HB-5195, As Passed House, February 25, 2010

 

 

 

 

 

 

 

 

 

 

 

 

SUBSTITUTE FOR

 

HOUSE BILL NO. 5195

 

 

 

 

 

 

 

 

 

 

 

 

     A bill to amend 1998 PA 386, entitled

 

"Estates and protected individuals code,"

 

by amending sections 2802, 2803, and 2804 (MCL 700.2802, 700.2803,

 

and 700.2804).

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 2802. As used in this section and sections 2803 and 2804:

 

     (a) "Abuse, neglect, or exploitation" means any of the

 

following:

 

     (i) An intentional act, the commission of which is a felony,

 

prohibited under chapter XXA of the Michigan penal code, 1931 PA

 

328, MCL 750.145m to 750.145r.

 

     (ii) A violation of section 174a of the Michigan penal code,

 

1931 PA 328, MCL 750.174a.

 

     (iii) A criminal act that is an offense involving domestic

 

violence as that term is defined in section 27b of the code of

 

criminal procedure, 1927 PA 175, MCL 768.27b.

 

     (iv) An act that constitutes child abuse under section 136b of

 

the Michigan penal code, 1931 PA 328, MCL 750.136b.

 

     (v) A criminal act that constitutes abuse as that term is

 

defined in section 11 of the social welfare act, 1939 PA 280, MCL

 

400.11.

 

     (b) (a) "Disposition or appointment of property" includes, but

 

is not limited to, a transfer of an item of property or another

 

benefit to a beneficiary designated in a governing instrument.

 

     (c) (b) "Governing instrument" means a governing instrument

 

executed by the decedent.

 

     (d) "Offender" means the individual who was convicted of

 

committing the abuse, neglect, or exploitation.

 

     (e) (c) "Revocable" means, with respect to a disposition,

 

appointment, provision, or nomination, one under which the

 

decedent, at the time of or immediately before death, was alone

 

empowered, by law or under the governing instrument, to cancel the

 

designation in favor of the killer or offender, whether or not the

 

decedent was then empowered to designate himself or herself in

 

place of his or her killer or offender and whether or not the

 

decedent then had the capacity to exercise the power.

 

     Sec. 2803. (1) An individual who feloniously and intentionally

 

kills or who is convicted of committing abuse, neglect, or

 

exploitation with respect to the decedent forfeits all benefits

 

under this article with respect to the decedent's estate, including

 

an intestate share, an elective share, an omitted spouse's or

 

child's share, a homestead allowance, a family allowance, and

 

exempt property. If the decedent died intestate, the decedent's

 

intestate estate passes as if the killer or offender disclaimed his

 

or her intestate share.

 

     (2) The felonious and intentional killing or the conviction of

 

the offender for the abuse, neglect, or exploitation of the

 

decedent does all of the following:

 

     (a) Revokes all of the following that are revocable:

 

     (i) Disposition or appointment of property made by the decedent

 

to the killer or offender in a governing instrument.

 

     (ii) Provision in a governing instrument conferring a general

 

or nongeneral power of appointment on the killer or offender.

 

     (iii) Nomination of the killer or offender in a governing

 

instrument, nominating or appointing the killer or offender to

 

serve in a fiduciary or representative capacity, including a

 

personal representative, executor, trustee, or agent.

 

     (b) Severs the interests of the decedent and killer or

 

offender in property held by them at the time of the killing,

 

abuse, neglect, or exploitation as joint tenants with the right of

 

survivorship, transforming the interests of the decedent and killer

 

or offender into tenancies in common.

 

     (3) A severance under subsection (2)(b) does not affect a

 

third party interest in property acquired for value and in good

 

faith reliance on an apparent title by survivorship in the killer

 

or offender unless a writing declaring the severance has been

 

noted, registered, filed, or recorded in records appropriate to the

 

kind and location of the property that are relied upon, in the

 

ordinary course of transactions involving that type of property, as

 

evidence of ownership.

 

     (4) A provision of a governing instrument is given effect as

 

if the killer or offender disclaimed all provisions revoked by this

 

section or, in the case of a revoked nomination in a fiduciary or

 

representative capacity, as if the killer or offender predeceased

 

the decedent.

 

     (5) A killer's or offender's wrongful acquisition of property

 

or interest not covered by this section shall be treated in

 

accordance with the principle that a killer or offender cannot

 

profit from his or her wrong.

 

     (6) After all right to appeal has been exhausted, a judgment

 

of conviction establishing criminal accountability for the

 

felonious and intentional killing or the abuse, neglect, or

 

exploitation of the decedent conclusively establishes the convicted

 

individual as the decedent's killer or as an offender, as

 

applicable, for purposes of this section. In With respect to a

 

claim of felonious and intentional killing, in the absence of a

 

conviction, the court, upon the petition of an interested person,

 

shall determine whether, under the preponderance of evidence

 

standard, the individual would be found criminally accountable for

 

the felonious and intentional killing of the decedent. If the court

 

determines that, under that standard, the individual would be found

 

criminally accountable 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.

 

     (7) This section does not apply if the forfeiture, revocation,

 

or severance would occur because of abuse, neglect, or exploitation

 

and the decedent executed a governing instrument after the date of

 

the conviction expressing a specific intent to allow the offender

 

to inherit or otherwise receive the estate or property of the

 

decedent.

 

     Sec. 2804. (1) Except as otherwise provided in this section, a

 

payor or other third party is not liable for having made a payment

 

or transferred an item of property or another benefit to a

 

beneficiary designated in a governing instrument affected by an

 

intentional and felonious killing or by abuse, neglect, or

 

exploitation, or for having taken another action in reliance on the

 

validity of the governing instrument, upon request and satisfactory

 

proof of the decedent's death. A payor or other third party is

 

liable for a payment made or other action taken 3 7 or more

 

business days after the payor or other third party actually

 

receives written notice of a claimed forfeiture or revocation under

 

section 2803. A payor or other third party is not obligated to

 

determine whether the decedent was the victim of felonious killing

 

or abuse, neglect, or exploitation or to seek evidence relating to

 

such a killing or abuse, neglect, or exploitation even if the

 

circumstances of the decedent's death are suspicious as to the

 

beneficiary's participation in such a killing or if there is

 

evidence that would raise suspicions that the decedent was the

 

victim of abuse, neglect, or exploitation by the beneficiary. A

 

recipient who incorrectly receives a payment, transfer of property,

 

or other benefit is liable for the payment or transfer received,

 

whether or not written notice of the claim is given.

 

     (2) Written notice of a claimed forfeiture or revocation 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. Notice to a sales

 

representative of a payor or other third party does not constitute

 

notice to the payor or other third party.

 

     (3) The written notice under subsection (1) must include the

 

decedent's name, the name of the person asserting an interest, the

 

nature of the payment, item of property, or other benefit, and a

 

statement that a claim of forfeiture or revocation is being made

 

under section 2803, and, if the claim is based on a conviction for

 

abuse, neglect, or exploitation, a copy of the judgment of

 

conviction. Notice in a form or service in a manner other than that

 

described in this section does not impose liability on a payor or

 

other third party for an action taken in accordance with a

 

governing instrument.

 

     (4) Upon receipt of written notice of a claimed forfeiture or

 

revocation under this section, a payor or other third party may pay

 

an amount owed to the county treasurer of the county of the court

 

having jurisdiction of the probate proceedings relating to the

 

decedent's estate or, if no proceedings have been commenced, to the

 

county treasurer of the county of the decedent's residence. With a

 

payment under this section, the payor or other third party shall

 

file a copy of the written notice received by the payor or other

 

third party. A payment made to the county treasurer discharges the

 

payor or other third party from a claim for the value of an amount

 

paid to the county treasurer.

 

     (5) The county treasurer shall not charge a filing fee for a

 

payment to the county treasurer under this section. The county

 

treasurer shall hold the money in accordance with section 3917 and,

 

upon the court's determination under section 2803, shall disburse

 

the money in accordance with the determination.

 

     (6) The provision for payment to the county treasurer under

 

this section does not preclude a payor or other third party from

 

taking another action authorized by law or the governing

 

instrument.