court is unable, after applying items (1) and (2), to place the beneficiaries, the trust, or both, in the positions they would have occupied if the fiduciary had not abused its discretion, the court may order the fiduciary to pay an appropriate amount from its own funds to one or more of the beneficiaries or the trust, or both.
(D) Upon a petition by the fiduciary, the court having jurisdiction over the trust or estate must determine whether a proposed exercise or nonexercise by the fiduciary of a discretionary power in the South Carolina Uniform Principal and Income Act would result in an abuse of the fiduciary's discretion. If the petition describes the proposed exercise or nonexercise of the power and contains sufficient information to inform the beneficiaries of the reasons for the proposal, the facts upon which the fiduciary relies, and an explanation of how the income and remainder beneficiaries would be affected by the proposed exercise or nonexercise of the power, a beneficiary who challenges the proposed exercise or nonexercise has the burden of establishing that it will result in an abuse of discretion.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904B. Definitions for Sections 62-7-904C through 62-7-904P.
The definitions in this section apply to Sections 62-7-904C through 62-7-904P.
(1) "Code" means the Internal Revenue Code of 1986, as amended from time to time, and any statutory enactment successor to the Code; reference to a specific section of the code in Sections 62-7-904B through 62-7-904P are considered a reference also to any successor provision dealing with the subject matter of that section of the Code.
(2) "Disinterested person" means a person who is not a related or subordinate party with respect to the person then acting as trustee of the trust and excludes the settlor of the trust and any interested trustee.
(3) "Express total return unitrust" means a trust created by the terms of a governing instrument requiring the distribution at least annually of a unitrust amount equal to a fixed percentage of not less than three percent nor more than five percent a year of the net fair market value of the amounts of the trust, valued at least annually.
(4) "Income trust" means a trust, created by either an inter vivos or a testamentary instrument, which directs or permits the trustee to distribute the net income of the trust to one or more persons, either in fixed proportions or in amounts or proportions determined by the trustee, and regardless of whether the trust directs or permits the trustee to distribute principal of the trust to one or more of those persons.
(5) "Interested distributee" means a living beneficiary who is a distributee or permissible distributee of trust income or principal who has the power to remove the existing trustee and designate as successor a person who may be a related or subordinate party with respect to that distributee.
(6) "Interested trustee" means any of the following:
(a) an individual trustee who is a qualified beneficiary;
(b) a trustee who may be removed and replaced by an interested distributee;
(c) an individual trustee whose legal obligation to support a beneficiary may be satisfied by distributions of income and principal of the trust.
(7) "Legal disability" means a person under a legal disability who is a minor, an incompetent or incapacitated person, or an unborn individual, or whose identity or location is unknown.
(8) "Qualified beneficiary" means a qualified beneficiary as defined in Section 62-7-103(12).
(9) "Related or subordinate party" means a related or subordinate party as defined in Section 672(c) of the Code.
(10) "Representative" means a person who may represent and bind another as provided in Part 3 of this article, the provisions of which apply for purposes of this section and Sections 62-7-904C through 62-7-904P.
(11) "Settlor" means an individual, including a testator, who creates a trust.
(12) "Total return unitrust" means an income trust that has been converted under and meets the provisions of this section and Section 62-7-904C through 62-7-904P.
(13) "Treasury regulations" means the regulations, rulings, procedures, notices, or other administrative pronouncements issued by the Internal Revenue Service, as amended from time to time.
(14) "Trustee" means a person acting as trustee of the trust, except as otherwise expressly provided in this section and Sections 62-7-904C through 62-7-904P whether acting in that person's discretion or on the direction of one or more persons acting in a fiduciary capacity.
(15) "Unitrust amount" means an amount computed as a percentage of the fair market value of the assets of the trust.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904C. Trustee's power to convert an income trust to a total return unitrust, reconvert a total return unitrust to an income trust, or change the percentage used to calculate the unitrust amount.
(A) A trustee, other than an interested trustee, or, where two or more persons are acting as trustees, a majority of the trustees who are not interested trustees (in either case hereafter "trustee") in the trustee's sole discretion and without court approval, may:
(1) convert an income trust to a total return unitrust;
(2) reconvert a total return unitrust to an income trust; or
(3) change the percentage used to calculate the unitrust amount or the method used to determine the fair market value of the trust if all of the following apply:
(a) The trustee adopts a written policy for the trust providing:
(i) in the case of a trust being administered as an income trust, that future distributions from the trust will be unitrust amounts rather than net income as determined pursuant to the South Carolina Uniform Principal and Income Act;
(ii) in the case of a trust being administered as a total return unitrust, that future distributions from the trust will be net income rather than unitrust amounts; or
(iii) that the percentage used to calculate the unitrust amount or the method used to determine the fair market value of the trust will be changed as stated in the policy.
(b) The trustee gives written notice of its intention to take the action, including copies of the written policy and Sections 62-7-904B through 62-7-904P, to:
(i) the settlor of the trust, if living; and
(ii) all persons who are the qualified beneficiaries of the trust at the time the notice is given. If a qualified beneficiary is under a legal disability, notice shall be given to the representative of the qualified beneficiary if a representative is available without court order.
(c) There is at least:
(i) one qualified beneficiary described in Section 62-7-103(12)(A) or (B) who is not under a legal disability or a representative of a qualified beneficiary so described; or
(ii) one qualified beneficiary described in Section 62-7-103(12)(C) who is not under a legal disability or a representative of a qualified beneficiary so described.
(d) No person receiving notice of the trustee's intention to take the proposed action objects to the action within ninety days after notice has been given. The objection must be by written notice to the trustee.
(B) If there is no trustee of the trust other than an interested trustee, the interested trustee or, where two or more persons are acting as trustee and are interested trustees, a majority of the interested trustees may, in its sole discretion and without court approval:
(1) convert an income trust to a total return unitrust;
(2) reconvert a total return unitrust to an income trust; or
(3) change the percentage used to calculate the unitrust amount or the method used to determine the fair market value of the trust if all of the following apply:
(a) The trustee adopts a written policy for the trust providing:
(i) in the case of a trust being administered as an income trust, that future distributions from the trust will be unitrust amounts rather than net income as determined pursuant to the South Carolina Uniform Principal and Income Act;
(ii) in the case of a trust being administered as a total return unitrust, that future distributions from the trust will be net income as determined pursuant to the South Carolina Uniform Principal and Income Act rather than unitrust amounts, or
(iii) that the percentage used to calculate the unitrust amount or the method used to determine the fair market value of the trust will be changed as stated in the policy.
(b) The trustee appoints a disinterested person who, in its sole discretion but acting in a fiduciary capacity, determines for the trustee:
(i) the percentage to be used to calculate the unitrust amount;
(ii) the method to be used in determining the fair market value of the trust; and
(iii) which assets, if any, are to be excluded in determining the unitrust amount.
(c) The trustee gives written notice of its intention to take the action, including copies of the written policy and Sections 62-7-904B through 62-7-904P and the determinations of the disinterested person to:
(i) the settlor of the trust, if living; and
(ii) all persons who are the qualified beneficiaries of the trust at the time of the giving of the notice. If a qualified beneficiary is under a legal disability, notice must be given to the representative of the qualified beneficiary if a representative is available without court order.
(d) There is at least:
(i) one qualified beneficiary described in Section 62-7-103(12)(A) or (B) or a representative of a beneficiary so described; or
(ii) one qualified beneficiary described in Section 62-7-103(12)(C) or a representative of a qualified beneficiary so described.
(e) No person receiving notice of the trustee's intention to take the proposed action of the trustee objects to the action or to the determination of the disinterested person within ninety days after notice has been given. The objection must be by written instrument delivered to the trustee.
(C) A trustee may act under subsection (A) or (B) of this section with respect to a trust for which both income and principal have been set aside permanently for charitable purposes under the governing instrument and for which a federal estate or gift tax deduction has been taken, if all of the following apply:
(1) Instead of sending written notice to the persons described in subsection (A)(3)(b) or subsection (B)(3)(b), as the case may be, the trustee shall send written notice to each charitable organization expressly designated to receive the income of the trust under the governing instrument and, if no charitable organization is expressly designated to receive all of the income of the trust under the governing instrument, to the Attorney General of this State.
(2) Subsection (A)(3)(d) or subsection (B)(3)(d) of this subsection, as the case may be, does not apply to this action.
(3) In each taxable year, the trustee shall distribute the greater of the unitrust amount or the amount required by Section 4942 of the Code.
(D) The provisions of Section 62-7-109 regarding notices and the sending of documents to persons under this article shall apply for purposes of notices and the sending of documents under this section.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904D. Petition by trustee or qualified beneficiary to convert an income trust, reconvert a total return unitrust, or change the percentage used to calculate the unitrust amount.
(A) If a trustee desires to:
(1) convert an income trust to a total return unitrust;
(2) reconvert a total return unitrust to an income trust; or
(3) change the percentage used to calculate the unitrust amount or the method used to determine the fair market value of the trust assets but does not have the ability to or elects not to do it under Section 62-7-904C, the trustee may petition the court for an order as the trustee considers appropriate. If there is only one trustee of the trust and the trustee is an interested trustee or if there are two or more trustees of the trust and a majority of them are interested trustees, the court, in its own discretion or on the petition of the trustee or trustees or any person interested in the trust, may appoint a disinterested person who, acting in a fiduciary capacity, shall present information to the court as necessary to enable the court to make its determinations under Sections 62-7-904B through 62-7-904P.
(B) A qualified beneficiary or a representative of a qualified beneficiary may request the trustee to:
(1) convert an income trust to a total return unitrust;
(2) reconvert a total return unitrust to an income trust; or
(3) change the percentage used to calculate the unitrust amount or the method used to determine the fair market value of the trust. If the trustee does not take the action requested, the qualified beneficiary or a representative of the qualified beneficiary may petition the court to order the trustee to take the action.
(C) All proceedings under this section must be conducted as provided in Part 2 of this article.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904E. Fair market value of trust assets.
(A) The fair market value of the trust assets must be determined at least annually, using a valuation date selected by the trustee in its discretion. The trustee, in its discretion, may use an average of the fair market value on the same valuation date for the current fiscal year and not more than three preceding fiscal years, if the use of this average appears desirable to the trustee to reduce the impact of fluctuations in market value on the unitrust amount. Assets for which a fair market value cannot be readily ascertained must be valued using valuation methods as are considered reasonable and appropriate by the trustee. Assets, such as a residence or tangible personal property, used by the trust beneficiary may be excluded by the trustee from the fair market value for computing the unitrust amount.
(B) The percentage to be used by the trustee in determining the unitrust amount must be a reasonable current return from the trust, but not less than three percent nor more than five percent, taking into account the intentions of the settlor of the trust as expressed in the terms of the trust, the needs of the beneficiaries, general economic conditions, projected current earnings and appreciation for the trust assets, and projected inflation and its impact on the trust.
(C) Following the conversion of an income trust to a total return unitrust, the trustee:
(1) shall consider the unitrust amount as paid from net accounting income determined as if the trust were not a unitrust;
(2) shall then consider the unitrust amount as paid from ordinary income not allocable to net accounting income;
(3) may, in the trustee's discretion, consider the unitrust amount as paid from net short-term gain described in Section 1222(5) of the Code and then from net long-term capital gain described in Section 1222(7) of the Code so long as the discretionary power is exercised consistently and in a reasonable and impartial manner, but the amount so paid from net capital gains may not be greater than the excess of the unitrust amount over the amount of distributable net income as defined in Section 643(a) of the Code without regard to Section 1.643(a)-3(b) of the Treasury Regulations, as amended from time to time; and
(4) shall then consider the unitrust amount as coming from the principal of the trust.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904F. Administration of a total return unitrust.
In administering a total return unitrust, the trustee may, in its sole discretion but subject to the terms of the trust, determine:
(1) the effective date of the conversion;
(2) the timing of distributions, including provisions for prorating a distribution for a short year in which a beneficiary's right to payments commences or ceases;
(3) whether distributions are to be made in cash or in kind or partly in cash and partly in kind;
(4) if the trust is reconverted to an income trust, the effective date of the reconversion; and
(5) any other administrative issues as may be necessary or appropriate to carry out the purposes of Sections 62-7-904B through 62-7-904P.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904G. Distribution of unitrust amount considered distribution of income and not of principal.
Conversion to a total return unitrust under Sections 62-7-904B through 62-7-904P does not affect any other provision of the terms of the trust, if any, regarding distributions of principal. For purposes of Sections 62-7-904B through 62-7-904P, the distribution of a unitrust amount is considered a distribution of income and not of principal.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904H. Limitation of liability.
No trustee or disinterested person who in good faith takes or fails to take any action under Sections 62-7-904B through 62-7-904P is liable to any person affected by the action or inaction, regardless of whether the person received written notice as provided in Sections 62-7-904B through 62-7-904P and regardless of whether the person was under a legal disability at the time of the delivery of the notice. The exclusive remedy for any person affected by such action or inaction is to obtain an order of the court directing the trustee to:
(1) convert an income trust to a total return unitrust;
(2) reconvert from a total return unitrust to an income trust; or
(3) change the percentage used to calculate the unitrust amount.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904I. Applicability of Sections 62-7-904B through 62-7-904P.
Sections 62-7-904B through 62-7-904P apply to all trusts in existence on, or created after the effective date of Sections 62-7-904A through 62-7-904P unless:
(1) the governing instrument contains a provision clearly expressing the settlor's intention that the current beneficiary or beneficiaries are to receive an amount other than a reasonable current return from the trust;
(2) the trust is a trust described in Section 170(f)(2)(B), Section 664(d), Section 2702(a)(3), or Section 2702(b) of the Code;
(3) the trust is a trust under which any amount is, or has been in the past, set aside permanently for charitable purposes unless the income from the trust also is devoted permanently to charitable purposes; or
(4) the governing instrument expressly prohibits use of Sections 62-7-904B through 62-7-904P by specific reference to Sections 62-7-904B through 62-7-904P or expressly states the settlor's intent that net income not be calculated as a unitrust amount.
A provision in the terms of the trust that "the provisions of Sections 62-7-904B through 62-7-904P of this part or any corresponding provision of future law, must not be used in the administration of this trust," or "the trustee shall not determine the distributions to the income beneficiary as a unitrust amount," or similar words reflecting that intent is sufficient to preclude the use of Sections 62-7-904B through 62-7-904P.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904M. Unitrust amount to be distributed by the express total return unitrust.
(A) The unitrust amount to be distributed by the express total return unitrust may be determined by the terms of the unitrust governing instrument by reference to the net fair market value of the trust's assets determined annually or averaged on a multiple-year basis.
(B) The terms of an express total return unitrust governing instrument may provide that:
(1) any assets of such a unitrust for which a fair market value cannot be readily ascertained must be valued using valuation methods that the trustee considers reasonable and appropriate;
(2) any assets of such a unitrust, such as a residence property or tangible personal property, used by the trust beneficiary entitled to the unitrust amount may be excluded by the trustee from the net fair market value for computing the unitrust amount.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904N. Distribution from an express total return unitrust.
The distribution from an express total return unitrust of a unitrust amount equal to a fixed percentage of not less than three percent nor more than five percent reasonably apportions between the income beneficiaries and the remainder of the total return of an express total return unitrust.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904O. Express total return unitrust governing instrument; changing the unitrust percentage; converting from a unitrust to an income trust; reconversion of an income trust to a unitrust.
(A) The terms of an express total return unitrust governing instrument may provide the method similar to the method provided under Section 62-7-904C for changing the unitrust percentage or for converting from a unitrust to an income trust or for a reconversion of an income trust to a unitrust, or for all of these actions.
(B) If the terms of an express total return unitrust governing instrument do not specifically or by reference to Section 62-7-904C grant a power to the trustee to change the unitrust percentage or change to an income trust, the trustee shall not have that power.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-904P. Trustee considerations for unitrust amount paid.
Unless the terms of the express total return unitrust governing instrument specifically provide otherwise, the trustee:
(A) shall consider the unitrust amount as paid from net accounting income determined as if the trust were not a unitrust;
(B) shall then consider the unitrust amount as paid from ordinary income not allocable to net accounting income;
(C) may, in the trustee's discretion, consider the unitrust amount as paid from net short-term gain described in Section 1222(5) of the Code and then from net long-term capital gain described in Section 1222(7) of the Code so long as this discretionary power is exercised consistently and in a reasonable and impartial manner, but the amount so paid from net capital gains may not be greater than the excess of the unitrust amount over the amount of distributable net income as defined in Section 643(a) of the Code without regard to Section 1.643(a)-3(b) of the Treasury Regulations; and
(D) shall then consider the unitrust amount as coming from the principal of the trust.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-905. Determinations of income and principal; distributions upon death or end of an income interest in a trust.
After a decedent dies, in the case of an estate, or after an income interest in a trust ends, a fiduciary:
(1) of an estate or of a terminating income interest shall determine the amount of net income and net principal receipts received from property specifically given to a beneficiary pursuant to Sections 62-7-907 through 62-7-930 which apply to trustees and the provisions of item (5). The fiduciary shall distribute the net income and net principal receipts to the beneficiary who is to receive the specific property;
(2) shall determine the remaining net income of a decedent's estate or a terminating income interest pursuant to Sections 62-7-907 through 62-7-930 which apply to trustees and by:
(a) including in net income all income from property used to discharge liabilities;
(b) paying from income or principal, in the fiduciary's discretion, fees of attorneys, accountants, and fiduciaries, court costs and other expenses of administration, and interest on death taxes; except that the fiduciary may pay those expenses from income of property passing to a trust for which the fiduciary claims an estate tax marital or charitable deduction only to the extent that the payment of those expenses from income does not cause the reduction or loss of the deduction; and
(c) paying from principal all other disbursements made or incurred in connection with the settlement of a decedent's estate or the winding up of a terminating income interest, including debts, funeral expenses, disposition of remains, family allowances, and death taxes and related penalties that are apportioned to the estate or terminating income interest by the will, the terms of the trust, or applicable law;
(3) shall distribute to a beneficiary who receives a pecuniary amount outright the rate of interest or other amount provided by the will or the terms of the trust. If the will or the terms of the trust provide no interest amount, the beneficiary of a pecuniary amount outright shall receive no interest or other income on the bequest for one year after the first appointment of a personal representative. Beginning one year after the first appointment of a personal representative, and notwithstanding any other provision of law to the contrary, the beneficiary of a pecuniary amount outright must be treated as any other beneficiary under item (4). If a beneficiary is to receive a pecuniary amount outright from a trust after an income interest ends and no interest or other amount is provided for by the terms of the trust, the fiduciary shall treat the pecuniary amount as if it were required to be paid under a will and as if the payment were being made beginning one year after the first appointment of a personal representative;
(4) shall distribute the net income remaining after distributions required by item (3) in the manner pursuant to Section 62-7-906 to all other beneficiaries, including a beneficiary who receives a pecuniary amount in trust, even if the beneficiary holds an unqualified power to withdraw assets from the trust or other presently exercisable general power of appointment over the trust; and
(5) may not reduce principal or income receipts from property described in item (1) because of a payment pursuant to Sections 62-7-924 and 62-7-925 to the extent that the will, the terms of the trust, or applicable law requires the fiduciary to make the payment from assets other than the property or to the extent that the fiduciary recovers or expects to recover the payment from a third party. The net income and principal receipts from the property are determined by including all of the amounts the fiduciary receives or pays with respect to the property, whether those amounts accrued or became due before, on, or after the date of a decedent's death or an income interest's terminating event, and by making a reasonable provision for amounts that the fiduciary believes the estate or terminating income interest may become obligated to pay after the property is distributed.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-906. Determination and distribution of net income.
(A) Each beneficiary described in Section 62-7-905(4) is entitled to receive a portion of the net income equal to his fractional interest in undistributed principal assets, using values as of the distribution date. If a fiduciary makes more than one distribution of assets to beneficiaries to whom this section applies, each beneficiary, including one who does not receive part of the distribution, is entitled, as of each distribution date, to the net income the fiduciary has received after the date of death or terminating event or earlier distribution date but has not distributed as of the current distribution date.
(B) In determining a beneficiary's share of net income, the:
(1) beneficiary is entitled to receive a portion of the net income equal to his fractional interest in the undistributed principal assets immediately before the distribution date, including assets that later may be sold to meet principal obligations;
(2) fractional interest of the beneficiary in the undistributed principal assets must be calculated without regard to property specifically given to a beneficiary and property required to pay pecuniary amounts not in trust;
(3) fractional interest of the beneficiary in the undistributed principal assets must be calculated on the basis of the aggregate value of those assets as of the distribution date without reducing the value by any unpaid principal obligation; and
(4) distribution date for purposes of this section may be the date as of which the fiduciary calculates the value of the assets if that date is reasonably near the date on which assets are actually distributed.
(C) If a fiduciary does not distribute all of the collected but undistributed net income to each person as of a distribution date, the fiduciary shall maintain appropriate records showing the interest of each beneficiary in that net income.
(D) A trustee may apply the provisions of this section, to the extent that the trustee considers it appropriate, to net gain or loss realized after the date of death or terminating event or earlier distribution date from the disposition of a principal asset if this section applies to the income from the asset.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-907. Beginning and end of income interests.
(A) An income beneficiary is entitled to net income from the date on which the income interest begins. An income interest begins on the date specified in the terms of the trust or, if no date is specified, on the date an asset becomes subject to a trust or successive income interest.
(B) An asset becomes subject to a trust on the date:
(1) it is transferred to the trust, in the case of an asset that is transferred to a trust during the transferor's life;
(2) the testator dies, in the case of an asset that becomes subject to a trust by reason of a will, even if there is an intervening period of administration of the estate; or
(3) the individual dies, in the case of an asset that is transferred to a fiduciary by a third party because of the death of the individual.
(C) An asset becomes subject to a successive income interest on the day after the preceding income interest ends, as determined pursuant to subsection (D), even if there is an intervening period of administration to wind up the preceding income interest.
(D) An income interest ends on the day before an income beneficiary dies or another terminating event occurs or on the last day of a period during which there is no beneficiary to whom a trustee may distribute income.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-908. Allocation of income receipts and disbursements.
(A) A trustee shall allocate an income receipt or disbursement, other than one subject to Section 62-7-905(1), to principal if its due date occurs before a decedent dies in the case of an estate or before an income interest begins in the case of a trust or successive income interest.
(B) A trustee shall allocate an income receipt or disbursement to income if its due date occurs on or after the date on which a decedent dies or an income interest begins and it is a periodic due date. An income receipt or disbursement must be treated as accruing from day to day if its due date is not periodic or it has no due date. The portion of the receipt or disbursement accruing before the date on which a decedent dies or an income interest begins must be allocated to principal and the balance must be allocated to income.
(C) An item of income or an obligation is due on the date the payer is required to make a payment. If a payment date is not stated, there is no due date for the purposes of this part. Distributions to shareholders or other owners from an entity subject to Section 62-7-910 are considered due on the date fixed by the entity for determining who is entitled to receive the distribution or, if no date is fixed, on the declaration date for the distribution. A due date is periodic for receipts or disbursements that must be paid at regular intervals under a lease or an obligation to pay interest or if an entity customarily makes distributions at regular intervals.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-909. Undistributed income.
(A) In this section, "undistributed income" means net income received before the date on which an income interest ends. The term does not include an item of income or expense that is due or accrued or net income that has been added or must be added to principal under the terms of the trust.
(B) When a mandatory income interest ends, the trustee shall pay to a mandatory income beneficiary who survives that date, or the estate of a deceased mandatory income beneficiary whose death causes the interest to end, the beneficiary's share of the undistributed income that is not disposed of under the terms of the trust, unless the beneficiary has an unqualified power to revoke more than five percent of the trust immediately before the income interest ends. In that case, the undistributed income from the portion of the trust that may be revoked must be added to principal.
(C) When the obligation of a trustee to pay a fixed annuity or a fixed fraction of the value of the trust assets ends, the trustee shall prorate the final payment if, and to the extent, required by applicable law to accomplish a purpose of the trust or its settlor relating to income, gift, estate, or other tax requirements.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-910. Allocation of receipts from an entity to principal or income.
(A) In this section, "entity" means a corporation, partnership, limited liability company, regulated investment company, real estate investment trust, common trust fund, or other organization in which a trustee has an interest other than a trust or estate subject to Section 62-7-911, a business or activity to which Section 62-7-912 applies, or an asset-backed security to which Section 62-7-924 applies.
(B) Except as otherwise provided in this section, a trustee shall allocate to income money received from an entity.
(C) A trustee shall allocate the following receipts from an entity to principal:
(1) property other than money;
(2) money received in one distribution or a series of related distributions in exchange for part or all of a trust's interest in the entity;
(3) money received in total or partial liquidation of the entity; and
(4) money received from an entity that is a regulated investment company or a real estate investment trust if the money distributed is a capital gain dividend for federal income tax purposes.
(D) Money is received in partial liquidation:
(1) to the extent that the entity, at or near the time of a distribution, indicates that it is a distribution in partial liquidation; or
(2) if the total amount of money and property received in a distribution or series of related distributions is greater than twenty percent of the entity's gross assets of the entity, as shown by the year-end financial statements immediately preceding the initial receipt.
(E) Money is not received in partial liquidation, nor may it be taken into account pursuant to subsection (D)(2), to the extent that it does not exceed the amount of income tax that a trustee or beneficiary must pay on taxable income of the entity that distributes the money.
(F) A trustee may rely upon a statement made by an entity about the source or character of a distribution if the statement is made at or near the time of distribution by the board of directors or other person or group of persons authorized to exercise powers to pay money or transfer property comparable to those of a corporation's board of directors.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-911. Allocations of income and principal received from a trust or an estate.
A trustee shall allocate to income an amount received as a distribution of income from a trust or an estate in which the trust has an interest other than a purchased interest, and shall allocate to principal an amount received as a distribution of principal from such a trust or estate. If a trustee purchases an interest in a trust that is an investment entity, or a decedent or donor transfers an interest in such a trust to a trustee, Section 62-7-910 or 62-7-924 applies to a receipt from the trust.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-912. Separate accounting for a business activity.
(A) If a trustee who conducts a business or other activity determines that it is in the best interest of all the beneficiaries to account separately for the business or activity instead of accounting for it as part of the general accounting records of the trust, the trustee may maintain separate accounting records for its transactions, whether or not its assets are segregated from other trust assets.
(B) A trustee who accounts separately for a business or other activity may determine the extent to which its net cash receipts must be retained for working capital, the acquisition or replacement of fixed assets, and other reasonably foreseeable needs of the business or activity, and the extent to which the remaining net cash receipts are accounted for as principal or income in the trust's general accounting records. If a trustee sells assets of the business or other activity, other than in the ordinary course of the business or activity, the trustee shall account for the net amount received as principal in the general accounting records of the trust to the extent the trustee determines that the amount received is no longer required in the conduct of the business.
(C) Activities for which a trustee may maintain separate accounting records include:
(1) retail, manufacturing, service, and other traditional business activities;
(2) farming;
(3) raising and selling livestock and other animals;
(4) management of rental properties;
(5) extraction of minerals and other natural resources;
(6) timber operations; and
(7) activities subject to Section 62-7-923.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-913. Allocations to principal.
A trustee shall allocate to principal:
(1) to the extent not allocated to income pursuant to this part, assets received from a transferor during his lifetime, a decedent's estate, a trust with a terminating income interest, or a payer under a contract naming the trust or its trustee as beneficiary;
(2) money or other property received from the sale, exchange, liquidation, or change in form of a principal asset, including realized profit;
(3) amounts recovered from third parties to reimburse the trust because of disbursements described in Section 62-7-926(A)(7) or for other reasons to the extent not based on the loss of income;
(4) proceeds of property taken by eminent domain, but a separate award made for the loss of income with respect to an accounting period during which a current income beneficiary had a mandatory income interest is income;
(5) net income received in an accounting period during which there is no beneficiary to whom a trustee may or must distribute income; and
(6) other receipts as provided in Sections 62-7-917 through 62-7-924.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-914. Accounting for receipts from rental property.
To the extent that a trustee accounts for receipts from rental property pursuant to this section, the trustee shall allocate to income an amount received as rent of real or personal property, including an amount received for cancellation or renewal of a lease. An amount received as a refundable deposit, including a security deposit or a deposit applied as rent for future periods, must be added to principal and held subject to the terms of the lease and is not available for distribution to a beneficiary until the trustee's contractual obligations have been satisfied with respect to that amount.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-915. Allocation of interest as income and proceeds from disposition of an obligation as principal; exceptions.
(A) An amount received as interest, whether determined at a fixed, variable, or floating rate, on an obligation to pay money to the trustee, including an amount received as consideration for prepaying principal, must be allocated to income without provision for amortization of premium.
(B) A trustee shall allocate to principal an amount received from the sale, redemption, or other disposition of an obligation to pay money to the trustee more than one year after it is purchased or acquired by the trustee, including an obligation whose purchase price or value when it is acquired is less than its value at maturity. If the obligation matures within one year after it is purchased or acquired by the trustee, an amount received in excess of its purchase price or its value when acquired by the trust must be allocated to income.
(C) This section does not apply to an obligation subject to Section 62-7-918, 62-7-919, 62-7-920, 62-7-921, or 62-7-924.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-916. Allocation of proceeds of insurance contracts; exception.
(A) Except as otherwise provided in subsection (B), a trustee shall allocate to principal the proceeds of a life insurance policy or other contract in which the trust or its trustee is named as beneficiary, including a contract that insures the trust or its trustee against loss for damage to, destruction of, or loss of title to a trust asset. The trustee shall allocate dividends on an insurance policy to income if the premiums on the policy are paid from income, and to principal if the premiums are paid from principal.
(B) A trustee shall allocate to income proceeds of a contract that insures the trustee against loss of occupancy or other use by an income beneficiary, loss of income, or, subject to Section 62-7-912, loss of profits from a business.
(C) This section does not apply to a contract subject to Section 62-7-918.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-917. Insubstantial allocations.
If a trustee determines that an allocation between principal and income required by Section 62-7-918, 62-7-919, 62-7-920, 62-7-921, or 62-7-924 is insubstantial, the trustee may allocate the entire amount to principal unless one of the circumstances provided in Section 62-7-904(C) applies to the allocation. This power may be exercised by a cotrustee in the circumstances provided in Section 62-7-904(D) and may be released for the reasons and in the manner provided in Section 62-7-904(E). An allocation is presumed to be insubstantial if:
(1) the amount of the allocation increases or decreases net income in an accounting period, as determined before the allocation, by less than ten percent; or
(2) the value of the asset producing the receipt for which the allocation is made is less than ten percent of the total value of the assets of the trust at the beginning of the accounting period.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-918. Allocation of payments; interest, dividends, or payments.
(A) In this section:
(1) "Payment" means a payment that a trustee may receive over a fixed number of years or during the life of one or more individuals because of services rendered or property transferred to the payer in exchange for future payments. The term includes a payment made in money or property from the payer's general assets or from a separate fund created by the payer. For purposes of subsections (D), (E), (F), and (G), the term also includes a payment from a separate fund, regardless of the reason for the payment.
(2) "Separate fund" includes a private or commercial annuity, an individual retirement account, and a pension, profit-sharing, stock-bonus, or stock-ownership plan.
(B) To the extent that a payment is characterized as interest, a dividend, or a payment made instead of interest or a dividend, a trustee shall allocate the payment to income. The trustee shall allocate to principal the balance of the payment and any other payment received in the same accounting period that is not characterized as interest, a dividend, or an equivalent payment.
(C) If part of a payment is not characterized as interest, a dividend, or an equivalent payment, and all or part of the payment is required to be made, a trustee shall allocate to income ten percent of the part that is required to be made during the accounting period and the balance to principal. If a part of a payment is not required to be made or the payment received is the entire amount to which the trustee is entitled, the trustee shall allocate the entire payment to principal. For purposes of this subsection, a payment is not "required to be made" to the extent that it is made because the trustee exercises a right of withdrawal.
(D) Except as otherwise provided in subsection (E), subsections (F) and (G) apply, and subsections (B) and (C) do not apply, in determining the allocation of a payment made from a separate fund to:
(1) a trust to which an election to qualify for a marital deduction under Section 2056(b)(7) of the Internal Revenue Code of 1986, as amended, has been made; or
(2) a trust that qualifies for the marital deduction under Section 2056(b)(5) of the Internal Revenue Code of 1986, as amended.
(E) Subsections (D), (F), and (G) do not apply if and to the extent that the series of payments would, without the application of subsection (D), qualify for the marital deduction under Section 2056(b)(7)(C) of the Internal Revenue Code of 1986, as amended.
(F) A trustee shall determine the internal income of each separate fund for the accounting period as if the separate fund were a trust subject to this act. Upon request of the surviving spouse, the trustee shall demand that the person administering the separate fund distribute the internal income to the trust. The trustee shall allocate a payment from the separate fund to income to the extent of the internal income of the separate fund and distribute that amount to the surviving spouse. The trustee shall allocate the balance of the payment to principal. Upon request of the surviving spouse, the trustee shall allocate principal to income to the extent the internal income of the separate fund exceeds payments made from the separate fund to the trust during the accounting period.
(G) If a trustee cannot determine the internal income of a separate fund but can determine the value of the separate fund, the internal income of the separate fund is deemed to equal four percent of the fund's value, according to the most recent statement of value preceding the beginning of the accounting period. If the trustee can determine neither the internal income of the separate fund nor the fund's value, the internal income of the fund is deemed to equal the product of the interest rate and the present value of the expected future payments, as determined under Section 7520 of the Internal Revenue Code of 1986, as amended, for the month preceding the accounting period for which the computation is made.
(H) This section does not apply to payments subject to Section 62-7-919.
HISTORY: 2005 Act No. 66, § 1; 2012 Act No. 204, § 1.A, eff June 7, 2012; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-919. Liquidating assets.
(A) In this section, "liquidating asset" means an asset whose value diminishes or terminates because the asset is expected to produce receipts for a period of limited duration. The term includes a leasehold, patent, copyright, royalty right, and right to receive payments during a period of more than one year under an arrangement that does not provide for the payment of interest on the unpaid balance. The term does not include a payment subject to Section 62-7-918, resources subject to Section 62-7-920, timber subject to Section 62-7-921, an activity subject to Section 62-7-923, an asset subject to Section 62-7-924, or any asset for which the trustee establishes a reserve for depreciation pursuant to Section 62-7-927.
(B) A trustee shall allocate to income ten percent of the receipts from a liquidating asset and the balance to principal.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-920. Allocation of receipts from interests in minerals or other natural resources.
(A) To the extent that a trustee accounts for receipts from an interest in minerals or other natural resources pursuant to this section, the trustee shall allocate them if:
(1) received as nominal delay rental or nominal annual rent on a lease, a receipt must be allocated to income;
(2) received from a production payment, a receipt must be allocated to income if and to the extent that the agreement creating the production payment provides a factor for interest or its equivalent. The balance must be allocated to principal;
(3) an amount received as a royalty, shut-in-well payment, take-or-pay payment, bonus, or delay rental is more than nominal, ninety percent must be allocated to principal and the balance to income;
(4) an amount is received from a working interest or any other interest not otherwise provided for in this subsection, ninety percent of the net amount received must be allocated to principal and the balance to income.
(B) An amount received on account of an interest in water that is renewable must be allocated to income. If the water is not renewable, ninety percent of the amount must be allocated to principal and the balance to income.
(C) This part applies whether or not a decedent or donor was extracting minerals, water, or other natural resources before the interest became subject to the trust.
(D) If a trust owns an interest in minerals, water, or other natural resources on the effective date of this part, the trustee may allocate receipts from the interest as provided in this part or in the manner used by the trustee before the effective date of this part. If the trust acquires an interest in minerals, water, or other natural resources after the effective date of this part, the trustee shall allocate receipts from the interest as provided in this part.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-921. Allocation of receipts from sale of timber and related products.
(A) To the extent that a trustee accounts for receipts from the sale of timber and related products pursuant to this section, the trustee shall allocate the net receipts to:
(1) income, to the extent that the amount of timber removed from the land does not exceed the rate of growth of the timber during the accounting periods in which a beneficiary has a mandatory income interest;
(2) principal, to the extent that the amount of timber removed from the land exceeds the rate of growth of the timber or the net receipts are from the sale of standing timber;
(3) or between income and principal, if the net receipts are from the lease of timberland or from a contract to cut timber from land owned by a trust, by determining the amount of timber removed from the land under the lease or contract and applying items (1) and (2); or
(4) principal, to the extent that advance payments, bonuses, and other payments are not otherwise allocated pursuant to this subsection.
(B) In determining net receipts to be allocated pursuant to subsection (A), a trustee shall deduct and transfer to principal a reasonable amount for depletion.
(C) This part applies whether or not a decedent or transferor was harvesting timber from the property before it became subject to the trust.
(D) If a trust owns an interest in timberland on the effective date of this part, the trustee may allocate net receipts from the sale of timber and related products as provided in this part or in the manner used by the trustee before the effective date of this part. If the trust acquires an interest in timberland after the effective date of this part, the trustee shall allocate net receipts from the sale of timber and related products as provided in this part.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-922. Marital deduction adjustments.
(A) If a marital deduction is allowed for all or part of a trust whose assets consist substantially of property that does not provide the surviving spouse with sufficient income from or use of the trust assets, and if the amounts that the trustee transfers from principal to income pursuant to Section 62-7-904 and distributes to the spouse from principal pursuant to the terms of the trust are insufficient to provide the spouse with the beneficial enjoyment required to obtain the marital deduction, the spouse may require the trustee to make property productive of income, convert property within a reasonable time, or exercise the power in Section 62-7-904(A). The trustee may decide which action or combination of actions to take.
(B) If subsection (A) is inapplicable, proceeds from the sale or other disposition of an asset are principal without regard to the amount of income the asset produces during any accounting period.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-923. Allocation of derivatives; options.
(A) In this section, "derivative" means a contract or financial instrument or a combination of contracts and financial instruments which gives a trust the right or obligation to participate in some or all changes in the price of a tangible or intangible asset or group of assets, or changes in a rate, an index of prices or rates, or other market indicator for an asset or a group of assets.
(B) To the extent that a trustee does not account pursuant to Section 62-7-912 for transactions in derivatives, the trustee shall allocate to principal receipts from and disbursements made in connection with those transactions.
(C) If a trustee grants an option to buy property from the trust, whether or not the trust owns the property when the option is granted, grants an option that permits another person to sell property to the trust, or acquires an option to buy property for the trust or an option to sell an asset owned by the trust, and the trustee or other owner of the asset is required to deliver the asset if the option is exercised, an amount received for granting the option must be allocated to principal. An amount paid to acquire the option must be paid from principal. A gain or loss realized upon the exercise of an option, including an option granted to a settlor of the trust for services rendered, must be allocated to principal.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-924. Allocation of payments related to asset-backed securities.
(A) In this section, "asset-backed security" means an asset whose value is based upon the right it gives the owner to receive distributions from the proceeds of financial assets that provide collateral for the security. The term includes an asset that gives the owner the right to receive from the collateral financial assets only the interest or other current return or only the proceeds other than interest or current return. The term does not include an asset subject to Section 62-7-909 or 62-7-918.
(B) If a trust receives a payment from interest or other current return and from other proceeds of the collateral financial assets, the trustee shall allocate to income the portion of the payment which the payer identifies as being from interest or other current return and shall allocate the balance of the payment to principal.
(C) If a trust receives one or more payments in exchange for the entire interest in an asset-backed security in one accounting period, the trustee shall allocate the payments to principal. If a payment is one of a series of payments that results in the liquidation of the interest of the trust in the security over more than one accounting period, the trustee shall allocate ten percent of the payment to income and the balance to principal.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-925. Disbursements from income.
A trustee shall make the following disbursements from income to the extent that they are not disbursements subject to Section 62-7-905(2)(b) or (c):
(1) one-half of the regular compensation of the trustee and of any person providing investment advisory or custodial services to the trustee;
(2) one-half of all expenses for accountings, judicial proceedings, or other matters that involve both the income and remainder interests;
(3) all of the other ordinary expenses incurred in connection with the administration, management, or preservation of trust property and the distribution of income, including interest, ordinary repairs, regularly recurring taxes assessed against principal, and expenses of a proceeding or other matter that concerns primarily the income interest; and
(4) recurring premiums on insurance covering the loss of a principal asset or the loss of income from or use of the asset.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-926. Disbursements from principal.
(A) A trustee shall make the following disbursements from principal:
(1) the remaining one-half of the disbursements provided in Section 62-7-925(1) and (2);
(2) all of the trustee's compensation calculated on principal as a fee for acceptance, distribution, or termination, and disbursements made to prepare property for sale;
(3) payments on the principal of a trust debt;
(4) expenses of a proceeding that concerns primarily principal, including a proceeding to construe the trust or to protect the trust or its property;
(5) premiums paid on a policy of insurance not provided in Section 62-7-925(4) of which the trust is the owner and beneficiary;
(6) estate, inheritance, and other transfer taxes, including penalties, apportioned to the trust; and
(7) disbursements related to environmental matters, including reclamation, assessing environmental conditions, remedying and removing environmental contamination, monitoring remedial activities and the release of substances, preventing future releases of substances, collecting amounts from persons liable or potentially liable for the costs of those activities, penalties imposed under environmental laws or regulations and other payments made to comply with those laws or regulations, statutory or common law claims by third parties, and defending claims based on environmental matters.
(B) If a principal asset is encumbered with an obligation that requires income from that asset to be paid directly to the creditor, the trustee shall transfer from principal to income an amount equal to the income paid to the creditor in reduction of the principal balance of the obligation.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-927. Transfer to principal of cash receipts from asset subject to depreciation.
(A) In this section, "depreciation" means a reduction in value due to wear, tear, decay, corrosion, or gradual obsolescence of a fixed asset having a useful life of more than one year.
(B) A trustee may transfer to principal a reasonable amount of the net cash receipts from a principal asset that is subject to depreciation, but may not transfer any amount for depreciation:
(1) of that portion of real property used or available for use by a beneficiary as a residence or of tangible personal property held or made available for the personal use or enjoyment of a beneficiary;
(2) during the administration of a decedent's estate; or
(3) under this section if the trustee is accounting pursuant to Section 62-7-912 for the business or activity in which the asset is used.
(C) An amount transferred to principal need not be held as a separate fund.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-928. Future principal disbursements reserves.
(A) If a trustee makes or expects to make a principal disbursement described in this section, the trustee may transfer an appropriate amount from income to principal in one or more accounting periods to reimburse principal or to provide a reserve for future principal disbursements.
(B) A principal disbursement for purposes of this section includes the following, but only to the extent that the trustee has not been, and does not expect to be, reimbursed by a third party:
(1) an amount chargeable to income but paid from principal because it is unusually large, including extraordinary repairs;
(2) a capital improvement to a principal asset, whether in the form of changes to an existing asset or the construction of a new asset, including special assessments;
(3) a disbursement made to prepare property for rental, including tenant allowances, leasehold improvements, and broker's commissions;
(4) a periodic payment on an obligation secured by a principal asset to the extent that the amount transferred from income to principal for depreciation is less than the periodic payments; and
(5) a disbursement described in Section 62-7-926(A)(7).
(C) If the asset whose ownership gives rise to the disbursements becomes subject to a successive income interest after an income interest ends, a trustee may continue to transfer amounts from income to principal as provided in subsection (A).
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-929. Payment of taxes from income and principal.
(A) A tax required to be paid by a trustee based on receipts allocated to income must be paid from income.
(B) A tax required to be paid by a trustee based on receipts allocated to principal must be paid from principal, even if the tax is called an income tax by the taxing authority.
(C) A tax required to be paid by a trustee on the trust's share of the taxable income of the entity must be paid:
(1) from income, to the extent that receipts from the entity are allocated to income;
(2) from principal, to the extent that receipts from the entity are allocated only to principal;
(3) proportionately from principal and income to the extent that receipts from the entity are allocated to both income and principal; and
(4) from principal to the extent that the tax exceeds the total receipts from the entity.
(D) After applying subsections (A) through (C), the trustee shall adjust income or principal receipts to the extent that the trust's taxes are reduced because the trust receives a deduction for payments made to a beneficiary.
HISTORY: 2005 Act No. 66, § 1; 2012 Act No. 204, § 2, eff June 7, 2012; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-930. Certain adjustments between principal and income; reduction of marital deduction or charitable contribution deduction.
(A) A fiduciary may make adjustments between principal and income to offset the shifting of economic interests or tax benefits between income beneficiaries and remainder beneficiaries which arise from:
(1) elections and decisions, other than those provided in subsection (B), that the fiduciary makes from time to time regarding tax matters;
(2) an income tax or any other tax that is imposed upon the fiduciary or a beneficiary as a result of a transaction involving or a distribution from the estate or trust; or
(3) the ownership by an estate or trust of an interest in an entity whose taxable income, whether or not distributed, is includable in the taxable income of the estate, trust, or a beneficiary.
(B) If the amount of an estate tax marital deduction or charitable contribution deduction is reduced because a fiduciary deducts an amount paid from principal for income tax purposes instead of deducting it for estate tax purposes, and as a result estate taxes paid from principal are increased and income taxes paid by an estate, trust, or beneficiary are decreased, each estate, trust, or beneficiary that benefits from the decrease in income tax shall reimburse the principal from which the increase in estate tax is paid. The total reimbursement must equal the increase in the estate tax to the extent that the principal used to pay the increase would have qualified for a marital deduction or charitable contribution deduction but for the payment. The proportionate share of the reimbursement for each estate, trust, or beneficiary whose income taxes are reduced must be the same as its proportionate share of the total decrease in income tax. An estate or trust shall reimburse principal from income.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-931. Application and construction of Uniform Principal and Income Act.
In applying and construing this Uniform Act, consideration must be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 9A
South Carolina Uniform Prudent Investor Act
SECTION 62-7-933. Uniform Prudent Investor Act.
(A) This section may be cited as the South Carolina Uniform Prudent Investor Act, or this act.
(B)(1) Except as otherwise provided in item (2) of this subsection, a trustee who invests and manages trust assets owes a duty to the beneficiaries of the trust to comply with the prudent investor rule in this act.
(2) The prudent investor rule is a default rule that may be expanded, restricted, eliminated, or otherwise altered by the provisions of a trust. A trustee is not liable to a beneficiary to the extent that the trustee acted in reasonable reliance on the provisions of the trust.
(C)(1) A trustee shall invest and manage trust assets as a prudent investor would by considering the purposes, terms, distribution requirements, and other circumstances of the trust. In satisfying this standard, the trustee shall exercise reasonable care, skill, and caution.
(2) A trustee's investment and management decisions respecting individual assets must be evaluated not in isolation but in the context of the trust portfolio as a whole and as a part of an overall investment strategy having risk and return objectives reasonably suited to the trust.
(3) Among other circumstances provided in item (1) of this subsection which a trustee shall consider in investing and managing trust assets are such of the following as are relevant to the trust or its beneficiaries:
(a) general economic conditions;
(b) the possible effect of inflation or deflation;
(c) the expected tax consequences of investment decisions or strategies;
(d) the role that each investment or course of action plays within the overall trust portfolio, including financial assets, interests in closely held enterprises, tangible and intangible personal property, and real property;
(e) the expected total return from income and the appreciation of capital;
(f) other resources of the beneficiaries;
(g) needs for liquidity, regularity of income, and preservation or appreciation of capital; and
(h) an asset's special relationship or special value to the purposes of the trust or to one or more of the beneficiaries.
(4) A trustee shall make a reasonable effort to verify facts relevant to the investment and management of trust assets.
(5)(a) A trustee may invest in any kind of property or type of investment consistent with the standards of this act.
(b) Nothing in this act prohibits affiliate investments if they otherwise comply with the standards of this act. For these purposes, 'affiliate' means an entity that owns or is owned by the trustee, in whole or in part, or is owned by the same entity that owns the trustee. Affiliate investments include:
(i) investment and reinvestment in the securities of an open-end or closed-end management investment company or of an investment trust registered under the Investment Company Act of 1940, as amended. A bank or trustee, or both of them, may invest in these securities even if the bank or trustee, or an affiliate of the bank or trustee, provides services to the investment company or investment trust such as that of an investment advisor, custodian, transfer agent, registrar, sponsor, distributor, manager, or otherwise, and receives reasonable remuneration for those services;
(ii) retention of the securities into which corporate securities owned by the trustee may be converted or which may be derived as a result of merger, consolidation, stock dividends, splits, liquidations, and similar procedures, and the exercise by purchase or otherwise any rights, warrants, or conversion features attaching to the securities;
(iii) purchase or other acquisition and retention of a security underwritten by a syndicate, even if the trustee or its affiliate participates or has participated as a member of the syndicate, provided the trustee does not purchase the security from itself, its affiliate, or from another member of the underwriting syndicate, or its affiliate, pursuant to an implied or express reciprocal agreement between the trustee, or its affiliate, and the other member, or its affiliate, to purchase all or part of each other's underwriting participation commitment within the syndicate.
(c) Notwithstanding any other provision of law, any fiduciary holding securities in its fiduciary capacity, any bank, trust company, or private banker holding securities as a custodian or managing agent, and any bank, trust company, or private banker holding securities as custodian for a fiduciary, is authorized to deposit or arrange for the deposit of such securities in a clearing corporation, as defined in Article 8 of the Uniform Commercial Code. When such securities are so deposited, certificates representing securities of the same class of the same issuer may be merged and held in bulk in the name of the nominee of such clearing corporation with any other such securities deposited in such clearing corporation by any person regardless of the ownership of such securities, and certificates of small denomination may be merged into one or more certificates of larger denomination. The records of such fiduciary and the records of such bank, trust company, or private banker acting as custodian, as managing agent or as custodian for a fiduciary shall at all times show the name of the party for whose account the securities are so deposited. Ownership of, and other interests in, such securities may be transferred by bookkeeping entry on the books of such clearing corporation without physical delivery of certificates representing such securities. A bank, trust company, or private banker so depositing securities pursuant to this section shall be subject to such regulations as in the case of state-chartered institutions, the Board of Financial Institutions, and, in the case of national banking associations, The Comptroller of the Currency may from time to time issue. A bank, trust company, or private banker acting as custodian for a fiduciary shall, on demand by the fiduciary, certify in writing to the fiduciary the securities so deposited by such bank, trust company, or private banker in such clearing corporation for the account of such fiduciary. A fiduciary shall, on demand by any party to a judicial proceeding for the settlement of such fiduciary's account or on demand by the attorney for such party, certify in writing to such party the securities deposited by such fiduciary in such clearing corporation for its account as such fiduciary. This subsection shall apply to any fiduciary holding securities in its fiduciary capacity, and to any bank, trust company, or private banker holding securities as a custodian, managing agent, or custodian for a fiduciary, acting on April 17, 1973, or who thereafter may act regardless of the date of the agreement, instrument, or court order by which it is appointed and regardless of whether or not such fiduciary, custodian, managing agent, or custodian for a fiduciary owns capital stock of such clearing corporation.
(6) [Reserved.]
(D) A trustee shall diversify the investments of the trust unless the trustee reasonably determines that, because of special circumstances, the purposes of the trust are better served without diversifying.
(E) Within a reasonable time after accepting a trusteeship or receiving trust assets, a trustee shall review the trust assets and make and implement decisions concerning the retention and disposition of assets in order to bring the trust portfolio into compliance with the purposes, terms, distribution requirements, and other circumstances of the trust and with the requirements of this act.
(F) [Reserved.]
(G) Compliance with the prudent investor rule is determined in light of the facts and circumstances existing at the time of a trustee's decision or action and not by hindsight.
(H) [Reserved.]
(I) The following terms or comparable language in the provisions of a trust, unless otherwise limited or modified, authorize any investment or strategy permitted pursuant to this act: "investments permissible by law for investment of trust funds", "legal investments", "authorized investments", "using the judgment and care under the circumstances then prevailing that persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not in regard to speculation but in regard to the permanent disposition of their funds, considering the probable income as well as the probable safety of their capital", "prudent man rule", "prudent trustee rule", "prudent person rule", and "prudent investor rule".
(J)(1) Notwithstanding provisions of this act to the contrary, the duties of a trustee with respect to acquiring a contract of insurance upon the life of the trustor or upon the lives of the trustor and the trustor's spouse, children, or parents do not include a duty to:
(a) determine whether the contract is or remains a proper investment;
(b) exercise policy options available under the contract; or
(c) diversify the contract.
(2) The trustee is not liable to the beneficiaries of the contract of insurance or to another party for loss arising from this subsection.
(3) Except as specifically provided in the trust instrument, the provisions of this subsection apply to a trust established before or after the effective date of this subsection and to a life insurance policy acquired by the trustee before or after the effective date of this act.
(K) This act applies to "charitable remainder trusts". "Charitable remainder trust" means a trust that provides for a specified distribution at least annually for either life or a term of years to one or more beneficiaries, at least one of which is not a charity with an irrevocable remainder interest to be held for the benefit of, or paid over to, charity.
(L) This act must be applied and construed to effectuate its general purpose to make uniform the law with respect to the subject of this act among the States enacting it.
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 57, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 10
Liability of Trustees and Rights of Persons Dealing With Trustee
SECTION 62-7-1001. Remedies for breach of trust.
(a) A violation by a trustee of a duty the trustee owes to a beneficiary is a breach of trust.
(b) To remedy a breach of trust that has occurred or may occur, the court may:
(1) compel the trustee to perform the trustee's duties;
(2) enjoin the trustee from committing a breach of trust;
(3) compel the trustee to redress a breach of trust by paying money, restoring property, or other means;
(4) order a trustee to account;
(5) appoint a special fiduciary to take possession of the trust property and administer the trust;
(6) suspend the trustee;
(7) remove the trustee as provided in Section 62-7-706;
(8) reduce or deny compensation to the trustee;
(9) subject to Section 62-7-1012, void an act of the trustee, impose a lien or a constructive trust on trust property, or trace trust property wrongfully disposed of and recover the property or its proceeds; or
(10) order any other appropriate relief.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1002. Damages for breach of trust.
(a) A trustee who commits a breach of trust is liable to the beneficiaries affected for the greater of:
(1) the amount required to restore the value of the trust property and trust distributions to what they would have been had the breach not occurred; or
(2) the profit the trustee made by reason of the breach.
(b) Except as otherwise provided in this subsection, if more than one trustee is liable to the beneficiaries for a breach of trust, a trustee is entitled to contribution from the other trustee or trustees. A trustee is not entitled to contribution if the trustee was substantially more at fault than another trustee or if the trustee committed the breach of trust in bad faith or with reckless indifference to the purposes of the trust or the interests of the beneficiaries. A trustee who received a benefit from the breach of trust is not entitled to contribution from another trustee to the extent of the benefit received.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1003. Damages in absence of breach.
(a) A trustee is accountable to an affected beneficiary for any profit made by the trustee arising from the administration of the trust, even absent a breach of trust.
(b) Absent a breach of trust, a trustee is not liable to a beneficiary for a loss or depreciation in the value of trust property or for not having made a profit.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1004. Attorney's fees and costs.
In a judicial proceeding involving the administration of a trust, the court, as justice and equity may require, may award costs and expenses, including reasonable attorney's fees, to any party, to be paid by another party or from the trust that is the subject of the controversy.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1005. Limitation of action against trustee.
(a) Unless previously barred by adjudication, consent, or limitation, a beneficiary may not commence a proceeding against a trustee for breach of trust more than one year after the date the beneficiary or a representative of the beneficiary was sent a report that adequately disclosed the existence of a potential claim for breach of trust.
(b) A report adequately discloses the existence of a potential claim for breach of trust if it provides sufficient information so that the beneficiary or representative knows of the potential claim or should have inquired into its existence.
(c) If subsection (a) does not apply, a judicial proceeding by a beneficiary or on behalf of a beneficiary against a trustee for breach of trust must be commenced within three years after the first to occur of:
(1) the removal, resignation, or death of the trustee;
(2) the termination of the beneficiary's interest in the trust; or
(3) the termination of the trust.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1005A. Trust protector.
(A) If a trust instrument provides that a trustee is to follow the direction of a trust protector and the trustee acts in accordance with such direction, then except in cases of wilful misconduct on the part of the trustee so directed, the trustee is not liable directly or indirectly from any such act.
(B) If a trust instrument provides that a trustee is to make decisions with the consent of a trust protector, then except in cases of wilful misconduct or gross negligence on the part of the trustee, the trustee is not liable for any loss resulting directly or indirectly from any act taken or omitted as a result of such trust protector's failure to provide such consent after having been requested to do so by the trustee.
(C) If the trust document provides for a trust protector and the serving trust protector is unwilling or unable to serve or continue to serve and there is no provision for a successor trust protector, the then serving trustee may petition the court having jurisdiction over the trust estate to appoint an individual or a bank or trust company qualified to do business in the state of the settlor's domicile at the time of the settlor's death as successor trust protector.
(D) A trust protector, other than a beneficiary, is a fiduciary with respect to each power granted to such trust protector. In exercising a power or refraining from exercising any power, a trust protector shall act in good faith and in accordance with the terms and purposes of the trust.
(E) A trust protector is an excluded fiduciary with respect to each power granted or reserved exclusively to any one or more other trustees, trust advisors, or trust protectors.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1005B. Trust investment advisor.
(A) If a trust instrument provides that a trustee is to follow the direction of a trust investment advisor, and the trustee acts in accordance with such a direction, then except in cases of wilful misconduct on the part of the trustee so directed, the trustee is not liable directly or indirectly from any such act.
(B) If a trust instrument provides that a trustee is to make decisions with the consent of a trust investment advisor, then except in cases of wilful misconduct or gross negligence on the part of the trustee, the trustee shall not be liable directly or indirectly from any act taken or omitted as a result of such trust investment advisor's failure to provide such consent after having been requested to do so by the trustee.
(C) If a trust instrument provides for a trust investment advisor and the serving trust investment advisor is unwilling or unable to serve or continue to serve and there is no provision for a successor trust investment advisor, the then serving trustee may petition the court having jurisdiction over the trust estate to appoint an individual or a bank or trust company qualified to do business in the state of the settlor's domicile at the time of the settlor's death as successor trust investment advisor.
(D) A trust investment advisor, other than a beneficiary, is a fiduciary with respect to each power granted to such trust investment advisor. In exercising any power or refraining from exercising any power, a trust investment advisor shall act in good faith and in accordance with the terms and purposes of the trust.
(E) A trust investment advisor is an excluded fiduciary with respect to each power granted or reserved exclusively to any one or more other trustees, trust advisors, or trust protectors.
HISTORY: 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1006. Reliance on trust instrument.
A trustee who acts in reasonable reliance on the terms of the trust as expressed in the trust instrument is not liable to a beneficiary for a breach of trust to the extent the breach resulted from the reliance.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1007. Event affecting administration or distribution.
If the happening of an event, including marriage, divorce, performance of educational requirements, or death, affects the administration or distribution of a trust, a trustee who has exercised reasonable care to ascertain the happening of the event is not liable for a loss resulting from the trustee's lack of knowledge.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1008. Exculpation of trustee.
A term of a trust relieving a trustee of liability for breach of trust is unenforceable to the extent that it:
(a) relieves the trustee of liability for breach of trust committed in bad faith or with reckless indifference to the purposes of the trust or the interests of the beneficiaries; or
(b) was inserted as the result of an abuse by the trustee of a fiduciary or confidential relationship to the settlor.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1009. Beneficiary's consent, release, or ratification.
(a) A trustee is not liable to a beneficiary for breach of trust if the beneficiary consented to the conduct constituting the breach, released the trustee from liability for the breach, or ratified the transaction constituting the breach, unless:
(1) the consent, release, or ratification of the beneficiary was induced by improper conduct of the trustee; or
(2) at the time of the consent, release, or ratification, the beneficiary did not have knowledge of the beneficiary's rights or of the material facts relating to the breach.
(b) No consideration is required for the consent, release or ratification to be valid.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1010. Limitation on personal liability of trustee.
(a) Except as otherwise provided in the contract, a trustee is not personally liable on a contract properly entered into in the trustee's fiduciary capacity in the course of administering the trust if the trustee in the contract disclosed the fiduciary capacity.
(b) A trustee is personally liable for torts committed in the course of administering a trust, or for obligations arising from ownership or control of trust property, including liability for violation of environmental law, only if the trustee is personally at fault.
(c) A claim based on a contract entered into by a trustee in the trustee's fiduciary capacity, on an obligation arising from ownership or control of trust property, or on a tort committed in the course of administering a trust, may be asserted in a judicial proceeding against the trustee in the trustee's fiduciary capacity, whether or not the trustee is personally liable for the claim.
(d) The question of liability as between the trust estate and the trustee individually may be determined in a proceeding for accounting, surcharge, or indemnification or other appropriate proceeding.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1011. Interest as general partner.
(a) Except as otherwise provided in subsection (c) or unless personal liability is imposed in the contract, a trustee who holds an interest as a general partner in a general or limited partnership is not personally liable on a contract entered into by the partnership after the trust's acquisition of the interest if the fiduciary capacity was disclosed in the contract or in a statement previously filed pursuant to the South Carolina versions of the Uniform Partnership Act or Uniform Limited Partnership Act.
(b) Except as otherwise provided in subsection (c), a trustee who holds an interest as a general partner is not personally liable for torts committed by the partnership or for obligations arising from ownership or control of the interest unless the trustee is personally at fault.
(c) The immunity provided by this section does not apply if an interest in the partnership is held by the trustee in a capacity other than that of trustee or is held by the trustee's spouse or one or more of the trustee's descendants, siblings, or parents, or the spouse of any of them.
(d) If the trustee of a revocable trust holds an interest as a general partner, the settlor is personally liable for contracts and other obligations of the partnership as if the settlor were a general partner.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1012. Protection of person dealing with trustee.
(a) A person other than a beneficiary who in good faith assists a trustee, or who in good faith and for value deals with a trustee, without knowledge that the trustee is exceeding or improperly exercising the trustee's powers is protected from liability as if the trustee properly exercised the power.
(b) A person other than a beneficiary who in good faith deals with a trustee is not required to inquire into the extent of the trustee's powers or the propriety of their exercise.
(c) A person who in good faith delivers assets to a trustee need not ensure their proper application.
(d) A person other than a beneficiary who in good faith assists a former trustee, or who in good faith and for value deals with a former trustee, without knowledge that the trusteeship has terminated is protected from liability as if the former trustee were still a trustee.
(e) Comparable protective provisions of other laws relating to commercial transactions or transfer of securities by fiduciaries prevail over the protection provided by this section.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1013. Certification of trust.
(a) Instead of furnishing a copy of the trust instrument to a person other than a beneficiary, the trustee may furnish to the person a certification of trust containing the following information:
(1) that the trust exists and the date the trust instrument was executed;
(2) the identity of the settlor;
(3) the identity and address of the currently acting trustee;
(4) the powers of the trustee which may make a reference to the powers set forth in the South Carolina Trust Code;
(5) the revocability or irrevocability of the trust and the identity of any person holding a power to revoke the trust;
(6) the authority of cotrustees to sign or otherwise authenticate and whether all or less than all are required in order to exercise powers of the trustee; and
(7) the manner of taking title to trust property.
(b) A certification of trust may be signed or otherwise authenticated by any trustee.
(c) A certification of trust must state that the trust has not been revoked, modified, or amended in any manner that would cause the representations contained in the certification of trust to be incorrect.
(d) A certification of trust need not contain the dispositive terms of a trust.
(e) A recipient of a certification of trust may require the trustee to furnish copies of those excerpts from the original trust instrument and later amendments which designate the trustee and confer upon the trustee the power to act in the pending transaction.
(f) A person who acts in reliance upon a certification of trust without knowledge that the representations contained therein are incorrect is not liable to any person for so acting and may assume without inquiry the existence of the facts contained in the certification. Knowledge of the terms of the trust may not be inferred solely from the fact that a copy of all or part of the trust instrument is held by the person relying upon the certification.
(g) A person who in good faith enters into a transaction in reliance upon a certification of trust may enforce the transaction against the trust property as if the representations contained in the certification were correct.
(h) A person making a demand for the trust instrument in addition to a certification of trust or excerpts is liable for damages if the court determines that the person did not act in good faith in demanding the trust instrument.
(i) This section does not limit the right of a person to obtain a copy of the trust instrument in a judicial proceeding concerning the trust.
(j) In a transaction involving title to real property, the certificate of trust must be executed and acknowledged in a manner that permits its recordation in the Office of the Register of Deeds or Clerk of Court in the county in which the real property is located.
(k) The Certificate of Trust may be either in the form set forth below or in any other form that satisfies the above requirements.
Settlor: ________________________________
Name of Trust: ________________________________
Date of Trust: ________________________________
Current Trustee(s): ________________________________
Address of Trust: ________________________________
The undersigned trustee(s) does hereby confirm the existence of the within described Trust and certify the following:
1. The undersigned is/are all of the currently serving trustee(s).
2. The Trust is in full force and effect and has not been revoked, terminated or otherwise amended in any manner which would cause the representations in this Certification of Trust to be incorrect.
3. The Trust is revocable/irrevocable. (If revocable, define who can revoke the document).
4. The above designated trustee(s) is/are fully empowered to act for said Trust and is/are properly exercising the trustee's authority under this Trust. No other trustee or other individual or entity is required to execute any document for the Trust.
5. The signature(s) of _______ of the trustees is/are required for any action taken on behalf of the Trust. (Define signature requirements)
6. The proper manner for taking title to Trust property is:
[Name(s) of all current trustees], Trustee
[Name of trust], dated [Date of trust]
7. To the undersigned's knowledge, there are no claims, challenges of any kind, or cause of action alleged, which contest or question the validity of the Trust or the trustee's authority to act for the Trust.
8. The trustee is authorized by the Trust Agreement to ______________________________. (State, synopsize, or describe relevant powers.)
IN WITNESS THEREOF: the undersigned, being all of the trustees, do hereby execute this Certificate of Trust this ___ day of ____________________, 20__.
Witnesses: Trustee(s):
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________ | | | | STATE OF SOUTH CAROLINA | ) | | | | ) | ACKNOWLEDGMENT | | COUNTY OF __________________ | ) | |
I,____________________, do hereby certify that trustee(s) personally appeared before me this day and acknowledged the due execution of the foregoing instrument. Witness my hand and official seal this the day of ______, 20__
(SEAL)
Notary Public for South Carolina
My Commission Expires:
HISTORY: 2005 Act No. 66, § 1; 2010 Act No. 244, § 58, eff June 7, 2010; 2013 Act No. 100, § 2, eff January 1, 2014.
Part 11
Miscellaneous Provisions
SECTION 62-7-1101. Uniformity of application and construction.
In applying and construing this article, consideration must be given to the need to promote uniformity of the law with respect to its subject matter among states that enact its provisions.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1102. Electronic records and signatures.
The provisions of this article governing the legal effect, validity, or enforceability of electronic records or electronic signatures, and of contracts formed or performed with the use of such records or signatures, conform to the requirements of Section 102 of the Electronic Signatures in Global and National Commerce Act (15 U.S.C. Section 7002) and supersede, modify, and limit the requirements of the Electronic Signatures in Global and National Commerce Act.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1103. Severability clause.
If any provision of this article or its application to any person or circumstances is held invalid, the invalidity does not affect other provisions or applications of this article which can be given effect without the invalid provision or application, and to this end the provisions of this article are severable.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.
SECTION 62-7-1106. Application to existing relationships.
(a) Except as otherwise provided in this article, on the effective date of this article:
(1) this article applies to all trusts created before, on, or after its effective date;
(2) this article applies to all judicial proceedings concerning trusts commenced on or after its effective date;
(3) this article applies to judicial proceedings concerning trusts commenced before its effective date unless the court finds that application of a particular provision of this article would substantially interfere with the effective conduct of the judicial proceedings or prejudice the rights of the parties, in which case the particular provision of this article does not apply and the superseded law applies;
(4) subject to subsections (a)(5) and (b), any rule of construction or presumption provided in this article applies to trust instruments executed before the effective date of the article unless there is a clear indication of a contrary intent in the terms of the trust; and
(5) an act done and any right acquired or accrued before the effective date of the article is not affected by this article. Unless otherwise provided in this article, any right in a trust accrues in accordance with the law in effect on the date of the creation of a trust.
(b) If a right is acquired, extinguished, or barred upon the expiration of a prescribed period that has commenced to run under any other statute before the effective date of the article, that statute continues to apply to the right even if it has been repealed or superseded.
HISTORY: 2005 Act No. 66, § 1; 2013 Act No. 100, § 2, eff January 1, 2014.TITLE 62. SOUTH CAROLINA PROBATE CODE
CHAPTER 8. South Carolina Uniform Power of Attorney Act
Part 1
General Provisions
SECTION 62-8-101. Short title.
This article may be cited as the "South Carolina Uniform Power of Attorney Act".
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-102. Definitions.
For purposes of this article:
(1) "Agent" means a person granted authority to act for a principal under a power of attorney, whether denominated an agent, attorney-in-fact, or otherwise. The term includes an original agent, coagent, successor agent, and a person to whom an agent's authority is delegated. An agent is a fiduciary.
(2) "Durable," with respect to a power of attorney, means not terminated by the principal's incapacity.
(3) "Electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.
(4) "Good faith" means honesty in fact.
(5) "Incapacity" means inability of an individual to manage property or business affairs because the individual:
(A) has an impairment in the ability to receive and evaluate information or make or communicate decisions even with the use of technological assistance; or
(B) is:
(i) missing;
(ii) detained, including incarcerated in a penal system; or
(iii) outside the United States and unable to return.
(6) "Person" means an individual, corporation, business trust, estate, trust, partnership, limited-liability company, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, or another legal or commercial entity.
(7) "Power of attorney" means a writing or other record that grants authority to an agent to act in the place of the principal, whether or not the term "power of attorney" is used.
(8) "Presently exercisable general power of appointment", with respect to property or a property interest subject to a power of appointment, means power exercisable at the time in question to vest absolute ownership in the principal individually, the principal's estate, the principal's creditors, or the creditors of the principal's estate. The term includes a power of appointment not exercisable until the occurrence of a specified event, the satisfaction of an ascertainable standard, or the passage of a specified period only after the occurrence of the specified event, the satisfaction of the ascertainable standard, or the passage of the specified period. The term does not include a power exercisable in a fiduciary capacity or only by will.
(9) "Principal" means an individual with contractual capacity who grants authority to an agent in a power of attorney.
(10) "Property" means anything that may be the subject of ownership, whether real or personal, or legal or equitable, or any interest or right in the property.
(11) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.
(12) "State" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or a territory or insular possession subject to the jurisdiction of the United States.
(13) "Stocks and bonds" means stocks, bonds, mutual funds, and all other types of securities and financial instruments, whether held directly, indirectly, or in another manner. The term does not include commodity futures contracts and call or put options on stocks or stock indexes.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-103. Applicability.
This article applies to all powers of attorney except a:
(1) power to the extent it is coupled with an interest in the subject of the power, including a power given to or for the benefit of a creditor in connection with a credit transaction;
(2) proxy or other delegation to exercise voting rights or management rights with respect to an entity;
(3) power created on a form prescribed by a government or governmental subdivision, agency, or instrumentality for a governmental purpose;
(4) power created on a form provided by a financial institution or brokerage firm that relates to the account at the financial institution or brokerage firm and is intended for use solely by the financial institution or brokerage firm.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-104. Power of attorney is durable.
A power of attorney created pursuant to this part after the effective date is durable unless it expressly provides that it is terminated by the incapacity of the principal.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-105. Execution of power of attorney.
A power of attorney must be:
(1) signed by the principal or in the principal's presence by another individual directed by the principal to sign the principal's name on the power of attorney;
(2) attested with the same formality and with the same requirements as to witnesses as a will in South Carolina; and
(3) acknowledged or proved pursuant to Section 30-5-30.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-106. Validity of power of attorney.
(a) A power of attorney executed on or after the effective date of this article is valid if its execution complies with Section 62-8-105.
(b) A power of attorney executed before the effective date of this article is valid if its execution complied with the law of this State as it existed at the time of execution.
(c) A power of attorney executed other than in this State that is not otherwise valid under subsection (a) or (b) is valid in this State if, when the power of attorney was executed, the execution complied with the:
(1) law of the jurisdiction that determines the meaning and effect of the power of attorney pursuant to Section 62-8-107; or
(2) requirements for a military power of attorney pursuant to 10 U.S.C. Section 1044b, as amended.
(d) Except as otherwise provided by statute other than this part, a photocopy or electronically transmitted copy of an original power of attorney has the same effect as the original.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-107. Meaning and effect of power of attorney.
The meaning and effect of a power of attorney is determined by the law of the jurisdiction indicated in the power of attorney and, in the absence of an indication of jurisdiction, by the law of the jurisdiction in which the power of attorney was executed.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-108. Nomination of conservator or guardian; relation of agent to court-appointed fiduciary.
(a) In a power of attorney, a principal may nominate a conservator or guardian for consideration by the court if protective proceedings for the principal's estate or person are begun after the principal executes the power of attorney. Except for good cause shown or disqualification, the court shall make its appointment in accordance with the principal's most recent nomination.
(b) If, after a principal executes a power of attorney, a court appoints a conservator or guardian of the principal's estate or other fiduciary charged with the management of some or all of the principal's property, the agent is accountable to the fiduciary as well as to the principal. Unless the power of attorney provides otherwise, appointment of a guardian terminates all or part of the power of attorney that relates to matters within the scope of a guardianship, and appointment of a conservator terminates all or part of the power of attorney that relates to matters within the scope of the conservatorship.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-109. When power of attorney effective.
(a) Except as provided in subsection (c), a power of attorney is effective when executed pursuant to Sections 62-8-105 and 62-8-106 unless the principal provides in the power of attorney that it becomes effective at a future date or upon the occurrence of a future event or contingency.
(1) If a power of attorney becomes effective upon the occurrence of a future event or contingency, the principal, in the power of attorney, may authorize one or more persons to determine in a writing or other record that the event or contingency has occurred.
(2) If a power of attorney becomes effective upon the principal's incapacity and the principal has not authorized a person to determine whether the principal is incapacitated, or the person authorized is unable or unwilling to make the determination, the power of attorney becomes effective upon a determination in a writing or other record by:
(A) a physician or licensed psychologist that the principal is incapacitated within the meaning of Section 62-8-102(5)(A); or
(B) attorney at law, court of competent jurisdiction, or an appropriate governmental official that the principal is incapacitated within the meaning of Section 62-8-102(5)(B).
(b) A person authorized by the principal in the power of attorney to determine that the principal is incapacitated may act as the principal's personal representative pursuant to the Health Insurance Portability and Accountability Act, Sections 1171 through 1179 of the Social Security Act, 42 U.S.C. Section 1320d, as amended, and applicable regulations, to obtain access to the principal's health care information and communicate with the principal's health care provider.
(c) After the principal's incapacity, an agent may exercise the authority granted unto the agent under the power of attorney only if the power of attorney has been recorded in the same manner as a deed in the county where the principal resides at the time the instrument is recorded. If the principal resides out of State, the power of attorney may be recorded in any county where property of the principal is located at the time the instrument is recorded. The power of attorney may be recorded before or after the principal's incapacity. After the principal's incapacity and before recordation, the agent's authority cannot be exercised.
(d) An agent may exercise a power of attorney executed in another jurisdiction if its execution complies with Section 62-8-106 if, after the principal's incapacity, it is recorded as required in subsection (c). Notwithstanding the provisions of Section 30-5-30, a valid power of attorney as provided for pursuant to this part, which is executed in another jurisdiction, may be recorded as though it complies with the provisions of Section 30-5-30.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-110. Termination of power of attorney or agent's authority.
(a) A power of attorney terminates when the:
(1) principal dies;
(2) principal becomes incapacitated, if the power of attorney is not durable;
(3) principal revokes the power of attorney;
(4) power of attorney provides that it terminates;
(5) purpose of the power of attorney is accomplished; or
(6) principal revokes the agent's authority or the agent dies, becomes incapacitated, or resigns, and the power of attorney does not provide for another agent to act under the power of attorney.
(b) An agent's authority terminates when the:
(1) principal revokes the authority;
(2) agent dies, becomes incapacitated, or resigns;
(3) agent's authority is revoked pursuant to Section 62-2-507, unless the power of attorney otherwise provides; or
(4) power of attorney terminates.
(c) Unless the power of attorney otherwise provides and subject to Section 62-8-109, an agent's authority is exercisable until the agent's authority terminates under subsection (b), notwithstanding a lapse of time since the execution of the power of attorney.
(d) Termination of an agent's authority or of a power of attorney is not effective as to the agent or another person that, without actual knowledge of the termination, acts in good faith under the power of attorney. An act so performed, unless otherwise invalid or unenforceable, binds the principal and the principal's successors in interest.
(e) Incapacity of the principal of a power of attorney that is not durable does not revoke or terminate the power of attorney as to an agent or other person that, without actual knowledge of the incapacity, acts in good faith under the power of attorney. An act so performed, unless otherwise invalid or unenforceable, binds the principal and the principal's successors in interest.
(f) The execution of a power of attorney does not revoke a power of attorney previously executed by the principal unless the subsequent power of attorney provides that the previous power of attorney is revoked or that all other powers of attorney are revoked.
(g) Unless otherwise provided in the power of attorney, a revocation of a power of attorney must be executed in accordance with Sections 62-8-105 and 62-8-106 and, if the power of attorney has been recorded, then the revocation also must be recorded in the same county as the recorded power of attorney.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-111. Coagents and successor agents.
(a) A principal may designate two or more persons to act as coagents. Unless the power of attorney otherwise provides, each coagent may exercise its authority independently.
(b) A principal may designate one or more successor agents to act if an agent resigns, dies, becomes incapacitated, is not qualified to serve, or declines to serve. A principal may grant authority to designate one or more successor agents to an agent or other person designated by name, office, or function. Unless the power of attorney otherwise provides, a successor agent:
(1) has the same authority as that granted to the original agent; and
(2) may not act until all predecessor agents have resigned, died, become incapacitated, are no longer qualified to serve, or have declined to serve.
(c) Except as otherwise provided in the power of attorney and subsection (d), an agent that does not participate in or conceal a breach of fiduciary duty committed by another agent, including a predecessor agent, is not liable for the actions of the other agent.
(d) An agent that has actual knowledge of a breach or imminent breach of fiduciary duty by another agent shall notify the principal and, if the principal is incapacitated, take any action reasonably appropriate in the circumstances to safeguard the principal's best interest. An agent that fails to notify the principal or take action as required by this subsection is liable for the reasonably foreseeable damages that could have been avoided if the agent had notified the principal or taken such action.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-112. Reimbursement and compensation of agent.
Unless the power of attorney otherwise provides, an agent is entitled to reimbursement of expenses reasonably incurred on behalf of the principal and to compensation that is reasonable under the circumstances.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-113. Agent's acceptance.
Except as otherwise provided in the power of attorney, a person accepts appointment as an agent under a power of attorney by exercising authority or performing duties as an agent or by another assertion or conduct indicating acceptance.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-114. Agent's duties.
(a) An agent that has accepted appointment shall act:
(1) in accordance with the principal's reasonable expectations to the extent actually known by the agent and in the principal's best interest;
(2) in good faith; and
(3) only within the scope of authority granted in the power of attorney.
(b) Except as otherwise provided in the power of attorney, an agent that has accepted appointment shall:
(1) act loyally for the principal's benefit;
(2) act so as not to create a conflict of interest that impairs the agent's ability to act impartially in the principal's best interest;
(3) act with the care, competence, and diligence ordinarily exercised by agents in similar circumstances;
(4) keep a record of all receipts, disbursements, and transactions made on behalf of the principal;
(5) cooperate with a person that has authority to make health care decisions for the principal to carry out the principal's reasonable expectations to the extent actually known by the agent and act in the principal's best interest; and
(6) attempt to preserve the principal's estate plan, to the extent actually known by the agent, if preserving the plan is consistent with the principal's best interest based on all relevant factors, including:
(A) the value and nature of the principal's property;
(B) the principal's foreseeable obligations and need for maintenance;
(C) minimization of taxes, including income, estate, inheritance, generation-skipping transfer, and gift taxes; and
(D) eligibility for a benefit, a program, or assistance under a statute or regulation.
(c) Except as provided in Section 62-7-602(A) an agent that acts in good faith is not liable to a beneficiary of the principal's estate plan for failure to preserve the plan.
(d) An agent that complies with subsection (a) is not liable solely because the agent also benefits from the act or has an individual or conflicting interest in relation to the property or affairs of the principal.
(e) If an agent is selected by the principal because of special skills or expertise possessed by the agent or in reliance on the agent's representation that the agent has special skills or expertise, the special skills or expertise must be considered in determining whether the agent has acted with care, competence, and diligence under the circumstances.
(f) Absent a breach of duty to the principal, an agent is not liable if the value of the principal's property declines.
(g) An agent that exercises authority to delegate to another person the authority granted by the principal or that engages another person on behalf of the principal is not liable for an act, error of judgment, or default of that person if the agent exercises care, competence, and diligence in selecting and monitoring the person.
(h) Except as otherwise provided in the power of attorney, an agent is not required to disclose receipts, disbursements, or transactions conducted on behalf of the principal unless ordered by a court or requested by the principal, a guardian, a conservator, another fiduciary acting for the principal, a governmental agency having authority to protect the welfare of the principal, or, upon the death of the principal, by the personal representative or successor in interest of the principal's estate. If so requested, within thirty days the agent shall comply with the request or provide a writing or other record substantiating why additional time is needed and shall comply with the request within an additional thirty days unless otherwise specified by the court.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-115. Exoneration of agent.
A provision in a power of attorney relieving an agent of liability for breach of duty is binding on the principal and the principal's successors in interest except to the extent the provision:
(1) relieves the agent of liability for breach of duty committed:
(A) dishonestly;
(B) in bad faith;
(C) with reckless indifference to the purposes of the power of attorney;
(D) through wilful misconduct;
(E) through gross negligence; or
(F) with actual fraud; or
(2) was inserted as a result of an abuse of a confidential or fiduciary relationship with the principal.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-116. Judicial relief.
(a) The following persons may petition a court to construe a power of attorney or review the agent's conduct, and grant appropriate relief:
(1) the principal or the agent;
(2) a guardian, conservator, or other fiduciary acting for the principal;
(3) a person authorized to make health care decisions for the principal;
(4) the principal's spouse, parent, or adult descendant;
(5) an individual who would qualify as a presumptive heir of the principal;
(6) a person named as a beneficiary to receive any property, benefit, or contractual right on the principal's death or as a beneficiary of a trust created by or for the principal that has a financial interest in the principal's estate;
(7) a governmental agency having regulatory authority to protect the welfare of the principal;
(8) the principal's caregiver or another person that demonstrates sufficient interest in the principal's welfare; and
(9) a person asked to accept the power of attorney.
(b) Upon motion by the principal, the court shall dismiss a petition filed pursuant to this section if the court determines that dismissal is in the best interest of the principal.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-117. Agent's liability.
An agent that violates this article is liable to the principal or the principal's successors in interest for the amount required to:
(1) restore the value of the principal's property to what it would have been had the violation not occurred; and
(2) reimburse the principal or the principal's successors in interest for the attorney's fees and costs paid on the agent's behalf.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-118. Agent's resignation; notice.
(a) Unless the power of attorney provides a different method for an agent's resignation, an agent may resign by giving written notice to:
(1) the principal;
(2) a coagent or successor agent;
(3) the principal's conservator if one has been appointed for the principal; and
(4) the principal's guardian if one has been appointed for the principal.
(b) If there is no person described in subsection (a)(1) through (4), then the agent shall provide written notice to:
(1) the principal's health care agent, if there is a health care agent; or
(2) another person reasonably believed by the agent to have sufficient interest in the principal's welfare, if there is no health care agent.
(c) If the power of attorney has been recorded then the resignation also must be recorded in the same location as the recorded power of attorney.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-119. Acceptance of and reliance upon acknowledged power of attorney; form.
(a) For purposes of this section and Section 62-8-120, "acknowledged" means purportedly executed pursuant to Section 62-8-105.
(b) A person that in good faith accepts an acknowledged power of attorney without actual knowledge that the power of attorney is void, invalid, or terminated, that the purported agent's authority is void, invalid, or terminated, or that the agent is exceeding or improperly exercising the agent's authority may rely upon the power of attorney as if the power of attorney were genuine, valid and still in effect, the agent's authority were genuine, valid and still in effect, and the agent had not exceeded and had properly exercised the authority.
(c) A person that is asked to accept an acknowledged power of attorney may request, and rely upon, without further investigation an:
(1) agent's certification under penalty of perjury of a factual matter concerning the principal, agent, or power of attorney; and
(2) English translation of the power of attorney if the power of attorney contains, in whole or in part, language other than English; and
(3) opinion of counsel as to a matter of law concerning the power of attorney if the power of attorney does not appear to be effective pursuant to Section 62-8-109. Such a request must provide a reason and be in writing.
(d) An English translation or an opinion of counsel requested pursuant to this section must be provided at the principal's expense unless the request is made more than seven business days after the power of attorney is presented for acceptance.
(e) For purposes of this section and Section 62-8-120, a person that conducts activities through employees is without actual knowledge of a fact relating to a power of attorney, a principal, or an agent if the employee conducting the transaction involving the power of attorney is without actual knowledge of the fact.
(f) The following optional form may be used by an agent to certify facts concerning a power of attorney:
AGENT'S CERTIFICATION AS TO THE VALIDITY OF POWER OF ATTORNEY AND AGENT'S AUTHORITY
State of _____________________________
[County] of___________________________
I, _____________________________________________ (Name of Agent), [certify] under penalty of perjury that __________________________________________(Name of Principal) granted me authority as an agent or successor agent in a power of attorney dated ________________________.
I further [certify] that to my knowledge:
(1) the Principal is alive and has not revoked the Power of Attorney or my authority to act under the Power of Attorney and the Power of Attorney and my authority to act under the Power of Attorney have not terminated;
(2) the action I desire to take is within the scope of my authority granted under the Power of Attorney.
(3) if the Power of Attorney was drafted to become effective upon the happening of an event or contingency, the event or contingency has occurred;
(4) if I was named as a successor agent, the prior agent is no longer able or willing to serve; and
(5) _____________________________________________
______________________________________________________
______________________________________________________
(Insert Other Relevant Statements)
SIGNATURE AND ACKNOWLEDGMENT
_____________________________________________
Agent's Name Printed
____________________________________________
____________________________________________
Agent's Address
____________________________________________
Agent's Telephone Number
This document was acknowledged before me on __________________________,
(Date)
by______________________________________.
(Name of Agent)
____________________________________________(Seal, if any)
Signature of Notary _________________________________
My commission expires: ________________________
[This document prepared by:
_____________________________________________________]
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-120. Liability for refusal to accept acknowledged power of attorney.
(a) Except as otherwise provided in subsection (b):
(1) a person shall either accept an acknowledged power of attorney as defined in Section 62-8-119 or request a certification, a translation, or an opinion of counsel as defined in Section 62-8-119(c) no later than seven business days after presentation of the power of attorney for acceptance;
(2) if a person requests a certification, a translation, or an opinion of counsel pursuant to Section 62-8-119, the person shall accept the power of attorney no later than five business days after receipt of the certification, translation, or opinion of counsel; and
(3) a person may not require an additional or different form of power of attorney for authority granted in the power of attorney presented.
(b) A person is not required to accept an acknowledged power of attorney if:
(1) the person is not otherwise required to engage in a transaction with the principal in the same circumstances;
(2) engaging in a transaction with the agent or the principal in the same circumstances would be inconsistent with federal law;
(3) the person has actual knowledge of the termination of the agent's authority or of the power of attorney before exercise of the power;
(4) a request for a certification, a translation, or an opinion of counsel pursuant to Section 62-8-119(d) is refused;
(5) the person in good faith believes that the power is not valid or that the agent does not have the authority to perform the act requested, whether or not a certification, a translation, or an opinion of counsel pursuant to Section 62-8-119 has been requested or provided;
(6) the person makes, or has actual knowledge that another person has made, a report to the appropriate state agency stating a good faith belief that the principal may be subject to physical or financial abuse, neglect, exploitation, or abandonment by the agent or a person acting for or with the agent; or
(7) the power does not contain the following provision or substantially the following provision:
"No person who may act in reliance upon the representation of my agent for the scope of authority granted to the agent shall incur any liability to me or to my estate as a result of permitting the agent to exercise this authority, nor is any person who deals with my agent responsible to determine or ensure the proper application of funds or property.".
(c) A person that refuses in violation of this section to accept an acknowledged power of attorney is subject to:
(1) a court order mandating acceptance of the power of attorney; and
(2) liability for reasonable attorney's fees and costs incurred in an action or proceeding that confirms the validity of the power of attorney or mandates acceptance of the power of attorney.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-121. Principles of law and equity.
Unless displaced by a provision of this article, the principles of law and equity supplement this article.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-122. Laws applicable to financial institutions and entities.
This part does not supersede another law applicable to financial institutions or other entities, and the other law controls if inconsistent with this part.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-123. Remedies under other law.
The remedies under this article are not exclusive and do not abrogate any right or remedy under the law of this State other than this article.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
Part 2
Authority
SECTION 62-8-201. Authority that requires specific grant; grant of general authority.
(a) Notwithstanding anything contained in Sections 62-8-204 through 62-8-217, an agent under a power of attorney may do the following on behalf of the principal or with the principal's property only if the power of attorney expressly grants the agent the authority and exercise of the authority is not otherwise prohibited by another agreement or instrument to which the authority or property is subject:
(1) create, amend, revoke, or terminate a trust, pursuant to Section 62-7-602A;
(2) make a gift;
(3) create or change rights of survivorship;
(4) create or change a beneficiary designation;
(5) delegate authority granted under the power of attorney;
(6) waive the principal's right to be a beneficiary of a joint and survivor annuity, including a survivor benefit under a retirement plan;
(7) exercise fiduciary powers that the principal has authority to delegate;
(8) disclaim property, including a power of appointment;
(9) access a safe deposit box or vault leased by the principal;
(10) exercise a power of appointment in favor of someone other than the principal;
(11) reject, renounce, disclaim, release, or consent to a reduction in or modification of a share in or payment from an estate, trust, or other beneficial interest; or
(12) deal with commodity futures contracts and call or put options on stocks or stock indexes.
(b) Notwithstanding a grant of authority to do an act described in subsection (a), unless the power of attorney otherwise provides, only an agent who is an ancestor, spouse, or descendant of the principal, may exercise authority under a power of attorney to create in the agent, or in an individual to whom the agent owes a legal obligation of support, an interest in the principal's property, whether by gift, right of survivorship, beneficiary designation, disclaimer, or otherwise.
(c) Except as to those acts enumerated in subsection (a) and subject to subsections (b), (d), and (e), if a power of attorney grants to an agent authority to do all acts that a principal could do, the agent has the general authority described in Sections 62-8-204 through 62-8-216.
(d) Unless the power of attorney otherwise provides, a grant of authority to make a gift is subject to Section 62-8-217.
(e) Except as to those acts enumerated in subsection (a) and subject to subsections (b) and (d), if the acts over which authority is granted in a power of attorney are similar or overlap, the broadest authority controls.
(f) Authority granted in a power of attorney is exercisable with respect to property that the principal has when the power of attorney is executed or acquires later, whether or not the property is located in this State and whether or not the authority is exercised or the power of attorney is executed in this State.
(g) An act performed by an agent pursuant to a power of attorney has the same effect and inures to the benefit of and binds the principal and the principal's successors in interest as if the principal had performed the act.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-202. Incorporation of authority.
(a) An agent has authority described in this part if the power of attorney cites the section in which the authority is described.
(b) A reference in a power of attorney citing one or more of Sections 62-8-204 through 62-8-217 incorporates the entire section as if it were set out in full in the power of attorney.
(c) The power of attorney may modify authority incorporated by reference or may grant authority to an agent as provided in the power of attorney.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-203. Construction of authority generally.
Except as otherwise provided in the power of attorney, by executing a power of attorney that incorporates by reference one or more of Sections 62-8-204 through 62-8-217, a principal also authorizes the agent, with respect to that subject, to:
(1) demand, receive, and obtain by litigation or otherwise, money or another thing of value to which the principal is, may become, or claims to be entitled, and conserve, invest, disburse, or use anything so received or obtained for the purposes intended;
(2) contract in any manner with any person, on terms agreeable to the agent, to accomplish a purpose of a transaction and perform, rescind, cancel, terminate, reform, restate, release, or modify the contract or another contract made by or on behalf of the principal;
(3) execute, acknowledge, seal, deliver, file, or record an instrument or communication the agent considers desirable to accomplish a purpose of a transaction, including creating at any time a schedule listing some or all of the principal's property and attaching it to the power of attorney;
(4) initiate, participate in, submit to alternative dispute resolution, settle, oppose, or propose or accept a compromise with respect to a claim existing in favor of or against the principal or intervene in litigation relating to the claim;
(5) seek on the principal's behalf the assistance of a court or other governmental agency to carry out an act authorized in the power of attorney;
(6) engage, compensate, and discharge an attorney, accountant, discretionary investment manager, expert witness, or other advisor, even though they are associated with the agent to advise or assist the agent in the performance of the agent's administrative duties and to act upon their recommendation without independent investigation and, instead of acting personally, to employ one or more agents to perform an act of administration, whether or not discretionary;
(7) prepare, execute, and file a record, report, or other document to safeguard or promote the principal's interest under a statute or regulation;
(8) communicate with a representative or employee of a government or governmental subdivision, agency, or instrumentality, on behalf of the principal;
(9) access communications intended for, and communicate on behalf of the principal, whether by mail, electronic transmission, telephone, or other means, access the principal's files electronically, and obtain the principal's user names and passwords; and
(10) do any lawful act with respect to the subject and all property related to the subject.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-204. Real property.
Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to real property authorizes the agent to:
(1) demand, buy, lease, receive, accept as a gift or as security for an extension of credit, or otherwise acquire or reject an interest in real property or a right incident to real property;
(2) sell; exchange; convey with or without covenants, representations, or warranties; quitclaim; release; surrender; retain title for security; encumber; partition; consent to partitioning; subject to an easement or covenant; subdivide; apply for zoning or other governmental permits; plat or consent to platting; develop; grant an option concerning; lease; sublease; contribute to an entity in exchange for an interest in that entity; or otherwise grant or dispose of an interest in real property or a right incident to real property;
(3) pledge or mortgage an interest in real property or right incident to real property as security to borrow money or pay, renew, or extend the time of payment of a debt of the principal or a debt guaranteed by the principal;
(4) release, assign, satisfy, or enforce by litigation or otherwise a mortgage, deed of trust, conditional sale contract, encumbrance, lien, or other claim to real property which exists or is asserted;
(5) manage or conserve an interest in real property or a right incident to real property owned or claimed to be owned by the principal, including:
(A) insuring against liability or casualty or other loss;
(B) obtaining or regaining possession of or protecting the interest or right by litigation or otherwise;
(C) paying, assessing, compromising, or contesting taxes or assessments or applying for and receiving refunds in connection with them; and
(D) purchasing supplies, hiring assistance or labor, and making repairs or alterations to the real property;
(6) use, develop, alter, replace, remove, erect, or install structures or other improvements upon real property in or incident to which the principal has, or claims to have, an interest or right;
(7) participate in a reorganization with respect to real property or an entity that owns an interest in or right incident to real property and receive, and hold, and act with respect to stocks and bonds or other property received in a plan of reorganization, including:
(A) selling or otherwise disposing of them;
(B) exercising or selling an option, right of conversion, or similar right with respect to them; and
(C) exercising any voting rights in person or by proxy;
(8) change the form of title of an interest in or right incident to real property; and
(9) dedicate to public use, with or without consideration, easements or other real property in which the principal has, or claims to have, an interest.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-205. Tangible personal property.
Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to tangible personal property authorizes the agent to:
(1) demand, buy, receive, accept as a gift or as security for an extension of credit, or otherwise acquire or reject ownership or possession of tangible personal property or an interest in tangible personal property;
(2) sell; exchange; convey with or without covenants, representations, or warranties; quitclaim; release; surrender; create a security interest in; grant options concerning; lease; sublease; or, otherwise dispose of tangible personal property or an interest in tangible personal property;
(3) grant a security interest in tangible personal property or an interest in tangible personal property as security to borrow money or pay, renew, or extend the time of payment of a debt of the principal or a debt guaranteed by the principal;
(4) release, assign, satisfy, or enforce by litigation or otherwise, a security interest, lien, or other claim on behalf of the principal, with respect to tangible personal property or an interest in tangible personal property;
(5) manage or conserve tangible personal property or an interest in tangible personal property on behalf of the principal, including:
(A) insuring against liability or casualty or other loss;
(B) obtaining or regaining possession of or protecting the property or interest, by litigation or otherwise;
(C) paying, assessing, compromising, or contesting taxes or assessments or applying for and receiving refunds in connection with taxes or assessments;
(D) moving the property from place to place;
(E) storing the property for hire or on a gratuitous bailment; and
(F) using and making repairs, alterations, or improvements to the property;
(6) change the form of title of an interest in tangible personal property; and
(7) take possession and order the removal and shipment of property of the principal from a post, warehouse, depot, dock, or other place of storage or safekeeping, either governmental or private, and execute and deliver a release, voucher, receipt, bill of lading, shipping ticket, certificate, or other instrument for that purpose.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-206. Stocks and bonds.
Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to stocks and bonds, authorizes the agent to:
(1) buy, sell, and exchange stocks and bonds;
(2) establish, continue, modify, or terminate an account with respect to stocks and bonds;
(3) pledge stocks and bonds as security to borrow, pay, renew, or extend the time of payment of a debt of the principal;
(4) receive certificates and other evidences of ownership with respect to stocks and bonds; and
(5) exercise voting rights with respect to stocks and bonds in person or by proxy, enter into voting trusts, and consent to limitations on the right to vote.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-207. Commodities and options.
Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to commodities and options authorizes the agent to:
(1) buy, sell, exchange, assign, settle, and exercise commodity futures contracts and call or put options on stocks or stock indexes traded on a regulated option exchange; and
(2) establish, continue, modify, and terminate option accounts.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-208. Banks and other financial institutions.
Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to banks and other financial institutions authorizes the agent to:
(1) continue, modify, and terminate an account or other banking arrangement made by or on behalf of the principal;
(2) establish, modify, and terminate an account or other banking arrangement with a bank, trust company, savings and loan association, credit union, thrift company, brokerage firm, or other financial institution selected by the agent;
(3) contract for services available from a financial institution, including renting a safe deposit box or space in a vault;
(4) withdraw, by check, order, electronic funds transfer, or otherwise, money or property of the principal deposited with or left in the custody of a financial institution;
(5) receive statements of account, vouchers, notices, and similar documents from a financial institution and act with respect to them;
(6) borrow money and pledge as security personal property of the principal necessary to borrow money or pay, renew, or extend the time of payment of a debt of the principal or a debt guaranteed by the principal;
(7) make, assign, draw, endorse, discount, guarantee, and negotiate promissory notes, checks, drafts, and other negotiable or nonnegotiable paper of the principal or payable to the principal or the principal's order, transfer money, receive the cash or other proceeds of those transactions, and accept a draft drawn by a person upon the principal and pay it when due;
(8) receive for the principal and act upon a sight draft, warehouse receipt, or other document of title whether tangible or electronic, or other negotiable or nonnegotiable instrument;
(9) apply for, receive, and use letters of credit, credit and debit cards, electronic transaction authorizations, and traveler's checks from a financial institution and give an indemnity or other agreement in connection with letters of credit; and
(10) consent to an extension of the time of payment with respect to commercial paper or a financial transaction with a financial institution.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-209. Operation of entity or business.
Subject to Section 62-8-201 and the terms of a document or an agreement governing an entity or an entity ownership interest, and unless the power of attorney otherwise provides, language in a power of attorney granting general authority with respect to operation of an entity or business authorizes the agent to:
(1) operate, buy, sell, enlarge, reduce, or terminate an ownership interest;
(2) perform a duty or discharge a liability and exercise in person or by proxy a right, power, privilege, or option that the principal has, may have, or claims to have;
(3) enforce the terms of an ownership agreement;
(4) initiate, participate in, submit to alternative dispute resolution, settle, oppose, or propose or accept a compromise with respect to litigation to which the principal is a party because of an ownership interest;
(5) exercise in person or by proxy, or enforce by litigation or otherwise, a right, power, privilege, or option the principal has or claims to have as the holder of stocks and bonds;
(6) initiate, participate in, submit to alternative dispute resolution, settle, oppose, or propose or accept a compromise with respect to litigation to which the principal is a party concerning stocks and bonds;
(7) with respect to an entity or business 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 entity or business before execution of the power of attorney;
(B) determine the:
(i) location of its operation;
(ii) nature and extent of its business;
(iii) methods of manufacturing, selling, merchandising, financing, accounting, and advertising employed in its operation;
(iv) amount and types of insurance carried; and
(v) mode of engaging, compensating, and dealing with its employees and accountants, attorneys, or other advisors;
(C) change the name or form of organization under which the entity or business is operated and enter into an ownership agreement with other persons to take over all or part of the operation of the entity or business; and
(D) demand and receive money due or claimed by the principal or on the principal's behalf in the operation of the entity or business and control and disburse the money in the operation of the entity or business;
(8) put additional capital into an entity or business in which the principal has an interest;
(9) join in a plan of reorganization, consolidation, conversion, domestication, or merger of the entity or business;
(10) sell or liquidate all or part of an entity or business;
(11) establish the value of an entity or business under a buy-out agreement to which the principal is a party;
(12) prepare, sign, file, and deliver reports, compilations of information, returns, or other papers with respect to an entity or business and make related payments; and
(13) pay, compromise, or contest taxes, assessments, fines, or penalties and perform another act to protect the principal from illegal or unnecessary taxation, assessments, fines, or penalties, with respect to an entity or business, including attempts to recover, in any manner permitted by law, money paid before or after the execution of the power of attorney.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-210. Insurance and annuities.
Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to insurance and annuities authorizes the agent to:
(1) continue, pay the premium or make a contribution on, modify, exchange, rescind, release, or terminate a contract procured by or on behalf of the principal which insures or provides an annuity to either the principal or another person, whether or not the principal is a beneficiary under the contract;
(2) procure new, different, and additional contracts of insurance and annuities for the principal and the principal's spouse, children, and other dependents, and select the amount, type of insurance or annuity, and mode of payment;
(3) pay the premium or make a contribution on, modify, exchange, rescind, release, or terminate a contract of insurance or annuity procured by the agent;
(4) apply for and receive a loan secured by a contract of insurance or annuity;
(5) surrender and receive the cash surrender value on a contract of insurance or annuity;
(6) exercise an election;
(7) exercise investment powers available under a contract of insurance or annuity;
(8) change the manner of paying premiums on a contract of insurance or annuity;
(9) change or convert the type of insurance or annuity with respect to which the principal has or claims to have authority described in this section;
(10) apply for and procure a benefit or assistance under a statute or regulation to guarantee or pay premiums of a contract of insurance on the life of the principal;
(11) collect, sell, assign, hypothecate, borrow against, or pledge the interest of the principal in a contract of insurance or annuity;
(12) select the form and timing of the payment of proceeds from a contract of insurance or annuity; and
(13) pay, from proceeds or otherwise, compromise or contest, and apply for refunds in connection with, a tax or assessment levied by a taxing authority with respect to a contract of insurance or annuity or its proceeds or liability accruing by reason of the tax or assessment.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-211. Estates, trusts, and other beneficial interests.
(a) In this section, "estate, trust, or other beneficial interest" means a trust, probate estate, guardianship, conservatorship, escrow, or custodianship or a fund from which the principal is, may become, or claims to be, entitled to a share or payment.
(b) Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to estates, trusts, and other beneficial interests authorizes the agent to:
(1) accept, receive, receipt for, sell, assign, pledge, or exchange a share in or payment from an estate, trust, or other beneficial interest;
(2) demand or obtain money or another thing of value to which the principal is, may become, or claims to be, entitled by reason of an estate, trust, or other beneficial interest, by litigation or otherwise;
(3) exercise for the benefit of the principal a presently exercisable general power of appointment held by the principal;
(4) initiate, participate in, submit to alternative dispute resolution, settle, oppose, or propose or accept a compromise with respect to litigation to ascertain the meaning, validity, or effect of a deed, will, declaration of trust, or other instrument or transaction affecting the interest of the principal;
(5) initiate, participate in, submit to alternative dispute resolution, settle, oppose, or propose or accept a compromise with respect to litigation to remove, substitute, or surcharge a fiduciary;
(6) conserve, invest, disburse, or use anything received for an authorized purpose; and
(7) transfer an interest of the principal in real property, stocks and bonds, accounts with financial institutions or securities intermediaries, insurance, annuities, and other property to the trustee of a revocable trust created by the principal as settlor.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-212. Claims and litigation.
Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to claims and litigation authorizes the agent to:
(1) assert and maintain before a court or administrative agency a claim, claim for relief, cause of action, counterclaim, offset, recoupment, or defense, including an action to recover property or other thing of value, recover damages sustained by the principal, eliminate or modify tax liability, or seek an injunction, specific performance, or other relief;
(2) bring an action to determine adverse claims or intervene or otherwise participate in litigation;
(3) seek an attachment, garnishment, order of arrest, or other preliminary, provisional, or intermediate relief and use an available procedure to effect or satisfy a judgment, order, or decree;
(4) make or accept a tender, offer of judgment, or admission of facts, submit a controversy on an agreed statement of facts, consent to examination, and bind the principal in litigation;
(5) submit to alternative dispute resolution, settle, and propose or accept a compromise;
(6) waive the issuance and service of process upon the principal, accept service of process, appear for the principal, designate persons upon whom process directed to the principal may be served, execute and file or deliver stipulations on the principal's behalf, verify pleadings, seek appellate review, procure and give surety and indemnity bonds, contract and pay for the preparation and printing of records and briefs, receive, execute, and file or deliver a consent, waiver, release, confession of judgment, satisfaction of judgment, notice, agreement, or other instrument in connection with the prosecution, settlement, or defense of a claim or litigation;
(7) act for the principal with respect to bankruptcy or insolvency, whether voluntary or involuntary, concerning the principal or some other person, or with respect to a reorganization, receivership, or application for the appointment of a receiver or trustee which affects an interest of the principal in property or other thing of value;
(8) pay a judgment, award, or order against the principal or a settlement made in connection with a claim or litigation; and
(9) receive money or other thing of value paid in settlement of or as proceeds of a claim or litigation.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-213. Personal and family maintenance.
(a) Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to personal and family maintenance authorizes the agent to:
(1) perform the acts necessary to maintain the customary standard of living of the principal, the principal's spouse, and the following individuals, whether living when the power of attorney is executed or later born:
(A) individuals legally entitled to be supported by the principal; and
(B) the individuals whom the principal has customarily supported or indicated the intent to support;
(2) make periodic payments of child support and other family maintenance required by a court or governmental agency or an agreement to which the principal is a party;
(3) provide living quarters for the individuals described in subsection (a)(1) by:
(A) purchase, lease, or other contract; or
(B) paying the operating costs, including interest, amortization payments, repairs, improvements, and taxes, for premises owned by the principal or occupied by those individuals;
(4) provide normal domestic help, usual vacations and travel expenses, and funds for shelter, clothing, food, appropriate education, including postsecondary and vocational education, and other current living costs for the individuals described in item (1);
(5) pay expenses for necessary health care and custodial care on behalf of the individuals described in subsection (a)(1);
(6) act as the principal's personal representative pursuant to the Health Insurance Portability and Accountability Act, Sections 1171 through 1179 of the Social Security Act, 42 U.S.C. Section 1320d, as amended, and applicable regulations, in making decisions related to the past, present, or future payment for the provision of health care consented to by the principal or anyone authorized under the law of this State to consent to health care on behalf of the principal;
(7) continue a provision made by the principal for automobiles or other means of transportation, including registering, licensing, insuring, and replacing them, for the individuals described in subsection (a)(1);
(8) maintain credit and debit accounts for the convenience of the individuals described in subsection (a)(1) and open new accounts;
(9) continue payments incidental to the membership or affiliation of the principal in a religious institution, club, society, order, or other organization or to continue contributions to those organizations; and
(10) enter into financial arrangements and agreements for the admission and care of the principal with an assisted living facility, nursing home, hospital, rehabilitative or respite facility, in home or other care providers, including hiring and firing home health care and other providers of services to the principal.
(b) Authority with respect to personal and family maintenance is neither dependent upon, nor limited by, authority that an agent may or may not have with respect to gifts pursuant to this article.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-214. Benefits from governmental programs or civil or military service.
(a) In this section, "benefits from governmental programs or civil or military service" means a benefit, program, or assistance provided under a statute or regulation including Social Security, Medicare, and Medicaid.
(b) Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to benefits from governmental programs or civil or military service authorizes the agent to:
(1) execute vouchers in the name of the principal for allowances and reimbursements payable by the United States or a foreign government or by a state or subdivision of a state to the principal, including allowances and reimbursements for transportation of the individuals described in Section 62-8-213(a)(1), and for shipment of their household effects;
(2) enroll in, apply for, select, reject, change, amend, or discontinue, on the principal's behalf, a benefit or program;
(3) prepare, file, and maintain a claim of the principal for a benefit or assistance, financial or otherwise, to which the principal may be entitled under a statute or regulation;
(4) initiate, participate in, submit to alternative dispute resolution, settle, oppose, or propose or accept a compromise with respect to litigation concerning a benefit or assistance the principal may be entitled to receive under a statute or regulation; and
(5) receive the financial proceeds of a claim described in item (4) and conserve, invest, disburse, or use for a lawful purpose anything so received.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-215. Retirement plans.
(a) In this section, "retirement plan" means a plan or account created by an employer, the principal, or another individual to provide retirement benefits or deferred compensation of which the principal is a participant, beneficiary, or owner, including a plan or account under the following sections of the Internal Revenue Code:
(1) an individual retirement account under Internal Revenue Code 26 U.S.C. Section 408, as amended;
(2) a Roth individual retirement account under Internal Revenue Code 26 U.S.C. Section 408A, as amended;
(3) a deemed individual retirement account under Internal Revenue Code 26 U.S.C. Section 408(q), as amended;
(4) an annuity or mutual fund custodial account under Internal Revenue Code 26 U.S.C. Section 403(b), as amended;
(5) a pension, profit-sharing, stock bonus, or other retirement plan qualified under Internal Revenue Code 26 U.S.C. Section 401(a), as amended;
(6) a plan under Internal Revenue Code 26 U.S.C. Section 457(b), as amended; and
(7) a nonqualified deferred compensation plan under Internal Revenue Code 26 U.S.C. Section 409A, as amended.
(b) Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to retirement plans authorizes the agent to:
(1) select the form and timing of payments under a retirement plan, including election of survivor benefits, and withdraw benefits from a plan;
(2) make a rollover, including a direct trustee-to-trustee rollover, of benefits from one retirement plan to another;
(3) establish a retirement plan in the principal's name;
(4) make contributions to a retirement plan;
(5) exercise investment powers available under a retirement plan; and
(6) borrow from, sell assets to, or purchase assets from a retirement plan.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-216. Taxes.
Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to taxes authorizes the agent to:
(1) prepare, sign, and file federal, state, local, and foreign income, gift, payroll, property, Federal Insurance Contributions Act, and other tax returns, claims for refunds, requests for extension of time, petitions regarding tax matters, and other tax-related documents, including receipts, offers, waivers, consents, including consents and agreements pursuant to Internal Revenue Code 26 U.S.C. Section 2032A, as amended, closing agreements, and any power of attorney required by the Internal Revenue Service, including Form 2848 or other taxing authority with respect to a tax year upon which the statute of limitations has not run and the following twenty-five tax years;
(2) pay taxes due, collect refunds, post bonds, receive confidential information, and contest deficiencies determined by the Internal Revenue Service or other taxing authority;
(3) exercise any election available to the principal under federal, state, local, or foreign tax law; and
(4) act for the principal in all tax matters for all periods before the Internal Revenue Service, or other taxing authority.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-217. Gifts.
(a) In this section, a gift "for the benefit of" a person includes a gift to a trust, an account under the Uniform Transfers to Minors Act, and a tuition savings account or prepaid tuition plan as defined in Internal Revenue Code 26 U.S.C. Section 529, as amended.
(b) Unless the power of attorney otherwise provides and subject to Section 62-8-201, language in a power of attorney granting general authority with respect to gifts authorizes the agent to:
(1) make outright to, or for the benefit of, a person, a gift of any of the principal's property, including by the exercise of a presently exercisable general power of appointment held by the principal, in an amount per donee not to exceed the annual dollar limits of the federal gift tax exclusion pursuant to Internal Revenue Code 26 U.S.C. Section 2503(b), as amended, without regard to whether the federal gift tax exclusion applies to the gift, or if the principal's spouse agrees to consent to a split gift pursuant to Internal Revenue Code 26 U.S.C. 2513, as amended, in an amount per donee not to exceed twice the annual federal gift tax exclusion limit; and
(2) consent, pursuant to Internal Revenue Code 26 U.S.C. Section 2513, as amended, to the splitting of a gift made by the principal's spouse in an amount per donee not to exceed the aggregate annual gift tax exclusions for both spouses.
(3) An agent may make a gift of the principal's property only as the agent determines is consistent with the principal's objectives if actually known by the agent and, if unknown, as the agent determines is consistent with the principal's best interest based on:
(A) the value and nature of the principal's property;
(B) the principal's foreseeable obligations and need for maintenance;
(C) minimization of taxes, including income, estate, inheritance, generation-skipping transfer, and gift taxes;
(D) eligibility for a benefit, a program, or assistance under a statute or regulation; and
(E) the principal's personal history of making or joining in making gifts.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
Part 4
Miscellaneous Provisions
SECTION 62-8-401. Jurisdiction.
The probate court has concurrent jurisdiction with the circuit courts of this State over all subject matter related to the creation, exercise, construction, and termination of powers of attorney governed by the provisions of this article.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-402. Relation to Electronic Signatures in Global and National Commerce Act.
This article modifies, limits, and supersedes the federal Electronic Signatures in Global and National Commerce Act, 15 U.S.C. Section 7001, et seq., but 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).
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017.
SECTION 62-8-403. Effect on existing powers of attorney.
Except as otherwise provided in this article on the effective date of this act:
(a) this article applies to a power of attorney created on or after the effective date of this act;
(b) the procedural provisions of this article apply to a judicial proceeding concerning a power of attorney commenced on or after the effective date of this act;
(c) the applicable law in effect before the effective date of this act applies to a power of attorney created or restated before the effective date of this act;
(d) the procedural provisions of this article apply to a judicial proceeding concerning a power of attorney commenced before the effective date of this act unless the court finds that application of a procedural provision of this act would substantially interfere with the effective conduct of the judicial proceeding or prejudice the rights of a party, in which case that procedural provision does not apply and the applicable procedural provision in effect at the commencement of the judicial proceeding applies; and
(e) an act done before the effective date of this act is not affected by this act.
HISTORY: 2016 Act No. 279 (S.778), § 1, eff January 1, 2017. |
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