Minnesota Session Laws - 1992, Regular Session

  

                         Laws of Minnesota 1992 

                        CHAPTER 461-S.F.No. 2368 
           An act relating to probate; allowing collection of 
          personal property by affidavit; enacting the uniform 
          transfer on death security registration act; providing 
          for rights of creditors and revocation of beneficiary 
          designation by will; amending Minnesota Statutes 1990, 
          section 168A.14, by adding a subdivision; Minnesota 
          Statutes 1991 Supplement, section 524.3-1201; 
          proposing coding for new law in Minnesota Statutes, 
          chapter 524. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 

                                ARTICLE 1

              Collection of Personal Property by Affidavit
    Section 1.  Minnesota Statutes 1990, section 168A.14, is 
amended by adding a subdivision to read: 
    Subd. 1a.  The department, upon receipt of an affidavit as 
provided in section 524.3-1201(a), an application for a new 
certificate of title, and any required fee, shall issue a new 
certificate of title in the name of the successor as owner, 
listing any secured party on it.  The department shall mail the 
certificate to the successor and shall issue any secured party a 
notification that the security interest has been filed. 
    Sec. 2.  Minnesota Statutes 1991 Supplement, section 
524.3-1201, is amended to read: 
    524.3-1201 [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 an instrument evidencing a debt, 
obligation, stock or chose in action to a person claiming to be 
the successor of the decedent, or a county agency with a claim 
authorized by section 256B.15, upon being presented a certified 
death certificate of the decedent and an affidavit, in 
duplicate, made by or on behalf of the successor stating that: 
    (1) the value of the entire probate estate, wherever 
located, less liens and encumbrances, does not exceed $10,000; 
    (2) 30 days have elapsed since the death of the decedent; 
    (3) no application or petition for the appointment of a 
personal representative is pending or has been granted in any 
jurisdiction; and 
    (4) the claiming successor is entitled to payment or 
delivery of the property. 
    (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). 
    (c) The claiming successor or county agency shall disburse 
the proceeds collected under this section to any person with a 
superior claim under section 524.3-805 or 525.15. 
    (d) A motor vehicle registrar shall issue a new certificate 
of title in the name of the successor upon the presentation of 
an affidavit as provided in subsection (a). 

                                ARTICLE 2

         Enactment of the Uniform TOD Security Registration Act

                                ARTICLE 6

                                 Part 3

                  UNIFORM TOD SECURITY REGISTRATION ACT
    Section 1.  [524.6-301] [DEFINITIONS.] 
    In this part: 
    (1) "Beneficiary form" means a registration of a security 
which indicates the present owner of the security and the 
intention of the owner regarding the person who will become the 
owner of the security upon the death of the owner. 
    (2) "Register," including its derivatives, means to issue a 
certificate showing the ownership of a certificated security or, 
in the case of an uncertificated security, to initiate or 
transfer an account showing ownership of securities. 
    (3) "Registering entity" means a person who originates or 
transfers a security title by registration, and includes a 
broker maintaining security accounts for customers and a 
transfer agent or other person acting for or as an issuer of 
securities. 
    (4) "Security" means a share, participation, or other 
interest in property, in a business, or in an obligation of an 
enterprise or other issuer, and includes a certificated 
security, an uncertificated security, and a security account. 
    (5) "Security account" means (i) a reinvestment account 
associated with a security, a securities account with a broker, 
a cash balance in a brokerage account, cash, interest, earnings, 
or dividends earned or declared on a security in an account, a 
reinvestment account, or a brokerage account, whether or not 
credited to the account before the owner's death, or (ii) a cash 
balance or other property held for or due to the owner of a 
security as a replacement for or product of an account security, 
whether or not credited to the account before the owner's death. 
    Sec. 2.  [524.6-302] [REGISTRATION IN BENEFICIARY FORM; 
SOLE OR JOINT TENANCY OWNERSHIP.] 
    Only individuals whose registration of a security shows 
sole ownership by one individual or multiple ownership by two or 
more with right of survivorship, rather than as tenants in 
common, may obtain registration in beneficiary form.  Multiple 
owners of a security registered in beneficiary form hold as 
joint tenants with right of survivorship, as tenants by the 
entireties, or as owners of community property held in 
survivorship form, and not as tenants in common.  
    Sec. 3.  [524.6-303] [REGISTRATION IN BENEFICIARY FORM; 
APPLICABLE LAW.] 
     A security may be registered in beneficiary form if the 
form is authorized by this or a similar statute of the state of 
organization of the issuer or registering entity, the location 
of the registering entity's principal office, the office of its 
transfer agent or its office making the registration, or by this 
or a similar statute of the law of the state listed as the 
owner's address at the time of registration.  A registration 
governed by the law of a jurisdiction in which this or similar 
legislation is not in force or was not in force when a 
registration in beneficiary form was made is nevertheless 
presumed to be valid and authorized as a matter of contract law. 
    Sec. 4.  [524.6-304] [ORIGINATION OF REGISTRATION IN 
BENEFICIARY FORM.] 
    A security, whether evidenced by certificate or account, is 
registered in beneficiary form when the registration includes a 
designation of a beneficiary to take the ownership at the death 
of the owner or the deaths of all multiple owners. 
     Sec. 5.  [524.6-305] [FORM OF REGISTRATION IN BENEFICIARY 
FORM.] 
    Registration in beneficiary form may be shown by the words 
"transfer on death" or the abbreviation "TOD," or by the words 
"pay on death" or the abbreviation "POD," after the name of the 
registered owner and before the name of a beneficiary. 
    Sec. 6.  [524.6-306] [EFFECT OF REGISTRATION IN BENEFICIARY 
FORM.] 
    The designation of a TOD beneficiary on a registration in 
beneficiary form has no effect on ownership until the owner's 
death.  A registration of a security in beneficiary form may be 
canceled or changed at any time by the sole owner or all then 
surviving owners without the consent of the beneficiary. 
    Sec. 7.  [524.6-307] [OWNERSHIP ON DEATH OF OWNER.] 
    On death of a sole owner or the last to die of all multiple 
owners, ownership of securities registered in beneficiary form 
passes to the beneficiary or beneficiaries who survive all 
owners.  On proof of death of all owners and compliance with any 
applicable requirements of the registering entity, a security 
registered in beneficiary form may be reregistered in the name 
of the beneficiary or beneficiaries who survive the death of all 
owners.  Until division of the security after the death of all 
owners, multiple beneficiaries surviving the death of all owners 
hold their interests as tenants in common.  If no beneficiary 
survives the death of all owners, the security belongs to the 
estate of the deceased sole owner or the estate of the last to 
die of all multiple owners. 
     Sec. 8.  [524.6-3075] [RIGHTS OF CREDITORS.] 
     A registration in beneficiary form is not effective against 
an estate of a deceased sole owner or a deceased last to die of 
multiple owners to transfer to a beneficiary or beneficiaries 
sums needed to pay debts, taxes, and expenses of administration, 
including statutory allowances to the surviving spouse, minor 
children, and dependent children, if other assets of the estate 
are insufficient.  A TOD beneficiary in whose name a security is 
registered after the death of the owner is liable to account to 
the deceased owner's personal representative for securities so 
registered or their proceeds to the extent necessary to 
discharge such claims and charges remaining unpaid after the 
application of the assets of the decedent's estate.  A 
proceeding to assert this liability may not be commenced unless 
the personal representative has received a written demand by a 
surviving spouse, a creditor, or one acting for a minor 
dependent child of the decedent, and a proceeding may not be 
commenced later than two years following the death of the 
decedent.  A beneficiary against whom the proceeding is brought 
may elect to transfer to the personal representative the 
security registered in the name of the beneficiary after the 
death of the deceased owner if the beneficiary still owns the 
security, or the net proceeds received by the beneficiary upon 
disposition of the security by the beneficiary, and that 
transfer fully discharges the beneficiary from all liability 
under this section.  Amounts or securities recovered by the 
personal representative must be administered as part of the 
deceased owner's estate. 
     This section does not affect the right of a registering 
entity to register a security in the name of the beneficiary, or 
make a registering entity liable to the estate of a deceased 
owner, except for a reregistration after a registering entity 
has received written notice from any claimant to an interest in 
the security objecting to implementation of a registration in 
beneficiary form. 
    Sec. 9.  [524.6-308] [PROTECTION OF REGISTERING ENTITY.] 
    (a) A registering entity is not required to offer or to 
accept a request for security registration in beneficiary form.  
If a registration in beneficiary form is offered by a 
registering entity, the owner requesting registration in 
beneficiary form assents to the protections given to the 
registering entity by this part. 
     (b) By accepting a request for registration of a security 
in beneficiary form, the registering entity agrees that the 
registration will be implemented on death of the deceased owner 
as provided in this part. 
     (c) A registering entity is discharged from all claims to a 
security by the estate, creditors, heirs, or devisees of a 
deceased owner if it registers a transfer of the security in 
accordance with section 524.6-307 and does so in good faith 
reliance (i) on the registration, (ii) on this part, and (iii) 
on information provided to it by affidavit of the personal 
representative of the deceased owner, or by the surviving 
beneficiary or by the surviving beneficiary's representatives, 
or other information available to the registering entity.  The 
protections of this part do not extend to a reregistration or 
payment made after a registering entity has received written 
notice from any claimant to any interest in the security 
objecting to implementation of a registration in beneficiary 
form.  No other notice or other information available to the 
registering entity affects its right to protection under this 
part. 
     (d) The protection provided by this part to the registering 
entity of a security does not affect the rights of beneficiaries 
in disputes between themselves and other claimants to ownership 
of the security transferred or its value or proceeds. 
     Sec. 10.  [524.6-309] [NONTESTAMENTARY TRANSFER ON DEATH.] 
    (a) A transfer on death resulting from a registration in 
beneficiary form is effective by reason of the contract 
regarding the registration between the owner and the registering 
entity and this part and is not testamentary. 
     (b) This part does not limit the rights of creditors of 
security owners against beneficiaries and other transferees 
under other laws of this state. 
    Sec. 11.  [524.6-3095] [REVOCATION OF BENEFICIARY 
DESIGNATION BY WILL.] 
    A registration in beneficiary form may be canceled by 
specific reference to the security or the securities account in 
the will of the sole owner or the last to die of multiple 
owners, but the terms of the revocation are not binding on the 
registering entity unless it has received written notice from 
any claimant to an interest in the security objecting to 
implementation of a registration in beneficiary form prior to 
the registering entity reregistering the security.  If the 
beneficiary designation is canceled, the security belongs to the 
estate of the deceased sole owner or the estate or the last to 
die of all multiple owners. 
    Sec. 12.  [524.6-310] [TERMS, CONDITIONS, AND FORMS FOR 
REGISTRATION.] 
    (a) A registering entity offering to accept registrations 
in beneficiary form may establish the terms and conditions under 
which it will receive requests (i) for registrations in 
beneficiary form, and (ii) for implementation of registrations 
in beneficiary form, including requests for cancellation of 
previously registered TOD beneficiary designations and requests 
for reregistration to effect a change of beneficiary.  The terms 
and conditions so established may provide for proving death, 
avoiding or resolving any problems concerning fractional shares, 
designating primary and contingent beneficiaries, and 
substituting a named beneficiary's descendants to take in the 
place of the named beneficiary in the event of the beneficiary's 
death.  Substitution may be indicated by appending to the name 
of the primary beneficiary the letters LDPS, standing for 
"lineal descendants per stirpes."  This designation substitutes 
a deceased beneficiary's descendants who survive the owner for a 
beneficiary who fails to so survive, the descendants to be 
identified and to share in accordance with the law of the 
beneficiary's domicile at the owner's death governing 
inheritance by descendants of an intestate.  Other forms of 
identifying beneficiaries who are to take on one or more 
contingencies, and rules for providing proofs and assurances 
needed to satisfy reasonable concerns by registering entities 
regarding conditions and identities relevant to accurate 
implementation of registrations in beneficiary form, may be 
contained in a registering entity's terms and conditions. 
    (b) The following are illustrations of registrations in 
beneficiary form which a registering entity may authorize: 
    (1) Sole owner-sole beneficiary:  John S. Brown TOD (or POD)
John S. Brown Jr. 
    (2) Multiple owners-sole beneficiary:  John S. Brown Mary B.
Brown JT TEN TOD John S. Brown Jr. 
    (3) Multiple owners-primary and secondary (substituted) 
beneficiaries:  John S. Brown Mary B. Brown JT TEN TOD John S. 
Brown Jr. SUB BENE Peter Q. Brown or John S. Brown Mary B. Brown 
JT TEN TOD John S. Brown Jr. LDPS. 
    Sec. 13.  [524.6-311] [APPLICATION.] 
    Sections 1 to 13 apply to registrations of securities in 
beneficiary form made before, on, or after the effective date of 
sections 1 to 13 by decedents dying on or after the effective 
date. 
    Sec. 14.  [EFFECTIVE DATE.] 
    This act is effective June 1, 1992. 
    Presented to the governor April 14, 1992 
    Signed by the governor April 15, 1992, 1:25 p.m.