Florida Senate - 2009 SB 1396
By Senator Aronberg
27-00409B-09 20091396__
1 A bill to be entitled
2 An act relating to administration of estates; amending
3 s. 731.201, F.S.; revising definitions; amending s.
4 732.108, F.S.; providing for nonapplication of certain
5 limitation-of-action provisions to certain paternity
6 determinations; amending s. 732.2025, F.S.; revising a
7 definition; amending s. 732.2045, F.S.; expanding an
8 exclusion from application of certain provisions of
9 law; amending s. 732.2075, F.S.; revising provisions
10 for satisfaction of an elective share; providing
11 additional requirements; amending s. 732.2085, F.S.;
12 correcting a cross-reference; amending s. 732.2135,
13 F.S.; revising criteria for time of an election;
14 providing for award of attorney fees and costs for
15 elections made in bad faith; amending s. 732.402,
16 F.S.; revising criteria for certain household items,
17 motor vehicles, and tuition programs as exempt
18 property; amending s. 733.201, F.S.; revising a
19 criterion for proof of wills to conform; amending s.
20 733.504, F.S.; revising a criterion for removal of a
21 personal representative to conform; amending s.
22 733.602, F.S.; removing a cross-reference; amending s.
23 735.203, F.S.; revising requirements for a petition
24 for summary administration; amending s. 739.102, F.S.;
25 revising a definition; amending s. 739.104, F.S.;
26 excluding from court approval certain disclaimers of
27 interests in property; amending s. 739.201, F.S.;
28 providing an additional rule applicable to disclaimers
29 of interests in property; amending s. 739.207, F.S.;
30 limiting a criterion for effectiveness of a disclaimer
31 of power held in a fiduciary capacity; amending s.
32 739.402, F.S.; correcting terminology; amending s.
33 739.501, F.S.; preserving application of certain
34 provisions to effectiveness of certain disclaimers or
35 transfers; amending ss. 660.417, 736.0802, and 895.02,
36 F.S.; correcting cross-references to conform;
37 providing an effective date.
38
39 Be It Enacted by the Legislature of the State of Florida:
40
41 Section 1. Subsection (21) of section 731.201, Florida
42 Statutes, is amended, subsections (25) through (39) of that
43 section are renumbered as subsections (26) through (40),
44 respectively, and a new subsection (25) is added to that
45 section, to read:
46 731.201 General definitions.—Subject to additional
47 definitions in subsequent chapters that are applicable to
48 specific chapters or parts, and unless the context otherwise
49 requires, in this code, in s. 409.9101, and in chapters 736,
50 738, 739, and 744, the term:
51 (21) “Incapacitated” “Incompetent” means a judicial
52 determination that a person lacks the capacity to manage at
53 least some of the person's property or to meet at least some of
54 the person's essential health and safety requirements. A minor
55 shall be treated as being incapacitated or a person adjudicated
56 incompetent.
57 (25) “Minor” means a person under 18 years of age whose
58 disabilities have not been removed by marriage or otherwise.
59 Section 2. Paragraph (b) of subsection (2) of section
60 732.108, Florida Statutes, is amended to read:
61 732.108 Adopted persons and persons born out of wedlock.—
62 (2) For the purpose of intestate succession in cases not
63 covered by subsection (1), a person born out of wedlock is a
64 descendant of his or her mother and is one of the natural
65 kindred of all members of the mother's family. The person is
66 also a descendant of his or her father and is one of the natural
67 kindred of all members of the father's family, if:
68 (b) The paternity of the father is established by an
69 adjudication before or after the death of the father. Chapter 95
70 shall not apply in determining heirs in a probate proceeding
71 under this paragraph.
72 Section 3. Subsection (10) of section 732.2025, Florida
73 Statutes, is amended to read:
74 732.2025 Definitions.—As used in ss. 732.2025-732.2155, the
75 term:
76 (10) “Transfer in satisfaction of the elective share” means
77 an irrevocable transfer by the decedent during life to an
78 elective share trust.
79 Section 4. Paragraph (f) of subsection (1) of section
80 732.2045, Florida Statutes, is amended to read:
81 732.2045 Exclusions and overlapping application.—
82 (1) EXCLUSIONS.—Section 732.2035 does not apply to:
83 (f) The decedent's one-half of the property to which ss.
84 732.216-732.228, or any similar provisions of law of another
85 state, apply and real property that is community property under
86 the laws of the jurisdiction where it is located.
87 Section 5. Section 732.2075, Florida Statutes, is amended
88 to read:
89 732.2075 Sources from which elective share payable;
90 abatement.—
91 (1) Unless otherwise provided in the decedent's will or, in
92 the absence of a provision in the decedent's will, in a trust
93 referred to in the decedent's will, the following are applied
94 first to satisfy the elective share:
95 (a) Property interests included in the elective estate that
96 pass or have passed to or for the benefit of the surviving
97 spouse, including interests that are contingent upon making the
98 election, but only to the extent that such contingent interests
99 do not diminish other property interests that would be applied
100 to satisfy the elective share in the absence of the contingent
101 interests. To the extent paid to or for the benefit of the
102 surviving spouse, the proceeds of any term or other policy of
103 insurance on the decedent's life if, at the time of decedent's
104 death, the policy was owned by any person other than the
105 surviving spouse.
106 (b) To the extent paid to or for the benefit of the
107 surviving spouse, amounts payable under any plan or arrangement
108 described in s. 732.2035(7).
109 (c) To the extent paid to or for the benefit of the
110 surviving spouse, the decedent's one-half of any property
111 described in s. 732.2045(1)(f).
112 (d) To the extent paid to or for the benefit of the
113 surviving spouse, the proceeds of any term or other policy of
114 insurance on the decedent's life if, at the time of decedent's
115 death, the policy was owned by any person other than the
116 surviving spouse.
117 (e)(d) Property held for the benefit of the surviving
118 spouse in a qualifying special needs trust.
119 (e) Property interests included in the elective estate that
120 pass or have passed to or for the benefit of the surviving
121 spouse, including interests that are contingent upon making the
122 election, but only to the extent that such contingent interests
123 do not diminish other property interests that would be applied
124 to satisfy the elective share in the absence of the contingent
125 interests.
126 (f) Property interests that would have satisfied the
127 elective share under any preceding paragraph of this subsection
128 but were disclaimed.
129 (2) If, after the application of subsection (1), the
130 elective share is not fully satisfied, the unsatisfied balance
131 shall be allocated entirely to one class of apportioned among
132 the direct recipients of the remaining elective estate and
133 apportioned among those recipients, and if the elective share
134 amount is not fully satisfied, to the next class of direct
135 recipients, in the following order of priority, until the
136 elective share amount is satisfied:
137 (a) Class 1.—The decedent's probate estate and revocable
138 trusts.
139 (b) Class 2.—Recipients of property interests, other than
140 protected charitable interests, included in the elective estate
141 under s. 732.2035(2), (3), or (6) and, to the extent the
142 decedent had at the time of death the power to designate the
143 recipient of the property, property interests, other than
144 protected charitable interests, included under s. 732.2035(5)
145 and (7).
146 (c) Class 3.—Recipients of all other property interests,
147 other than protected charitable interests, included in the
148 elective estate.
149 (d) Class 4.—Recipients of protected charitable lead
150 interests, but only to the extent and at such times that
151 contribution is permitted without disqualifying the charitable
152 interest in that property for a deduction under the United
153 States gift tax laws.
154 For purposes of this subsection, a protected charitable interest
155 is any interest for which a charitable deduction with respect to
156 the transfer of the property was allowed or allowable to the
157 decedent or the decedent's spouse under the United States gift
158 or income tax laws. A protected charitable lead interest is a
159 protected charitable interest where one or more deductible
160 interests in charity precede some other nondeductible interest
161 or interests in the property.
162 (3) If, after the application of subsections (1) and (2),
163 the elective share amount is not fully satisfied, the additional
164 amount due to the surviving spouse shall be determined and
165 satisfied as follows:
166 (a) The remaining unsatisfied balance shall be satisfied
167 from property described in paragraphs (1)(a) and (b) which
168 passes or which has passed in a trust in which the surviving
169 spouse has a beneficial interest, other than an elective share
170 trust or a qualified special needs trust.
171 (b) In determining the amount of the remaining unsatisfied
172 balance, the effect, if any, of any change caused by the
173 operation of this subsection in the value of the spouse's
174 beneficial interests in property described in paragraphs (1)(a)
175 and (b) shall be taken into account, including, if necessary,
176 further recalculations of the value of those beneficial
177 interests.
178 (c) If there is more than one trust to which this
179 subsection could apply, unless otherwise provided in the
180 decedent's will or, in the absence of a provision in the
181 decedent's will, in a trust referred to in the decedent's will,
182 the unsatisfied balance shall be apportioned pro rata to all
183 such trusts in proportion to the value, as determined under s.
184 732.2095(2)(d), of the surviving spouse's beneficial interests
185 in the trusts.
186 (4) If, after the application of subsections (1), (2), and
187 (3), the elective share is not fully satisfied, any remaining
188 unsatisfied balance shall be satisfied from direct recipients of
189 protected charitable lead interests, but only to the extent and
190 at such times that contribution is permitted without
191 disqualifying the charitable interest in that property for a
192 deduction under the United States gift tax laws. For purposes of
193 this subsection, a protected charitable lead interest is a
194 protected charitable interest as defined in subsection (2) in
195 which one or more deductible interests in charity precede some
196 other nondeductible interest or interests in the property.
197 (5)(3) The contribution required of the decedent's probate
198 estate and revocable trusts may be made in cash or in kind. In
199 the application of this subsection, subsections (6) (4) and (7)
200 (5) are to be applied to charge contribution for the elective
201 share to the beneficiaries of the probate estate and revocable
202 trusts as if all beneficiaries were taking under a common
203 governing instrument.
204 (6)(4) Unless otherwise provided in the decedent's will or,
205 in the absence of a provision in the decedent's will, in a trust
206 referred to in the decedent's will, any amount to be satisfied
207 from the decedent's probate estate, other than from property
208 passing to an inter vivos trust, shall be paid from the assets
209 of the probate estate in the order prescribed in s. 733.805.
210 (7)(5) Unless otherwise provided in the trust instrument
211 or, in the decedent's will if there is no provision in the trust
212 instrument, any amount to be satisfied from trust property shall
213 be paid from the assets of the trust in the order provided for
214 claims under s. 736.05053(2) and (3). A direction in the
215 decedent's will is effective only for revocable trusts.
216 Section 6. Paragraph (a) of subsection (1) of section
217 732.2085, Florida Statutes, is amended to read:
218 732.2085 Liability of direct recipients and beneficiaries.—
219 (1) Only direct recipients of property included in the
220 elective estate and the beneficiaries of the decedent's probate
221 estate or of any trust that is a direct recipient, are liable to
222 contribute toward satisfaction of the elective share.
223 (a) Within each of the classes described in s.
224 732.2075(2)(b) and, (c), and (d), each direct recipient is
225 liable in an amount equal to the value, as determined under s.
226 732.2055, of the proportional part of the liability for all
227 members of the class.
228 Section 7. Subsection (3) of section 732.2135, Florida
229 Statutes, is amended, and subsection (5) is added to that
230 section, to read:
231 732.2135 Time of election; extensions; withdrawal.—
232 (3) The surviving spouse or an attorney in fact, guardian
233 of the property, or personal representative of the surviving
234 spouse may withdraw an election at any time within on or before
235 the earlier of the date that is 8 months after the date of the
236 decedent's death and before the court's or the date of a court
237 order of contribution. If an election is withdrawn, the court
238 may assess attorney's fees and costs against the surviving
239 spouse or the surviving spouse's estate.
240 (5) If the court determines that an election is made or
241 pursued in bad faith, the court may assess attorney's fees and
242 costs against the surviving spouse or the surviving spouse's
243 estate.
244 Section 8. Subsection (2) of section 732.402, Florida
245 Statutes, is amended to read:
246 732.402 Exempt property.—
247 (2) Exempt property shall consist of:
248 (a) Household furniture, furnishings, and appliances in the
249 decedent's usual place of abode up to a net value of $20,000
250 $10,000 as of the date of death.
251 (b) Two motor vehicles as defined in s. 316.003(21), which
252 do not, individually as to either such motor vehicle, have a
253 gross vehicle weight in excess of 15,000 pounds, All automobiles
254 held in the decedent's name and regularly used by the decedent
255 or members of the decedent's immediate family as their personal
256 motor vehicles automobiles.
257 (c) All qualified tuition programs authorized by s. 529 of
258 the Internal Revenue Code of 1986, as amended, including, but
259 not limited to, the Florida Prepaid College Trust Fund advance
260 payment contracts under s. 1009.98 and the Florida Prepaid
261 College Trust Fund participation agreements under s. 1009.981
262 Stanley G. Tate Florida Prepaid College Program contracts
263 purchased and Florida College Savings agreements established
264 under part IV of chapter 1009.
265 (d) All benefits paid pursuant to s. 112.1915.
266 Section 9. Subsection (3) of section 733.201, Florida
267 Statutes, is amended to read:
268 733.201 Proof of wills.—
269 (3) If it appears to the court that the attesting witnesses
270 cannot be found or that they have become incapacitated
271 incompetent after the execution of the will or their testimony
272 cannot be obtained within a reasonable time, a will may be
273 admitted to probate upon the oath of the personal representative
274 nominated by the will as provided in subsection (2), whether or
275 not the nominated personal representative is interested in the
276 estate, or upon the oath of any person having no interest in the
277 estate under the will stating that the person believes the
278 writing exhibited to be the true last will of the decedent.
279 Section 10. Subsection (1) of section 733.504, Florida
280 Statutes, is amended to read:
281 733.504 Removal of personal representative; causes for
282 removal.—A personal representative may be removed and the
283 letters revoked for any of the following causes, and the removal
284 shall be in addition to any penalties prescribed by law:
285 (1) Adjudication that the personal representative is
286 incapacitated of incompetency.
287 Section 11. Subsection (1) of section 733.602, Florida
288 Statutes, is amended to read:
289 733.602 General duties.—
290 (1) A personal representative is a fiduciary who shall
291 observe the standards of care applicable to trustees as
292 described by part VII of chapter 736. A personal representative
293 is under a duty to settle and distribute the estate of the
294 decedent in accordance with the terms of the decedent's will and
295 this code as expeditiously and efficiently as is consistent with
296 the best interests of the estate. A personal representative
297 shall use the authority conferred by this code, the authority in
298 the will, if any, and the authority of any order of the court,
299 for the best interests of interested persons, including
300 creditors.
301 Section 12. Section 735.203, Florida Statutes, is amended
302 to read:
303 735.203 Petition for summary administration.—
304 (1) A petition for summary administration may be filed by
305 any beneficiary or person nominated as personal representative
306 in the decedent's will offered for probate. The petition must be
307 signed and verified by the surviving spouse, if any, and any
308 beneficiaries except that the joinder in a petition for summary
309 administration is not required of a beneficiary who will receive
310 full distributive share under the proposed distribution. Any
311 beneficiary not joining shall be served by formal notice with
312 the petition.
313 (2) If a person named in subsection (1) has died, is
314 incapacitated, or is a minor, or has conveyed or transferred all
315 interest in the property of the estate, then, as to that person,
316 the petition must be signed and verified certified by:
317 (a) The personal representative, if any, of a deceased
318 person or, if none, the surviving spouse, if any, and the
319 beneficiaries;
320 (b) The guardian of an incapacitated person or a minor; or
321 (c) The grantee or transferee of any of them shall be
322 authorized to sign and verify the petition instead of the
323 beneficiary or surviving spouse.
324 (3) If each trustee of a trust that is a beneficiary of the
325 estate of the deceased person is also a petitioner, each
326 qualified beneficiary of the trust as defined in s. 736.0103
327 shall be served by formal notice with the petition for summary
328 administration unless joinder in, or consent to, the petition is
329 obtained from each qualified beneficiary of the trust. The
330 joinder in, or consent to, a petition for summary administration
331 is not required of a beneficiary who will receive full
332 distributive share under the proposed distribution. Any
333 beneficiary not joining or consenting shall receive formal
334 notice of the petition.
335 Section 13. Subsection (8) of section 739.102, Florida
336 Statutes, is amended to read:
337 739.102 Definitions.—As used in this chapter, the term:
338 (8) “Insolvent” means, solely for purposes of this chapter,
339 that the sum of a person's debts is greater than all of the
340 person's assets at fair valuation and that. A person is presumed
341 to be “insolvent” if the person is generally not paying his or
342 her debts as they become due. For purposes of this subsection,
343 the term “assets” has the same meaning as that provided in s.
344 726.102.
345 Section 14. Subsection (2) of section 739.104, Florida
346 Statutes, is amended to read:
347 739.104 Power to disclaim; general requirements; when
348 irrevocable.—
349 (2) With court approval, a fiduciary may disclaim, in whole
350 or part, any interest in or power over property, including a
351 power of appointment, except that a disclaimer of a power
352 arising under s. 739.201(4) does not require court approval.
353 Without court approval, a fiduciary may disclaim, in whole or in
354 part, any interest in or power over property, including a power
355 of appointment, if and to the extent that the instrument
356 creating the fiduciary relationship explicitly grants the
357 fiduciary the right to disclaim. In the absence of a court
358 appointed guardian, notwithstanding anything in chapter 744 to
359 the contrary, without court approval, a natural guardian under
360 s. 744.301 may disclaim on behalf of a minor child of the
361 natural guardian, in whole or in part, any interest in or power
362 over property, including a power of appointment, which the minor
363 child is to receive solely as a result of another disclaimer,
364 but only if the disclaimed interest or power does not pass to or
365 for the benefit of the natural guardian as a result of the
366 disclaimer.
367 Section 15. Subsection (4) is added to section 739.201,
368 Florida Statutes, to read:
369 739.201 Disclaimer of interest in property.—Except for a
370 disclaimer governed by s. 739.202, s. 739.203, or s. 739.204,
371 the following rules apply to a disclaimer of an interest in
372 property:
373 (4) In the case of a disclaimer of property over which the
374 disclaimant has a power, in a fiduciary or nonfiduciary
375 capacity, to direct the beneficial enjoyment of the disclaimed
376 property, unless the disclaimer specifically provides to the
377 contrary with reference to this subsection, the disclaimant
378 shall also be deemed to have disclaimed that power unless the
379 power is limited by an ascertainable standard, as defined in s.
380 736.0103, as in effect when the disclaimer becomes irrevocable.
381 Section 16. Subsection (3) of section 739.207, Florida
382 Statutes, is amended to read:
383 739.207 Disclaimer of power held in fiduciary capacity.—
384 (3) A disclaimer under this section is effective as to
385 another fiduciary if the disclaimer so provides and the
386 fiduciary disclaiming has the authority to bind the estate,
387 trust, or other person for whom the fiduciary is acting, except
388 that a disclaimer of a fiduciary power arising under s.
389 739.201(4) shall bind only the disclaiming fiduciary.
390 Section 17. Subsection (2) of section 739.402, Florida
391 Statutes, is amended to read:
392 739.402 When disclaimer is barred or limited.—
393 (2) A disclaimer of an interest in property is barred if
394 any of the following events occur before the disclaimer becomes
395 effective:
396 (a) The disclaimant disclaimer accepts the interest sought
397 to be disclaimed;
398 (b) The disclaimant voluntarily assigns, conveys,
399 encumbers, pledges, or transfers the interest sought to be
400 disclaimed or contracts to do so;
401 (c) The interest sought to be disclaimed is sold pursuant
402 to a judicial sale; or
403 (d) The disclaimant is insolvent when the disclaimer
404 becomes irrevocable.
405 Section 18. Section 739.501, Florida Statutes, is amended
406 to read:
407 739.501 Tax-qualified disclaimer.—Notwithstanding any other
408 provision of this chapter other than s. 739.402, if, as a result
409 of a disclaimer or transfer, the disclaimed or transferred
410 interest is treated pursuant to the provisions of s. 2518 of the
411 Internal Revenue Code of 1986 as never having been transferred
412 to the disclaimant, the disclaimer or transfer is effective as a
413 disclaimer under this chapter.
414 Section 19. Paragraph (b) of subsection (3) of section
415 660.417, Florida Statutes, is amended to read:
416 660.417 Investment of fiduciary funds in investment
417 instruments; permissible activity under certain circumstances;
418 limitations.—
419 (3) The fact that such bank or trust company or an
420 affiliate of the bank or trust company owns or controls
421 investment instruments shall not preclude the bank or trust
422 company acting as a fiduciary from investing or reinvesting in
423 such investment instruments, provided such investment
424 instruments:
425 (b) When sold to accounts for which the bank or trust
426 company is acting as a trustee of a trust as defined in s.
427 731.201(37):
428 1. Are available for sale to accounts of other customers;
429 and
430 2. If sold to other customers, are not sold to the trust
431 accounts upon terms that are less favorable to the buyer than
432 the terms upon which they are normally sold to the other
433 customers.
434 Section 20. Paragraph (f) of subsection (5) of section
435 736.0802, Florida Statutes, is amended to read:
436 736.0802 Duty of loyalty.—
437 (5)
438 (f)1. The trustee of a trust as defined described in s.
439 731.201(37) may request authority to invest in investment
440 instruments described in this subsection other than a qualified
441 investment instrument, by providing to all qualified
442 beneficiaries a written request containing the following:
443 a. The name, telephone number, street address, and mailing
444 address of the trustee and of any individuals who may be
445 contacted for further information.
446 b. A statement that the investment or investments cannot be
447 made without the consent of a majority of each class of the
448 qualified beneficiaries.
449 c. A statement that, if a majority of each class of
450 qualified beneficiaries consent, the trustee will have the right
451 to make investments in investment instruments, as defined in s.
452 660.25(6), which are owned or controlled by the trustee or its
453 affiliate, or from which the trustee or its affiliate receives
454 compensation for providing services in a capacity other than as
455 trustee, that such investment instruments may include investment
456 instruments sold primarily to trust accounts, and that the
457 trustee or its affiliate may receive fees in addition to the
458 trustee's compensation for administering the trust.
459 d. A statement that the consent may be withdrawn
460 prospectively at any time by written notice given by a majority
461 of any class of the qualified beneficiaries.
462 A statement by the trustee is not delivered if the statement is
463 accompanied by another written communication other than a
464 written communication by the trustee that refers only to the
465 statement.
466 2. For purposes of paragraph (e) and this paragraph:
467 a. “Majority of the qualified beneficiaries” means:
468 (I) If at the time the determination is made there are one
469 or more beneficiaries as described in s. 736.0103(14)(c), at
470 least a majority in interest of the beneficiaries described in
471 s. 736.0103(14)(a), at least a majority in interest of the
472 beneficiaries described in s. 736.0103(14)(b), and at least a
473 majority in interest of the beneficiaries described in s.
474 736.0103(14)(c), if the interests of the beneficiaries are
475 reasonably ascertainable; otherwise, a majority in number of
476 each such class; or
477 (II) If there is no beneficiary as described in s.
478 736.0103(14)(c), at least a majority in interest of the
479 beneficiaries described in s. 736.0103(14)(a) and at least a
480 majority in interest of the beneficiaries described in s.
481 736.0103(14)(b), if the interests of the beneficiaries are
482 reasonably ascertainable; otherwise, a majority in number of
483 each such class.
484 b. “Qualified investment instrument” means a mutual fund,
485 common trust fund, or money market fund described in and
486 governed by s. 736.0816(3).
487 c. An irrevocable trust is created upon execution of the
488 trust instrument. If a trust that was revocable when created
489 thereafter becomes irrevocable, the irrevocable trust is created
490 when the right of revocation terminates.
491 Section 21. Subsection (10) of section 895.02, Florida
492 Statutes, is amended to read:
493 895.02 Definitions.—As used in ss. 895.01-895.08, the term:
494 (10) “Trustee” means any of the following:
495 (a) Any person acting as trustee pursuant to a trust
496 established under s. 689.07 or s. 689.071 in which the trustee
497 holds legal or record title to real property.
498 (b) Any person who holds legal or record title to real
499 property in which any other person has a beneficial interest.
500 (c) Any successor trustee or trustees to any or all of the
501 foregoing persons.
502 However, the term “trustee” does not include any person
503 appointed or acting as a personal representative as defined in
504 s. 731.201(27) or appointed or acting as a trustee of any
505 testamentary trust or as a trustee of any indenture of trust
506 under which any bonds have been or are to be issued.
507 Section 22. This act shall take effect July 1, 2009.