1.1                          A bill for an act 
  1.2             relating to property; validating certain conveyances 
  1.3             by religious corporations; requiring published notice 
  1.4             of dispositions of certain real property in a marriage 
  1.5             dissolution action; regulating property held in 
  1.6             revocable trusts upon the dissolution of marriage; 
  1.7             regulating specific devises and distributions of 
  1.8             property under the uniform probate code; amending 
  1.9             Minnesota Statutes 1996, sections 315.121; 518.11; 
  1.10            524.2-402; 524.2-403; and 524.2-606; proposing coding 
  1.11            for new law in Minnesota Statutes, chapters 501B; and 
  1.12            524. 
  1.13  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.14     Section 1.  Minnesota Statutes 1996, section 315.121, is 
  1.15  amended to read: 
  1.16     315.121 [RELIGIOUS CORPORATIONS, CERTAIN CONVEYANCES 
  1.17  VALIDATED.] 
  1.18     All conveyances executed by any religious corporation 
  1.19  organized under this chapter, conveying real property within 
  1.20  this state that were recorded prior to July 1, 1984, have been 
  1.21  of record for more than six years in the office of the county 
  1.22  recorder or registrar of titles of the county in which the real 
  1.23  estate conveyed is located, and the record of the conveyance, 
  1.24  are legalized, validated, and confirmed, even though the 
  1.25  corporate records do not disclose that the execution of the 
  1.26  conveyance was authorized by the congregation of the religious 
  1.27  corporation in the manner provided by law, or the record of the 
  1.28  authorization has not been recorded in the office of the county 
  1.29  recorder or registrar of titles of the county in which the real 
  2.1   estate conveyed is located. 
  2.2      Sec. 2.  [501B.90] [EFFECT OF DISSOLUTION OF MARRIAGE.] 
  2.3      Subdivision 1.  [REVOCATION OF CERTAIN TRUST 
  2.4   PROVISIONS.] If after execution of a trust instrument in which a 
  2.5   sole grantor reserves a power to alter, amend, revoke, or 
  2.6   terminate the provisions of the trust, the grantor's marriage is 
  2.7   dissolved or annulled, the dissolution or annulment revokes any 
  2.8   disposition, provision for beneficial enjoyment or appointment 
  2.9   of property made by the trust instrument to a grantor's former 
  2.10  spouse, any provisions conferring a general or special power of 
  2.11  appointment on the former spouse and any appointment of the 
  2.12  former spouse as trustee, unless the trust instrument expressly 
  2.13  provides otherwise. 
  2.14     Subd. 2.  [PASSING OF PROPERTY.] Property prevented from 
  2.15  passing to a former spouse because of revocation by dissolution 
  2.16  or annulment of marriage passes as if the former spouse died on 
  2.17  the date of the entry of the judgment and decree dissolving or 
  2.18  annulling the grantor's marriage and other provisions conferring 
  2.19  some power or office on the former spouse are interpreted as if 
  2.20  the former spouse died on the date of the entry of the judgment 
  2.21  and decree dissolving or annulling the grantor's marriage.  
  2.22     Subd. 3.  [REVIVAL OF REVOKED PROVISIONS.] If provisions 
  2.23  are revoked solely by this section, they are revived by the 
  2.24  grantor's remarriage to the former spouse.  For purposes of this 
  2.25  chapter, dissolution of marriage includes divorce.  A decree of 
  2.26  separation which does not terminate the status of husband and 
  2.27  wife is not a dissolution of marriage for purposes of this 
  2.28  section.  No change of circumstances other than as described in 
  2.29  this section revokes a trust instrument.  
  2.30     Sec. 3.  Minnesota Statutes 1996, section 518.11, is 
  2.31  amended to read: 
  2.32     518.11 [SERVICE; ALTERNATE SERVICE; PUBLICATION.] 
  2.33     (a) Unless a proceeding is brought by both parties, copies 
  2.34  of the summons and petition shall be served on the respondent 
  2.35  personally.  
  2.36     (b) When service is made out of this state and within the 
  3.1   United States, it may be proved by the affidavit of the person 
  3.2   making the same.  When service is made without the United States 
  3.3   it may be proved by the affidavit of the person making the same, 
  3.4   taken before and certified by any United States minister, charge 
  3.5   d'affaires, commissioner, consul or commercial agent, or other 
  3.6   consular or diplomatic officer of the United States appointed to 
  3.7   reside in such country, including all deputies or other 
  3.8   representatives of such officer authorized to perform their 
  3.9   duties; or before an officer authorized to administer an oath 
  3.10  with the certificate of an officer of a court of record of the 
  3.11  country wherein such affidavit is taken as to the identity and 
  3.12  authority of the officer taking the same.  
  3.13     (c) If personal service cannot be made, the court may order 
  3.14  service of the summons by alternate means.  The application for 
  3.15  alternate service must include the last known location of the 
  3.16  respondent; the petitioner's most recent contacts with the 
  3.17  respondent; the last known location of the respondent's 
  3.18  employment; the names and locations of the respondent's parents, 
  3.19  siblings, children, and other close relatives; the names and 
  3.20  locations of other persons who are likely to know the 
  3.21  respondent's whereabouts; and a description of efforts to locate 
  3.22  those persons.  
  3.23     The court shall consider the length of time the 
  3.24  respondent's location has been unknown, the likelihood that the 
  3.25  respondent's location will become known, the nature of the 
  3.26  relief sought, and the nature of efforts made to locate the 
  3.27  respondent.  The court shall order service by first class mail, 
  3.28  forwarding address requested, to any addresses where there is a 
  3.29  reasonable possibility that mail or information will be 
  3.30  forwarded or communicated to the respondent.  
  3.31     If the petitioner seeks disposition of real estate located 
  3.32  within the state of Minnesota, the court shall order that the 
  3.33  summons, which shall contain the legal description of the real 
  3.34  estate, be published in the county where the real estate is 
  3.35  located.  The court may also order publication, within or 
  3.36  without the state, but only if it might reasonably succeed in 
  4.1   notifying the respondent of the proceeding.  Also, the court may 
  4.2   require the petitioner to make efforts to locate the respondent 
  4.3   by telephone calls to appropriate persons.  Service shall be 
  4.4   deemed complete 21 days after mailing or 21 days after 
  4.5   court-ordered publication. 
  4.6      Sec. 4.  Minnesota Statutes 1996, section 524.2-402, is 
  4.7   amended to read: 
  4.8      524.2-402 [DESCENT OF HOMESTEAD.] 
  4.9      (a) If there is a surviving spouse, the homestead, 
  4.10  including a manufactured home which is the family residence, 
  4.11  descends free from any testamentary or other disposition of it 
  4.12  to which the spouse has not consented in writing or as provided 
  4.13  by law, as follows: 
  4.14     (1) if there is no surviving descendant of decedent, to the 
  4.15  spouse; or 
  4.16     (2) if there are surviving descendants of decedent, then to 
  4.17  the spouse for the term of the spouse's natural life and the 
  4.18  remainder in equal shares to the decedent's descendants by 
  4.19  representation. 
  4.20     (b) If there is no surviving spouse and the homestead has 
  4.21  not been disposed of by will it descends as other real estate. 
  4.22     (c) If the homestead passes by descent or will to the 
  4.23  spouse or decedent's descendants, it is exempt from all debts 
  4.24  which were not valid charges on it at the time of decedent's 
  4.25  death except that the homestead is subject to a claim filed 
  4.26  pursuant to section 246.53 for state hospital care or 256B.15 
  4.27  for medical assistance benefits.  If the homestead passes to a 
  4.28  person other than a spouse or decedent's descendants, it is 
  4.29  subject to the payment of the items mentioned in section 
  4.30  524.2-101.  No lien or other charge against a homestead so 
  4.31  exempted is enforceable in the probate court, but expenses of 
  4.32  administration, funeral expenses, expenses of last illness, 
  4.33  taxes, and debts.  The claimant may seek to enforce the a lien 
  4.34  or other charge against a homestead so exempted by an 
  4.35  appropriate action in the district court. 
  4.36     (d) For purposes of this section, except as provided in 
  5.1   section 524.2-301, the surviving spouse is deemed to consent to 
  5.2   any testamentary or other disposition of the homestead to which 
  5.3   the spouse has not previously consented in writing unless the 
  5.4   spouse files in the manner provided in section 524.2-211, 
  5.5   paragraph (f), a petition that asserts the homestead rights 
  5.6   provided to the spouse by this section. 
  5.7      Sec. 5.  Minnesota Statutes 1996, section 524.2-403, is 
  5.8   amended to read: 
  5.9      524.2-403 [EXEMPT PROPERTY.] 
  5.10     (a) If there is a surviving spouse, then, in addition to 
  5.11  the homestead and family allowance, the surviving spouse is 
  5.12  entitled from the estate to: 
  5.13     (1) property not exceeding $10,000 in value in excess of 
  5.14  any security interests therein, in household furniture, 
  5.15  furnishings, appliances, and personal effects, subject to an 
  5.16  award of sentimental value property under section 525.152; and 
  5.17     (2) one automobile, if any, without regard to value. 
  5.18     (b) If there is no surviving spouse, the decedent's 
  5.19  children are entitled jointly to the same property as provided 
  5.20  in paragraph (a). 
  5.21     (c) If encumbered chattels are selected and the value in 
  5.22  excess of security interests, plus that of other exempt 
  5.23  property, is less than $10,000, or if there is not $10,000 worth 
  5.24  of exempt property in the estate, the surviving spouse or 
  5.25  children are entitled to other personal property of the estate, 
  5.26  if any, to the extent necessary to make up the $10,000 value. 
  5.27     (d) Rights to exempt property and assets needed to make up 
  5.28  a deficiency of exempt property have priority over all claims 
  5.29  against the estate, but the right to any assets to make up a 
  5.30  deficiency of exempt property abates as necessary to permit 
  5.31  earlier payment of the family allowance. 
  5.32     (e) The rights granted by this section are in addition to 
  5.33  any benefit or share passing to the surviving spouse or children 
  5.34  by the decedent's will, unless otherwise provided, by intestate 
  5.35  succession or by way of elective share.  
  5.36     (f) A claim under section 246.53, 256B.15, 256D.16, or 
  6.1   261.04 takes precedence over any rights granted to a decedent's 
  6.2   adult children under this section.  No rights granted to a 
  6.3   decedent's adult children under this section shall have 
  6.4   precedence over a claim under section 246.53, 256B.15, 256D.16, 
  6.5   261.04, or 524.3-805, paragraph (a), clause (1), (2), or (3). 
  6.6      Sec. 6.  Minnesota Statutes 1996, section 524.2-606, is 
  6.7   amended to read: 
  6.8      524.2-606 [NONADEMPTION OF SPECIFIC DEVISES; UNPAID 
  6.9   PROCEEDS OF SALE, CONDEMNATION, OR INSURANCE; SALE BY 
  6.10  CONSERVATOR OR GUARDIAN.] 
  6.11     (a) A specific devisee has a right to the specifically 
  6.12  devised property in the testator's estate at death and: 
  6.13     (1) any balance of the purchase price, together with any 
  6.14  security agreement, owing from a purchaser to the testator at 
  6.15  death by reason of sale of the property; 
  6.16     (2) any amount of a condemnation award for the taking of 
  6.17  the property unpaid at death; 
  6.18     (3) any proceeds unpaid at death on fire or casualty 
  6.19  insurance on or other recovery for injury to the property; and 
  6.20     (4) property owned by the testator at death and acquired as 
  6.21  a result of foreclosure, or obtained in lieu of foreclosure, of 
  6.22  the security interest for a specifically devised obligation. 
  6.23     (b) If specifically devised property is sold or mortgaged 
  6.24  by a conservator or guardian or by an agent acting within the 
  6.25  authority of a durable power of attorney for an incapacitated 
  6.26  principal, or if a condemnation award, insurance proceeds, or 
  6.27  recovery for injury to the property are paid to a conservator or 
  6.28  guardian or to an agent acting within the authority of a durable 
  6.29  power of attorney for an incapacitated principal, the specific 
  6.30  devisee has the right to a general pecuniary devise equal to the 
  6.31  net sale price, the amount of the unpaid loan, the condemnation 
  6.32  award, the insurance proceeds, or the recovery. 
  6.33     (c) The right of a specific devisee under paragraph (b) is 
  6.34  reduced by any right the devisee has under paragraph (a). 
  6.35     (d) For the purposes of the references in paragraph (b) to 
  6.36  a conservator or guardian or an agent acting within the 
  7.1   authority of a durable power of attorney, paragraph (b) does not 
  7.2   apply if after the sale, mortgage, condemnation, casualty, or 
  7.3   recovery; 
  7.4      (1) in the case of a conservator or guardian, it was 
  7.5   adjudicated that the testator's incapacity ceased and the 
  7.6   testator survived the adjudication by one year.; or 
  7.7      (2) in the case of an agent acting within the authority of 
  7.8   a durable power of attorney, the testator's incapacity ceased 
  7.9   and the testator survived for one year after the incapacity 
  7.10  ceased.  
  7.11     (e) For the purposes of the references in paragraph (b) to 
  7.12  an agent acting within the authority of a durable power of 
  7.13  attorney for an incapacitated principal, (i) "incapacitated 
  7.14  principal" means a principal who is an incapacitated person as 
  7.15  defined in section 525.54, subdivision 3, and (ii) a finding of 
  7.16  the principal's incapacity need not occur during the principal's 
  7.17  life.  
  7.18     Sec. 7.  [524.2-711] [FUTURE INTERESTS IN "HEIRS," "HEIRS 
  7.19  AT LAW," OR "NEXT OF KIN."] 
  7.20     If a governing instrument calls for a future distribution 
  7.21  to or creates a future interest in a designated individual's 
  7.22  "heirs," "heirs at law," or "next of kin," the property passes 
  7.23  to those persons, including the state of Minnesota under section 
  7.24  524.2-105, and in such shares as would succeed to the designated 
  7.25  individual's intestate estate under the laws of intestate 
  7.26  succession of the state of Minnesota if the designated 
  7.27  individual died when the disposition is to take effect in 
  7.28  possession or enjoyment.  If the designated individual's 
  7.29  surviving spouse is living at the time the disposition is to 
  7.30  take effect in possession or enjoyment, the surviving spouse is 
  7.31  an heir of the designated individual for the purposes of this 
  7.32  section, whether or not the surviving spouse is remarried. 
  7.33     Sec. 8.  [TRANSITION PROVISION.] 
  7.34     Section 1 does not affect any action or proceeding pending 
  7.35  on its effective date or that is commenced before February 1, 
  7.36  1998, involving the validity of a conveyance recorded or filed 
  8.1   after June 30, 1984, if a notice of the pendency of the action 
  8.2   or proceeding is recorded or filed before February 1, 1998, in 
  8.3   the office of the county recorder or registrar of titles in 
  8.4   which the real property affected by the action or proceeding is 
  8.5   located.  
  8.6      Sec. 9.  [APPLICATION.] 
  8.7      Section 2 applies to all trusts, whenever created, in which 
  8.8   a sole grantor has a power to alter, amend, revoke, or terminate 
  8.9   the provisions of the trust on the later of (1) the effective 
  8.10  date of this section, and (2) the date of the entry of the 
  8.11  judgment and decree dissolving or annulling the grantor's 
  8.12  marriage.