SOUTH CAROLINA PROBATE CODE ARTICLE I Parts 1

Transcription

SOUTH CAROLINA PROBATE CODE
ARTICLE I
Parts 1 - 4
PART 1
SHORT TITLE, CONSTRUCTION, GENERAL PROVISIONS
§ 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.
§ 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 §§ 62-1-101 et seq. to the term "Code", unless the context clearly indicates
otherwise, shall mean the South Carolina Probate Code.
§ 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.
§ 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.
§ 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.
§ 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.
§ 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 or
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.
REPORTER'S COMMENTS
By virtue of this section, the six-year period of limitation provided by Section 15-3-530(7) of the
1976 Code for actions for relief on the ground of fraud is reduced, with respect to fraud
perpetrated in connection with proceedings and statements filed under this Code, or to circumvent
its provisions or purposes. Under this section, actions for relief on the ground of fraud must be
brought within two years after discovery of the fraud. In no event, however, may an action be
brought against one not the perpetrator of the fraud (such as an innocent party benefiting from the
fraud)
later
than
five
years
after
the
commission
of
the
fraud.
The last sentence of this section, however, excepts from this section actions "relating to fraud
practiced on a decedent during his lifetime which affect the succession of his estate" such as fraud
inducing the execution or revocation of a will. There is some general authority for the proposition
that one who is damaged by fraud which interferes with the making of a will may maintain an
action for damages against the person who commits the fraud, 79 Am. Jur. 2d, Wills Section 414.
In such a case, the six-year limitation provided by Section 15-3-530(7) of the 1976 Code should
continue to apply. In cases involving direct contest of wills which are allegedly the result of fraud,
however, the provisions of Section 62-3-108 would be applicable and a formal probate
proceeding would have to be commenced within the later of twelve months from the informal
probate or three years from the decedent's death, at which time the allegations of fraud would be
considered.
Effect of Amendment
The 2011 amendment clarified that any person injured by the effects of fraud may (i) obtain relief
against the perpetrator of the fraud and (ii) restitution from any person (other than a bona fide
purchaser) benefiting from the fraud.
§ 62-1-107. Evidence as to death or status. Applicability of Rules of Evidence.
In proceedings under this Code, the rules of evidence in courts of general jurisdiction including
any relating to simultaneous deaths, are applicable unless specifically displaced by the Code. In
addition, the following rules relating to determination of death and status are applicable:
(1) 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.
(2) 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.
(3) A person 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.
South Carolina Reporter's Comments
This section states that the rules of evidence that apply in circuit court also apply in probate court
proceedings unless specifically displaced by provisions of the South Carolina Probate Code. The
2011 Amendment removed those sections related to evidence as to the status of death, and these
provisions have been incorporated into §62-1-507 of the Uniform Simultaneous Death Act. See
§§62-1-500 to 62-1-510 for the Uniform Simultaneous Death Act.
§ 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.
REPORTER'S COMMENTS
This section allows one who is the holder of a presently exercisable "general power of
appointment" (which, in this context, means one having the power to take absolute ownership of
property to himself, either by appointment, by amendment, or by revocation) to agree to actions
taken by a personal representative or by a trustee, to consent to the modification or termination of
a trust or a deviation from its terms, and, thereby, to bind the beneficiaries whose interests are
subject to the power.
§ 62-1-109. Duties and obligations of lawyer arising out of relationship between 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.
§ 62-1-110. Fiduciary-lawyer privilege.
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.
This section was enacted and intended to: (i) expressly reject the concept of a "fiduciary
exception" to any attorney-client privilege; (ii) encourage full disclosure by the fiduciary to the
lawyer to further the administration of justice; and (iii) foster confidence between a fiduciary and
his lawyer that will lead to a trusting and open attorney-client dialogue. See Estate of Kofsky, 487
Pa. 473 (1979). This section also expressly rejects the holding set forth in the case of Riggs Natl.
Bank v. Zimmer, 355 A.2d 709 (Del. Ch. 1976)(trustee's invocation of the attorney-client
privilege does not shield document from disclosure to trust beneficiaries) as applied by the Court
in Floyd v. Floyd, 365 S.C. 56, 615 S.E.2d 465 (Ct. App. 2005).
§ 62-1-111. Attorney's fees and costs.
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.
This section was enacted to clarify the probate court's authority to award costs and expenses. See
§62-7-1004 for similar provision in the South Carolina Trust Code.
PART 2
DEFINITIONS
§ 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 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 § 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 § 62-2401.
(12A) "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.
(12B) "Fair Market Value" is the price that property would sell for on the open market. It is the
price 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.
(13) "Fiduciary" includes personal representative, guardian, conservator, and trustee.
(14) "Foreign personal representative" means a personal representative of another jurisdiction.
(15) "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.
(16) "Guardian" means a person appointed by the court as guardian who has qualified as a
guardian of an incapacitated person pursuant to testamentary or court appointment, but excludes
one who is merely a guardian ad litem or a statutory guardian.
(16A) "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.
(17) "Heirs" means those persons, including the surviving spouse, who are entitled under the
statute of intestate succession to the property of a decedent.
(18) "Incapacitated person" is as defined in § 62-5-101.
(19) "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.
(20) "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.
(21) "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.
(22) "Lease" includes an oil, gas, or other mineral lease.
(23) "Letters" includes letters testamentary, letters of guardianship, letters of administration, and
letters of conservatorship.
(24) "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.
(25) "Mortgage" means any conveyance, agreement, or arrangement in which real property is
used as security.
(26) "Nonresident decedent" means a decedent who was domiciled in another jurisdiction at the
time of his death.
(27) "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.
(28) "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.
(29) "Person" means an individual, a corporation, an organization, or other legal entity 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.
(30) "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.
(31) "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.
(31A) "Probate Estate" means the decedent's property passing under the decedent's will plus the
decedent's property passing by intestacy.
(32) "Proceeding" includes action at law and suit in equity.
(33) "Property" includes both real and personal property or any interest therein and means
anything that may be the subject of ownership.
(34) "Protected person" is as defined in § 62-5-101.
(35) "Protective proceeding" is as defined in § 62-5-101.
(36) "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.
(36A) "Security interest" means any conveyance, agreement, or arrangement in which personal
property is used as security.
(37) "Settlement" in reference to a decedent's estate includes the full process of administration,
distribution, and closing.
(38) "Special administrator" means a personal representative as described by §§62-3-614 through
62-3-618.
(39) "State" includes any means a state of the United States, the District of Columbia, the
Commonwealth of Puerto Rico, the United States Virgin Islands, a federally recognized Indian
tribe, or and any territory or insular possession subject to the legislative authority jurisdiction of
the United States.
(40) "Stepchild" with reference to any person means one who is the child , natural or adopted, of
such person's spouse but who is not the child , natural or adopted, of such person.
(41) "Successor personal representative" means a personal representative, other than a special
administrator, who is appointed to succeed a previously appointed personal representative.
(42) "Successors" means those persons, other than creditors, who are entitled to property of a
decedent under his will or this Code.
(43) "Testacy proceeding" means a formal proceeding to establish a will or determine intestacy.
(44) "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 Gifts to Minors Act, Article 5, 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.
(45) "Trustee" includes an original, additional, or successor trustee, whether or not appointed or
confirmed by court.
(46) "Ward" is as defined in § 62-5-101.
(47) "Will" includes codicil and any testamentary instrument which merely appoints an executor
or revokes or revises another will.
REPORTER'S COMMENTS: The definitions set out in this section are applicable throughout
this Code. Of interest is the definition of "claims" in item (4) which includes claims arising out of
tort.
Also see Sections 62-4-101, 62-5-101, and 62-6-101 for additional definitions for Articles 4, 5,
and 6.
Effect of Amendments:
The 2010 amendment rewrote the definitions of "Application", "Formal proceedings", "Informal
proceedings", and "Petition", and added "formal" preceding "proceeding" in the definition of
"Testacy proceeding".
The 2011 amendment added definitions for "Fair Market Value" and "Probate Estate". The 2011
amendment also made changes to the definitions of "Guardian", "Person", "State" and
"Stepchild".
PART 3
SCOPE, JURISDICTION AND COURTS
§ 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.
REPORTER'S COMMENTS
This section merely states that this Code applies to matters having a connection to this State by
reason of a person's domicile or the situs of property.
Cross Reference: See S.C. Code Ann. §15-5-130, as amended, for proceedings against a
deceased nonresident.
§ 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;
(2) protection of minors, except that jurisdiction over the care, custody, and control of the
persons of minors is governed by Section 62-5-201 and incapacitated persons, including the
mortgage and sale of personal and real property owned by minors or incapacitated persons as well
as gifts made pursuant to the South Carolina Uniform Gifts to Minors Act, Article 5, Chapter 5,
Title 63, except that jurisdiction for approval of settlement of claims in favor of or against minors
or incapacitated persons is governed by Section 62-5-433;
(2) Subject to Part 7 of Article 5,
(i)
(ii)
Protective proceedings and guardianship proceedings under Article 5;
Gifts made pursuant to the South Carolina Uniform Gifts to Minors Act under
Article V, Chapter 5, Title 63.
(iii)
of
The Probate Court does not have jurisdiction over the care, custody, and control
the persons of minors.
(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, mental retardation,
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, commonlaw 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 5;
(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 Gifts to Minors Act,
Article 5, 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.
REPORTER'S COMMENTS
This section clearly states the subject matter jurisdiction of the probate court. It should be noted
that the probate court has "exclusive original jurisdiction" over the matters enumerated in this
section. This means, when read with other Code provisions (such as subsection (c) of this section
and Section 62-3-105), that matters within the original jurisdiction of the probate court must be
brought in that court, subject to certain provisions made for removal to the circuit court by the
probate court or on motion of any party.
The language of this section is similar to Section 14-23-1150 of the 1976 Code, which, in item
(a), provides that probate judges are to have jurisdiction "in all matters testamentary and of
administration, including jurisdiction in such matters to declare rights, status, and other legal
relations.
Effect of Amendments:
The 2008 amendment, in paragraph (d)(1), added "general".
The 2011 amendment modified the following paragraphs: paragraph (a)(1) added "determination
of property in which the estate of a decedent or protected person has an interest"; paragraphs
(a)(2), (d)(3) and (d)(4) were substantially re-written.
§ 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.
REPORTER'S COMMENTS
This section provides that, where a proceeding could be held in more than one county under
Section 62-3-201, the probate court in which the proceeding is first commenced has the exclusive
right to proceed. If proceedings are commenced in more than one probate court, the court in
which the proceeding was first commenced must continue to hear the matter unless it decides that
venue is properly in another county, in which event it is to transfer the matter to that other
county. Section 62-3-201 relates to testacy or appointment proceedings after death and grants
venue to the county of the decedent's domicile or, if the decedent was not domiciled in this State,
to any county in which his property was located.
This section also provides that venue with respect to a nonresident's estate could be in any county
where he owned property
§ 62-1-304. Practice in court.
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.
REPORTER'S COMMENTS
This section is essentially the same as Probate Court Rule l5, which states that "in all cases not
provided for by any of the foregoing Rules, the Rules of the Circuit Court, so far as they can be
made applicable, shall govern."
Effect of Amendment
The 2010 amendment rewrote this 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.
REPORTER'S COMMENTS
This section requires that the probate court keep a record of all matters filed with the court and
that records be so indexed and filed as to make them useful to those examining them. Further, the
court is required to issue certified copies of documents on file.
This section does not go into the detail of Sections 14-23-1100 and 14-23-1130 of the 1976 Code
which list in some detail the records which must be kept by the probate court. These sections are
not incompatible with Section 62-1-305. Probate Court Rule 1, pertaining to a calendar and to
books denoting titles of all cases and transactions therein, is not disturbed by this 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 of Title 14
of the 1976 Code relating to juries in circuit courts.
REPORTER'S COMMENTS
This section confers a right to trial by jury in the probate court in the same kinds of proceedings in
which the right to jury trial exists in the circuit court, namely, proceedings involving an issue of
fact in an action for the recovery of money only or of specific real or personal property, Section
15-23-60 of the 1976 Code. If no right to trial by jury exists, the court may impanel a jury to
decide any issue or fact on an advisory basis.
Chapter 7 of Title 14 of the 1976 Code, relating to juries in the circuit court, governs the method
of drawing, summoning, and compensating jurors.
Cross Reference: See South Carolina Supreme Court Order dated June 12, 1987 which
establishes the Probate Court Jury Policy.
§ 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.
Cross Reference: See S.C. Code Ann. §§14-23-1070, 14-23-1090 and 14-23-1100.
§ 62-1-308. Appeals.
Except as provided in subsection (g) (l), 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 and considering
himself injured by it may appeal to the circuit court in the same county. 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 within ten days after receipt of written notice of the
appealed from order, sentence, or decree of the probate court. The grounds of appeal must be
filed in the office of the probate court and a copy served on all parties within forty-five days after
receipt of written notice of the order, sentence, or decree of the probate court.
(b) Within thirty days after the grounds of appeal has been filed in the office of the probate court,
as provided in subsection (a), the probate court shall make a return to the appellate court of the
testimony, proceedings, and judgment and file it in the appellate court. Upon final disposition of
the appeal, all papers included in the return must be forwarded to the probate court. 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 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, 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 respondent. If a reply brief is prepared, appellant shall, within ten
days after service of 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 filed with the clerk of the circuit court one
copy of the Record on Appeal with proof of service.
(g) Except as provided herein, 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) When the return has been filed in the circuit court as provided in subsection (b), the court 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 may appeal directly
to the Supreme Court or Court of Appeals, as appropriate, and the procedure for the appeal must
be governed by the South Carolina Appellate Court Rules.
REPORTER'S COMMENTS
This section provides that appeals from the probate court are to the circuit court. Under Section
62-1-308(d) (i), any appeal from the probate court is strictly on the record
2011 amendments to this section were intended to clarify the process for appeals from the probate
court. With these changes, (i) the form for the Statement of Issues on Appeal follows that form
set forth in Rule 208(b)(1)(B); the use of briefs is specifically contemplated and the form of the
briefs follows that set forth in Rule 208, SCACR; (iii) the appellant bears the burden of preparing
the record on appeal; and (iv) the prevailing party bears the burden of providing the probate court
with a copy of the final decision and judgment from the circuit court, court of appeals, or
Supreme Court. While the 2011 amendments do incorporate certain provisions of the SCACR,
paragraph (g) clarifies that not all provisions of the SCACR apply to appeals from probate court
to circuit court.
§ 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 § 14-23-1020.
REPORTER'S COMMENTS
This section does not disturb Section 14-23-1040 of the 1976 Code which requires that a probate
judge or an associate judge must be a qualified elector of the county in which he is to be a judge.
PART 4
NOTICE, PARTIES, AND REPRESENTATION IN
ESTATE LITIGATION AND OTHER MATTERS
§ 62-1-401. Notice; method and time of giving.
(a) 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 demand 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.
(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.
REPORTER'S COMMENTS
This section provides that, where notice of hearing on a petition is required, the petitioner shall
give notice to any interested person or his attorney (1) by mailing at least twenty days in advance
of the hearing, or (2) by personal delivery at least twenty days in advance of the hearing, or (3) if
the person's address or identity is not known and cannot be ascertained, by publication as in the
court of common pleas.
Under this Code, when a petition is filed with the court, the court is to fix a time and place of
hearing and it is then the responsibility of the petitioner to give notice as provided in Section 621-401. See, for example, Sections 62-3-402 and 62-3-403. The procedure set forth in Section 1423-280 of the 1976 Code and Probate Court Rule 5, whereunder the court issues a summons to
the defendants named in the petition advising them that unless they plead thereto within twenty
days relief will be granted on the petition, is changed to place the responsibility for giving notice
on the petitioner.
Effect of Amendment
The 2010 amendment added subsection (d) relating to the nature of notice provisions in this
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.
§ 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.
REPORTER'S COMMENTS
This section applies to formal proceedings and judicially supervised settlements. It provides that in
certain specified instances a person will be bound by orders which are binding on others. Subitem
(i) of item (2) provides that an order which is binding upon the person or persons holding a power
of revocation or a general power of appointment will bind others, such as objects or takers in
default, to the extent that their interests are subject to the power. This would mean that an order
which is binding on one who has discretion will bind those in whose favor he might act.
Absent a conflict of interest, subitem (ii) of item (2) provides that orders binding a conservator or
guardian are binding on the protected person. In certain limited instances, orders binding on a
trustee or a personal representative are binding on beneficiaries and interested persons. Further,
under subitem (iii) of item (2) an unborn or unascertained person is bound by orders affecting
persons having a substantially identical interest. These provisions facilitate proceedings by limiting
multiplicity of parties.
Item (4) permits the court at any point in a proceeding to appoint a guardian ad litem to represent
a minor, an incapacitated person, an unborn or unascertained person, or one whose identity or
address is unknown if the court determines that representation of that interest would otherwise be
inadequate. Accordingly, in a proceeding where there are adult parties having the same interest as
the minor or incapacitated person, the court may not deem it necessary to appoint a guardian ad
litem if it appears that the common interest will be adequately represented. However, in protective
proceedings under Article 5 involving appointment of a guardian for an incapacitated person
(Section 62-5-301, et seq.), or a conservator of the estate of an incapacitated person (Section 625-401 et seq.), this Code mandates appointment of an attorney for the alleged incompetent person
should he not have counsel of his own choosing, such appointed attorney to have the powers and
duties of a guardian ad litem. See Sections 62-5-303(b) and 62-5-407(b). In the case of minors,
the appointment of a guardian ad litem (or an attorney having the powers and duties of a guardian
ad litem) is discretionary with the court. However, this Code does require that notice of the
proceeding be given to adults presumably having an interest in the minor's welfare, such as the
person having care and custody of the minor, parent(s), or nearest adult relatives.
Effect of Amendment
The 2010 amendment in subsection (3) substituted "Service of summons, petition, and notice" for
"Notice"; in subsection (3)(i) substituted "Service of summons, petition, and notice must" for
"Notice as prescribed by Section 62-1-401 shall" at the beginning of the first sentence, and
substituted "Service of summons and petition upon, as well as notice," for "Notice" at the
beginning of the second sentence; in subsection (3)(ii) substituted "Service upon and notice" for
"Notice" at the beginning of the sentence; and made other nonsubstantive changes.
ARTICLE I
Part 5
"Uniform Simultaneous Death Act"
PART 5
UNIFORM SIMULTANEOUS DEATH ACT
§ 62-1-5001. Short title.
This part may be cited as the "Uniform Simultaneous Death Act".
South Carolina Reporter's Comment
The 2011 amendment made significant changes to Part 5. Prior to the 2011 amendment, Part 5
did not include a 120 hour survival requirement similar to §62-2-104. The revisions to Part 5
now incorporate a default 120 hour survival requirement for testate and intestate decedents as
well as for non-probate transfers, subject to the exceptions set forth in §62-1-506.
§ 62-1-501. Definitions.
(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.
§ 62-1-502. Disposition of property when persons die simultaneously. Requirement of
survival by 120 hours.
When the title to property or the devolution thereof depends upon priority of death and there is
no sufficient evidence that the persons have died otherwise than simultaneously the property of
each person shall be disposed of as if he had survived, except as provided otherwise in this part
[§§ 62-1-501 et seq.].
(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 120 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 120 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 120 hours unless it is established
by clear and convincing evidence that the individual survived the class member or members by at
least 120 hours.
The 2011 amendment rewrote this section. This section now imposes a 120-hour survival
requirement for beneficiaries except as provided in §62-1-506.
§ 62-1-503. Successive beneficiaries of disposition of property. Requirement of survival by
120 hours under governing instruments.
When two or more beneficiaries are designated to take successively by reason of survivorship
under another person's disposition of property and there is no sufficient evidence that these
beneficiaries have died otherwise than simultaneously, the property thus disposed of shall be
divided into as many equal portions as there are successive beneficiaries and these portions shall
be distributed respectively to those who would have taken in the event that each designated
beneficiary had survived.
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 120 hours is deemed to have predeceased the event.
§ 62-1-504. Joint tenants or tenants by the entirety. Co-Owners with right of survivorship;
requirement of survival by 120 hours.
When there is no sufficient evidence that two joint tenants or tenants by the entirety have died
otherwise than simultaneously, the property so held shall be distributed one half as if one had
survived and one half as if the other had survived. If there are more than two joint tenants and all
of them have so died, the property shall be so distributed in the proportion that one bears to the
whole number of joint tenants.
Except as otherwise provided by this Code, if (i) 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 120 hours, one-half of the property passes as if one had survived by at least 120 hours and
one-half as if the other had survived by at least 120 hours and (ii) there are more than two coowners and it is not established by clear and convincing evidence that at least one of them
survived the others by at least 120 hours, the property passes to the estates of each of the coowners in the proportion that one bears to the whole number of co-owners.
REPORTER'S COMMENT
This section applies to property or accounts held by co-owners with right of survivorship. As
defined in §62-1-501, the term "co-owners with right of survivorship" includes multiple-party
accounts with right of survivorship.
§ 62-1-505. Insured and beneficiary. Decedent deemed to survive killer.
When the insured and the beneficiary in a policy of life or accident insurance have died and there
is no sufficient evidence that they have died otherwise than simultaneously, the proceeds of the
policy shall be distributed as if the insured had survived the beneficiary.
Notwithstanding any other provisions of the Code, solely for the purpose of determining whether
the decedent is entitled to any right or benefit that depends on surviving the death of decedent's
killer under §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 120 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 120 hours.
§ 62-1-506. Part is not retroactive. Exceptions to the 120 hour survival requirement.
This part shall not apply to the distribution of the property of a person who died prior to April 3,
1948.
Survival by 120 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 120-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 120-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 120 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 or 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 120 hour requirement of survival would result in an escheat.
REPORTER'S COMMENT
Subsection (1). Subsection (1) provides that the 120-hour requirement of survival is inapplicable
if 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." The
application of this provision is illustrated by the following example.
Example. G died leaving a will devising her entire estate to her husband, H, adding that "in the
event he dies before I do, at the same time that I do, or under circumstances as to make it
doubtful who died first," my estate is to go to my brother Melvin. H died about 38 hours after G's
death, both having died as a result of injuries sustained in an automobile accident.
Under this section, G's estate passes under the alternative devise to Melvin because H's failure to
survive G by 120 hours means that H is deemed to have predeceased G. The language in the
governing instrument does not, under subsection (1), nullify the provision that causes H, because
of his failure to survive G by 120 hours, to be deemed to have predeceased G. Although the
governing instrument does contain language dealing with simultaneous deaths, that language is
not operable under the facts of the case because H did not die before G, at the same time as G, or
under circumstances as to make it doubtful who died first.
if "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 stated period."
Mere words of survivorship in a governing instrument do not expressly indicate that an individual
is not required to survive an event by any specified period. If, for example, a trust provides that
the net income is to be paid to A for life, remainder in corpus to B if B survives A, the 120-hour
requirement of survival would still apply. B would have to survive A by 120 hours. If, however,
the trust expressly stated that B need not survive A by any specified period, that language would
negate the 120-hour requirement of survival.
Language in a governing instrument requiring an individual to survive by a specified period also
renders the 120-hour requirement of survival inapplicable. Thus, if a will devises property "to A if
A survives me by 30 days," the express 30-day requirement of survival overrides the 120-hour
survival period provided by this Act.
if "the application of this section to multiple governing instruments would result in an unintended
failure or duplication of a disposition." The application of this provision is illustrated by the
following example.
Example. Pursuant to a common plan, H and W executed mutual wills with reciprocal provisions.
Their intention was that a $50,000 charitable devise would be made on the death of the survivor.
To that end, H's will devised $50,000 to the charity if W predeceased him. W's will devised
$50,000 to the charity if H predeceased her. Subsequently, H and W were involved in a common
accident. W survived H by 48 hours.
Were it not for subsection (4), not only would the charitable devise in W's will be effective,
because H in fact predeceased W, but the charitable devise in H's will would also be effective,
because W's failure to survive H by 120 hours would result in her being deemed to have
predeceased H. Because this would result in an unintended duplication of the $50,000 devise,
subsection (4) provides that the 120-hour requirement of survival is inapplicable. Thus, only the
$50,000 charitable devise in W's will is effective.
Subsection (4) also renders the 120-hour requirement of survival inapplicable had H and W died
in circumstances in which it could not be established by clear and convincing evidence that either
survived the other. In such a case, an appropriate result might be to give effect to the common
plan by paying half of the intended $50,000 devise from H's estate and half from W's estate.
The 2011 amendment rewrote this section. Under subsection (5), if the application of the 120hour survival requirement would cause the loss of an available tax exemption, deduction,
exclusion, or credit, creating a federal or State gift, estate or inheritance tax, the 120-hour
survival requirement will not be applied. Additionally, under subsection (6), the 120-hour survival
requirement is not applicable if it would cause an escheat.
§ 62-1-507. Part is not applicable if instrument provides otherwise. Evidence as to death or
status.
This part [§§ 62-1-501 et seq.] shall not apply in the case of wills, living trusts, deeds, or
contracts of insurance wherein provision has been made for distribution of property different from
the distribution that would otherwise be made under the provisions of this part [§§ 62-1-501 et
seq.].
In addition to the rules of evidence in courts of general jurisdiction, 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 (§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 paragraph (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 5 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
paragraph (2) or (3), a document described in paragraph (2) or (3) that states a time of death 120
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 120 hours.
The 2011 amendment rewrote this section. This section incorporates the provisions of former
§62-1-107.
§ 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 [§§ 62-1-501 et seq.], 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 paragraph (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 neither
obligated under this part to return the payment, item of property, or benefit nor liable under this
part for the amount of the payment or the value of the item of property or benefit. But 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.
§ 62-1-509. Construction.
This part [§§ 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.
This section was previously §62-1-508.
§ 62-1-510. Effective date.
(a) This part [§§ 62-1-501 et seq.] takes effect ____________________.
(b) On the effective date of this part [§§ 62-1-501 et seq.]:
(1) an act done before the effective date in any proceeding and any accrued right is not impaired
by this part. If a right is acquired, extinguished, or barred upon the expiration of a prescribed
period of time that has commenced to run by the provisions of any statute before the effective
date, the provisions remain in force with respect to that right; and
(2) any rule of construction or presumption provided in this part applies to instruments executed
and multiple-party accounts opened before the effective date unless there is a clear indication of a
contrary intent.
REPORTER'S COMMENT
Subsection (b) is adapted from Section 8-101(b)(4) and (5) of the Uniform Probate Code.
Application to Pre-Existing Governing Instruments. For decedents dying after the effective date
of enactment, the provisions of this Act apply to governing instruments executed prior to as well
as on or after the effective date of enactment. The Joint Editorial Board for the Uniform Probate
Code has issued a statement concerning the constitutionality under the Contracts Clause of this
feature. The statement, titled "Joint Editorial Board Statement Regarding the Constitutionality of
Changes in Default Rules as Applied to Pre-Existing Documents," can be found at 17 Am. C. Tr.
& Est. Couns. Notes 184 (1991) or can be obtained from the headquarters office of the National
Conference of Commissioners on Uniform State Laws, 676 N. St. Clair St., Suite 1700, Chicago,
IL 60611, Phone 312/915-0195, FAX 312/915-0187.
Article Two
Part One
Intestate Succession and Wills
62-2-101 through 62-2-114
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.
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.
62-2-103. Share of heirs other than surviving spouse.
The part of the intestate estate not passing to the surviving spouse under Section 62-2102, 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 greatgrandparents, 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;
(6) if there is no surviving issue, parent or issue of a parent, grandparent or issue of a
grandparent, great-grandparent or issue of a great-grandparent, but the decedent is survived by
one or more stepchildren or issue of stepchildren, the estate passes to the surviving stepchildren
and to the issue of any deceased stepchildren; if they are all of the same degree of step-kinship to
the decedent they take equally, but if of unequal degree then those of more remote degree take by
representation.
New comment:
The amendment eliminates step-children as intestate heirs.
62-2-104. Requirement that heir survive decedent for one hundred twenty hours
Any
person who fails to survive the decedent by one hundred twenty hours is deemed to have
predeceased the decedent for purposes of Section 62-2-401 and intestate succession, and the
decedent's heirs are determined accordingly. If the time of death of the decedent or of the person
who would otherwise be an heir, or the times of death of both, cannot be determined, and it
cannot be established that the person who would otherwise be an heir has survived the decedent
by one hundred twenty hours, it is deemed that the person failed to survive for the required
period. This section is not to be applied where its application would result in a taking of the
intestate estate by the State under Section 62-1-105.
§ 62-2-104. Requirement of Survival by 120 Hours; Individual in Gestation.
(a) Requirement of Survival by 120 Hours; Individual in Gestation. For purposes of intestate
succession, homestead allowance, and exempt property, and except as otherwise provided in
subsection (b):
(1) an individual who was born before a decedent’s death but who fails to survive the decedent by
120 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 120 hours, it is deemed that
the individual failed to survive for the required period.
(2) 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 120 hours after birth. If it is not established that an
individual who was in gestation at the decedent’s death lived 120 hours after birth, it is deemed
that the individual failed to survive for the required period.
(b) Section Inapplicable if Escheat Would Result. This section does not apply if it would result
in a taking of the intestate estate by the state under Section 2-105.
New comment:
The amendment makes clear that survival for the 120 hours is a condition for benefit of intestate
succession, the homestead allowance, and the exempt property exclusion; the amendment clarifies
that an infant in gestation must survive for 120 hours following birth.
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.
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.
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.
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.
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 20-7-1825, 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 20-7-1574 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.
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.
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.
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.
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.
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 motion of 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 20-7-40 and
did not otherwise provide for the needs of the decedent during his or her 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 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 (“Disqualified
Parent”) 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 20-7-40 and did not otherwise provide for the needs of the decedent during his or her
minority. The proceeds, or portion thereof, that the Disqualified Parent would have taken
shall pass as though the Disqualified Parent had predeceased the decedent.
New comment:
The amendment makes clear that an action under this section must be commenced by the service
of a Summons, Petition and Notice by either parent or any other party of potential interest; the
amendment defines a Disqualified Parent as a parent found by the court by a preponderance of the
evidence not to have reasonably have provided support for the deceased child; the amendment
clarifies that the portion, or all , as the court determines, of the intestate share denied to the
Disqualified Parent shall pass as if the Disqualified Parent had predeceased the child.
Article Two Part Two Elective Share
62-2-201 through 62-2-207
62-2-201. Right of elective share.
None
62-2-202. Probate estate.
ARTICLE 2. INTESTATE SUCCESSION AND WILLS
(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.
Comment
The amendment does not change the definition of “probate estate,” a term with a settled meaning.
As defined, the “probate estate” to which the elective share is applicable is actually the net
probate estate, after the probate estate is reduced by funeral and administration expenses and
enforceable claims.
The amendment adds a new sub-paragraph (b), which takes into account and leaves unchanged
the provisions of Section 62-7-401(c) of the South Carolina Trust Code. SCTC Section 62-7401(c) is the statutory descendant of former SCPC Section 62-7-112, which was enacted after
the Siefert decision, Seifert v. Southern Nat'l Bank of South Carolina , 305 S.C. 353, 409 S.E.2d
337 (1991). Seifert found that the revocable trust before the court was “illusory” and, even
though not a part of the settlor/decedent’s probate estate, assets owned by the trust were
nevertheless subject to the elective share. The amendment means to leave intact the Seifert
decision, including the possibility that assets owned by a revocable inter vivos trust found not to
be illusory are not subject to the elective share. The amendment clarifies that the only non-probate
assets subject to the elective share in South Carolina are assets in a revocable trust found to be
illusory under the rationale of Seifert
The intent of the amendment is to clarify and provide certainty with respect to all other of a
decedent’s non-probate assets, which by this amendment are not subject to the elective share in
South Carolina.
The amendment expressly rejects the concept of the “augmented estate” as the multiplicand of the
one-third elective share entitlement. This rejection is in keeping with and continues the intent of
the drafters of the elective share statute as originally enacted in 1987, whose comment to this
section stated “This section rejects the "augmented estate" concept promulgated by the drafters of
the Uniform Probate Code as unnecessarily complex.” The drafters of this amendment agree, and
add that the latest concept of “augmented estate” promulgated by the drafters of the Uniform
Probate Code is more onerous and complex than the version rejected in 1987.
The revised Uniform Probate Code last promulgated by the NATIONAL CONFERENCE OF
COMMISSIONERS ON UNIFORM STATE LAWS, as well as statutes adopted in some states
(for example, North Carolina) have extended the reach of the statutory spousal share or elective
share to non-probate assets. The property to which the surviving electing spouse is entitled to
receive a portion is referred to as the augmented estate.
The effective and expeditious administration of decedents’ estates would be virtually impossible if
nonprobate assets owned by persons not subject to the personal jurisdiction of any South
Carolina court are subject to disgorgement by reason of the elective share. A similar problem
presently exists in estates in South Carolina where an equitable apportionment of the estate tax
imposes on the personal representative the duty of collecting the proportionate share of tax from
recipients of non-probate property. Current laws provide no efficient, cost effective means to
attach these assets in the hands of persons outside the reach of existing long arm statutes.
62-2-203. Exercise of right of election by surviving spouse.
None
62-2-204. Voluntary waiver of surviving spouse's right to elective share, homestead
allowance, and exempt property; property settlement in anticipation of divorce.
None
62-2-205. Proceedings for elective share; time limit.
None
62-2-206. Effect of election on benefits by will or statute.
None
62-2-207. Charging spouse with gifts received; liability of others for balance of elective
share.
Section 62-2-207.
(a) In the proceeding for an elective share, all property (including any
beneficial interests) which passes or has passed to the surviving spouse
1. under the decedent's will,
2. or by intestacy,
3. or by the homestead allowance,
4. or by Section 62-2-401,
5. or by beneficiary designation of any life insurance
6. or by beneficiary designation of any Individual retirement account or qualified retirement
plan, or annuity,
7. or which would have passed to the spouse but was renounced disclaimed,
8. or which is contained in a trust created by the decedent's will
9. or which is contained in a trust as described in 62-7-401(c),
is applied first to satisfy the elective share and to reduce any contributions due from other
recipients of transfers included in the probate estate.
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. or an interest as a beneficiary in property passing under the decedent's will to an inter
vivos trust created by the decedent,
3. or an interest as a beneficiary in property contained at the decedent’s death in a trust
described in 62-7-401(c).
For purposes of this subsection, the value of the electing spouse's beneficial interest in any
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 any such 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).
The value of such 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
may choose assets, in order of abatement as hereafter provided, to satisfy the elective share, using
the fair market value at the date of distribution. The elective share is pecuniary in nature.
The electing spouse who is the beneficiary of an income trust, the value of which is treated (or
could be treated) as qualifying property, shall have the rights granted under Section 62-7-904.3 to
seek a conversion of the income trust to a total return trust.
(b) In choosing assets to fund the elective share, remaining property of the probate estate is so
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.
New comment:
The amendment rewrites this section entirely and changes substantively the method of calculation
of the elective share in South Carolina.
Under the law prior to this amendment, nonprobate assets passing to the surviving spouse were
not credited against the elective share. Under the amendment, the amount of the probate estate
subject to the elective share is reduced by the value of nonprobate assets passing to the spouse at
the death of the decedent. Including the value of nonprobate assets passing to the surviving
spouse in the calculation of the elective share imposes on the Personal representative the duty to
ascertain the value of those nonprobate assets as well as the duty to verify that the assets in fact
pass to the surviving spouse. Probate Courts may require that nonprobate assets be identified
sufficiently on the Inventory to enable the calculation to be made. The amendment makes clear
that the non-probate assets are applied first to satisfy the elective share before assets from the
probate estate are applied in satisfaction.
The amendment clarifies and makes certain that property passing directly to the surviving spouse
in a revocable inter vivos trust, including a beneficial interest, will satisfy the elective share. The
amendment eliminates the concern that property had to “pass under the will” first in order to be
applied in satisfaction of the elective share.
The amendment leaves unchanged the law that the value of the electing spouse's beneficial
interest in any 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 any such qualifying property. Two
comments are relevant here. First, the future of the federal estate tax is at best uncertain. The
federal estate tax law in effect on December 31, 2009, as it pertained to the qualification for the
federal estate tax marital deduction, was settled law, familiar to laymen and practitioners alike.
Consequently, incorporation of the qualification requirements for the federal estate tax marital
deduction then in effect, particularly with respect to the so called “QTIP” marital trust, is the
measure least likely to cause confusion and error. Next, the drafters, in rejecting the “augmented
estate” while at the same time continuing to credit at full value the assets in an income only QTIP
trust, were mindful that the consequences to a surviving spouse in the present and projected
economy could be harsh. Moreover, the drafters took into account changes to South Carolina law
since 1987, including adoption of the Prudent Investor Act (SCTC Section 62-7-933), predicated
on Modern Portfolio Theory. Recognizing that simple, income only trusts may be disappointing
and inadequate, the amendment provides that the electing spouse who is the beneficiary of an
income trust, the value of which is treated (or could be treated) as qualifying property, shall have
the rights granted under SCTC Section 62-7-904.3 to seek a conversion of the income trust to a
total return trust.
The amendment makes clear that he value of such 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. Generally this is fair market value. The amendment makes clear, first, that in satisfying
the elective share, probate assets will be valued at date of distribution values; secondly the
amendment provides that the elective share is pecuniary in nature and not fractional. The drafters
believe this is less burdensome and requires revaluation only of assets in kind used to fund the
elective share. The intent of the amendment is that the pecuniary nature of the elective share is
prospective only.
The amendment leaves unchanged the order of abatement within the probate estate.
Article Two
Part Three
Omitted Spouse and Child
62-2-301 through 62-2-302
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 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.
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 had one or more children and 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 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.
New comment:
The amendment addresses afterborn children by clarifying that a will devising substantially all of a
testator’s estate to his or her spouse is valid against the claim of a child omitted under such will if
the will was executed by the decedent after marriage and before the child was born or adopted.
Article Two
Part Four
Exempt Property
62-2-401 through 62-2-403
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.
New comment
The amendment increases the amount of exempt assets passing to a surviving spouse or minor or
dependent children to $25,000.
62-2-402. Source, determination, and documentation.
None
62-2-403. Federal Veteran Payments shall be Exempt from Creditors' Claims.
All moneys 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
are hereby declared to be exempt from the claims of any and all creditors of such deceased
veteran.
New comment:
The amendment exempts moneys 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 that term is defined under federal regulations. Prior to
amendment the protection did not cover veterans of conflicts after WW II.
SECTION 62-2-501. Who may make a will.
An individual person who is of sound mind and who is not a minor as defined in Section 62-1201(24) may make a will.
Changes/Comments:
the word “person” was changed to “individual” because the word “person” is currently defined in
S.C. Code Ann Section 62-1-201(29) to mean “an individual, a corporation, an organization, or
other legal entity.”
Update reference to Section 62-1-201(24) if necessary.
REPORTER’S COMMENTS
Section 62-2-501, read with Section 62-2-101, allows any person individual of sound
mind who is married or at least eighteen years old not a minor to make a will. An individual is not
a minor if the individual is either (1) at least eighteen, (2) married, or (3) emancipated. An
individual may make a will of his or her “estate.” The estate which may be so devised is defined in
item (11) of Section 62-1-201 as “property”, in turn defined in item 33 of Section 62-1-201 as
both real and personal and “anything that may be the subject of ownership.” No distinction on the
question of capacity to make a will is drawn by Section 62-2-501 between men and women or
between citizens and aliens.
Undoubtedly, Section 62-2-501, even when read with the very broad definitions contained
in Section 62-2-101, item 11 of 62-1-201, and item 33 of 62-1-201, supra, is not meant to reverse
the South Carolina law with respect to tenants in fee simple conditional, Jones v. Postell, 16
S.C.L. 92 (Harp. L. )(1824), and tenants in joint tenancies with express provisions for right of
survivorship, Davis v. Davis, 223 S.C. 182, 75 S.E.2d 46 (1963), . in In both cases the law
disabling disabled such tenants from passing their estates by will. The spirit, if not the letter, of
this Code’s provisions is opposed to the grant of any such novel right to devise.
Tenants who hold real property Tenants in joint tenancies lacking express survivorship
provisions long have been able to may devise their interest in such real property. estates, and in In
the absence of a will such tenant’s interest in such real property such estates would have will
passed in intestacy. See Section 62-2-804.
4th ¶
No change
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; and
(2)
either:
(i)
signed by the testator; or
(ii)
signed in the testator's name by some other individual person in the testator's
presence and by the testator’s his direction;, and
(3)
shall be signed by at least two individuals persons each of whom witnessed either:
(i)
the signing; or
(ii)
the testator's acknowledgment of the signature or of the will.
Change/Comments:
No substantive changes recommended; stylistic change recommended.
The words “person” and “persons” were changed to “individual” and “individuals” because the
word “person” is currently defined in S.C. Code Ann § 62-1-201(29) to mean “an individual, a
corporation, an organization, or other legal entity.”
Update references to Code Sections if necessary.
No change
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 __________, 19___,
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 age eighteen, am married or emancipated as
decreed by 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 age eighteen, is married or
emancipated as decreed by 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 age eighteen, was married or emancipated as decreed
by 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.
Changes/Comments:
No change.
SECTION 62-2-504. Subscribing witnesses not incompetent because of interest; effect on gifts to
them.
(a)
A No subscribing witness to any will , testament, or codicil may be held is not
incompetent to attest or prove the same by reason of any devise , legacy, or bequest therein in
favor of such witness, such witness’s spouse or such witness’s issue or the husband or wife of
such witness, by reason of any appointment therein of such witness or the husband or wife of such
witness to any office, trust, or duty, or by reason of any charge therein of debts to any part of the
estate in favor of such witness as creditor. If there are two disinterested witnesses to a will in
addition to the interested witness, then Any such devise , legacy, or bequest is valid and effectual,
if otherwise so , but unless there are two other and disinterested witnesses then so far as the
property, estate, or interest so devised or bequeathed exceeds in value any property, estate, or
interest to which such witness or the husband or wife of such witness would be entitled upon the
failure to establish such will, testament, or codicil, . If there are fewer than two disinterested
witnesses to a will in addition to an interested witness, then such devise , legacy or bequest is shall
be null and void to the extent of such the excess of the value of the property, estate, or interest so
devised over the value of the property, estate or interest to which such witness, such witness’s
spouse or such witness’s issue would be entitled upon the failure to establish such will. The
voided portion of such devise shall pass by intestacy in accordance with § 62-2-101 et seq.,
provided the share of the interested witness, such witness’s spouse or such witness’s issue shall
not be increased thereby.
(b)
A subscribing witness to any will is not incompetent to attest or prove the same by reason
of any appointment therein of such witness or such witness’s spouse or such witness’s issue to
any office, trust, or duty. Any such The appointment of a witness or a witness’s spouse or such
witness’s issue to any office, trust, or duty is valid, if otherwise so, and the person 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 same by reason
of any charge therein of debts to any part of the estate in favor of such witness or such witness’s
spouse or such witness’s issue as creditor.
Changes
Added witness’s issue
Under section 62-3-406, an interested witness is competent to testify to prove the execution of a
will.
An “interested witness” is an individual (1) who is named as a devisee in the testator’s will; (2)
whose spouse is named as a devisee in the testator’s will, (3) whose issue are named as devisees
in the testator’s will; (4)
SECTION 62-2-505. Choice of law as to execution.
A written will is valid if either:
(1)
(2)
it is executed in compliance with § 62-2-502 either:
(i)
at the time of execution; or
(ii)
at the date of the testator's death; or
if its execution complies with the law at the time of execution of either:
(1) (i) the place where the will is executed, ; or
(2) (ii) the place where the testator is domiciled at the time of execution or at the time of
death.
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 which that revokes the prior 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 individual in his the testator’s presence
and by his 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; 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; each will is fully operative on the testator’s death to the extent they are not
inconsistent.
SECTION 62-2-507. Revocation by Effect of divorce , annulment, and order terminating marital
property rights on intestate succession, wills, trusts, joint assets, life insurance, and beneficiary
designations; 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 within
the meaning of subsections (b) and (c) of 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, power of attorney, life insurance
beneficiary designations, annuity beneficiary designations, retirement plan beneficiary designations
and transfer on death accounts.
(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 marital or parental circumstances other than those described in this section
and in Section 62-2-803 revokes a will 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, and
(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; and
(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 coownership 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 such 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)
Protection of payors and other third parties.
(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.
Comment [m1]: Coordinate with power of
attorney statute.
Comment [m2]: Coordinate with multiple party
bank account statute
(h)
Protection of bona fide purchasers; personal liability of recipient.
(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. But 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.
Changes/Comments:
·
Title changed to match title of 62-2-802 (Effect of divorce on …)
·
To unify the law of probate and non-probate transfers
·
The revisions expand this section to cover life insurance and retirement plan beneficiary
designations, transfer on death accounts, and other revocable dispositions to the former
spouse that the divorced individual established before the divorce or annulment
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 The revocation by acts under § 62-2-506(a)(2), of a the previous will made
subsequent to a former will, where the subsequent will would have revoked the former will if the
subsequent will had remained effective at the death of the testator, shall not revive or make
effective any former will unless it remains revoked unless it is revived. The previous will is
revived if it appears by clear , cogent, and convincing evidence that the testator intended to revive
or make effective the prior previous will.
(b)
If a subsequent will that partly revoked a previous will is thereafter revoked by a
revocatory act under § 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)
The revocation by a third will under 62-2-506(1) of a will made subsequent to a former
will, where the subsequent will would not have revoked the former will if the subsequent will had
remained effective at the death of the testator, shall not revive or make effective any former will
except 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 third later will that the testator intended the former previous will to take
effect.
Changes/Comments:
The revised section distinguishes between the revocation of a subsequent will that effects a
complete revocation or a partial revocation of a previous will
There is a presumption against revival where the subsequent will wholly revokes the previous will
There is a presumption in favor of revival (of the revoked part or parts of the previous will) where
a subsequent will partially revoked the previous will. The justification is that where the
subsequent will only partially revoked the previous will, the subsequent will is only a codicil to the
previous will and the testator should know that the previous will has continuing effect.
Add example of (c) in comments: effect on Will #1 of revoking Will #2 (the revoking Will) by
another, later, Will (Will #3). Will #1 remains revoked except to the extent that Will #3 shows an
intent to have Will #1 effective.
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.
SECTION 62-2-510. Additions to trusts.
(a)
A devise or bequest, the validity of which is determinable by the law of this State, may be
made by a will to the trustee of a trust established or to be established by the testator or by the
testator and some other person or by some other person (including a funded or unfunded life
insurance trust, although the trustor has reserved any or all rights of ownership of the insurance
contracts) if is valid subject to the following conditions:
(i)
the trust is identified in the testator's will and its terms are set forth in either:
(A)
a written instrument (other than a will) executed before or , 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 a person another individual who has predeceased the
testator (regardless of the existence, size, or character of the corpus of the trust). 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;
(ii)
the trust is not required to have a trust corpus other than the expectancy of
receiving the testator’s devise; and
(iii)
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.
(iv)
Unless the testator's will provides otherwise, the property so devised
(1)(A) 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)(B) 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 (regardless of whether made before
or after the execution of the testator’s will), and, if the testator’s will so provides,
including any amendments to the trust made after the death of the testator.
(v)
Unless the testator’s will provides otherwise, a A revocation or termination of the
trust before the death of the testator causes the devise to lapse.
(b)
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.
(c)
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.
(d)
In the event no trustee makes proper claim to the proceeds payable as provided in
subsections (b) and (c) 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.
(e)
Death benefits payable as provided in subsections (b) and (c) 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.
(f)
Such death benefits payable as provided in subsections (b) and (c) of this section so held in
trust may be commingled with any other assets which may properly come into such trust.
Changes/Comments
Allows receptacle trust to be executed after the execution of the testator’s will
Makes clear that the trust does not have to have a corpus other than the expectancy of receiving
the testator’s devise
SECTION 62-2-511. Events of independent significance.
A will may dispose of property by reference to acts and events which 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.
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 , evidences of indebtedness,
documents of title (as defined in Section 36-1-201(15)), securities (as defined in Section 36-8102(1)(A)), 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 him 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 which that has no significance apart from its effect
upon the dispositions made by the will.
Changes/Comments:
We deleted “evidences of indebtedness, documents of title (as defined in Section 36-1-201(15)),
securities (as defined in Section 36-8-102(1)(A)” because these are not items of tangible personal
property to begin with and we thought this would eliminate a source of confusion.
Clarify in Reporter’s Comments that vehicles and boats are tangible personal property.
Mention in Reporter’s Comments that Black’s Law Dictionary defines “tangible personal
property” includes coin collections and therefore coin collections may be items disposed of in a
tangible personal property memorandum.
SECTION 62-2-601. Rules of construction and intention; reformation to correct mistake.
(a)
The intention of a testator as expressed in his the testator’s will controls the legal effect of
his 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 subparagraph (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.
Changes/Comments:
Add subsection (b) which tracks UPC 2-805 Reformation to Correct Mistakes - To give Probate
Judges statutory authority to reform a will’s terms when there is clear and convincing evidence of
a mistake (for example, in husband/wife wills where attorney mistakenly forgets to change the
name of the devisee from wife to husband in wife’s will).
This addition mirrors Section 62-7-415 in the Trust Code:
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 that both the settlor's
intent and the terms of the trust were affected by a mistake of fact or law, whether in
expression or inducement.
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 his 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.
Changes/Comments
To make clear that items that may be payable to a testator after death, such as accrued but unpaid
bonuses, pass by the testator’s will, not by intestacy
SECTION 62-2-603. Anti-lapse; deceased devisee; class gifts.
(a)
Unless a contrary intent appears in the will, If if a devisee, who is a great-grandparent or a
lineal descendant of a great-grandparent of the testator:
(i)
is dead at the time of execution of the will,
(ii)
fails to survive the testator, or
(iii)
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 then 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 “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).
Changes/Comments:
Broke down the section to make it easier to read
Added a presumption that words of survivorship are sufficient indication that the testator does not
intend the antilapse section to apply
SECTION 62-2-604. Failure of testamentary provision.
(a)
Except as provided in § 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 § 62-2-603, if the residue is devised to two or more persons, and
the share of one of the residuary devisees that fails for any reason , his share passes to the other
residuary devisee, or to other residuary devisees in proportion to their interests in the residue.
SECTION 62-2-605. Change in securities; accessions ; nonademptions.
(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 entity organization owned by the
testator by reason of action initiated by the entity organization or any successor, related or
acquiring organization excluding any acquired by exercise of purchase options;
(3)
securities of another entity organization owned by the testator as a result of a
merger, consolidation, reorganization, or other similar action initiated by the entity organization
or any successor, related or acquiring organization;
(4)
any additional securities of the entity organization owned by the testator as a result
of a plan of reinvestment if it is a regulated investment company.
(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.
Changes/Comments:
Eliminated “non-ademption” in title because this concept doesn’t seem to apply to the content of
the statute
Substituted the word “organization” for “entity” because “organization” is defined in our current
probate code
Added “successor, related, or acquiring organization” to contemplate multiple changes in title of
securities between testator’s acquisition of the security and testator’s death
Eliminated “if it is a regulated investment company” from (a)(4) because of the uncertainty as to
what this term means
Added the words “in cash” to subsection (b) to clarify that distributions made in cash to not fall
within subsection (a) while distributions of other securities do fall within subsection (a)
Added the word “declared” to subsection (b) to clarify that the cash distributions declared before
death do not pass as part of the devise regardless of whether they are paid before or after death.
SECTION 62-2-606. Nonademption of specific devises; unpaid proceeds of sale, condemnation
or insurance; sale by conservator or agent.
(a)
Where a portion of property specifically devised is no longer owned by the testator at the
time of death, a A specific devisee has the right to the remaining 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) owing from 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 on or on
other recover for injury to the property;
(4)
any property owned by the testator at his death and acquired as a result of
foreclosure, or obtained in lieu of foreclosure, of the security interest 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 if a
condemnation award or insurance proceeds are or recovery for injury to the property is paid to a
conservator as a result of condemnation, fire, or casualty 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, or the insurance proceeds, or the recovery.
(c)
The right of a specific devisee under subsection (b) is reduced by any right the devisee has
under subsection (a).
(d)
For purposes of references in subsection (b) to a conservator, This subsection (b) does not
apply if subsequent to after the sale, mortgage, condemnation, or casualty or recovery, it is was
adjudicated that the testator’s disability of the testator has ceased and the testator survivesd 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.
Changes/Comments:
Added actions by an agent acting within the scope of a durable power of attorney to subsection
(c).
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.
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.
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.
???
SECTION 62-2-610. Ademption by satisfaction.
(a)
Property which a testator gave in his 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, or
(ii)
the testator declaresd in a contemporaneous writing that the gift is to be deducted
from the devise or is in satisfaction of the devise, or
(iii)
the devisee acknowledgesd 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 as of the time of death 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 Section 62-2-603 and 63-2-604, unless the testator’s
contemporaneous writing provides otherwise.
Changes/Comments:
Reporter’s Comments are to reference section 62-2-606 which also deals with ademption
Section C is added to provide that if a devisee fails to survive the testator and the devisee’s
descendants take under 62-2-603 and if this devise is reduced with respect to the devisee, it shall
automatically be reduced with respect to the devisee’s descendants.
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.
None
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.
62-2-801. Disclaimer
(a) In addition to any methods available under existing law, statutory or otherwise, if a
person (or his executor, administrator, successor, personal representative, special
administrator, guardian, attorney-in-fact, trustee, committee, conservator, or his other
fiduciary or agent who performs substantially similar functions under the law governing
his status, acting with or without the approval of a specific court order and with or without
the receipt of consideration for the act), as a disclaimant, makes a disclaimer as defined in
Section 12-16-1910 of the 1976 Code, 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 allowance, devise,
bequest, beneficiary designation, survivorship provision, exercise and nonexercise of a
power, and otherwise) to him 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.
(b) The right to disclaim exists notwithstanding any limitation on the disclaimant’s interest
in the nature of a spendthrift provision or similar restriction.
(c) The right to disclaim is barred by the disclaimant’s written waiver of the right.
(d) Unless the transferor has provided otherwise in the event of a disclaimer, the disclaimed
interest shall be transferred (or fail to be transferred, as the case may be) 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.
(e) The date of effectiveness of the transfer of the disclaimed interest is (1) as to transfers by
intestacy, wrongful death, elective share, forced share, homestead allowance, exempt
property allowance, devise and bequest, the date of death of the decedent transferor of, 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 (2) as to all other transfers,
the date of effectiveness of the instrument, contract, or act of transfer.
(f) It is the intent of the legislature of the State of South Carolina by this provision to
clarify the laws of this State with respect to the subject matter hereof in order to ensure the
ability of persons to disclaim interests in property without the imposition of federal and
state estate, inheritance, gift, and transfer taxes. This provision is to be interpreted and
construed in accordance with, and in furtherance of, that intent.
(g) With the court’s approval, a personal representative, trustee, or similar fiduciary may
disclaim any one or more of the powers granted to the personal representative, trustee, or
similar fiduciary. Any disclaimer must be made by written instrument in the manner
provided in subsection (a) and has the same effect as in subsection (d). The disclaimer of a
power may be made binding on any successor fiduciary, if the disclaiming fiduciary so
declares when making the disclaimer.
(a)
This section applies to disclaimers of any interest in or power over property,
whenever created and is the exclusive means by which a disclaimer may be made under
the laws of this State.
(b)
(c)
For purpose of this section:
(1)
“disclaimer” means any writing which disclaims, renounces, declines, or
an interest in or power over property;
refuses
(2)
“disclaimant” means the person to whom a disclaimed interest or power
have passed had the disclaimer not been made;
would
(3)
“disclaimed interest” means the interest that would have passed to the
disclaimant had the disclaimer not been made; and
(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.
(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 knowledge of the interest. A disclaimer is conclusively
presumed to have been made within a reasonable time if made within nine (9)
months after the date of effectiveness of the transfer as determined under item (3)
of subsection (d).
(3)
A disclaimer is not a transfer, assignment, or release if made within a reasonable
time after the disclaimant acquires knowledge of the interest and if not otherwise
barred.
(4)
A disclaimer is barred by any of the following conditions occurring before the
disclaimer becomes effective, and a barred disclaimer is ineffective as a disclaimer
under this section:
(i)
the disclaimant has waived in writing the right to disclaim;
(ii)
the disclaimant has accepted the interest sought to be disclaimed;
(5)
(6)
(d)
(iii)
the disclaimant has 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.
A disclaimer is not barred by any of the following conditions:
(i)
by a spendthrift provision or similar restriction on transfer or the right to
disclaim, imposed by the creator of such interest in or power over the
property;
(ii)
by the 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);
(iii)
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;
(iv)
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 the disclaimant.
Unless a disclaimer is barred, a disclaimer treated as a qualified disclaimer pursuant
to Internal Revenue Code § 2518 is effective as a disclaimer under this section.
(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 non-exercise 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 the case may
be), 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)
(e)
(f)
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, 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.
(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)
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 to that parent as a result of the
disclaimer.
(1)
To be effective, a disclaimer must be in writing, declare the writing as a
disclaimer, describe the interest or power disclaimed, be signed by the
person
making the disclaimer, and be filed or delivered as provided under items (3) through (12)
of this subsection.
(2)
Subject to paragraphs (3) through (12) of this subsection, delivery of a disclaimer
may be effected 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. Delivery by any other method shall be
effective upon receipt by the person to whom the disclaimer is to be delivered
under this section.
(3)
In the case of a disclaimer of an interest created under the law of intestate
succession or an interest created by will, other than an interest in a testamentary
trust:
(i)
the disclaimer must be delivered to the personal representative of
decedent’s estate; or
the
(ii)
if no personal representative is serving when the disclaimer is
sought
to be delivered, the disclaimer must be filed with the probate
court in any
county where venue of administration would be proper.
(4)
In the case of a disclaimer of an interest in a testamentary trust:
(i)
the disclaimer must be delivered to the trustee serving when the
disclaimer is delivered or, if no trustee is then serving, to the
personal representative of the decedent’s estate; or
(ii)
if no personal representative is serving when the disclaimer is
sought
to be delivered, the disclaimer must be filed with the probate
court in any
county where venue of administration of the decedent’s
estate
would
be
proper.
(5)
In the case of a disclaimer of an interest in an inter vivos trust:
(i)
the disclaimer must be delivered to the trustee serving when the
disclaimer is delivered;
(ii)
if no trustee is then serving, the disclaimer must be filed with a
having jurisdiction to enforce the trust; or
court
(iii)
if the disclaimer is made before the time the instrument creating the trust
becomes irrevocable, the disclaimer must be delivered to the
grantor of the
revocable trust or the transferor of the interest or to such
person’s
legal
representative.
(6)
In the case of a disclaimer of an interest created by a beneficiary designation made
before the time the designation becomes irrevocable, the disclaimer must be
delivered to the person making the beneficiary designation or to such person’s
legal representative.
(7)
In the case of a disclaimer of an interest created by a beneficiary designation made
after the time the designation becomes irrevocable, the disclaimer must be
delivered to the person obligated to distribute the interest.
(8)
In the case of a disclaimer by a surviving holder of property held jointly with right
of survivorship, the disclaimer must be delivered to the person to whom the
disclaimed interest passes or, if such person cannot reasonably be located by the
disclaimant, the disclaimer must be delivered as provided in subsection (3).
(9)
In the case of a disclaimer by an object, or taker in default of exercise, of a power
of appointment at any time after the power was created:
(i)
the disclaimer must be delivered to the holder of the power or to
fiduciary acting under the instrument that created the power; or
(ii)
(10)
the
if no fiduciary is serving when the disclaimer is sought to be
delivered, the disclaimer must be filed with a court having authority
to appoint the fiduciary.
In the case of a disclaimer by an appointee of a nonfiduciary power of
appointment:
(i)
the disclaimer must be delivered to the holder, the personal representative
of the holder’s estate, or the fiduciary under the
instrument that created the
power; or
(ii)
·
If no fiduciary is serving when the disclaimer is sought to be
delivered, the disclaimer must be filed with a court having authority
to appoint the fiduciary.
(11)
In the case of a disclaimer by a fiduciary of a power over a trust or estate, the
disclaimer must be delivered as provided in subsection (3), subsection (4), or
subsection (5) as if the power disclaimed were an interest in property.
(12)
In the case of a disclaimer of a power exercisable by an agent, other than a power
exercisable by a fiduciary over a trust or estate, the disclaimer must be delivered to
the principal or the principal’s representative.
(13)
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 under item (3) of subsection
(c), 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.
SECTION 62-2-802. Effect of divorce, annulment, decree of separate maintenance, or order
terminating marital property rights.
(a)
An person 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,
he the individual is married to the decedent at the time of death. A decree of separate maintenance
which 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 person 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 subsequently live together as husband and wife at the
time of the decedent’s death;
(2)
an person individual who, following an invalid decree or judgment of divorce or
annulment obtained by the decedent, participates in a marriage ceremony with a third individual;
or
(3)
an person 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 person 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.
Changes/Comments:
the word “person” was changed to “individual” because the word “person” is currently defined in
S.C. Code Ann § 62-1-201(29) to mean “an individual, a corporation, an organization, or other
legal entity.”
Clarify that a purportedly an individual who undergoes a divorce that is either invalid or not
recognized in SC will be considered a surviving spouse if the individual is living as husband and
wife with the decedent at the time of decedent’s death.
Section 62-2-802 provides, with respect to the capacity of a putative surviving spouse to
take by way of succession to the estate of a decedent, whether testate or intestate, for the effects
of (1) a divorce, (2) an annulment, (3) a decree of separate maintenance, and (4) an order
terminating marital property rights, or confirming equitable distribution between spouses, in cases
in which any such event affects the marriage of the decedent to the putative surviving spouse.
Valid Divorce and Annulment
Under Section 62-2-802(a), a valid divorce or a valid annulment deprives the putative
spouse of the status of surviving spouse of the decedent and the capacity to take as such in
succession to the decedent’s estate under this Code, i.e., by way of provisions in favor of a
“surviving spouse,” whether found in the decedent’s will, Parts 5 and 6 of Article 2, on in the
intestacy statute, Section 62-2-101, or in the provision for an omitted spouse, Section 62-2-301,
or in that for a spouse with respect to exempt property, Section 62-2-401. However, the issuance
of a decree of separate maintenance, not terminating the marital status, has no such effect. It
should be apparent that a valid divorce or annulment must always have deprived the former
spouse of the status of spouse of the decedent for purposes of succession.
Marital Conditions Other than Divorce or Annulment
Under Section 62-2-802(b), any one of the following, an order terminating marital
property rights, or confirming equitable distribution between spouses, subsection (3), a divorce or
an annulment not recognized as valid in South Carolina if the putative spouse obtained or
consented to it, subsection (1), or subsequent to it he or she participated in a marriage ceremony
with some third person, subsection (2), deprives the putative spouse of the status of surviving
spouse of the decedent; but, under Section 62-2-802(b) itself, the deprivation is only for the
purposes of succession to the decedent’s estate in intestacy, as in omitted spouse, as a spouse
with respect to exempt property, and as a spouse in line for appointment as an administrator in
intestacy, i.e., as under Parts 1, 3 and 4 of Article 2 and under Section 62-3-203.
However, under Section 62-2-507, such an order, a divorce or annulment, whether valid
or invalid as under Section 62-2-802(b) has the additional effect of revoking, by operation of law,
so much of the decedent’s will as affects the putative spouse. Section 62-2-507 refers to Section
62-2-802(b) for the definition of divorce and annulment.
Perhaps other marital conditions, not valid as divorces or annulments and not detailed in
Section 62-2-802(b), will continue by the common law to estop a putative spouse from claiming
as a surviving spouse. See Section 62-1-103. Further, matters of succession not within the
coverage of Sections 62-2-802(b) and Section 62-2-507 will continue to be governed by the prior
South Carolina law, e.g., recovery under the Wrongful Death Act, Section 15-51-20 of the 1976
Code. See Folk v. U.S., 102 F. Supp. 736 (W.D.S.C. 1952), and see Lytle v. Southern Ry.Carolina Division, 171, 171, S.C. 221, 171 S.E. 42 (1933) and Lytle v. Southern Ry.-Carolina
Divisions, 152 S.C. 161, 149 S.E. 692 (1929).
Both of Sections 62-2-802 and 62-2-507 provide for the exceptional case of the
subsequent intermarriage of the decedent to the putative spouse, the sections being rendered
inapplicable to such a case.
SECTION 62-2-803. Effect of homicide on intestate succession, wills, trusts, joint assets, life
insurance, and beneficiary designations.
(a)
An surviving spouse, heir, or devisee 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 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 his 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 person
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 of by conviction or guilty plea establishing criminal accountability of
felonious and intentional killing of the decedent is conclusively establishes the convicted individual
for purposes of this section. In the absence of a conviction of felonious and intentional killing such
final judgment the court may determine by a preponderance of evidence whether the killing was ,
upon the petition of an interested person, must determine whether, upon the preponderance of the
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 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.
(fg)
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.
(gh) If an individual feloniously and intentionally kills the decedent, and if the killer dies within
120 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.
Changes/Comments:
Expand applicability to individuals who are criminally accountable (e.g. accomplices and coconspirators)
Revoke nomination of fiduciary roles
Impose personal liability on killer for wrongfully acquired property
Attempt to clarify former subsection (g) regarding decedent’s right to inherit from killer if killer
dies within 120 hours of decedent (e.g. in a murder/suicide situation)
SECTION 62-2-804. Effect of provision for survivorship on succession to joint tenancy.
When any person individual is seized or possessed of any real property held in joint tenancy at the
time of his 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 person
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".
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.
Section 62-2-806 Modification to achieve Testator’s Tax Objectives
To achieve the testator’s tax objectives, the court may modify the terms of the testator’s will in a
manner that is not contrary to the testator’s probable intention. The court may provide that the
modification has retroactive effect.
SECTION 62-2-901. Delivery of will to judge of probate; filing.
(a)
Every executor, devisee, legatee, trustee, guardian, attorney or other After the death of a
testator, a person having in his possession, custody, or control any last of a will and testament,
including any codicil or codicils thereto, of any person dying must the testator shall deliver such
will, within thirty days after of actual notice or knowledge of the testator’s death of the testator
deliver such last will and testament, including any codicil or codicils thereto, to the judge of the
probate court having jurisdiction to admit the same to probate and or to a person named as
Personal Representative in such will who shall deliver such will to the judge of such probate
court. Upon receipt of such will, such judge of probate shall file the same in his probate court and
if proceedings for the probate are not begun within thirty days he such judge must shall publish a
notice of such delivery and filing in one of the newspapers in his the county of such probate court
for fifteen days. Any executor, devisee, legatee, guardian, attorney, or other person who fails to
deliver to the judge of the probate court having jurisdiction to admit it to probate any last will and
testament, including any codicil or codicils thereto, upon conviction must be punished as for a
misdemeanor.
(b)
Any person who intentionally or fraudulently destroys, suppresses, conceals, or fails to
deliver such will to the judge of the probate court having jurisdiction to admit it to probate any
last will and testament, including any codicil or codicils thereto, for the purpose and with the
intent to prevent the institution of proceedings for its probate shall, upon conviction thereof, be
punished by a fine of not more than five hundred dollars or by imprisonment for not more than
one year, or both, in the discretion of the court 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 such 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 penalty for contempt of court.
Changes/Comments:
Allow a custodian of a will to deliver the will to the Personal Representative named in the will as
opposed to the probate judge consistent with S.C. Code Ann. § 34-19-50 authorizing financial
institutions to deliver a will from the safe deposit box to the Personal Representative named in the
will.
Adds a 3rd party cause of action against a person who destroys or conceals a will
Adds penalty for failing to file will after being ordered to do so by the probate court to a penalty
for contempt of court.
ARTICLE 3
ARTICLE 3.
PROBATE OF WILLS AND ADMINISTRATION
PART 1.
GENERAL PROVISIONS
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 an executor 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.
SECTION 62-3-104. Claims against decedent; necessity of administration.
No claim can be filed against the estate of a decedent and noNo 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. 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.
SECTION 62-3-108. Probate, testacy, and appointment proceedings; ultimate time limit.
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, except (1) 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 thereafter 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; (2) 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 (3) 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 the later of eight months from the informal probate or one year from the
decedent's death. If no informal probate and no formal testacy proceedings are commenced within
ten years after the decedent's death, and no proceedings under (2) above 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 cases under (1) or (2) above, 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.
CREDIT(S)
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 17; 1990 Act No. 521, § 31.
REPORTER'S COMMENTS
This section establishes a time limitation of ten years after decedent's death for commencement of
any proceeding to determine whether a decedent died testate or for commencing administration of
his estate, with the following exceptions:
(1) a proceeding to probate a will previously probated in testator's domicile;.
(2) appointment proceedings relating to an estate in which there has been a prior appointment;.
(3) if a previous proceeding was dismissed because of doubt about the fact of death, and if
decedent's death in fact occurred prior to commencement of the previous proceeding, and if there
has been no undue delay in commencing the subsequent proceeding;.
(4) if the decedent was a protected person, as an absent, disappeared, or missing person, Section
62-5-401, for whose estate a conservator has been appointed, and if the proceeding is commenced
within three years after the conservator is able to establish the death of the protected person; or.
(5) a proceeding to contest an informally probated will and appointment if the contest is
successful, may be commenced within the later of twelve months from informal probate or three
years from decedent's death.
These limitations do not apply to proceedings to construe wills or to determine heirs of an
intestate. See Comments, Section 62-3-107.
This section also fixes as the date of death for purposes of the other limitations of this Code which
relate to date of death, the date of proper commencement of a testacy or appointment proceeding
more than three years after the established date of death in the two exceptions relating to
dismissal of a formal proceeding because of doubt about the fact of death and estates of protected
persons for whom a conservator has been appointed.
If no will is probated within ten years from death, or within the time permitted by one of the
exceptions, this section makes the assumption of intestacy final.
If a will has been probated informally within ten years, this section makes the informal probate
conclusive within the later of three years from death or twelve months from informal probate,
whichever is later. The limitation period prescribed applies to all persons including those under
disability.
Interested persons can protect themselves against changes within the period of doubt concerning
whether a person died testate or intestate by commencing at an earlier date a formal proceeding,
Sections 62-3-412, 62-3-413.
Protection to a personal representative appointed after informal probate of a will or informally
issued letters of administration, but which is subject to change in a subsequent formal proceeding
commenced within the limitations prescribed, is afforded under Section 62-3-703.
Distributees who receive distributions from an estate before the expiration of the period remain
potentially liable to those determined to be entitled in properly commenced formal proceedings,
Section 62-3-909, 62-3-1006.
Purchasers from the personal representative or a distributee may be protected without regard to
whether the period has run, Sections 62-3-715, 62-3-910.
Creditors' claims are barred against the personal representative, heirs, and devisees after three
years from date of death in any event. Section 62-3-803(a)(2). See, also, Comments, Section 623-102.
(A) 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.
The following exceptions apply:
(1) 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
thereafter 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;
(2) 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
(3) 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 the later of eight months from the informal probate or one year from the decedent’s death.
(B) If no informal probate and no formal testacy proceedings are commenced within ten years
after the decedent’s death, and no proceedings under (2) above 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 cases under (1) or (2) above, 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.
PART 2.
VENUE FOR PROBATE AND ADMINISTRATION; PRIORITY TO ADMINISTER;
DEMAND FOR NOTICE
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;
(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 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) Appointment of one who does not have priority may be made only in formal or informal
proceedings. Before appointing one without priority, the court must determine that those having
priority, except those with equal priority, although having been served a summons and petition
and having been given notice of the hearing the proceedings, have failed to request appointment
or to nominate another for appointment, and that administration is necessary.
(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) a corporation:
(i) created by another state of the United States or by any foreign state, kingdom or
government, or created under the laws of the United States and
(ii) not having a business in this State, or
(B) 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 such 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, niece, nephew, mother-in-law, father-inlaw, 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.
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. Such demand for notice shall expire one (1) 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 no order or filing to which the demand relates may
be made or accepted without notice as prescribed in Section 62-1-401 to the demandant or his
attorney. 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.
PART 3.
INFORMAL PROBATE AND APPOINTMENT PROCEEDINGS
SECTION 62-3-301. Informal probate or appointment proceedings; application; 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 or that an agreed copy of a will pursuant to (a) (4) below is in the court’s
possession;
(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 probate of a copy of a will and for the informal appointment of a
personal representative to administer an estate pursuant to the terms of such copy of 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. Informal probate of a copy of a will and informal
appointment of a personal representative to administer an estate pursuant to the terms of a copy
of a will shall be available if all parties interested in a decedent’s estate agree.
(5) 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 (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.
(6) 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.
(7) 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(c), 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.
(8) 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.
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(20);
(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 Sections 62-2-502, 62-2-503, 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) An unprobated will of a nonresident decedent which is not eligible for probate under
subsection (a) above may nevertheless be probated in this State upon receipt by the court of a
copy thereof authenticated as true by its legal custodian together with such legal custodian’s
certificate that the will is not ineligible for probate under the law of the other place.
SECTION 62-3-310. Informal appointment proceedings of someone with equal priority; notice
requirements.
The applicantmoving party must give notice as described by Section 62-1-401 of his intention to
seek an appointment informally: (1) to any person demanding it pursuant to Section 62-3-204;
and (2) to any person having a prior or equal right to appointment not waived in writing and filed
with the court. No other notice of an informal appointment proceeding is required.
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 sixseven 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.
SECTION 62-3-406. Formal testacy proceedings; contested cases; testimony of attesting
witnesses.
In a contested case in which the proper execution of a will is at issue, the following rules apply:
(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.
SECTION 62-3-408. Formal testacy proceedings; 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.
REPORTER'S COMMENTS
This section makes it incumbent upon the local court to give full faith and credit to final orders of
courts in another jurisdiction in the United States determining testacy or the validity or
construction of a will regardless of whether the parties before the local court were personally
before the foreign court. However, the foreign proceeding must have provided the requisite notice
and opportunity for contest or construction for the resulting order to be binding locally.
This section does not apply unless the foreign proceeding has been previously concluded. If a
local proceeding is concluded before completion of the foreign formal proceedings, local law will
control.
If there is a contest concerning the decedent's domicile in formal proceedings commenced in
different jurisdictions, Section 62-3-202 applies.
Local courts are bound by the foreign court's determination of the validity or construction of the
will so long as this determination is part of a final order; local courts are not bound by the foreign
court's construction of the will.
SECTION 62-3-409. Formal testacy proceedings; 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 has become effective under the law of the other place.
REPORTER'S COMMENTS
This section governs the scope and content of the formal testacy order. Every order must contain
the court's findings regarding whether the alleged decedent is dead, the decedent's domicile at
death, whether venue is proper, and whether the proceeding is a timely one. Regardless of
whether the decedent is alleged to have died intestate, the order must contain a determination of
heirs and testacy. If the court is not convinced of the alleged decedent's death, the court may
dismiss the proceeding or it may permit amendment of the proceeding so as to make it a
proceeding to protect the estate of a missing and therefore “disabled” person under Article 5.
Provision is made for proof of a will from a foreign jurisdiction which does not provide for
probate of wills.
EFFECT OF AMENDMENT
The 2010 amendment substituted “Upon” for “After the time required for any notice has
expired, upon” preceding, and substituted “service of the summons and petition” for “notice”
following, “proof of” at the beginning of the first sentence; and added “and notice” following
“and after any hearing” in the first sentence.
PART 5.
ADMINISTRATION UNDER PART 5
SCPC SECTIONS with Recommended Changes
SECTION 62-3-501. Administration under Part 5 [Sections 62-3-501 et seq.]; 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.].
SECTION 62-3-502. Administration under Part 5 [Sections 62-3-501 et seq.]; 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 62-3501 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.
SECTION 62-3-503. Administration under Part 5 [Sections 62-3-501 et seq.]; 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 he has
received 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.
SECTION 62-3-504. Administration under Part 5 [Sections 62-3-501 et seq.]; 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.
SECTION 62-3-505. Administration under Part 5 [Sections 62-3-501 et seq.]; 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.
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.
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.
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.
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 62-6101) in a manner that prevents their unauthorized disposition. Upon application On petition of
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, or permit the substitution of another bond with the same or different sureties.
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 said delay.
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.
SECTION 62-3-607. Order restraining personal representative.
(a) On application petition of any interested person who appears to have an interest in the estate,
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 petition application.
SECTION 62-3-608. Termination of appointment; general.
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.
SECTION 62-3-609. Termination of appointment; death or disability.
The death of a personal representative or the appointment of a conservator for the estate 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.
SECTION 62-3-610. Termination of appointment; voluntary.
(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 their 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.
SECTION 62-3-611. Termination of appointment by 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 their attorney of record
of any further duties to the Court.
SECTION 62-3-612. Termination of appointment; 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 there under, 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.
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.
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; or
(b) for a creditor of the decedent's estate to institute any proceeding under Section 62-3-803(c);
(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.
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.
SECTION 62-3-616. Special administrator; appointed informally; powers and duties.
A special administrator appointed by the court in informal proceedings pursuant to Section 62-3614(1) has the duty to collect and manage the assets of the estate, to preserve them, to account
there for, 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.
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.
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 62-3608 through 62-3-611.
SECTION 62-3-619. "Executor de son tort" defined.
Any persons who by means of fraud or without paying valuable consideration equivalent to the
value of said property obtains, receives and/or possesses any property of whatever kind that
belonged to the decedent shall be charged and chargeable as executor of his own wrong,
(executor de son tort) with respect to such goods and debts. The value of any debts owed to the
executor de son tort by the decedent shall be deducted from the value of the property charged to
the executor de son tort. Likewise, the value of such 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.
SECTION 62-3-620. Executor de son tort shall account for deceased's property; decree for
damages.
Executor de son tort shall 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.
SECTION 62-3-621. Liability.
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.
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 executor 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.
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.
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 have the duties of a trustee described in
Sections 62-7-801 through 62-7-803, and 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 is not aware 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.
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 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 account 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) 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.
(f) If a personal representative or trustee neglects or refuses to comply with any provision of
Section 62-3-706 he is liable to a penalty of one thousand dollars for each separate failure or
neglect and the official bond of the personal representative or trustee is liable therefor. This
penalty must be recovered by the South Carolina Department of Revenue for the use of the State
and an action for the recovery thereof may be brought by the Department of Revenue in any court
of competent jurisdiction and, upon collection, must be paid into the state treasury. But the
department, upon good cause shown, may, in its discretion, excuse the penalty or any part
thereof. 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.
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.
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, together with such other information as may be required by the South Carolina
Department of Revenue, 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;
(3) mail a copy of the filed inventory and appraisement to interested persons who have filed
a demand for notice of the filing of such 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 such property on the date of the decedent’s death.
(2) mail a copy of the list to each interested person who has requested such list.
(3) file proof of such mailing with the Probate Court.
The court, upon application of the personal representative, may extend the time for filing or
making either inventory.
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. Each appraiser
shall execute the inventory, stating thereon the item or items he appraised On motion 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.
SECTION 62-3-708. Duty of personal representative; supplementary inventory.
If any property not included in the original inventory comes to the knowledge of a personal
representative then within thirty days of acquiring such knowledge the personal
representative shall file a supplementary inventory and appraisement providing a
description and value of said property. 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 an amended and/or corrected inventory and appraisement showing the revised market
value or descriptions. The amended and/or corrected inventory and appraisement shall also
restate the original information in its entirety. The supplementary, amended and/or
corrected inventory and appraisement must provide the name of the appraiser or other data
relied upon, if any, and it must be filed with the court, and copies furnished to persons entitled
to receive the original inventory, and to interested persons who have requested the new
information.
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.
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.
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 Section 62-3-911 et. seq. or described in in Section 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 of five
thousand dollars or more without prior order of the court which may be issued upon
application of the personal representative and after such 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).
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.
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.
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.
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 settler.
(26) The personal representative has the power to access the decedent’s files and accounts
in electronic format including obtaining the decedent’s user names and passwords.
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.
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 set 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.
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.
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.
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.
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.
SECTION 62-3-801. Notice to creditors.
(a) Unless notice has already been given under this section, a personal representative upon his
appointment shallmay 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 eight months from one year of the published
notice as provided in (a) abovedecedent’s death, or within sixty days from the mailing or other
delivery of such notice, whichever is laterearlier, 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 (a) and (b) of this section, notice to creditors under this section is not
required if no personal representative is appointed to administer the decedent’s estate during the
one year period following the death of the decedent.
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 otheranother statute of limitations, or non-claim statute; are barred against the
estate, the personal representative, and the decedent’s heirs and devisees, and non-probate
transferees of the decedent,; unless presented within the earlier of the following dates: :
(1) one year after the decedent’s death; or
(2) within 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;
provided, claims.
(b) A claim described in subsection (a) which is barred by the nonclaimnon-claim statute at of the
decedent’sdecedent's domicile before the giving of notice to creditors barred in this State are
alsois barred in this State.
(bc) All claims against a decedent’s estate which arise at or after the death of the decedent,
including claims of the Statestate 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).
(cd) Nothing in this section affects or prevents: shall be construed as placing a limitation on the
time for:
(1) anycommencing a proceeding to enforce anya mortgage, pledge, lien, or other security interest
upon property of the estate; or
(2) to the limits of the insurance protection only, anycommencing a proceeding to establish
liability of the decedent or the personal representative for which he is protected by liability
insurance; or
(3) collection ofcollecting compensation for services rendered andto the estate or reimbursement
for expenses advanced by the personal representative or by the attorney or accountant for the
personal representative of the estate.
SECTION 62-3-804. Manner of presentation and enforcement of claims.
Claims against a decedent’s estate maymust be presented as follows:
(1) 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 clerk of the
probate court. in which the decedent’s estate is under administration. The claim is deemed
presented on the first to occur of receipt of the written statement of claim by the personal
representative orupon 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 correctlyfully the security, the nature of any uncertainty, and the due date of a
claim not yet due does not invalidate the presentation made.
(2) The 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, to obtainseeking
payment of its 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 permit 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 againstby the estate,
butand serving the same upon the personal representative. The commencement of the legal
proceeding under this subsection must occur within the time limitedlimit for presenting the claim,
and as set out 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 as inwith the probate court in which the
decedent’s estate is under administration providing substantially the same information as the
statement in subsection (1) above, with the clerk of the probate court. Noalong with a statement
that a legal proceeding to enforce the claim has commenced, and 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) The forgoing notwithstanding, no presentation of a claim is required in regard to matters
claimed in proceedings against the decedent which were pending at the time of histhe decedent’s
death.
(3) If a claim is presented under subsection (1),5) The forgoing notwithstanding, no proceeding
thereonfor 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 with warning
of the impending bar; or partial disallowance of the claim in accordance with the provisions of
section 62-3-806; but, 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 courtCourt, on petition presented to the court prior to the expiration of such
thirty-day period, may order an extension of the thirty- day period, but in no event mayshall the
extension run beyond the applicable statute of limitations.
(6) The forgoing notwithstanding, no claim against a decedent’s estate may be presented; or legal
action commenced against a decedent’s estate prior to the appointment of personal representative
to administer the decedent’s estate.
(7) Any legal proceedings against or involving the decedent and pending on the date of his death
must be suspended until a personal representative is appointed to administer the decedent’s estate.
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 reasonable attorney’s fees, and reasonable
funeral expenses; ;
(2)(i) reasonable funeral expenses;
(3) debts and taxes with preference under federal law;
(4) reasonable and necessary medical andexpenses, hospital expenses, and personal care expenses
of the last illness of the decedent, including compensation of persons attending the decedent;
prior to death;
(ii)(5) 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;
(3) debts and taxes with preference under federal law;
(4) debts and taxes with preference under other laws of this State, in the order of their priority;
(56) all other claims.
(b) Except as is provided under subsection (a)(45) above, 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 loaning 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.
SECTION 62-3-807. Payment of claims.
(a) Upon Prior to the expirationclosing of the applicable time limitation provided in Section
62-3-803 forestate and no later than fourteen months after the presentation of claims,decedent’s
death the personal representative shallmust proceed to pay the claims allowed against the estate in
the order of priority prescribed; and, after making provision for homestead, for exempt property
under Section 62-2-401, for claims already presented which have not yet been allowed or whose
allowance has been appealeddisallowance 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. By petition to the court in a proceeding for the purpose, or
by appropriate motion if the administration is under Part 5, a claimant whose claim has been
allowed but not paid as provided herein may secure an order directing the personal representative
to pay the claim to the extent that funds of the estate are available for the payment. Upon
application of the personal representative and for good cause shown, the probate court may
extend the time for payment of creditor claims.
(b(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 stated in subsection (a)set out 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 wilfulwillful fault of the personal
representative, in such manner as to deprive the injured claimant of his priority.
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, and ademption and elective share.
Comments:
UPC includes reference to elective share.
§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.
Comments:
Suggested change is consistent with UPC.
§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.
Comments:
None
§62-3-904
N/A
§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.
Comments:
None
§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 paragraph (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 distributon. 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 bequest, devise, or transfer in trust, in kind with assets at their value for
federal estate tax purposes, the fiduciary, in order to implement the bequest, 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 bequest, 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.
Comments:
A provision has been added to 3-906(b) to require notice of deadline to object to proposed
distribution.
§62-3-907
Distribution in kind; evidence
(A)(a) If distribution in kind is made, whether real or personal property, the personal
representative must execute an instrument or deed of distribution assigning, transferring, or
releasing the assets to the distributee as evidence of the distributee’s title to the property.
(B)(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)(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)(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).
Comments:
Changes made are to provide clarity and consistency.
§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.
Comments:
None
§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.
Comments:
None
§62-3-910
Purchasers from distributees or personal representatives protected
(A)(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 Title 12, Chapter 24 has been paid, and which has been recorded, is prima facie
evidence that the sale was made for value.Any recorded instrument described in this section on
which the appropriate documentary or revenue stamps are affixed is prima facie evidence that the
transfer was made for value.
(B)(b) If a will devises real property to a personal representative or authorizes a personal
Formatted: Font: Times New Roman
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, because the personal representative exercises the
power of sale in trust, for the benefit of creditors, and others interested in the estate, who have
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 Title 12,
Chapter 24 has been paid, and which has been recorded, is prima facie evidence that the sale was
made for value.Any recorded instrument described in this section on which the appropriate
documentary or revenue stamps are affixed is prima facie evidence that the sale was made for
value.
Comments:
Changes to reword awkward phraseology and update terminology regarding recording fees.
§62-3-911
Partition for purpose of distribution
For purposes of this section, “interested heirs or devisees” shall mean 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 kind if it can be fairly and equitably partitioned in
kind. If not subject to fair and equitable partition in kind, the court shall direct the personal
representative to sell the property and distribute the proceeds. 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 section.
(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 10 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 subsection (2)(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 30 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 10 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
subsections (B) or (C) of this subsection (2), the interested heirs or devisees seeking to purchase
the interests of the other interested heirs or devisees shall have 45 days to pay into the court the
price set as the value of those interests to be purchased, in such shares and proportions as the
court shall determine. Upon the payment and approval of it by the court, 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 subsection (D) of this subsection (2), the
court shall proceed according to the traditional practices of circuit courts in partition sales.
Comments:
3-911 has been re-written to provide a method of partition in Probate Court comparable to the
procedure in Circuit Court pursuant to Section 15-61-25.
§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.
Comments:
This section mirrors the UPC. The subcommittee discussed whether amendment was needed
concerning real estate and its devolution at death pursuant to 62-3-101. There was some concern
as to whether a deed of distribution pursuant to the private agreement was sufficient. The
subcommittee concluded that the language of 3-101 was sufficiently clear to not necessitate any
amendment to this section. We also discussed whether this section should contain, or whether
there should be an analogous trust code section that would allow similar private agreements
among trust beneficiaries.
§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).
Comments:
None
§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 and 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 one
hundredfive thousand dollars or less may be paid or transferred by the personal representative to
the South Carolina State Treasurer.
Comments:
This section is much broader than the UPC. Subsection (c) has been revised to permit proof of
publication by either filing with the court copies of the newspaper itself or an affidavit of the
publisher or printer of the newspaper. The de minimus amount in subsection (h) now includes an
intestate share and has been increased to $5000.
§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.
Comments:
More streamlined than UPC. No changes recommended.
§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) Unless the will otherwise provides, the tax 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 the
decedent’s will directs a method of apportionment of tax different from the method described in
this Code, the method described in the will controls.
(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 paragraph (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 paragraph:
(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 subsection (b)(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 interest in the estate. The values used in determining the tax are to be used for that
purpose. If the decedent’s will directs a method of apportionment of tax different from the
method described in this Code, the method described in the will 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.
Comments:
From the UPC: General Comment: Part 9A incorporates into the Uniform Probate Code the
Uniform Estate Tax Apportionment Act as revised in 2003 (UETAA or new UETAA). The new
UETAA replaces the Code's former estate tax apportionment provision (Section 3-916), which
incorporated into the Code the former UETAA. The new UPC apportionment statute is actually
15 sections (although a couple are blank, marked “reserved”) and with comments extends for
more than 20 pages.
Our current statute does not allow a variance from the statutory apportionment by revocable
trust, only by will. The new UPC requires a specific and unambiguous direction for the payment
and allows it in a will or in a revocable trust. Per the UPC comments, a general direction to pay
debts from the residue does not meet this standard.
CLOSING ESTATES
§62-3-1001
Required filings with court; petition for order compelling personal representative to
perform duties; court orders
(a) Within one year after the date of the first publication of notice to creditors, (or if a state or
federal estate tax return was filed, within ninety days after the receipt of a state or federal estate
tax closing letter, whichever is later), a personal representative must 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) a petitionan application for settlement of the estate, which may request the court to determine
testacy if not previously determined, to consider the final accounting or approve an accounting
and distribution, to construe any will or determine heirs, 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 petition 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 under pursuant to subsection
(a), any and all interested persons may 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 under pursuant to subsection (a). After notice and hearing in accordance with
Section 62-1-401, The the court may issue an order requiring the personal representative to
perform his duties under 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 such the notice under 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, on appropriate conditions, determining testacy, determining the persons entitled to
distribution of the estate, and, as circumstances require, 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 any 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 such the notice under 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 under 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 anya 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.
Comments:
The above changes incorporate S.371. This abbreviated method of closing an estate seems
preferable to the provisions of UPC 3-1003, which allows a PR to close an estate by sworn
statement, resulting in appointment terminating one year after filing statement if no proceedings.
§62-3-1002
Payment of taxes; certificate from Department of Revenue
No final account 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 of 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.
Comment: No changes recommended.
§62-3-1003
Payment of taxes; filing federal estate tax return
No final account 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 the tax imposed on the property by Chapter 16 of Title 12,
including applicable interest, has been paid in full or that no such tax is due.
Comments: Delete Reporter’s Comments in annotated Code. Those comments refer to UPC
Section 1002, which was not adopted by SC.
§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.
Comments:
None
§62-3-1005
Rights of successors and creditorsLimitations on proceedings against personal
representative
Unless previously barred by adjudication and except as provided in anythe 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 account, proposal for distribution of the
estate, petition application for settlement of the estate, and proofs 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.
Comments:
Title changed to conform to UPC and all states that have adopted it. Also corresponds to
neighboring Code sections.
Other changes conform this section to changes to 3-1001, allowing waiver of accounting and
proposal for distribution.
§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.
Comments:
None
§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.
Comments:
None
§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 petition 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.
Comments:
Changes made to conform to H. 3803
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 tentwenty-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; and
(5) be approved and countersigned by the probate judge of the county of the decedent’s
residencedomicile at the time of his death 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.
(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).
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. If any
person to whom an affidavit is delivered refuses to pay, deliver, transfer, or issue any personal
property or evidence thereof, it may be recovered or its payment, delivery, transfer, or issuance
compelled upon proof of their right in a proceeding brought for the purpose by or on behalf of the
persons entitled thereto.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.
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 tentwenty-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 givingpublishing notice to creditors required byas permitted 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.
(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 fiduciaries, are the sole devisees under the
probated will of a testate decedent or the sole heirs of an intestate decedent,; the personal
representative or representatives, after giving publishing notice to creditors as required
bypermitted 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.
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.), aafter 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 tentwenty-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 hethe 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 theany court one year after the closing statement is fileddate of the decedent’s death,
the appointment of the personal representative terminates.
SECTION 62-3-1302. Sale of real estate.
The court may, as herein provided, authorize the sale of the real estateproperty of such deceased
person.a decedent.
SECTION 62-3-1303. Issuance of summons upon applicationpetition for sale.
At any time after the qualification of the personal representative, on applicationpetition to the
court by an interested person requesting the sale of real estate property of the deceaseddecedent,
a summons shall be issued to the personal representative (if not the petitioner), the heirs orat law
of the decedent (if the decedent died intestate or the time to challenge a will admitted to probate
has not expired), the devisees of the estateunder 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.
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 or devisees, and any otherat
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 such their appointment as guardian endorsed onad litem to the probate court prior to being
served with the summons and petition. Nothing herein contained precludes any of the parties
interested in the proceeding from accepting service of the summons and petition or fromand
consenting to the sale as prayed for in the petition.
SECTION 62-3-1309. Time for answer or other response; sale of real estateproperty after
hearing and notice.
The time to answer or otherwise respond by motion to the a summons and petition is at least
thirty days from the datefor sale of service. Should the personal representative (if not the
petitioner) or any of the heirs or devisees, or other parties, if any, desirereal property of a
decedent is the same as time to answer or otherwise respond by motion itin any other civil
litigation case. Interested persons who wish to file an answer or return to the petition must be do
so in writing andin the same manner as an answer to a complaint in other civil litigation cases. In
addition the court shall in regular order, as in the case of other litigated cases, proceed to
determine the issues made by petition,may hear such motions and accept such subsequent
pleadings, and motions and if 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 decides thatwill convene a hearing on the merits of the real estatepetition. 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, and after
the payment of the costs and expenses thereof, the court shall payproceeds of the sale will be paid
over to the personal representative the net proceeds of such sale.. 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.
Probate Code Revision Committee
A. Changes Proposed to
Article 4 – Ancillary Administration
I.
§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, and of any official bond he has given, which bond shall name the court in this State as
co-obligee on such bond. The filing of a bond shall not be required unless the court in its
discretion orders it.
II.
§62-4-207. Ancillary and other local administrations; provisions governing.
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.
ARTICLE 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 ArticleCode:
(1)
“Adult” means an individual who has attained eighteen years of age or who has been
emancipated by a court of competent jurisdiction.
(2)
“Conservator” means a person appointed by the court to manage the estate of a protected
person.
(3)
“Court” means the probate court.
(4)
“Emergency” means circumstances that likely will result in substantial harm to a primary
respondent’s health, safety, or welfare or in substantial economic loss to the primary respondent.
(5)
“Guardian” means a person appointed by the court as guardian, but excludes one who is a
guardian ad litem.
(A)
“Guardian Without Limitation” is a guardian who has all the powers and duties
conferred in section 62-(1) “Incapacitated person” means any person who is impaired by reason of
mental illness, mental deficiency, physical illness or disability, advanced age, chronic use of drugs,
chronic intoxication, or other cause (except minority) to the extent that he lacks sufficient
understanding or capacity to make or communicate responsible decisions concerning his person or
property;
(2) A “protective proceeding” is a proceeding under the provisions of Section 62-5-401 to
determine if a person is an incapacitated person, or to secure the administration of the estates of
incapacitated persons or minors;
(3) A “protected person” is a minor or incapacitated person for whom a conservator has
been appointed or other protective order has been made;
(4) A “ward” is a person for whom a guardian has been appointed;
(5-313.
(B)
“Guardian With Limitation” is a guardian whose powers or duties have been
limited by court order.
(6)
“Guardian ad litem” is a person appointed by the court in accordance with Part 8 of
Article 5.
(7)
“Guardianship order” means an order appointing a guardian or adjudicating an adult
incapacitated.
(8)
) A “guardianship proceeding” meansis a formal proceeding under the provisions of Part 3
of Article 5 (Section 62--5--301, et seq.) to determine if an adult is an incapacitated person or in
which an order for the appointment of a guardian for an adult is sought or has been issued.
(9)
“Home state” means the state in which the primary respondent was physically present,
including a period of temporary absence, for at least six consecutive months immediately before
the filing of a petition for the appointment of a guardian or protective order; or if none, the state
in which the primary respondent 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.
(10
“Incapacitated person” means an individual who, for reasons other than minority has
incapacity.
(11) “Incapacity” means the inability to receive and evaluate information or make or
communicate decisions to such an extent that a person, even with appropriate technological
assistance, (A) is unable to provide for his physical health, safety, or self-care to the extent he
needs a guardian, or (B) is unable to manage his property to the extent he needs a protective
order.
(12) “Party” means the primary respondent, petitioner, guardian, conservator, or any other
person allowed by the court or entitled under this Article to participate in a guardianship
proceeding or protective proceeding.
(13) “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.
(14) “Primary respondent” means (A) an adult for whom a protective order is sought, (B) an
adult for whom the appointment of a guardian is sought, (C) an adult for whom a determination
of incapacity is sought, or (D) a minor for whom a protective order is sought.
(15) “Protected a person” means
(A) (i) a minor,
(ii) is an incapacitated person, or to appoint a guardian for an incapacitated person.
(iii) a person who is confined, is detained by a foreign power or has disappeared; or
(iv) a person who is disabled and requires a court order to create and establish a
special needs
trust; and
(B) for whom a conservator has been appointed or other protective order has been made.
(16) “Protective order” means an order appointing a conservator or related to the management
of the property of
(A) an incapacitated person;
(B) a minor;
(C) a person who is confined, is detained by a foreign power or has disappeared; or
(D) a person who is disabled and requires a court order to create and establish a special
needs trust for such person’s benefit.
(17) “Protective proceeding” means a judicial proceeding in which a protective order is sought
or has been issued.
(18) “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.
(19) “Significant-connection state” means a state, other than the home state, with which a
primary respondent has a significant connection other than mere physical presence and in which
substantial evidence concerning the primary respondent is available. Determination of whether a
primary respondent has a significant connection with a particular state shall include consideration
of the following factors:
(A)
the location of the primary respondent’s family and others required to be notified
of the guardianship proceeding or protective proceeding;
(B)
the length of time the primary respondent at any time was physically present in the
state and the duration of any absences;
(C)
the location of the primary respondent’s property; and
(D)
the extent to which the primary respondent has other ties to the state such as
voting registration, filing of state or local tax returns, vehicle registration, driver’s license, social
relationships, and receipt of services.
(20) “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
SECTION 62-5-102. Jurisdiction of subject matter; consolidation of proceedings.
(a) The probate court has jurisdiction of the United States.
(21) “Visitor” is a person who has the requisite knowledge, training, or expertise to perform
the duties required as the court may determine appropriate and must be an officer, employee, or
special appointee of the court with no personal interest in the proceeding.
(22) “Ward” means an adult for whom a guardian has been appointed.
REPORTER'S COMMENTS
Section 62-5-101 defines certain terms which are used in Article 5.
Definitions from the South Carolina Adult Guardianship and Protective Proceedings Jurisdiction
Act (Part 7) have been moved to 62-5-101. The South Carolina Adult Guardianship and
Protective Proceedings Jurisdiction Act is a slightly modified version of the Uniform Adult
Guardianship and Protective Proceedings Jurisdiction Act (UAGPPJA) drafted by the Uniform
Law Commission.
The definition of “Incapacity” and “Incapacitated Person” have changed significantly. These
definitions are modified versions of the definition contained in the Uniform Guardianship and
Protective Proceedings Act (1997) drafted by the Uniform Law Commission. The new definition
is based upon an individual’s functional capacity rather than the person’s disability. The
requirement that the person be unable to make “responsible” decisions is deleted, as is the
requirement that the person have an impairment by reason of a specified disability or other cause,
a requirement which may have led the trier of fact to focus unduly on the nature of the
respondent’s disabling condition, as opposed to the respondent’s actual ability to function. The
revised definition is based on recommendations of the 1988 Wingspread conference on
guardianship reform, the report of which should be referred to for additional background. See
Guardianship: An Agenda For Reform 15 (A.B.A. 1989). See also Stephen J. Anderer,
Determining Competency in Guardianship Proceedings (A.B.A. 1990). Courts seeking guidance
on particular factors to consider should also consult the California Due Process in Competency
Determination Act, California Probate Code Section 811.
This Article 5 uses the term” guardian” (5) to refer to a fiduciary who has custody of an
incapacitated adult. See Section 62-1-201(16).There are two types of guardian: “guardian without
limitation” (5)(A) and “guardian with limitation” (5)(B)
Under this Article 5, a fiduciary appointed to manage the assets of a minor or incapacitated
person is referred to as a “conservator” (2).
Any person for whom a guardian has been appointed is referred to as a “ward” (21).
Any person for whom a conservator has been appointed or a protective order issued is referred to
as a “Protected Person” (14 ).
A person who may participate in a guardianship proceeding or a protective proceeding is referred
to as a “Party” (11).
A “Conservator” (2) is appointed pursuant to a “Protective Order” (15) which is issued as part of
a “Protective Proceeding” (16) and which authorizes the conservator to manage the property of a
“Protected Person” (14). A protective order may be issued by the court without the appointment
of a conservator. For example, under 62-5-405 the court may authorize a so-called single
transaction. For this reason, Article 5 contains frequent references to the broader category of
protective orders. When intended to apply only to conservatorships, such as in Part 7 dealing
with transfer of proceedings to other states, this Article 5 refers to conservatorship and not the
broader category ofover protective proceedings.
Article 5 applies to all types of and guardianship proceedings and protective proceedings,
whether full, limited, temporary or emergency..
In compliance with the requirement of a summons with all petitions in the probate court, the
individual for whom a guardianship or protective proceeding is sought is referred to as the
“Primary Respondent” (13).
The definition of “home state” (8) is derived from but differs in a couple of respects from the
definition of the same term in Section 102 of the Uniform Child Custody Jurisdiction and
Enforcement Act (1997). First, unlike the definition in the UCCJEA, the definition clarifies that
actual physical presence is necessary. The UCCJEA definition instead focuses on where the child
has “lived” for the prior six months. Basing the test on where someone has “lived” may imply that
the term “home state” is similar to the concept of domicile. Domicile, in an adult guardianship
context, is a vague concept that can easily lead to claims of jurisdiction by courts in more than one
state. Second, under the UCCJEA, home state jurisdiction continues for six months following
physical removal from the state and the state has ceased to be the actual home. Under this Act,
the six-month tail is incorporated directly into the definition of home state. The place where the
respondent was last physically present for six months continues as the home state for six months
following physical removal from the state. This modification of the UCCJEA definition eliminates
the need to refer to the six-month tail each time home state jurisdiction is mentioned in the Act.
The definition of “significant-connection state” (18) is similar to Section 201(a)(2) of the Uniform
Child Custody Jurisdiction and Enforcement Act (1997). However, this definition adds a list of
factors relevant to adult guardianship and protective proceedings to aid the court in deciding
whether a particular place is a significant-connection state. Under Section 301(e)(1), the
significant connection factors listed in the definition are to be taken into account in determining
whether a conservatorship may be transferred to another state.
SECTION 62-5-102. Consolidation of proceedings.
(b) 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.
SECTION 62-5-103. Facility of payment or delivery.
(1) A person under a duty to pay or deliver money or personal property to a minor or
incapacitated person may perform this duty in amounts not exceeding an aggregate amount of ten
thousand dollars each year, by paying or delivering the money or property to:
(A) (1) a person having the care and custody of the minor or incapacitated person with whom
the minor or incapacitated person resides;
(B) (2) a guardian of anthe minor or incapacitated person; or
(C) (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 Gifts to Minors Act and giving notice
of the deposit to the minor.
(2) This section does not apply if the person making payment or delivery has actual knowledge
that a conservator has been appointed or that a proceedingproceedings for appointment of a
conservator of the estate of the primary respondent isminor or incapacitated person are pending.
The persons, other than the minor or incapacitated person or a financial institution under (C3)
above, receiving money or property for a minor or incapacitated person, serve as fiduciaries
subject to fiduciary duties, and are obligated to apply the money for the benefit of the minor or
incapacitated person with due regard to (i) the size of the estate, the probable duration of the
minority or incapacity, and the likelihood that the minor or incapacitated person, at some future
time, may be able fully to manage his affairs and his estate; (ii) the accustomed standard of living
of the minor or incapacitated person and members of his household; and (iii) other funds or
resourcessources used or available for the support of the minor or incapacitated person. The
persons, but 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 person’s support.
Money or other property received on behalf of a minor or incapacitated person 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 person. Excess sums must be preserved for future benefit
of the minor or incapacitated person, and anya balance not used and property received for the
minor or incapacitated person must be turned over to the minor when he attains majority or to the
incapacitated person when he is 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 propertyit.
(3)
Regardless of the amount of compensation, any employer may fulfill his duties to a minor
or incapacitated employee by delivering a check to or depositing payment into an account in the
name of the minor or incapacitated employee.
Reporter’s Comments
This section applies to the property of minors or incapacitated persons. This section does not
require a court order. This section was amended to clarify that the $10,000.00 limit is an
aggregate amount each year. Multiple distributions in one year aggregating more than
$10,000.00 require the appointment of a conservator or other protective order.
When a minor or incapacitated person annually receives from a specific payer property or cash of
$10,000 or less, in all likelihood it will be expended for support within the year and it would be
cumbersome and unnecessarily expensive to require the establishment of a conservatorship to
handle the payments. This section allows the person required to transfer the property to do so in a
more expeditious way.
The person required to transfer the property has the option of making the transfer to the person
having care and custody of the minor or incapacitated person, when the minor or incapacitated
person resides with that person, or may instead make payments to the guardian of the minor or
incapacitated person, a custodian under the Uniform Gifts to Minors Act, or to a financial
institution where an interest-bearing account or certificate in only the minor’s name is located.
The protections of this section do not apply if the person required to make the transfer knows that
a conservator has been appointed or that there is a proceeding pending for the appointment of a
conservator. Consequently, the fact that a guardian has been appointed does not require that
payment be made to that guardian. A guardian of a minor or incapacitated person may receive
payments but has no power to compel payment from a third person. Should a guardian desire
such authority, the appropriate course is for the guardian to petition the Court to be appointed as
conservator.
Although the person making the transfer has no duty or obligation to see that the money or
property is properly applied, this section is a default statute and does not override any specific
provisions in a will or trust instrument relating to monies to be paid to a minor or incapacitated
person. In those cases, the duty of the person making the transfer would be dictated by the terms
of the instrument.
The section limits the use of the money or property for the benefit of the minor or incapacitated
person. The money or property may not be used to discharge a legal or customary obligation of
support. Only expenses reasonably incurred may be reimbursed from this money or property,
with the balance being preserved for the future benefit of the minor or incapacitated person. This
section is not applicable to child support payments made pursuant to a Court order because child
support payments are made to another for the minor’s benefit.
While a recipient of funds is not a fiduciary in the normally understood sense of a person
appointed by the Court or by written instrument, a recipient under this section is subject to
fiduciary obligations. Under subsection (c), the recipient may not derive any personal benefit from
the transfer and must preserve funds not used for the minor’s benefit and transfer any balance to
the minor upon emancipation or attainment of majority. Should the recipient misapply the funds
or property transferred, the recipient, given this fiduciary role, would be liable for breach of trust.
The person receiving the monies may consider, in appropriate cases, the purchase of an annuity or
some other financial arrangement whereby payout occurs at a time subsequent to the minor’s
attainment of majority. But to provide more certainty for the transaction, the recipient should
consider petitioning the Court under Section 5-412 for approval of the purchase as a protective
arrangement.
This section is modified from the UGPPA (1982) Section 1-106 (UPC Section 5-101 (1982)).
SECTION 62-5-104.
SECTION 62-5-104. Delegation of guardian’s powers.
A guardian of an incapacitated person, by a properly executed power of attorney, may delegate to
another person, for not more than thirty days, any of his powers regarding care and custody of the
incapacitated person.
SECTION 62-5-105. 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
thethat patient assetsa sum of money, not in excess of the sum of ten thousand dollars in one
calendar year, which may be due the patient or trainee by inheritance, gift, pension, or otherwise
with an aggregate value not exceeding ten 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 assetsthe sum received. Upon receipt, of these funds the director or his designee
shall use the assetsit for the proper maintenance, use, and benefit of the patient or as much of the
fundsfund as may be necessary for these purposes. In the event the patient dies leaving an
unexpended balance of assetsthese funds in the hands of the director or his designee, the director
or his designeehe shall apply the balance first to the funeral expenses of the patient or trainee, and
any balance remaining must be held by the director or his designee for a period of six months;, and
if he is not within this period, the director or his designee is not contacted by the personal
representative of the deceased patient, the balance ofin the assets maypersonal fund account must
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 probate court in
the county in which the patient last resided 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.
This section was formerly Section 62-5-105. This section addresses the receipt of assets up to an
aggregate of $10,000.00 per year by the Director of the Department of Mental Health for patients
of a state mental health facility for whom no conservator has been appointed. If a conservator has
been appointed, the assets must be delivered to the conservator.
At the death of the patient, the Director may apply remaining funds to funeral expenses. The
director must notify the court of the patient’s death and provide a list of assets within thirty days
from the date of death. If no personal representative is appointed and contacts the Director
within six months of the death, the funds may be applied to the account of the deceased patient.
SECTION 62-5-106. Termination of conservatorship.
(A) For purposes of this section, “ incapacitated person” has the meaning set forth in Sections
62-5-101(1) and 62-5-401(2) and does not include a person protected only by reason of his
minority.
(B) Notwithstanding another provision of law, neither a guardianship of an incapacitated person
established pursuant to Part 3 of this article or a conservatorship or other protective order for an
incapacitated person established pursuant to Part 4 of this article terminates only because the
ward or protected person attains the age of majority or other benchmark age.
PART 2.
JURISDICTION
SECTION 62-5-201. Jurisdiction
Jurisdiction of the probate court is set forth in Section 62-1-302, and in Section 62-5-701family
courts as to appointmentminors.
The family courts of a guardian or issuance of a protective order for an adult. The probate court
does notthis State have jurisdiction over the care, custody, and control of the persons of minors,
but does have jurisdiction over the property of minors.
This section is intended to clarify that the probate court has jurisdiction of guardianships and
protective proceedings for adults, but only protective proceedings for a minor. The Family Court
has jurisdiction over the person of a minor.
PART 3.
GUARDIANS OF INCAPACITATED PERSONS
SECTION 62-5-301. Venue.
Subject to the provisions of 62-5-701 et seq., venue for guardianship proceedings for an
incapacitated person is in the place where the incapacitated person resides or is present. If the
incapacitated person is committed to an institution pursuant to an order of a court of competent
jurisdiction, venue is also in the county in which that court sits.
Section 62-5-301 was previously numbered Section 62-5-302.
The Section was amended to include reference to the South Carolina Adult Guardianship and
Protective Proceedings Jurisdiction Act (Part 7).
SECTION 62-5-302. Testamentary appointment of guardian. for incapacitated person.
(1) A
(a) The parent, of an incapacitated person may by will, may appoint a guardian for an unmarried
adult child whoof the parent believes is an incapacitated person. SuchA testamentary appointment
by a parent becomes effective when, after having given twenty days prior written notice of
intention to the incapacitated person and any person to whom notice is required under Section 625-303(2) (C),to the person having his care or to his nearest adult relative, the guardian files
acceptance of appointment in the court in which the will is informally or formally probated, if
prior thereto, both parents are dead or the surviving parent is adjudged incapacitated. If both
parents are deceaseddead, an effective appointment by the surviving parent who died later has
priority over any appointmentunless it is terminated by the first deceased parent. The denial of
probate in formal proceedings terminates a testamentary appointment of guardian under this
section.
(2) An individual, b) The spouse of a married incapacitated person may by will, may appoint a
guardian forof the individual’s spouse who the appointing spouse believes is an incapacitated
person. Such testamentaryThe appointment by a spouse becomes effective when, after having
given twenty days prior written notice of his intention to do so to the incapacitated person and
any person to whom notice is required under Section 62-5-303(2)(C),to the person having his
care or to his nearest adult relative, the guardian files acceptance of appointment in the court in
which the will is informally or formally probated. An effective appointment by a spouse has
priority over a testamentaryan appointment by a parent, unless it is terminated by the denial of
probate in formal proceedings. The denial of probate in formal proceedings terminates a
testamentary appointment of guardian under this section.
(3)
Upon the c) This State shall recognize a testamentary appointment effected by filing of
acceptance of testamentary appointment under a will probated at the testator’s domicile in another
state, this state shall recognize a testamentary appointment of guardian effected by .
(d) On the filing of acceptance of appointment in the manner set forth in (1) and (2) of this section
in the county in this state in which the incapacitated person resides.
(4) Upon the filing, with the court in which the will was probated, of written objection to the
testamentary appointment by the person for whom a testamentary appointment of guardian has
been made or by any person to whom notice is required under Section 62-5-303(2)(C),, the
appointment is terminated. An objection does not prevent appointment by the court in a proper
proceeding of the testamentary nominee or any other suitable person upon an adjudication of
incapacity in proceedings under the succeeding section of this Part.
(5)
The appointment of a guardian under this section is not an adjudication of incapacity.
(6)
Upon effectiveness, the testamentary guardian shall be deemed to have been appointed by
the court and the court shall issue a certificate of appointment to the testamentary guardian who
shall have all of the rights, duties and responsibilities of a guardian under Part 3.
Section 62-5-302 was previously numbered Section 62-5-301.
Section (1) providesvenue for appointment of a guardian by will of a parent. Notice is required to
be given to those to whom notice is required in 62-5-303 (2)(C). Because of the presumption
that an individual is not guardianship proceedings for an incapacitated until proven otherwise, the
language of this subsection was amended to assume not the incapacity of the individual, but rather
that the parent has a belief that the individual is incapacitated.
Section (2) provides for appointment of a guardian by will of a spouse. Similar changes were
made to Section (B) as were made to Section (A).
Section (4) allows for the person for whom testamentary appointment is sought, as well as anyone
to whom notice was required to be sent, to object to the appointment. If any of those entitled to
object do so, the appointment is terminated.
Section (5) and (6) were added to clarify that the appointment of a Guardian under this section is
not an adjudication of incapacity and that once effective, a Guardian appointed under this section
is deemed to have the same rights, duties and responsibilities as a Guardian appointed through
Court proceedings under this Part.
SECTION 62-5-303. Procedure for determination of incapacity and court appointment of a
guardian.
(1) An alleged is in the place where the incapacitated person resides or is present. If the
incapacitated person or any person interested in the welfare of the primary respondent may
petition the court for a finding of incapacity and, if appropriate, for the appointment of a guardian
with limitation or a guardian without limitation for the alleged incapacitated person. The
guardianship proceeding is commenced by the filing and service of a summons and verified
petition upon the primary respondent and those persons listed in Paragraph (2) (C) of this
Section.is admitted to an institution pursuant to order of a court of competent jurisdiction, venue
is also in the county in which that court sits.
(2)
SECTION 62-5-303. Procedure for court appointment of a guardian of an incapacitated person.
(a) The incapacitated person or a person interested in his welfare may petition for a finding of
incapacity and appointment of a guardian.
(b) Upon the filing and service of the summons and the petition the court shall send a visitor to
the place where the allegedly incapacitated person resides to observe conditions and report in
writing to the court. The court shall set forth, to the extent known or reasonably ascertainable,
the following information:a date for hearing on the issues of incapacity and unless the allegedly
incapacitated person has counsel of his own choice, it shall appoint an attorney to represent him in
the proceedings and that attorney shall have the powers and duties of a guardian ad litem. The
person alleged to be incapacitated shall be examined by two examiners, one of whom shall be a
physician appointed by the court who shall submit their reports in writing to the court. The
person alleged to be incapacitated is entitled to be present at the hearing in person, and to see or
hear all evidence bearing upon his condition. He is entitled to be represented by counsel, to
present evidence including testimony by a physician of his own choosing, to cross-examine
witnesses, including the court-appointed examiners. The issue may be determined at a closed
hearing if the person alleged to be incapacitated or his counsel so requests.
(A) the interest of the petitioner;
(B) (i)
the name, age, current address, of the primary respondent;
(ii)
the physical location of the primary respondent during the six month
period immediately preceding the filing of the summons and petition; and, if the
primary respondent was not physically present in South Carolina for that period,
sufficient information on which the court may make a determination that it has
initial jurisdiction pursuant to Section 62-5-707.
(C) the names and addresses of the following persons whose identity and whereabouts
are known or reasonably ascertainable:
(i)
the primary respondent’s spouse;
(ii) the primary respondent’s adult children;
(iii)
if there is no spouse or adult children whose the primary respondent’s
parents;
(iv) if there is no spouse, adult children, or parent, at least one of the primary
respondent’s adult relatives with the nearest degree of kinship;
(v) any person known to have been appointed as agent for the primary
respondent under a general durable power of attorney or health care power of
attorney;
(vi) any person who under Section 62-5-305 has equal or greater priority for
appointment as guardian with the person whose appointment the petition
advocates;
(vii) any person with whom the primary respondent resides outside of a health
care facility, group home, homeless shelter, or prison; and
(viii) any 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 primary respondent within the six month
period preceding the filing of the petition with the court.
(D)
the name and address of the person whose appointment is sought and the basis of
his priority for appointment;
(E)
the reason why guardianship is necessary, including a brief description of the
nature and extent of the primary respondent’s alleged incapacity;
(F)
whether petitioner is requesting the appointment of a guardian with limitation or a
guardian without limitation and, if guardian without limitation is requested, the reason why a
guardian with limitation is inappropriate; or, if guardian with limitation is requested, the
restrictions sought to be imposed on the primary respondent and the limitations sought to be
imposed on the guardian’s powers and duties; and
(G)
a general statement of the primary respondent’s assets, with an estimate of its
value, and the source and amount of any income of the primary respondent.
(3)
Upon the filing of the summons and petition with the court and proof of service of the
summons and petition upon the primary respondent, the court must appoint a guardian ad litem
for the primary respondent in accordance with Section 62-5-830, and such guardian ad litem shall
have the duties and responsibilities set forth in Section 62-5-830 et seq. The appointment of a
guardian ad litem under this section shall have no effect on the legal capacity of the primary
respondent and shall not raise a presumption of incapacity of the primary respondent.
(4)
The primary respondent is not required to be represented by counsel but is entitled to be
represented by counsel of his or her choosing. If the primary respondent is not represented by
counsel, then:
(A) upon the request of the primary respondent, the court may allow the primary
respondent to proceed pro se or instruct the guardian ad litem to assist the primary
respondent in obtaining counsel or
(B) upon the request of the primary respondent, guardian ad litem, any party, or upon the
court’s own motion,
the court may appoint counsel for the primary respondent. Nothing in this section shall be
construed to require an attorney to accept an uncompensated appointment. During the pendency
of any guardianship proceeding, any attorney purporting to represent the primary respondent shall
file a notice of appearance with the court. Fees for counsel retained by a primary respondent who
is determined to be incapacitated shall be subject to approval by the court.
(5)
summons and petition upon the primary respondent, the court shall appoint an examiner, who
shall be a physician, to examine the primary respondent and report to the court the physical and
mental condition of the primary respondent. Upon the motion or written request of the guardian
ad litem, the primary respondent, any party or on its own motion, the court may appoint one or
more additional examiners, who may be a physician or any other person the court determines
qualified to evaluate the primary respondent’s alleged impairment. If the court appoints any
additional examiners, the court shall set out in the order appointing the examiner(s) why an
additional examiner is necessary and why the appointed examiner(s) is appropriate to serve in that
capacity. Each examiner shall complete a verified report evaluating the condition of the primary
respondent and file their original report with the court or deliver the original report to the
guardian ad litem, who, without undue delay must file the report with the court by the deadline set
by the court, 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 allow admission of an examiner’s report
filed less than forty-eight hours prior to the hearing. All parties to the proceeding are entitled to
a copy of examiners’ reports. The examiner(s)’ report(s) shall evaluate the condition of the
primary respondent and shall contain, to the best information and belief of the examiner: (i) a
description of the nature, type, and extent of the primary respondent's incapacity, including the
primary respondent's specific functional impairments, (ii) a diagnosis and assessment of the
primary respondent's mental and physical condition, including a statement as to whether the
primary respondent is on any medications that may affect his actions or demeanor, (iii) where
appropriate and consistent with the scope of the examiner's license, an evaluation of the primary
respondent's ability to learn self-care skills, adaptive behavior, and social skills and a prognosis for
improvement, (iv) the date or dates of the examinations, evaluations, and assessments upon which
the report is based, (v) the identity of those persons with whom the examiner met or consulted
regarding the primary respondent’s mental or physical condition; and (vi) the signature of the
examiner and the nature of any professional license held by the examiner. Unless otherwise
directed by the court, in preparing a report for the court, the examiner may rely upon an
examination conducted by the examiner within the ninety-day period immediately preceding the
filing of the petition. In the absence of bad faith or malicious intent, an examiner appointed by the
court and performing an examination and submitting a report under this section shall be immune
from civil liability for any breach of patient confidentiality made in furtherance of his duties under
this section. A report prepared pursuant to this section shall be admissible as evidence of the facts
stated therein and the results of the examination or evaluation referred to therein.
(6)
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 served, the court must hold a hearing on the merits of the
petition. The primary respondent, all parties, and any person who has filed a demand for notice
pursuant to subparagraph (7) hereof, must be given notice of the hearing as provided in section
62-1-401. The primary respondent shall attend the hearing, unless excused by the court for good
cause. In determining good cause, the court may consider affidavits submitted by the guardian ad
litem or any interested persons.
(7)
Any interested person who desires to be notified before any order is made in a
guardianship proceeding may file with the court a demand for notice. The court shall mail a copy
of the demand to the guardian, if one has been appointed, or to the petitioner, if no guardian has
been appointed. A demand for notice is not effective unless it contains a statement indicating the
nature of the interest of the person filing the demand, his address or that of his attorney, and is
effective only as to matters occurring after the filing of the demand.
(8)
After a hearing, or with the consent of all parties, upon the finding that a basis for the
appointment of a guardian has been established as set forth in this section, the court shall make an
appointment. A primary respondent represented by counsel may consent through counsel.
Section 62-5-303 was significantly revised.
The revised section adds the requirement of a summons and clarifies that a petition must be
verified.
The phrase “any person interest in the welfare of the primary respondent” is intended to be
broader than then term “interested person” defined in 62-1-201. For example, it could include a
friend, neighbor, or person residing with the primary respondent.
This section sets out the basic procedure for a finding of incapacity or appointment of a guardian.
The section was also amended to provide for both guardianship with limitation and guardianship
without limitation.
Section (2) provides detailed requirements for the content of a petition for appointment of
conservator or other protective order. While the subsection only requires the petitioner to
provide information known to the petitioner, it imposes on the petitioner a duty to engage in a
reasonable effort to ascertain the required information. Specifying the required contents of the
petition is in accordance with the recommendations of both the Wingspread conference on
guardianship reform and the Commission on National Probate Court Standards. See
Guardianship: An Agenda For Reform 9 (A.B.A. 1989); National Probate Court Standards,
Standard 3.3.1, “Petition” (1993).
Subsection (2)(f) emphasizes the importance of limited guardianship, the encouragement of which
is a major theme of the Act. The petitioner, when requesting an unlimited guardianship, must state
in the petition why a limited guardianship would not work. If a limited guardianship is requested,
the petition must set out the recommended powers to be granted to the guardian.
A substantive change was made in that the appointment of a visitor is always optional under 62-5314, but the appointment is no longer required at commencement of the action.
Subsection (3) provides for the appointment of a guardian ad litem, upon the filing and service of
the verified petition for a finding of incapacity or appointment of a guardian. While appointment
of a guardian ad litem occurs without a preliminary assessment of capacity by the court, the
subsection makes it clear the mere appointment of the guardian ad litem does not impact the
rights of the person allegedly in need of a guardian and the appointment is not evidence of
incapacity.
With this revision, the roles of counsel and guardian ad litem have been separated. A guardian ad
litem is required to be appointed in every case. A guardian ad litem must be meet the
qualifications set forth in Section 62-5-820, but the guardian ad litem is no longer required to be
an attorney. If the guardian ad litem is an attorney, that person may not also serve as counsel for
the primary respondent.
Subsection (4) provides that the primary respondent is not required to be represented by counsel,
but is entitled to be represented by counsel of his or her own choosing. This subsection sets forth
the options of the court when dealing with a primary respondent who is not represented by
counsel. This section does not mandate the appointment of counsel, nor is the primary
respondent required to be represented by counsel. If the court determines an unrepresented
primary respondent should not proceed without counsel, the subsection authorizes the court to
appoint counsel for the primary respondent. The subsection also suggests to the court the option
of directing the guardian ad litem to assist the person in obtaining counsel. This would be
particularly appropriate where the court felt the need for counsel and the person had adequate
resources with which to pay counsel. The enhanced duties of the guardian ad litem established by
Title 62, Article 5, Part 8, in conjunction with the enhanced qualification for persons acting as
guardian ad litem should provide adequate protection of the interests of the person who is the
subject of a guardianship proceeding in most cases.
Subsection (5) provides the appointment of an examiner in connection with a proceeding for a
finding of incapacity or appointment of a guardian, establishes the necessary qualification of the
person who will serve as an examiner, sets forth the type of report the examiner is to produce, and
the time within which the report is to be produced. Unlike prior law, only one examiner is
required. A designated examiner, who is a physician, must be appointed. Additional designated
examiners may be appointed by the court. The additional examiners may be physicians or any
other person the court has determined is qualified to evaluate the primary respondent’s alleged
impairment. The subsection also clarifies prior law, by establishing the examiner may make his
report from information obtained in an examination conducted prior to the examiner’s
appointment. If the examiner’s report references an examination conducted prior to appointment,
it must have been conducted within the 90 days immediately preceding the examiner’s
appointment; otherwise the examination must occur subsequent to the appointment.
Subsection (6) establishes the requirement of a hearing in regard to the petition, provides who
must be given notice of the hearing, and the timing of notice. Note the subsection mandates
attendance at the hearing by the primary respondent absent a showing of good cause.
Subsection (7) provides a procedure for interested persons to obtain notice prior to orders being
issued in the proceeding.
Subsection (8) establishes the requirement that the court issue an order in response to a petition
and clarifies that such an order may arise by consent of all parties. If the petition contains an
allegation of incapacity on behalf of the primary respondent, he or she must be represented by
counsel in order to consent.
SECTION 62-5-304. Order adjudicating incapacity, order of appointment; alternatives;
limitations on guardian’s powers.
(1) A) The court shall exercise the authority conferred in this part so as to encourage the
development of maximum self--reliance and independence of the incapacitated person and make
appointive and other orders only to the extent necessitated by the incapacitated person’s mental
and adaptive limitations or other conditions warranting the court’s order.procedure.
(2)
The court may adjudicate the primary respondent as incapacitated only if it finds by clear
and convincing evidence that the primary respondent is an incapacitated person as defined in
Section 62-5-101. If the primary respondent is adjudicated as incapacitated and the primary
respondent’s identified needs cannot be met by less restrictive means, the court may appoint a
guardian for the primary respondent.
(3)
In an order appointing a guardian, the court may appoint a guardian with limitation or a
guardian without limitation.
(4)
The court shall provide a copy of its orders to all parties to the proceeding.
Section 62-5-304 was amended to require a finding of incapacity to meet the clear and convincing
standard of review. The court is to exercise its authority to encourage maximum self-reliance.
Appointment orders are to be made only to the extent necessitated by the incapacitated person’s
mental and adaptive limitations. The court is to appoint a guardian only if the primary respondent
is determined to be incapacitated, by clear and convincing evidence, and if the primary
respondent’s needs cannot be met by less restrictive means. The section permits the court to
consider less restrictive alternatives to guardianship.
SECTION 62-5-305. Who may be guardian; priorities.
(1)
The court in appointing a guardian shall consider persons, who are otherwise qualified, in
the following order of priority:
(A)
a guardian, other than a temporary or emergency guardian, currently acting for the
ward in this state or elsewhere;
(B)
a person nominated to serve as guardian by the primary respondent prior to his
incapacity;
(C)
an attorney in fact appointed by the primary respondent pursuant to Section
62-5-501, whose authority includes powers relating to the person of the incapacitated person;
(D)
the spouse of the primary respondent or a person nominated as testamentary
guardian in the will of the primary respondent’s deceased spouse;
(E)
an adult child of the primary respondent;
(F)
a parent of the primary respondent or a person nominated as testamentary guardian
in the will of the primary respondent’s deceased parent;
(G)
another relative of the primary respondent;
(H)
a person nominated by the person who is caring for the primary respondent or
paying benefits to him.
(2)
With respect to persons having equal priority, the court shall select the person it considers
best qualified to serve as guardian for the primary respondent. The court, acting in the best
interest of the primary respondent, may decline to appoint a person having priority and appoint a
person having a lower priority or no priority.
Section 62-5-305, formerly Section 62-5-311, was amended to comply with the South Carolina
Adult Guardianship and Protective Proceedings Jurisdiction Act (Part 7) giving highest priority to
an individual currently serving as guardian. The list of priorities was further amended to allow a
spouse to nominate a guardian by will as is allowed for a parent. Also, the court may deviate
from the stated priorities if appointment of proposed guardian, with less priority, is in the best
interests of the ward.
SECTION 62-5-306. Rights of the ward; impact on testamentary capacity
(1)
Notwithstanding an adjudication of incapacity or the appointment of a guardian, every
ward retains the rights set forth below, unless otherwise ordered by the court:
(A)
The right to a guardian who acts in the best interest of the ward;
(B)
The right to a guardian who is reasonably accessible to the ward;
(C)
The right to have the ward's property utilized to provide adequately for the ward's
support, care, education, health, and welfare;
(D)
The right to communicate freely and privately with persons other than the
guardian;
(E)
The right to a reasonably accessible telephone or similar communication device;
(F)
The right to meet or otherwise communicate with legal counsel outside the
presence of the guardian;
(G)
The right to notify the court that the ward is being unjustly denied a right or
privilege retained under or granted by this section or ordered by the court. Any person who
knowingly interferes with transmission of this type of notification to the court may be adjudicated
guilty of contempt.
(H)
The right to request re-adjudication of incapacity as set forth in Section 62-5311(3); and
(I)
The right to the least restrictive form of guardianship and living environment
practicable, taking into consideration the ward's functional limitations, personal needs, and
identifiable preferences.
(2)
Unless an order of the court specifies otherwise, a finding of incapacity and/or the
appointment of a guardian is not a determination that the ward lacks testamentary capacity or the
capacity to create, amend or revoke a revocable trust.
Section 62-5-306 is a new section added to the code which lists the rights retained by the ward,
unless otherwise ordered by the court. The Section also addresses the common law rule that a
finding of incapacity is not a determination that the ward lacks testamentary capacity.
SECTION 62-5-307. Rights and powers removed from ward upon adjudication of incapacity or
upon appointment of guardian.
(1)
Unless the court's order specifies otherwise, an adjudication of incapacity or the
appointment of a guardian without limitation shall remove from the ward the following rights and
powers:
(A)
The right to marry;
(B)
The right to reside in a place of the ward’s choosing;
(C)
The right to travel without the consent of the guardian;
(D)
Except as otherwise provided in Section 62-5-306(G) and (H), the right to bring
or defend any action at law or equity;
(E)
The power to make, modify, or terminate contracts;
(F)
The power to refuse or consent to medical treatment;
(2)
Upon appointment of a guardian with limitation the court must set forth in the order which
rights enumerated in subsection (1) above are retained by the ward and which are removed from
the ward.
(3)
Unless the court’s order specifies otherwise, the appointment of a guardian suspends the
authority of an agent who was previously appointed by the ward to act as an agent under a
durable power of attorney for health care or other advance medical directive. The suspension of
the authority of an agent does not abrogate any other directives included in a properly executed
advance medical directive.
Section 62-5-307 is a new section added to the code which lists the rights which are lost when
guardianship without limitation or full guardianship is sought. The court may specify that some or
all of these rights are retained even in a guardianship without limitation, but the rights are lost if
the court does not specify the rights are retained. For limited guardianship, the court must list the
specific rights which are lost. For example, an individual may not have the capacity to understand
their health care needs to the extent necessary to consent to treatment, but they may be able to
understand and appreciate the benefits of one living arrangement over another. In that
circumstance, a ward may lose the right to make health care decisions but may maintain the right
to make decisions about where they reside.
SECTION 62-5-308. (B) The court may appoint a guardian as requested if it is satisfied that the
person for whom a guardian is sought is incapacitated and that the appointment is necessary or
desirable as a means of providing continuing care and supervision of the person of the
incapacitated person. The court, on appropriate findings, may:
(1) treat the petition as one for a protective order under Section 62-5-401 and proceed
accordingly;
(2) enter another appropriate order; or
(3) dismiss the proceeding.
(C) The court, at the time of appointment or later, on its own motion or on appropriate petition or
motion of the incapacitated person or other interested person, may limit the powers of a guardian
otherwise conferred by this article and create a limited guardianship. A limitation on the statutory
power of a guardian of an incapacitated person must be endorsed on the guardian’s letters or, in
the case of a guardian by parental or spousal appointment, must be reflected in letters issued at
the time a limitation is imposed. Following the same procedure, a limitation may be removed or
modified and appropriate letters issued.
By accepting appointment, a guardian submits personally to the jurisdiction of the court in any
informal or formal proceeding relating to the guardianship that may be instituted by any interested
person. Notwithstanding the foregoing, all formal proceedings instituted by interested persons are
governed by and subject Notice of any proceeding shall be delivered to the rules of civil
procedure adopted for the circuit guardian or mailed to him by ordinary first class mail at his
address as listed in the court and other rules of procedure in this title. records and to his address
as then known to the petitioner.
Section 62-5-308 was previously section 62-5-305. The notice provisions under the previous
section 62-5-305 were moved to section 62-5-303.
SECTION 62-5-309. Compensation and expenses.
Any guardian ad litem, attorney, examiner, visitor or guardian appointed in a guardianship
proceeding is entitled to reasonable compensation from the ward’s estate, as determined by the
court. In addition, the court has discretion to award, from the ward’s estate, reasonable fees and
expenses to attorneys involved in the proceeding resulting in an adjudication of incapacity, the
appointment of a guardian, or a protective order concerning the primary respondent.
Section 62-5-309 is a new section added to the code explaining how appointees are to be
compensated and allowing attorneys to be compensated from the estate of the ward. This change
is in response to the decision in Dowaliby v. Chambless,544 S.E.2d 646 (S.C.App. 2001) and is
intended to provide a statutory basis for the court, in its discretion, to award attorney’s fees, to be
paid from the ward’s estate, to attorneys involved in the proceeding.
SECTION 62-5-310306. Termination of guardianship at death of wardfor incapacitated person.
The authority and responsibility of a guardian for a wardan incapacitated person terminates upon
the death of the guardian or ward, the determination of incapacity of the guardian, or upon
removal or resignation of the guardian as provided in Section 62-5-311307. Testamentary
appointment under an informally probated will terminates if the will is later denied probate in a
formal proceeding. Termination does not affect the guardian’shis liability for prior acts nor his
obligation to account for funds and assets of his ward. Upon the death of the ward, the guardian
shall file a certified copy of the ward’s death certificate with the court having continuing
jurisdiction over the ward within 60 days of the ward’s death and, upon receipt, the court must
issue a termination of appointment. Before the termination of the guardian’s appointment, the
court may require from the guardian an accounting of any assets held by the guardian on behalf of
the ward.
Section 62-5-310 was previously section 62-5-306. The last two sentences were added to the
previous section 62-5-306 to create a procedure for notice to the court if the ward dies. In such
event, the court may require an accounting for any assets held by the guardian.
SECTION 62-5-311307. Removal or resignation of guardian; termination of incapacity.
(1)
In accordance with the procedure set forth in Section 62-5-303,
(1)
(a) After service of the summons and petition of the ward or any person interested in his
welfare may file a summons and petition for the removal of a guardian and, if necessary,
appointment of a successor guardian. If the court determines that it is in the best interests of the
ward, the court may remove thea guardian and, if necessary, appoint a successor guardian.
(2)
(A)
If co-guardians are appointed by the court, one if in the best interests of the ward.
On petition of the co-guardians may resign by filing a statement of guardian, the court may accept
his resignation and, upon such filing, the court may informally confirm the appointment of the
remaining co-guardian as sole guardian for the ward or the court may, in its discretion require the
commencement of a formal proceeding under Section 62-5-303.
(B) If no co- guardian is then serving, a guardian seeking to resign must file a summons and
petition for discharge and appointment of a successor guardian. Upon the filing of a summons
and petition by the guardian and service upon the primary respondent and other parties set forth in
Section 62-5-303(2)(C), the court may accept the resignation of the guardian and make any other
order which may be appropriate. Resignation of a guardian is not effective until a successor is
appointed and has qualified.
(3) (A) A request for (b) An order re-adjudicating or readjudicating incapacity may be made by
informal letter to the court judge by the guardian or the ward. Any person who knowingly
interferes with transmission of this type of request to the court or judge may be adjudged guilty of
contempt. The court may issue an order specifyingspecify a minimum period, not exceeding one
year, during which no petition for re-an adjudication that the ward is no longer incapacitated may
be filed without special leave of the court.. Subject to this restriction, the ward or the guardian
may petition ormay make a request for an order from the court that the wardhe is no longer
incapacitated, and for termination of the guardianshipremoval of the guardian. A request for this
order may be made by informal letter to the court or judge and any person who knowingly
interferes with transmission of this kind of request to the court or judge may be adjudged guilty of
contempt of court.
(B) (c) Before acting upon any such petition or request, the court shall send a visitor to the
residence of the present guardian ad litemand to the place where the ward resides or is detained to
observe conditions and report in writing to the court. After reviewing the report of the visitor,
the court may order the termination of the ward'sward’s incapacity solely on the basis of the
guardian ad litem’s report or require the filing of a summons and petition for discharge and
termination of the guardianship or a hearing following the procedures set forth in Section . The
court may issue an interim order, for a period not to exceed ninety days, regarding the care of the
ward until a hearing is held and a final order is issued62-5-303.
Section 62-5-311 was previously section 62-5-307. The section was reorganized for clarity,
amended to require a summons and petition, and allows for an interim order pending a hearing
and final order.
SECTION 62-5-312. Temporary guardians308. Visitor in guardianship proceeding.
(1) Following
A visitor is the procedure for , with respect to guardianship proceedings, a person who is trained
in law, nursing, or social work and is an officer, employee, or special appointee of the court with
no personal interest in the proceedings.
SECTION 62-5-309. Service and notice in guardianship proceedings.
(A) In a proceeding that is properly commenced by filing and service of the summons and petition
for the appointment or removal of a guardian of an incapacitated person other than the
appointment of a temporary guardian with noticeor temporary suspension of a guardian, the
following persons must be properly served:
(A)
In the case of (1) the ward or the person alleged to be incapacitated and his
spouse, parents, and adult children;
(2) a person who has no is serving as his guardian or temporary guardian:
(i)
Following the filing of a summons and verified petition for appointment of
guardian and service upon the primary respondent, any party may move the court
for an order appointing a temporary guardian for the primary respondent.
(ii)
Unless made during a hearing in open court, the motion shall be in writing,
and shall state with particularity:
(a)
the name and address of the proposed temporary guardian and that person’s
relationship to the primary respondent;
(b)
to the extent known, conservator, or reasonably ascertainable,
those persons whose priority for appointmentattorney in fact under a
durable power of attorney pursuant to Section 62--5-305 are higher than
the priority of the proposed temporary guardian;
why the appointment of a temporary guardian is necessary for the welfare of the
primary respondent; and
(B) In the case of a person for whom a guardian-501 or temporary guardian has previously
been appointed, and that appointment has not been terminated through an adjudication of
capacity:who has his care and custody;
(i)
Any party may move the court for an order appointing a temporary guardian for
the ward.
(ii)
Unless made during a hearing in open court, the motion shall be in writing and
shall state with particularity:
(a)
the name and address of the proposed temporary guardian and that person’s
relationship to the ward;
(b)
to the extent known or reasonably ascertainable, those persons whose priority for
appointment under Section 62-5-305 are higher than the priority of the
proposed temporary guardian;
(c)
why the current guardian or temporary guardian cannot or is not adequately
fulfilling the guardian’s duties to the ward;
(d)
why the appointment of a temporary guardian is necessary for the welfare of the
ward;
(C)
As soon as practicable after the filing of a motion for appointment of temporary
guardian, the court shall set a hearing on the motion.
(D)
Notice of the hearing on the motion as provided in Section 62-1-401 must be given
to the ward or primary respondent, and those persons listed in Paragraph (2)(C) of Section
62-5-303.
(E) At or following the hearing convened for the purpose of considering the appointment of a
temporary guardian, the court may appoint a temporary guardian for a ward or primary
respondent,(3) if no other person is notified under item (1), at least one of his closest adult
relatives, if one can be found.
(B) Notice of hearing must be given as provided in Section 62-1-401. Waiver of notice by the
person alleged to be incapacitated is not effective unless he attends the hearing or his waiver of
notice is given by his attorneys or, in proceedings for removal, confirmed in an interview with the
visitor, which may be done at any time. Representation of the alleged incapacitated person by a
guardian ad litem is not necessary.
(c)
SECTION 62-5-310. Temporary guardians.
(A) If the court makes emergency preliminary findings that:
(i)
no guardian has been appointed for the primary respondent or the guardian or
temporary guardian for a ward is not effectively performing his duties; and
(ii) in the case of a person for whom there has been no adjudication of incapacity,(1) a
physician has certified to the court, orally or in writing, that the person is incapacitated; and
(iii)
(2) no guardian has been appointed previously; and
(3) the welfare of the ward or primary respondent incapacitated person requires immediate action.
(F)
An order appointing; then the court, with or without petition or notice, may
appoint a temporary guardian shall:
(i) set forth the duration of the appointment; which, except for good cause shown, shalla
specified period not to exceed six (6) months. in accordance with the priorities set out in Section
62-5-311.
(ii)
set forth a concise statement of(B) If the evidence submitted at the hearing;
(iii)
set forth thecourt makes emergency preliminary findings required under
Paragraph that:
(1)(E) of this section;
(iv) state) the reasonappointed guardian or temporary guardianshipguardian is necessary for not
effectively performing his duties; and
(2) the welfare of the primary respondent or ward; andallegedly incapacitated person requires
immediate action, then the court may appoint, with or without petition or notice, a temporary
guardian for a specified period not to exceed six months in accordance with the priorities set out
in Section 62-5-311.
(v)
set forth whether the appointment is of a temporary guardian with limitation or a
(C)(1) The court may itself exercise the power of temporary guardian, with or
without limitation; andpetition or notice, if a temporary guardian with limitation,
the powers and duties of the guardian.
(G)
To the extent practicable and consistent with the urgency of the needs of the
primary respondent or ward, in appointing a temporary guardian the court shall consider persons,
who are otherwise qualified, in the same order of priority it does in appointments of guardians
under Section 62-5-305.
(2)
Following is the procedure for Emergency Appointment of Temporary Guardian:
(A)
Any person interested in the welfare of a ward or primary respondent, may file a
motion for emergency appointment of a temporary guardian.
(B)
Upon receipt of the motion, the court may issue an order ex parte or schedule a
hearing with such notice as the court may prescribe; all as the interests of justice and the
needs of the ward or primary respondent require.
(C)
No order appointing a temporary guardian for a ward or primary respondent shall
issue except as provided in Section 62-3-312(1), unless (i) the subject of the motion has
previously been adjudicated incapacitated or (ii) a physician has certified to the court,
orally or in writing, that in that physician’s opinion the person is incapacitated; and it
clearly appears from specific facts, shown by affidavit or by a verified petition for
appointment of guardian that anthe court makes emergency exists.
(D)
An emergency order appointing a temporary guardian shall be endorsed with the
date of issuance; shall be filed in the record of the case; and shall be served, together with
a summons and verified petition for appointment of guardian, in the event no summons
and verified petition have previously been served in the action and no guardian has
previously been appointed, upon the ward or primary respondent, and those persons
required to receive notice of a summons and petition for guardianship under Section 62-5303.
(E)
An emergency order appointing temporary guardian must state the nature of the
emergency; and, if no notice was required, state why the order was granted without
notice.
(F)
Further, an emergency order appointing a temporary guardian shall expire by its
terms within such time after entry, not to exceed 30 days, as the court fixes; unless within
the time so fixed in the order, for good cause shown, the order is extended for a like
period. The reasons for the extension shall be set forth in the order granting the extension.
(G)
On two days' notice to the party who obtained the emergency order appointing a
temporary guardian, or on such shorter notice to that party as the court may prescribe, the
primary respondent, ward, or any party opposed to the order may appear and move its
dissolution or modification; and in that event, the court shall proceed to hear and
determine such motion as expeditiously as the ends of justice require.
(H)
Unless limited by the court, an emergency temporary guardian has the powers and
duties of a guardian without limitation.
(3)
The court may exercise the powers of temporary guardian, with or without petition or
notice, if the court makes preliminary findings that:
(A) either no person appears to have authority to act on behalf of athe incapacitated person or
more than one person is authorized to make health care decisions for the incapacitated person,
and these authorized persons disagree on whether certain care must be provided; and:
(B) (a) the person has been adjudicated as being incapacitated, or a physician has certified to
the court, orally or in writing, that the person is incapacitated; and
(C) (b) an emergency exists.
(4)
2) For health care purposes of this section, “emergency” means
(A)
(i)
no person appears to have authority to act on behalf of a ward or primary
respondent; or
(ii)
the guardian is not adequately fulfilling the guardian’s duties to the ward;
or
(iii) the agent acting pursuant to a durable power of attorney authorizing the
agent to
make health care decisions is not adequately fulfilling the
agent’s duties to the
principal; or
(iv) more than one person is authorized to make health care decisions for the
person,
and those authorized persons disagree on whether certain
care will or will not be
provided; and
(B) thethat a delay associated withcaused by (i) further attempts to locate a person authorized
to make health care decisions for the person, to resolve a dispute between multiple persons
authorized to act for the person, or to comply with the procedures set forth in subsection (1) of
this section or (ii) proceedings for appointment of a guardian would present a serious threat to the
life, health, or bodily integrity of the ward or primary respondent.incapacitated person.
(5) (D) If a temporary guardian is appointed without petition or notice under this section, a
hearing to review the appointment must be held after petition and notice and within thirty days
after the appointment of the temporary guardian.
(E) A temporary guardian is entitled to the care and custody of the ward and the authority of a
permanent guardian previously appointed by the court is suspended so long as a temporary
guardian has authority. A temporary guardian may be removed at any time. A temporary
guardian shall make such reports the court requires. In generalother respects the provisions of
law concerning guardians apply to temporary guardians.
(6) F) A hearing concerning the need for appointment of a permanent guardian must be a hearing
de novo as to all issues before the court.
Section 62-5-312 was previously section 62-5-310. The section provides for three possibilities:
(1) a temporary guardian can be appointed after notice and a hearing, (2) if there is an emergency,
a temporary guardian can be appointed ex parte, or (3) the court may act as a guardian in an
emergency. All three procedures require the filing of a summons and petition. A temporary
appointment requires proof that it is necessary for the welfare of the primary respondent or ward.
An emergency appointment requires a finding that an emergency exists. Emergency is defined in
the section and means that not only is there not someone acting on behalf of the ward or primary
respondent’s best interest, but also that delay would present a serious threat to the life, health, or
bodily integrity of the ward or primary respondent. The emergency order is not to exceed 30
days unless the court finds, for good cause shown, that the order should be extended. A hearing
on the need for appointment of a permanent guardian must be a de novo hearing on all issues
before the court.
SECTION 62-5-313. Duties, Powers, Rights and Immunities of guardian.
(1) Duties of the
SECTION 62-5-311. Who may be guardian; priorities.
(A) Any competent person or a suitable institution may be appointed guardian of an incapacitated
person.
(B) Subject to a finding of good cause by the court, persons who are not disqualified have priority
for appointment as guardian in the following order:
(1) a person nominated to serve as guardian by the incapacitated person;
(2) an attorney in fact appointed by the incapacitated person pursuant to Section 62-5-501, whose
authority includes powers relating to the person of the incapacitated person;
(3) the spouse of the incapacitated person. A person who claims to be a common law spouse of
the incapacitated person has the burden of proving that status in order to qualify for appointment
as a guardian under this provision. A decision by the probate court regarding the status of a
common law spouse is for the purpose of guardianship appointment proceedings only and is not
binding in any other court of law or in any administrative proceeding;
(4) an adult child of the incapacitated person;
(5) a parent of the incapacitated person, including a person nominated by will or other writing
signed by a deceased parent;
(6) another relative of the incapacitated person;
(7) a person nominated by the person who is caring for him or paying benefits to him.
SECTION 62-5-312. General powers and duties of guardian.
(A)
Except as otherwise limited by the court,
(a) A guardian shall:
(i)
make decisions regarding the ward’s health, education, maintenance and
support.
(ii)
exercise authority only as necessitated by the ward’s limitations and, to the
extent possible, encourage the ward to participate in decisions, act on the
ward’s own behalf, and develop or regain the capacity to manage the
ward’s personal affairs.
(iii)
consider the expressed desires and personal values of the ward to the
extent known to or reasonably ascertainable by the guardian.
act in the ward’s best interest and exercise reasonable care, diligence, and
prudence.
(v)
become or remain personally acquainted with the ward and maintain
sufficient contact with the ward to know of the ward’s capacities,
limitations, needs, opportunities, and physical and mental health.
(vi)
take reasonable care of the ward’s personal effects and bring protective
proceedings if necessary to protect the property of the ward;
(vii) expend money of the ward that has been received by the guardian for the
ward’s current needs for health education, maintenance and support;
(viii) conserve any excess money of the ward for the ward’s future needs.
Notwithstanding subsection (1)(B)(v) above, if a conservator has been
appointed for the estate of the ward, the guardian shall immediately pay the
ward’s money and deliver the ward’s property to the conservator;
(ix)
immediately notify the court if the ward’s condition has changed to the
extent that the ward is capable of exercising rights previously removed; and
(x)
inform the court of any change in the ward’s custodial dwelling or address.
(B)
A guardian is required to report in writing the condition of his ward and of the
ward’s estate that has been subjected to the guardian’s possession or control, as required
by the court or court rule, but at least on an annual basis. The court shall receive and
review the annual reports.
(2)
Powers of the guardian. Except as otherwise provided by law or by the court, a guardian
shall have the following powers:
(A)
The guardian shall make decisions regarding the ward's health, education,
maintenance and support.
(B)
A guardian of a wardincapacitated person has the same powers, rights, and duties
respecting thehis ward that a parent has forrespecting his or her
unemanicipatedunemancipated minor child, except that a guardian is not liable to third
persons for acts of the ward nor is the guardian financially responsible for the ward solely
by reason of his appointment as guardian. If a ward is in a facility licensedsolely by reason
of the parental relationship. In particular, and without qualifying the foregoing, a guardian
has the following powers and duties, except as modified by the Department of Health and
Environmental Control, the guardian is not responsible for placement in another facility or
for providing care for the ward in the home of the guardian; however, the guardian is
responsible for determining that the ward is receiving adequate and appropriate care and
cooperate in identifying alternative placement, if necessary,order of the court:
(1) to the extent that it is consistent with the terms of any order by a court of competent
jurisdiction relating to the detention or commitment of the ward,
(C) A guardianhe is entitled to custody of the person of his ward and may establish the ward’s
place of residence within this state. The guardian may establish the ward’s place of residence
outside of this state upon express authorization of the court and in accordance with the provisions
of Section 62-5-714.abode within or without this State.
(D) A guardian(2) If entitled to custody of his ward he shall make provision for the care, comfort,
and maintenance of his ward and, whenever appropriate, arrange for his training and education.
Without regard to custodial rights of the ward’s person, he shall take reasonable care of his
ward’s clothing, furniture, vehicles, and other personal effects and commence protective
(iv)
proceedings if other property of thehis ward is in need of protection.
(E) 3) A guardian may give any consents, denials, or approvals that may be 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 as to the placement or care of the ward.
(F) 4) If no conservator for the estate of the ward has been appointed, or if the guardian is also
conservator, he may:
(i) apply for and institute proceedings to compel any person under a duty to support the ward or
to pay sums for the welfare of the ward to perform suchhis duty;
(ii) receive money and tangible property deliverable to the ward up to an aggregate sum of
$10,000.00 per calendar year and apply the money and property for support, care, and education
of the ward; but, he may not use funds from his ward’s estate for room and board or services
which the guardian or the guardian’she, his spouse, parent, or child have furnished the ward
unless a charge for the services and/or room and board is approved by application toorder of the
court aftermade upon notice to at least one of the next of kin of the ward who has no interest in
the application for approval. The court may approve or decline to approve any application for
approval or in its discretion require the commencement of a formal proceeding for approval. A
guardian , if notice is possible. He must exercise care to conserve any excess funds for the ward’s
needs. If a
(5) A guardian is required to report the condition of his ward and of the estate which has been
subject to his possession or control, as required by the court or court rule, but at least on an
annual basis.
(6) If a conservator has been appointed, 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
must be paid to the conservator for management as provided in this Code, and the guardian
receives money or tangible property deliverable to the ward, he must account to the
courtconservator for the receipt and disbursement of such property annually and, if the amount
held exceeds the sum of $10,000.00, he must petition funds expended.
(b) Any guardian of one for the appointment of a conservator whom a conservator also has been
appointed shall control the custody and care of the ward and is entitled to receive reasonable sums
for the ward.his services and for room and board furnished to the ward as agreed upon between
him and the conservator, provided the amounts agreed upon are reasonable under the
circumstances. The guardian may request the conservator to expend the ward’s estate by
payment to third persons or institutions for the ward’s care and maintenance.
(G)
If reasonable under all of the circumstances, a guardian may delegate to the ward
certain responsibilities for decisions affecting the ward’s well-being.
(H)
A guardian, by a properly executed special durable 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.
(3)
Rights and Immunities of the guardian.
(A)
A guardian is entitled to reasonable compensation for services as guardian and to
reimbursement for room, board, clothing, and other reasonable and proper expenses for
the benefit of the ward, but only after application to the court for approval and notice to at
least one next of kin of the ward who has no interest in the application for approval. The
court may approve or decline to approve any application for approval or in its discretion
require the commencement of a formal proceeding for approval. If a conservator, other
than the guardian or one who is affiliated with the guardian, has been appointed for the
estate of the ward, reasonable compensation and reimbursement to the guardian may be
approved and paid by the conservator without order of the court.
(B)
A guardian who exercises reasonable care in choosing a third person providing
medical or other care, treatment, or service for the ward is not liable for injury to the ward
resulting from the wrongful conduct of the third person.
SECTION 62--5--313 was previously section 62-5-312. The section was amended to be
consistent with the South Carolina Adult Guardianship and Protective Proceedings Jurisdiction
Act (Part 7).
The duties of the guardian are listed under subsection (1) and include a report to be made to the
court as the court requires, but at least annually. The guardian is to become or remain
knowledgeable about the condition of the ward, to consider the ward’s expressed desires and
values in making decisions, to encourage the ward to regain independence, and to perform other
duties specifically listed.
Each court is encouraged to establish a system for monitoring guardianships, which would
include, but not be limited to, mechanisms for assuring that annual reports are timely filed and
reviewed. An independent monitoring system is crucial for a court to adequately safeguard against
abuses in the guardianship cases. Monitors can be paid court personnel, Court appointees or
volunteers. For a comprehensive discussion of the various methods for monitoring guardianships,
see Sally Balch Hurme, Steps to Enhance Guardianship Monitoring (A.B.A. 1991).
The National Probate Court Standards also provide for the filing of reports and procedures for
monitoring guardianships. See National Probate Court Standards, Standards 3.3.14 “Reports by
the Guardian,” and 3.3.15 “Monitoring of the Guardian” (1993). The National Probate Court
Standards additionally contain recommendations relating to the need for periodic review of
guardianships and sanctions for failures of guardians to comply with reporting requirements. See
National Probate Court Standards, Standards 3.3.16 “Reevaluation of Necessity for
Guardianship,” and 3.3.17 “Enforcement.”
The guardian has authority to make decisions on behalf of the ward, unless otherwise provided by
law or the court. The section was amended to make it clear that the guardian is not financially
responsible for the ward solely by reason of appointment as a guardian. The guardian is not
required to provide care for the ward in the guardian’s home. If the ward is in a facility licensed
by DHEC, then the guardian does not have to place in another facility, but does have to ensure
the ward is receiving adequate and appropriate care.
The guardian may receive money and tangible property deliverable to the ward up to an aggregate
sum of $10,000 per calendar year and apply the money for the support, care, and education of the
ward. If the cumulative amount exceeds $10,000, then the guardian must petition for the
appointment of a conservator for the ward.
If reasonable to do so, the guardian may delegate responsibility for certain decisions to the ward.
Also, for a period not to exceed sixty days, the guardian may delegate the care and custody of
the ward under a properly executed special durable power of attorney. The original power of
attorney must be filed with the court.
Subsection (3) provides that the guardian is entitled to reasonable compensation for services as
guardian and reimbursement for expenses provided on behalf of the ward. The amount
determined to be reasonable may vary from state to state and from one geographical area to
another within a state. In addition, factors to be considered by the Court in setting compensation
will vary. Court approval is required unless a conservator, not affiliated with the guardian, has
been appointed. Also, if the guardian exercises reasonable care in choosing a third person to
provide care or services on behalf of the ward, the guardian is not liable for the wrongful conduct
of the third person. The guardian is liable only if personally at fault.
SECTION 62-5-314. Visitor.
At any time during a guardianship proceeding, the court may appoint a visitor to carry out such
investigation as the court directs, including meeting with the primary respondent or ward and with
the guardian, if a guardian has previously been appointed, conducting interviews, observing
conditions, and reporting back in writing to the court as the court so directs.
Section 62-5-314 was previously section 62-5-308. A visitor is defined in Section 62-5-101 (20).
A visitor is not required in a guardianship proceeding, but the court may appoint a visitor at any
time during the proceedings.
SECTION 62-5-315. Proceedings subsequent to appointment; venue.
(1) a) The court which appointed the guardian, or in which acceptance of a testamentary
appointment has beenwas filed, has jurisdiction over resignation, removal, accounting,
modification, and other proceedings relating to the guardianship The court which appointed the
guardian must maintain jurisdiction over the guardianship until such time as:.
(A)
the proceeding is terminated pursuant to Section 62-5-310, termination of
guardianship at death of ward;
(B)
the proceeding is terminated pursuant to Section 62-5-311(3), termination of
incapacity;
(C)
there is a completed transfer of the proceeding to another county’s jurisdiction
pursuant to Section 62-5-315(2);
(D)
there is a completed transfer of the proceedings to another state pursuant to
Section 62-5-714.
(2)
(b) If the court which appointed the guardian, or in which acceptance of appointment is
filed, being the court in which proceedings subsequent to appointment are commenced,
determines that the proceedings more appropriately belong :
in another county of this state, the court located where the ward resides, the first court shall notify
the other court, in this or another state, and, after consultation with the other court, determine
whether to retain jurisdiction or transfer the proceedings to the other court, whichever shallmay
be in the best interest of the ward. A copy of any order accepting a resignation or removing a
guardian shall be sent to the court in which acceptance of appointment is filed;.
(A)
in another state, the first court shall follow the procedures set forth in Section 625-714.
Section 62-5-315 was previously section 62-5-313. The section was amended to provide
consistency with the South Carolina Adult Guardianship and Protective Proceedings Jurisdiction
Act (Part 7). A case may be transferred if it is in the ward’s best interest to do so.
PART 4.
PROTECTION OF PROPERTY OF PERSONS UNDER DISABILITY AND MINORS
SECTION 62-5-401. VenueProtective proceedings.
Subject toAfter service of the summons and petition and notice of hearing in accordance with the
provisions of Section 62-5-701 et seq., venue for proceedings under this part is:
(1)
In the county in this state where, the primary respondent resides whether or not a guardian
has been appointed in another place; or
(2)
If the primary respondent does not reside in this state, in any county in this state where the
primary respondent has property or has the right to take legal action.
This section consolidates venue for protective proceeding under Part 4. While the venue
provisions are generally consolidated in this section, the section makes it clear that venue is
subject to the provisions of the South Carolina Adult Guardianship and Protective Proceedings
Jurisdiction Act.
SECTION 62-5-402. Procedure for court appointment ofmay appoint a conservator or make
other protective order solely for reason of minority.cause as follows:
(1) Appointment of a conservator or other protective order may be made in relation to the estate
and affairs of a minor, if the court determines that (i) a minor owns money or property that
requires management or protection thatwhich cannot otherwise be provided, (ii) has or may have
business affairs thatwhich may be jeopardized or prevented by his minority, or (iii)that funds are
needed for the health, his support and education, maintenance, and support of the minor and a
protective orderthat protection is necessary or desirable in order to obtain or provide such funds.
(2) Appointment of a conservator or other protective order may be made in relation to the estate
and affairs of a person if the court determines that (i) the person is unable to manage his property
and affairs effectively for reasons such as mental illness, mental deficiency, physical illness or
disability, advanced age, chronic use of drugs, chronic intoxication, confinement, detention by a
foreign power, or disappearance; and (ii) the person has property which will be wasted or
dissipated unless proper management is provided, or that funds are needed for the support, care,
and welfare of the person or those entitled to be supported by him and that protection is necessary
or desirable to obtain or provide funds.
SECTION 62-5-402. Protective proceedings; jurisdiction of affairs of protected persons.
After the service of the summons and petition in a proceeding seeking the appointment of a
conservator or other protective order and until termination of the proceeding, the probate court in
which the summons and petition are filed has:
(1) exclusive jurisdiction to determine the need for a conservator or other protective order until
the proceedings are terminated;
(2) exclusive jurisdiction to determine how the estate of the protected person which is subject to
the laws of this State must be managed, expended, or distributed to or for the use of the protected
person or any of his dependents; and
(3) concurrent jurisdiction to determine the validity of claims for or against the person or estate of
the protected person except as limited by Section 62-5-433.
Venue for proceedings under this part is:
(1) In the place in this State where the person to be protected resides whether or not a guardian
has been appointed in another place; or
(2) If the person to be protected does not reside in this State, in any place where he has property.
SECTION 62-5-404. Original petition for appointment or protective order.
(a) The person to be protected, any person who is interested in his estate, affairs, or welfare,
including his parent, guardian, or custodian, or any person who would be adversely affected by
lack of effective management of his property and affairs may petition for the appointment of a
conservator or for other appropriate protective order.
(b) The petition shall set forth to the extent known, the interest of the petitioner; the name, age,
residence, and address of the person to be protected; the name and address of his guardian, if
any; the name and address of his nearest relative known to the petitioner; a general statement of
his property with an estimate of the value thereof, including any compensation, insurance,
pension, or allowance to which he is entitled; and the reason why appointment of a conservator
or other protective order is necessary. If the appointment of a conservator is requested, the
petition also shall set forth the name and address of the person whose appointment is sought and
the basis of his priority for appointment.
SECTION 62-5-405. Service of summons and petition; notice of hearing; waiver of notice by
person to be protected.
(a) After filing of the summons and the petition for appointment of a conservator or other
protective order, the person to be protected must be served personally with the summons and
petition. The following persons also must be properly served: the spouse and the adult children
of the person to be protected, or if none, his parents or nearest adult relatives if there are no
parents, and other persons as the court may direct.
(b) Notice of hearing on a petition for appointment of a conservator or other initial protective
order, and of any subsequent hearing, must be given to the person to be protected, to any person
who has filed a request for notice under Section 62-5-406, to interested persons, and to other
persons as the court may direct. Notice must be given in accordance with Section 62-1-401.
Waiver of notice of hearing by the person to be protected is not effective unless he attends the
hearing or waiver of notice is given by his attorney.
SECTION 62-5-406. Protective proceedings; request for notice; interested person.
Any interested person who desires to be notified before any order is made in a protective
proceeding may file with the court a request for notice subsequent to payment of any fee required
by statute or court rule. The clerk shall mail a copy of the request to the conservator if one has
been appointed. A request is not effective unless it contains a statement showing the interest of
the person making it and his address, or that of his attorney, and is effective only as to matters
occurring after the filing. Any governmental agency paying or planning to pay benefits to the
person to be protected is an interested person in protective proceedings.
SECTION 62-5-407. Procedure concerning hearing and order on original petition.
(a) Upon the filing of a summons and petition for appointment of a conservator or other
protective order based uponbecause of minority, the summons and the petition shall be served
upon the minor, the minor’s living parents whose identity and whereabouts are known or
reasonably ascertainable, and the person or persons having custody of the minor. After the time
has elapsed for the filing of a response to the petition as to all parties served, the court may
schedule aand after service of the summons and the petition, the court may set a date for hearing
on the matters alleged in the petition or, if the court is satisfied that the interests of the minor have
been or will be adequately protected, the court may issue an order without the necessity of a
hearing. If, at any time in the proceeding, the court determines that the interests of the minor are
or may be inadequately represented, it may appoint a guardian ad litem for the minor, with the
duties and responsibilities set forth in Section 62-5-830.an attorney to represent the minor, giving
consideration to the choice of the minor if fourteen years of age or older. A lawyer appointed by
the court to represent a minor has the powers and duties of a guardian ad litem. If the minor
already has an attorney, that attorney shall act as his guardian ad litem.
(1)
If a minor is receiving needs-based government benefits, including but not limited to
Supplemental Security Income or Medicaid, the court may limit access to the funds for the
minor’s benefit to prohibit payment of those expenses that would be considered support by the
Social Security Administration including, but not limited to, food and shelter expenses.
(2)
If prior to termination of a conservatorship based upon minority only, an interested person
files (b) Upon the filing of a summons and petition for appointment of a conservator or other
protective order under Section 62-5-403, the minor’s conservatorship shall not be terminated until
such petition is heard by the court.
This section sets out the basic procedure for the appointment of a conservator or entry of another
protective order by reason of minority. This section is not applicable to actions involving minors
who are also incapacitated. §62-5-403 is applicable to those cases. While the section requires
service on the minor and others, after the time for response to the petition has expired, the section
allows for the appointment of a conservator or other protective order without the necessity of a
formal hearing. Subsection 3 of this Section was added to enable the court to structure the assets
of a minor so as not to interfere with any needs based government benefits he or she may be
entitled to. Further, while a conservatorship solely by reason of minority would terminate when
the protected person attains the age of majority, subsection 4 allows for the conservatorship to
be continued past majority, if a petition for conservatorship or other protective order under §625-403 is pending when the minor attains majority.
SECTION 62-5-403. Procedure for court appointment of a conservator or other protective order
for reasons other than minority.
(1) Appointment of a conservator or other protective order may be made in relation to the
estate and affairs of a person if:
(A)
The court determines, by a preponderance of the evidence, the person is
incapacitated or is unable to manage his property or affairs effectively for reasons
of confinement, detention by a foreign power, or disappearance, and
(i)
the person has an agent under a durable power of attorney and the actions
necessary to prevent waste or dissipation of the person’s property are not
being adequately performed by the agent under the durable power of
attorney or are beyond the authority of the agent under the durable power
of attorney, or
(ii)
the person has no agent under a durable of attorney and the person has
property which will be wasted or dissipated or funds are needed for the
health, education, maintenance or support of the person or for those
entitled to be supported by such person and protection is necessary or
desirable in order to obtain or provide such funds.
(B)
The court determines, by a preponderance of the evidence, a protective order is
necessary or desirable to create a special needs trust for a person who is disabled in
accordance with Social Security Administration guidelines.
(2)
An alleged incapacitated person or any person interested in the estate, affairs, or welfare
of the primary respondent may petition the court for the appointment of a conservator or for other
appropriate protective order. A protective proceeding is commenced by the filing and service of
a , and after service of the summons and verified petition for appointment of a conservator or
other protective order, for reasons other than minority, upon the primary respondent and those
persons listed in paragraph (3)(C) of this section.
(3)
The petition the petition, the court shall set forth, toa date for hearing. Unless the extent
known or reasonably ascertainable, the following information:
(A)
the interests of the Petitioner
(B)
(i)
(ii)
the name, age, and current address of the primary respondent;
the physical location of the primary respondent during the six month period
immediately preceding the filing of the summons and petition; and, if the
primary respondent was not physically present in South Carolina for that
period, sufficient information on which the court may make a determination
that it has initial jurisdiction pursuant to Section 62-5-707.
(C)
the names and addresses of the following persons:
(i)
the primary respondent’s guardian, if any;
(ii)
the primary respondent’s spouse;
(iii)
the primary respondent’s adult children;
(iv)
if there is no spouse or adult children, the primary respondent’s parents;
(v)
if there is no spouse, adult children or parents, the primary respondent's
nearest adult relative;
(vi)
any person known to have been appointed as agent for the primary
respondent under a general durable power of attorney or a health care
power of attorney;
(vii) any person whose priority for appointment as conservator under section
62-5-408, is equal to or greater than the priority for appointment of the
person whose appointment the petition advocates;
(viii) any person with whom the primary respondent resides outside of a health
care facility, group home, homeless shelter, or prison; and
(ix)
if the conservatorship is for the purpose of receiving Veterans’ benefits, the
Secretary of the Department of Veterans’ Affairs.
(D)
a general statement of the primary respondent’s assets with an estimate of its
value, and the source and amount of any income, insurance, pension, or allowance
to which the primary respondent is entitled;
(E)
the reason why appointment of a conservator or other protective order is
necessary, including a brief description of the nature and extent of the primary
respondent's alleged incapacity;
(F)
if the appointment of a conservator is requested, the name and address of the
person whose appointment is sought, the basisto be protected has counsel of his
priority for appointment, and any limitations or restrictions sought to be imposed
on the conservator’s powers and duties.
(4)
summons and petition upon the primary respondentown choice, the court must appoint a lawyer
to represent him who then has the powers and duties of a guardian ad litem. If the protected
person already has representation by an attorney that attorney shall act as his guardian ad litem for
the primary respondent in accordance with Title 62, Article 5, Part 8, and such guardian ad litem
shall have the duties and responsibilities set forth in Title 62, Article 5, Part 8. Unless otherwise
ordered by the court, the appointment of a guardian ad litem under this section will not affect the
rights of the primary respondent and will not raise a presumption of incapacity of the primary
respondent.
(5)
The primary respondent is entitled to retain counsel of his or her choosing. If the primary
respondent is not represented by counsel, then (A) the court may allow the primary respondent to
proceed pro se or shall instruct the guardian ad litem to assist the primary respondent in obtaining
counsel or (B) upon the request of the guardian ad litem, the primary respondent, any party, or
upon the court’s own motion, the court may appoint counsel for the primary respondent. This
section shall not be construed to require an attorney to accept an uncompensated appointment.
During the pendency of any protective proceeding, any attorney purporting to represent the
primary respondent shall file a notice of appearance with the court. Attorney's fees for counsel
appointed under this section shall be subject to approval by the court.
Except in cases governed by Section 62-5-431 relating to Veterans’ benefits, upon the filing of
the summons and petition with the court in which the petitioner alleges the primary respondent is
incapacitated and proof of service of the summons and petition upon the primary respondent, the
court must appoint an examiner, who shall be a physician, to examine the primary respondent and
report to the court the physical and . If the alleged disability is mental condition of the primary
respondent. Upon motion or written request of the guardian ad litem, the primary respondent, any
interested party, or upon the court's own motion, the court may appoint illness, mental deficiency,
physical illness or disability, advanced age, chronic use of drugs, or chronic intoxication, the court
shall direct that the person to be protected be examined by one or more additional examiners, who
may be a physician or any other person the court determines qualified to evaluate the primary
respondent’s alleged impairment. If the court appoints any additional examiners, the court shall
set out in the order appointing the examiner(s) why an additional examiner is necessary and why
the appointed examiner(s) is appropriate to serve in that capacity. Each examiner shall complete a
verified report evaluating the condition of the primary respondent and file their original report
with the court or deliver the original report to the guardian ad litem, who, without undue delay
must file the report with the court by the deadline set by the court, 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 allow admission of an examiner’s report filed less than forty-eight hours prior to the
hearing. All parties to the proceeding are entitled to a copy of examiners’ reports. The
examiner(s)’ report(s) shall evaluate the condition of the primary respondent and shall contain, to
the best information and belief of the examiner: (i) a description of the nature, type, and extent of
the primary respondent's incapacity, including the primary respondent's specific functional
impairments, (ii) a diagnosis and assessment of the primary respondent's mental and physical
condition, including a statement as to whether the primary respondent is on any medications that
may affect his actions or demeanor, (iii) where appropriate and consistent with the scope of the
examiner's license, an evaluation of the primary respondent's ability to learn self-care skills,
adaptive behavior, and social skills and a prognosis for improvement, (iv) the date or dates of the
examinations, evaluations, and assessments upon which the report is based, (v) the identity of
those persons with whom the examiner met or consulted regarding the primary respondent’s
mental or physical condition; and (vi) the signature of the examiner and the nature of the
professional license held by the examiner. Unless otherwise directed by the court, in preparing a
report for the court, the examiner may rely upon an examination of the primary respondent
conducted by the examiner subsequent to his or her appointment or within the ninety-day period
immediately preceding the filing of the petition. In the absence of bad faith or malicious intent, an
examiner appointed by the court and performing an examination and submitting a report under
this section shall be immune from civil liability for any breach of physicians designated by the
court, preferably physicians who are not connected with any institution in which the person is a
patient confidentiality made in furtherance of his duties under this section. A report prepared
pursuant to this section shall be admissible as evidence of the facts stated therein and the results of
the examination or evaluation referred to thereinor is detained.
(6)
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 primary respondent, all parties, and any person who has filed a demand for notice pursuant to
subparagraph (8) hereof, must be given notice of the hearing as provided in section 62-1-401.
The primary respondent shall attend the hearing unless excused by the court for good cause. In
determining good cause, the court may consider affidavits submitted by the guardian ad litem or
any interested persons. Nothing in this section prohibits all parties not in default from waiving a
hearing on any petition, and the court for good cause may entertain a consent order on any
Petition. A primary respondent represented by counsel may consent through counsel.
(7)
Any interested person who desires to be notified before any order is made in a protective
proceeding may file with the court a demand for notice. The court shall mail a copy of the demand
to the conservator, if one has been appointed, or to the petitioner, if no conservator has been
appointed. A demand for notice is not effective unless it contains a statement indicating the
nature of the interest of the person filing the demand, his address or that of his attorney, and is
effective only as to matters occurring after the filing of the demand.
After a hearing, or with the consent of all parties(c) After hearing, upon finding that a basis for the
appointment of a conservator or other protective order has been established as set forth in this
section , the court shall make an appointment or other appropriate protective order.
(8)
Any person interested in the estate, affairs or welfare of a person who is unable to manage
his property or affairs effectively for reasons of confinement, detention by a foreign power, or
disappearance may petition the court for appointment of a conservator or for other protective
order for such person under this section provided; however, that the appointment of an examiner
shall not be required for a person who is confined, detained or missing.
Section 62-5-403 was significantly revised.
The revised section adds the requirement of a summons and clarifies that a petition must be
verified.
This section sets out the basic procedure for the appointment of a conservator or entry of another
protective order for reasons other than minority.
The phrase “any person interested in the estate, affairs, or welfare of the primary respondent” is
intended to be broader than then term “interested person” defined in 62-1-201. For example, it
could include a friend, neighbor, or person residing with the primary respondent.
Subsection (1) sets out the conditions under which the appointment of a conservator or other
protective order is appropriate. In order to preserve any advance planning by the primary
respondent, the revised subsection emphasizes the importance of looking first to agents under a
durable power of attorney, before appointing a conservator or issuing a protective order. Nothing
in the section precludes a party from questioning the validity of a power of attorney or seeking the
removal of an agent under a power of attorney for breach or dereliction of duty. Further the
section acknowledges that necessary actions may be beyond the authority given to an agent under
a durable power of attorney. A major addition to the reasons for the appointment of a
conservator or protective order is the need to create a special needs trust for a disabled person.
For this subsection to apply the disabled person need not be incapacitated, but must be disabled
under social security guidelines. It is not necessary the individual be actually receiving social
security disability or SSI benefits.
Subsection (2) provides who may commence a proceeding for the appointment of a conservator
or other protective order, how to commence the proceeding, and who must be served in
connection with the proceeding. This section makes it clear the petition used to commence the
proceeding must be verified by the petitioner.
Subsection (3) provides detailed requirements for the content of a petition for appointment of
conservator or other protective order. While the subsection only requires the petitioner to
provide information known to the petitioner, it imposes on the petitioner a duty to engage in a
reasonable effort to ascertain the required information. Specifying the required contents of the
petition is in accordance with the recommendations of both the Wingspread conference on
guardianship reform and the Commission on National Probate Court Standards. See
Guardianship: An Agenda For Reform 9 (A.B.A. 1989); National Probate Court Standards,
Standard 3.3.1, “Petition” (1993).
Subsection (4) provides for the appointment of a guardian ad litem, upon the filing and service of
the verified petition for appointment of conservator or other protective order. While appointment
of a guardian ad litem occurs without a preliminary assessment of capacity by the court, the
subsection makes it clear the mere appointment of the guardian ad litem does not impact the
rights of the person allegedly in need of a conservator or protective order and the appointment is
not evidence of incapacity.
With this revision, the roles of legal counsel and guardian ad litem have been separated. While, a
guardian ad litem is required to be appointed in every case; unlike prior law, it is not necessary for
the guardian ad litem to be an attorney. Further, if the guardian ad litem is an attorney, that
person may not also serve as counsel for the primary respondent in the proceeding. This revision
eliminates the conflict which existed under prior law between the role of legal counsel as advocate
for the primary respondent and the role of guardian ad litem, who has duties to both the primary
respondent and the court.
Subsection (5) provides that the primary respondent is not required to be represented by counsel,
but is entitled to be represented by counsel of his or her own choosing. This subsection sets forth
the options of the court when dealing with a primary respondent who is not represented by
counsel. This section does not mandate the appointment of counsel, nor is the primary
respondent required to be represented by counsel. If the court determines an unrepresented
primary respondent should not proceed without counsel, the subsection authorizes the court to
appoint counsel for the primary respondent. The subsection also suggests to the court the option
of directing the guardian ad litem to assist the person in obtaining counsel. This would be
particularly appropriate where the court felt the need for counsel and the person had adequate
resources with which to pay counsel. The enhanced duties of the guardian ad litem established by
Title 62, Article 5, Part 8, in conjunction with the enhanced qualification for persons acting as
guardian ad litem should provide adequate protection of the interests of the person who is the
subject of a protective proceeding in most cases.
Subsection (6) provides the appointment of an examiner in connection with a proceeding for the
appointment of a conservator or other protective order, establishes the necessary qualification of
the person who will serve as an examiner, sets forth the type of report the examiner is to produce,
and the time within which the report is to be produced. A designated examiner, who is a
physician, must be appointed. Additional designated examiners may be appointed by the court.
The additional examiners may be physicians or any other person the court has determined is
qualified to evaluate the primary respondent’s alleged impairment. The subsection also clarifies
prior law, by establishing the examiner may make his report from information obtained in an
examination conducted prior to the examiner’s appointment. If the examiner’s report references
an examination conducted prior to appointment, it must have been conducted within the 90 days
immediately preceding the examiner’s appointment; otherwise the examination must occur
subsequent to the appointment.
Subsection (7) establishes the requirement of a hearing in regard to the petition, provides who
must be given notice of the hearing, and the timing of notice. Note the subsection mandates
attendance at the hearing by the primary respondent absent a showing of good cause.
Subsection (8) provides a procedure for interested persons to obtain notice prior to orders being
issued in the proceeding.
Subsection (9) establishes the requirement that the court issue an order in response to a petition,
and clarifies that such an order may arise by consent of all parties. If the petition contains an
allegation of incapacity on behalf of the primary respondent, he or she must be represented by
counsel in order to consent.
Subsection (10) clarifies that the appointment of an examiner is not necessary, in the absence of
an allegation of incapacity. An examiner would be unnecessary in cases of detention or missing
persons.
SECTION 62-5-404. Temporary Relief; Powers of the408. Permissible court orders.
The court has the following powers which may be exercised directly or through a conservator
within respect to the estate and affairs of protected persons:
(1)
Procedure for Temporary Relief.
(A)
During the pendency of(1) While a proceedingpetition for the appointment of a
conservator or other protective order, any party or other person interested in the estate,
affairs or welfare of the primary respondent may file with the is pending and after
preliminary hearing upon such notice by the court a motion foras is reasonable under the
circumstances, and if the petition requests temporary relief in regard, the court has the
power to preserve and apply the property or financial affairs of the primary respondent.
(B)
Unless made in open court, of the person to be protected as may be required for
his benefit or the motion shall be in writing and shall describe the naturebenefit of his
dependents; however, notice of such actions of the temporary relief sought, and state why
the temporary relief is in the best interest of the primary respondent.
(C)
Upon receipt of the motion, the court may issue an order ex parte or schedule a
hearing with such notice as the court may prescribe; all as the interests of justice or the
needs of the primary respondent require.
(D)
The forgoing notwithstanding, no order for temporary relief will issue other than
following a hearing with notice to all parties as provided in Section 62-1-401 unless it
appears from specific facts, shown by affidavit or evident from the petition, that the
requested relief is necessary to provide for the health and welfare of the primary
respondent or those dependent upon the primary respondent for support or to prevent the
property of the primary respondent from being wasted; and there is insufficient time to
hold a noticed hearing.
(E) Notice of any temporary relief granted shall be given to allinterested parties as soon
thereafter as practicable. If relief was granted without a noticed hearing, on two days’ notice to
the party who obtained the order for temporary relief, or on shorter notice to that party as the
court may prescribe, the primary respondent, or any party opposed to the order may appear and
move its dissolution or modification; and in that event, the court shall proceed to hear and
determine such motion as expeditiously as the ends of justice require.
(F)
Except as otherwise provided by the court, any order granting temporary relief
under this section shall terminate upon the courts final ruling on the merits of the pending
petition for conservatorship or protective order.
Upon finding(2) After hearing and upon determining that a basis for an appointment or other
protective order exists with respect to a minor solely for reason of minoritywithout other
disability, the court has all of thethose powers over the estate and affairs of the minor which are
or might be necessary for the best interests of the minor, his family, and members of his
household.
(2)
Upon finding(3)(a) After hearing and upon determining that a basis for an appointment or
other protective order exists with respect to a person for reasons other than minority, the court
has all , for the benefit of the person and of his estate and fulfillment of his legal obligations of
support of dependents, all the powers over the person’s real and personal property and
financialhis estate and affairs which such personhe could exercise if present and not under
disability, except the power to make a will.
This Section provides a procedure for obtaining temporary relief pending a determination in a
protective proceeding, and sets forth a general description of These powers include, but are not
limited to, the power of the court after it determines the appointment of a conservator or issuance
of a protective order is appropriate. to:
Subsection 1 establishes the procedure for seeking an order of temporary relief in regard to the
affairs of the primary respondent in protective proceeding. The subsection provides that any
person interested in the affairs of the primary respondent may move the court for an order of
temporary relief during the pendency of a protective proceeding. The phrase “other person
interested in the estate, affairs, or welfare of the primary respondent” is intended to be broader
than then term “interested person” defined in 62-1-201. For example, it could include a friend,
neighbor, or person residing with the primary respondent. Note no such order may issue prior to
the filing and service of a summons and petition. While the subsection authorizes the court to
issue exparte orders in response to the motion for temporary relief, the subsection emphasizes that
absent exigent circumstances the court should schedule a hearing on the motion and provide
notice to all parties to the proceeding. The subsection also provides for a procedure for the
primary respondent or any party to the proceeding to seek dissolution of an order of temporary
relief.
Subsection 2 delineates the powers of the court over the affairs of a minor.
Subsection 3 delineates the powers of the court over the affairs of a primary respondent after a
finding the basis for an appointment of conservator or issuance of protective order exists.
(i) make gifts as the court, in its discretion, believes would be made by the person if he were
competent;
(ii) convey or release the person’s contingent and expectant interests in property including
material property rights and any right of survivorship incident to joint tenancy;
(iii) exercise or release the person’s powers as trustee, personal representative, custodian for
minors, conservator, or donee of a power of appointment;
(iv) enter into contracts;
(v) create or amend revocable trusts or create irrevocable trusts of property of the estate which
may extend beyond the person’s disability or life;
(vi) fund trusts;
(vii) exercise options of the disabled person to purchase securities or other property;
(viii) exercise the person’s right to elect options and change beneficiaries under insurance and
annuity policies and to surrender the policies for their cash value;
(ix) exercise the person’s right to an elective share in the estate of the person’s deceased spouse;
(x) renounce any interest by testate or intestate succession or by inter vivos transfer; and
(xi) ratify any such actions taken on the person’s behalf.
(b) In order to exercise, or direct the exercise of the court’s authority in any powers set forth in
item (a), the court must entertain a petition in which the specific relief sought is set forth, the
incapacitated person, his known heirs, devisees, donees, and beneficiaries are made parties to the
action, and which contains a statement that the person either is incapable of consenting or has
consented to the proposed exercise of power.
(c) In exercising the powers set forth in item (b), the court also must inquire into and consider any
known lifetime gifts or the estate plan of the person, the terms of any revocable trust of which he
is grantor, and any contract, transfer, or joint ownership arrangements with provisions for
payment or transfer of benefits or interests at his death to another which he may have originated.
In exercising the court’s authority set forth in item (b), the court must set forth in the record
specific findings upon which it has based its ruling.
(4) An order made pursuant to this section determining that a basis for appointment of a
conservator or other protective order exists, has no effect on the capacity of the protected person,
except to the extent the order affects his estate or affairs.
SECTION 62-5-405409. Protective arrangements and single transactions authorized.
When(a) If it is established in a proper proceeding that a basis exists as described in Section
62-5-402 or 62-5-403401 for affecting the property and affairs of the primary respondent,a
person the court, without appointing a conservator, may authorize, direct, or ratify any
transaction necessary or desirable to achieve any security, service, or care arrangement meeting
the foreseeable needs of the primary respondentprotected person. Protective arrangements
include, but are not limited to, payment, delivery, deposit, or retention of funds or property, sale,
mortgage, lease, or other transfer of property, entry into an annuity contract, a contract for life
care, a deposit contract, a contract for training and education, or addition to or establishment of a
suitable trust.
(b) When it has been established in a proper proceeding that a basis exists as described in Section
62-5-402 or 62-5-403401 for affecting the property and affairs of the primary respondenta
person, the court, without appointing a conservator, may authorize, direct, or ratify any contract,
trust, or other transaction relating to the primary respondent’sprotected person’s financial affairs
or involving the primary respondent'shis estate if the court determines that the transaction is in the
best interests of the primary respondentprotected person.
(c) Before approving a protective arrangement or other transaction under this section, the court
shall consider whetherthe interests of creditors and dependents of the protected person and, in
view of the primary respondent'shis disability, whether the primary respondentprotected person
needs the continuing protection of a conservator. The court may appoint a special conservator to
assist in the accomplishment of any protective arrangement or other transaction authorized under
this section. The special conservator who shall have the authority conferred by the court's order,
shall file any and all reports as required by the court and shall serve until discharged by order after
report to the court of all matters done pursuant to the court.order of appointment.
(1)
When it is established in a proper proceeding that a basis exists as described in section 625-403 for affecting the property and affairs of the primary respondent, the court may exercise or
authorize a conservator or a special conservator to exercise any of the powers set forth in
subparagraph (C) below.
(A)
If the power sought to be exercised in subparagraph (C) below is requested
concurrently with the petition under section 62-5-403, in addition to those persons
required to be served under section 62-5-403, all of the primary respondent’s
known heirs and devisees are also required to be served with the summons and
petition.
(B)
If the power sought to be exercised in subparagraph (C) below is requested
subsequent to the appointment of a conservator, then the primary respondent and
all of the primary respondent’s known heirs and devisees are required to be served
with the summons and petition requesting the requested relief.
(C)
The following powers may be authorized by the court after hearing or with the
consent of all necessary parties:
(i)
to make gifts as the court, in its discretion, believes would be made by the
primary respondent if the primary respondent were competent;
(ii)
to convey or release the primary respondent's contingent and expectant
interests in property including material property rights and any right of
survivorship incident to joint tenancy;
(iii)
to create or amend revocable trusts or create irrevocable trusts of property
of the primary respondent's estate that may extend beyond the primary
respondent's disability or life, including the creation or funding of a special needs
trust or a pooled fund trust for a minor who has been determined to be disabled;
(iv)
to fund trusts;
(v)
to exercise the primary respondent's right to elect options and change
beneficiaries under insurance and annuity policies and to surrender policies for
their cash value;
(vi)
to exercise the primary respondent's right to an elective share in the estate
of the primary respondent's deceased spouse;
(vii) to renounce any interest by testate or intestate succession or by inter vivos
transfer; and
(viii) to ratify any such actions taken on the behalf of the primary respondent.
(5)
In exercising or approving a conservator’s or special conservator's exercise of the powers
set forth in subsection (4)(C) above, the court shall, to the extent ascertainable, give primary
weight to what the primary respondent would do under the circumstances were the primary
respondent capable of acting independently. The court may also consider:
(A)
the financial needs and legal obligations of the primary respondent, including the
needs of individuals to whom the primary respondent owes an obligation of
support:
(B)
possible reduction of taxes, including, but not limited to, income, estate, and
inheritance taxes;
(C)
the primary respondent's eligibility or potential eligibility for governmental
assistance;
(D)
the primary respondent's previous pattern of giving or level of support;
(E)
the primary respondent's existing estate plan; and
(F)
the primary respondent's life expectancy and the probability that the
conservatorship will terminate before the primary respondent's death.
(6)
In exercising or approving a conservator's or special conservator's exercise of the powers
set forth in subsection (4)(C) above, the court shall set forth in the court's record specific findings
upon which the court bases its ruling. For purposes of issuing a consent order under subsection
(4)(C) above, a guardian ad litem may consent on behalf of the primary respondent.
This encompasses former §62-5-409 and a portion of §62-5-408. Consistent with the philosophy
of this article that a conservator be appointed only as a last resort, this section authorizes the
court, in lieu of appointing a conservator, to order a variety of less intrusive “protective
arrangements.” A protective arrangement typically involves a single transaction such as a sale of
land or the entry of a contract for care. The procedure for obtaining a protective arrangement is
similar to that required for the appointment of a conservator. A summons and petition must be
filed, and notice must be given to the appropriate parties.
The code section provides that the court may authorize a protective arrangement or single
transaction without the appointment of a conservator, however, the section also introduces the
concept of a special conservator. The role of the special conservator is to carry out only those
tasks that are specifically ordered by the court.
Subsection 4 lists powers the court can exercise over the assets of a protected person, but which
require notice to parties who may not normally be served with the summons and petition for a
conservator or other protective order. The reason is these actions may affect what a non-party
would receive by way of inheritance from the protected person. The subsection deals with both
the situation of a request for the action in an original petition, and a request for the action in a
proceeding after a conservator has been appointed.
Subsection 4 again takes the opportunity to suggest the use of consent orders, to mitigate
disputes that may arise.
Subsection 5, lists the things the court should consider in determining whether it should approve
or facilitate a protective arrangement described in subsection 4. Subsection makes it clear the
decision to approve or disapprove a request for a protective proceeding described in subsection 4
should be primarily based on the decision that the protected person would have made, if of full
capacity. In that regard the court should take into consideration the protected person’s personal
values and expressed desires, past and present, are to be considered when making decisions.
Carrying out the protected person’s intent or probable intent is a major theme of this article. In
this regard, this section probably confirms what the law is already. Even in the absence of a
statute, the conservator should consider the protected person’s probable wishes, particularly with
respect to gifts and other estate planning related transactions. The authority of a court to
authorize a conservator to engage in estate planning and related transactions is expressly
confirmed by statute in a majority of states.
Subsection 6 provides guidance to the court on what should be included in an order approving a
protective arrangement described in subsection 4.
The authority confirmed by this section will often be used to engage in tax planning on behalf of
the protected person. For example, by making annual exclusion gifts, the federal estate tax liability
at the protected person’s death may be substantially reduced. However, this section can also be
used for non-tax transactions. Transfers may be made to qualify the protected person for
governmental programs, or the court may continue the protected person’s prior pattern of giving
to charities and others.
SECTION 62-5-406. Impact on testamentary capacity.
Unless an order of the court specifies otherwise, a finding of incapacity and appointment of a
conservator or other protective order is not a determination that the protected person lacks
testamentary capacity or the capacity to create, amend or revoke a revocable trust.
This section makes it clear that a finding of incapacity for purposes of appointment of a
conservator or other protective order is not a finding as to testamentary capacity.
SECTION 62-5-407. Rights and privileges removed from protected person upon appointment of
conservator.
(1)
Unless the court's order specifies otherwise, the appointment of a conservator shall
remove from the protected person the following rights and privileges, which to the extent
authorized in section 62-5-422, and pending further order of the court, shall thereafter reside in
the conservator acting on behalf of the protected person:
(A)
The power to 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;
(B)
The power to make, modify, or terminate contracts;
(C)
The right to bring or defend any action at law or equity.
Nothing in this section shall prevent the protected person from notifying the court that the
protected person is being unjustly denied a right or privilege granted by this Part or requesting
removal of the conservator or termination of the conservatorship under section 62-5-428.
(2)
Unless the court's order specifies otherwise, the appointment of a conservator suspends
the authority of an agent who was previously appointed by the protected person to act as an agent
under financial provisions of a power of attorney. The authority of an agent to make health care
decisions or authority granted by other advance directives regarding health care is unaffected by
the appointment of a conservator. The court may, with appropriate findings, permanently
terminate the authority of an agent under a power of attorney.
This Section sets forth the rights and privileges lost by a protected person upon the appointment
of a Conservator. The court can override this section by court order.
Further subsection 2 of this section provides that upon the appointment of a conservator, the
authority of an agent under a general durable power of attorney executed by the protected person
is suspended. Note the agent’s authority is only suspended and not revoked. It the court
determines at some point in the future a conservator is no longer necessary the authority of the
agent under the power of attorney is revived.
Note the appointment of a conservator has no impact on the authority of an agent under a health
care power of attorney. However, the appointment a guardian under §62-5-303 would affect the
authority of such an agent.
SECTION 62-5-408410. Who may be appointed conservator; priorities.
(1) a) The court may appoint an individual, or a corporation with thegeneral power to serve as
trustee, as conservator of the estate of the primary respondenta protected person. The court in
appointing a conservator shall consider persons, who are otherwise qualified, in the following are
entitled to consideration for appointment in the order of priority:listed:
(1) a person previously appointed conservator, guardian of property, or other like fiduciary for
appointed or recognized by the primary respondent by anotherappropriate court of competent any
other jurisdiction in which the protected person resides;
(2) an individual or corporation nominated by the primary respondentprotected person if he is
fourteen or more years of age and has, in the opinion of the court, sufficient mental capacity to
make a reasonedan intelligent choice;
(3) an attorney in fact appointed by the primary respondent such protected person pursuant to
Section 62-5-501;
(4) the spouse of the primary respondent. protected person;
(E) 5) an adult child of the primary respondentprotected person;
(F)
6) a parent of the primary respondent;
(G)
the person nearest in kinship to the primary respondent who is willing to accept the
appointment;
(H)
a person with whom the primary respondent resides outside of a health care
facility, group home, homeless shelterprotected person, or prison; and
(I) a person nominated by a health care facility caring for the primary respondent.the will of a
deceased parent;
(7) any other relative of the protected person;
(8) a person nominated by the person who is caring for him or paying benefits to him.
(b) A person whose priority is based upon their status under (A), (C),(D), (E), (F), or (G)
above,in priorities (1), (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 shallis to select the person it
considersone who is best qualified of those willing to serve as conservator for the primary
respondent and in the best interest of the primary respondent. The court, acting in the best
interest of the primary respondentfor good cause, may decline to appointpass over a person
having highest priority and appoint a person having lesserless priority or no priority.
(c) A probate judge or an employee of the probate court shall not serve as a conservator of an
estate of a protected person; except however, a probate judge or an employee of the probate
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.
This Section expands prior §62-5-410. The section a detailed tiered system for determining who
should be given priority for appointment as conservator for a protected person. A change from
prior law is the addition in the list of priorities of a person with whom the primary respondent
resides, regardless of kinship. While the court must consider persons in the order listed, nothing
prevents a court from deviating from the order of priority in the best interest of the primary
respondent.
SECTION 62-5-409411. Bond.
Except upon a finding of The court, unless for good cause, the court must stated, shall require a
conservator to furnish a bond conditioned upon faithful discharge of all duties of the
conservatortrust according to law and mustwill approve all sureties. When If bond is required, 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 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. Good cause for waiver The court may permit the amount of the bond includes,
but is not limited to, be reduced by the establishmentvalue of a properly executed restricted
account agreement assets of the estate deposited with a domestic financial institution, as defined
in Section , in which the funds are deposited and held62-6-101, in a manner that prevents their
unauthorized disposition or other similar restrictive arrangements. The court may authorize an
unrestricted (unbonded) account to be used by the conservator for expenses on behalf of the
protected person, and all activity in such an account shall be reported by the conservator as
required by the court.. Upon application of the conservator or another interested person, or upon
the court'scourt’s own motion, the court may (a) order the creation, change or termination of an
account, (b) increase or reduce the amount of the bond, (c) release sureties, (d) dispense with
security or securities, or (e) permit the substitution of another bond with the same or different
sureties. A denial of an application by the court is not an adjudication and does not preclude a
formal proceeding.
This is former §62-5-411. This section continues its bias toward conservators being bonded.
Changes to prior law include guidance on the meaning of Good Cause for purposes of waving the
requirement of bond.
SECTION 62-5-410412. Terms and requirements of bonds.
(a) The following requirements and provisions apply to any bond required under Section
62-5-409411:
(1) Sureties shall 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 which issued letters to the primary obligor in any proceeding pertaining to the fiduciary
duties of the conservator and naming the surety as a party defendant. 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;
(3) After service of a summons and petition by a successor conservator or any interested person,
or upon the court'scourt’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.
This is former §62-5-412. There are no changes from prior law.
By accepting appointment, a conservator submits personally to the jurisdiction of the court in any
informal or formal proceeding relating to the conservatorship estate. that may be instituted by any
interested person. Notice of any proceeding shall be delivered to the conservator. , or mailed to
him by registered or certified mail at his address as listed in the petition for appointment or as
thereafter reported to the court and to his address as then known to the petitioner.
This is former §62-5-413. The section establishes that acceptance of the office of conservator
constitutes consent to the jurisdiction of South Carolina courts. Any proceeding against a person
for whom a conservator has been appointed must be delivered to the conservator.
SECTION 41262-5-414. Compensation and expenses.
Any guardian ad litem, attorney, examinerIf not otherwise compensated for services rendered, any
visitor, lawyer, physician, 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. In addition, the court has discretion to award, from the protected
person’s estate, reasonable fees and expenses to attorneys involved in the proceeding resulting in
a protective order.
This is former §62-5-414 and has been revised. This section explains how appointees are to be
compensated and allows attorneys to be compensated from the estate of the protected person.
This change is in response to the decision in Dowaliby v. Chambless,544 S.E.2d 646 (S.C.App.
2001) and is intended to provide a statutory basis for the court, in its discretion, to award
attorney’s fees, to be paid from the protected person’s estate, to attorneys involved in the
proceeding.
SECTION 62-5-413415. Death, resignation, or removal of conservator.
The court may remove a conservator for good cause, upon notice and hearing, or accept the
resignation of a conservator. After thehis death, resignation, or removal of a conservator, the
court may, if necessary appoint a successoranother conservator who. A conservator so appointed
succeeds to the title and powers of his predecessor. The removal of a conservator or the
discharge of a conservator based upon resignation and, if necessary, the
SECTION 62-5-416. Requests for orders subsequent to appointment of a successor conservator,
shall be in accordance; service of petition and summons; denial of application.
(a) Upon filing a petition and summons with the procedure set forth in section 62-appointing
court, a person interested in the welfare of a person for whom a conservator has been appointed
may request an order (1) requiring bond or security or additional bond or security, or reducing
bond, (2) requiring an accounting for the administration of the trust, (3) directing distribution, (4)
removing the conservator and appointing a temporary or successor conservator, or (5-428.
Resignation of a conservator is not effective until approved) granting other appropriate relief.
The petition and summons must be served upon the conservator and other persons as the court
may direct.
(b) Upon application to the appointing court, a conservator may request instructions concerning
his fiduciary responsibility. A denial of the application by the court. is not an adjudication and
does not preclude a formal proceeding.
This is former §62-5-415. The new section continues old law, but references new procedures for
the appointment of a successor conservator under §62-5-428. The section also makes it clear a
conservator’s resignation is not effective until a new conservator is appointed. This precludes a
conservator from resigning and abandoning a protected without court action.
(c) After notice and hearing as the court may direct, the court may give appropriate instructions
or make any appropriate order.
SECTION 62-5-414. 417. General duty of conservator; Plan.
In the exercise of his powers, a conservator is to act as a fiduciary and shall observe the standards
of care applicable to trustees as described by Section 62-7-933.
(1)
A conservator may exercise authority only as necessitated by the limitations of the
protected person, and to the extent possible, shall encourage the protected person to participate in
decisions, act in the person's own behalf, and develop or regain the ability to manage the
protected person's estate and business affairs.
(2)
If at any time the court determines appropriate, it may order a conservator to file a plan
for protecting, managing, expending, and distributing the assets of the protected person's estate.
Any such plan must be approved, disapproved, or modified by the court, in informal or formal
proceedings, as the court deems appropriate. Nothing herein shall require the court to oversee or
approve the investment choices made by the conservator. The plan must be based on the actual
needs of the protected person, take into consideration the best interest of the protected person
and be updated, modified and revised as the needs and circumstances of the protected person
require. The conservator shall include in the plan:
(A)
a statement of the extent to which the protected person may be able to develop or
recover ability to manage the person’s property and any planned steps to develop
or
restore the person's ability,
(B)
an estimate of the duration of the conservatorship, and
(C)
projections of expenses and resources.
(3)
In investing an estate, selecting assets of the estate for distribution, and invoking powers
of revocation or withdrawal available for the use and benefit of the protected person and
exercisable by the conservator, a conservator shall take into account any estate plan of the
protected person known to the conservator and may examine the will and any other donative,
nominative, or other appointive instrument of the protected person.
This is former §62-5-417. The section establishes the duties of a conservator. New to this code
section is the requirement that a conservator consult with and allow the protected person to
participate in the management and application of his or her assets. The new section also
introduces the concept of a plan. This clarifies the authority of the Probate Court to require the
conservator to submit a plan for the administration of a protected person’s estate. The section
also requires the conservator to take into account the protected person’s estate plan when making
decisions on investments, distributions, and other matters affecting the protected person’s assets.
This obligation was unclear under prior law.
SECTION 62-5-415418. Inventory and records.
Within sixtythirty days after his appointment, every conservator shall prepare and file with the
appointing court a complete inventory of the estate of the protected person together with the
conservator’shis oath or affirmation that it is complete and accurate to the best of the
conservator’s knowledge, information and belief.so far as he is informed. The court may, for
good cause shown, grant an extension to fileincrease the inventoryallotted time. The conservator
shall provide a copy thereof to the protected person’s guardian, if any, and any other persons the
court may direct.
This is former §62-5-418. The section requires the conservator to file an inventory 60 days after
his appointment, unless that date is extended by the Probate Court. The prior version of this
section provided a list of persons who were to be given copies of the inventory. This section
only requires a copy be delivered to the protected person’s guardian, if he or she has one, and
leaves to the Probate Court the decision of who else should be given a copy. The statement
under prior law requiring the conservator to keep suitable records and make the same available to
any interested person has been eliminated. The requirement to keep records and make them
available is now fully covered under §62-5-416.
SECTION 62-5-416. Accountings and Reports; Appointment of guardian ad litem; Monitoring.
(1)
A conservator shall report to the court regarding his administration of the estate annually,
upon resignation or removal, on termination of the protected person's minority or disability, upon
the death of the protected person, and at other times as the court directs. The conservator may
petition in formal proceedings under section 62-5-428 for
(A)
an order allowing an intermediate report of a conservator, and adjudicating
liabilities concerning the matters adequately disclosed in the accounting ;
(B)
an order allowing a final report and adjudicating all previously unsettled liabilities
relating to the conservatorship.
(2)
A report must state or contain:
(A)
an accounting of receipts and disbursements during the period for which the report
is made;
(B)
a list of the assets of the estate under the conservator's control and the location of
those assets;
(C)
any recommended changes in the plan for the conservatorship as well as a
recommendation as to the continued need for conservatorship and any
recommended changes in the scope of the conservatorship.
The conservator shall provide a copy of the report to the protected person if he can be located,
has attained the age of fourteen years, and has sufficient mental capacity to understand the
reportthese matters, and to any parent or guardian with whom the protected person resides. The
conservator shall keep suitable records of his administration and exhibit the same on request of
any interested person.
(3)
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.
(4)
In connection with a report, the court may order a conservator to submit the assets of the
estate to an appropriate examination in any manner directed by the court.
This section expands former §62-5-419. It provides a more detailed description of the type of
report a conservator is to produce, and when the report is to be produced. If further provides a
more restricted listing of who is to have copies of the report.
SECTION 62-5-417
SECTION 62-5-419. Accounts.
Every conservator shall account to the court for his administration of the trust annually and upon
his resignation or removal, and at other times as the court may direct. On termination of the
protected person’s minority or disability a conservator shall account to the court. Upon the filing
and service of summons and petition for approval of accounting, an order, made upon notice and
hearing, allowing an intermediate account of a conservator, adjudicates as to his liabilities
concerning the matters shown in connection with it and an order, made upon notice and hearing,
allowing a final account adjudicates as to all unsettled liabilities of the conservator to the
protected person or his successors relating to the conservatorship concerning the matters shown.
In connection with an account, the court may require a conservator to submit to a physical check
of the estate in his control, to be made in a manner the court may specify.
SECTION 62-5-420. 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 theretofore held for
the protected person by custodians or attorneys in fact, unless otherwise provided in the court’s
order.. Neither the appointment of a conservator nor the establishment of a trust in accordance
with Title 44, Chapter 6, Article 6, is a transfer or alienation within the meaning of general
provisions 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. , but this section does not restrict the ability of persons
to make specific provision by contract or dispositive instrument relating to a conservator.
This section revises prior §62-5-420. This section is the same as the prior section, except it
deletes the last phrase of the last sentence of §62-5-420 which reads “but this section does not
restrict the ability of a person to make specific provision by contract or dispositive instrument or
other transaction“. The rights of a person following the appointment of a conservator is now
more fully covered in §62-5-407.
SECTION 62-5-418421. Recording of conservator’s letters and notification to credit reporting
agencies.
Letters of conservatorship are evidence transfer all assets of vesting title of thea protected
person’s assets inperson 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. Letters or Certificates of conservatorship, and Terminations
of Appointmentorders terminating conservatorships, shall 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 other counties of this state or other states where the protected person owns real
estate, as is appropriate..
(1) Conservators may file letters of conservatorship with credit reporting agencies.
This section replaces and expands former §62-5-421. The primary change from prior law is the
suggestion the conservator may wish to file the letters of conservatorship with credit reporting
agencies.
SECTION 62-5-419422. Sale, encumbrance, or transaction involving conflict of interest;
voidable; exceptions.
Any sale or encumbrance to a conservator, his spouse, agent, or attorney, or any corporation, or
trust, or other entity in which he has a substantial beneficial interest, or any transaction which is
affected by a substantial conflict of interest by the conservator is void unless the transaction is
approved by the court in a proceeding in accordance with the procedure set forth in section 62-5428. after notice to interested persons and others as directed by the court.
This section replaces prior §62-5-422. The wording of the prior section left to the Probate Court
the procedure to follow in approving transactions involving self dealing by the conservator. The
new section directs the court to use the procedure established in §62-5-428.
SECTION 62-5-420423. 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 or approval as requiredprovided in this
PartSections 62-5-408 and 62-5-422, 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
62-5-424426 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. The protection here expressed
extends to instances in which some procedural irregularity or jurisdictional defect occurred in
proceedings leading to the issuance of letters. 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.
This is former §62-5-423. The only change was to correct internal references to other code
sections. This change was necessitated by section renumbering.
This section provides protection to bona fide purchasers for value of the property of a protected
person when dealing with his conservator. The purpose of this section is to facilitate commercial
transactions by negating the traditional duty of inquiry found under the common law of trusts.
Even the third party’s actual knowledge that the third party is dealing with a conservator does not
require that the third party inquire into the possession of or propriety of the conservator’s exercise
of a power. Nor is the third party, contrary to the common law, responsible for the proper
application of funds or property delivered to the conservator. But consistent with the emphasis on
limited conservatorship, the protection extended to third parties is not unlimited. Third parties are
charged with knowledge of restrictions on the authority of conservators when the restrictions are
endorsed on the conservator’s letters.
The protections provided by this section are of limited by the last sentence of the section which
provides this section will be superseded by statutes relating to commercial transactions, such as
the uniform commercial code, or by statutes relating to the transfer of securities.
SECTION 62-5-421. Protected person’s interest inalienable.
(1)
Except as otherwise provided in subsections (2) and (3), the interest of a protected person
in property vested in a conservator is not transferable or assignable by the protected person.
(2)
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 as if the protected
person had valid title.
(3)
A third party who deals with the protected person with respect to property vested in a
conservator is entitled to any protection provided by law.
This section provides a spendthrift effect for property of the protected person vested in the
conservator. The section, like §62-5-420, is designed to allow the estate to be administered with a
minimum of interference, and to make clear that the conservator, with respect to the property of
the conservatorship, occupies a role similar to that of a trustee. The section is also designed to
protect the estate, and hence the protected person, against possibly abusive or improvident claims.
But some significant exceptions are recognized to protect the rights of third parties. An attempted
transfer or assignment by the protected person, while ineffective to affect property rights, may
give rise to a claim against the protected person for restitution or damages.
Subsection (2) addresses a special situation. While title to certain tangible personal property, such
as an automobile, is transferred by means of a document of title, title to most tangible personal
property is transferred simply by delivery of possession. Sales of such property are often casual,
and purchasers do not usually inquire into the source of the seller’s title. Upon the conservator’s
appointment, title to a protected person’s tangible personal property, like title to the protected
person’s other assets, is transferred from the protected person to the conservator. But this transfer
of title will normally not be known to a prospective purchaser, particularly if the tangible personal
property is still in the protected person’s possession. The effect of this subsection is to generally
validate the title of such casual purchasers. The conservator may contest the purchaser’s title only
if the purchaser failed to pay full value, the purchaser knew of the conservatorship, or the
purchaser, based on the circumstances, should have inquired into the conservatorship’s existence.
Subsection (c) clarifies that this section does not supersede protections third parties may have
under other law, such as under the statutes regulating commercial transactions.
SECTION 62-5-422. Powers of conservator in administration.
Except as otherwise qualified or limited by the SECTION 62-5-424. Powers of conservator in
administration.
(A) A conservator has power without court in its order of appointment and endorsed on the
letters and certificates of appointment,authorization or confirmation to invest and reinvest funds
of the estate as would a trustee.
(B) 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 authorization or
confirmation, to:
(A)
invest and reinvest funds of the estate as would a trustee, subject to the
requirements of section 62-7-933.
(1) 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 the assets may be retained even though
they include an asset in which the conservatorhe personally is interested;
(2) receive additions to the estate;
(3) invest and reinvest estate assets in accordance with subsection (A);
(4) deposit estate funds in a financial institutionbank including a financial institutionbank operated
by the conservator;
(5) make ordinary or extraordinary repairs or alterations toin buildings or other structures, to
demolish, improve, improvement, to raze or erect existing or erect 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 havehas 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 62-5-432433; settle a claim by or against
the estate of the protected person by compromise, arbitration, or otherwise except as limited by
Section 62-5-432433; 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 conservatorhim 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; and
(18) execute and deliver all instruments which will accomplish or facilitate the exercise of the
powers vested in the conservator; and.
(B)
enter into a lease of a residence for the protected person for a term not exceeding
one year.
(C) 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 file an applicationact with the court
requesting authorityapproval 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) acquire or dispose of an estate asset including land in another state 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; to make or obtain the vacation of plats and
adjust boundaries; to adjust differences in valuation on exchange or to partition by giving or
receiving considerations; and to dedicate easements to public use without consideration;
(5) enter into a lease as lessor or lessee, other than with or without option to purchase or renew
for a residential lease described in section 62-5-422(2)(T);term within or extending beyond the
term of the conservatorship;
(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, 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 gifts to charitable organizations and for other religious, charitable, eleemosynary, or
educational purposes which are tax deductible as the protected person might have been expected
to make, in amounts which do not exceed in total for any year twenty percent of the income from
the estate, if and only if the estate is ample to provide for the purposes implicit in the distributions
authorized by Section 62-5-423425;
(10) encumber, mortgage, or pledge an asset for a term extending within or beyond the term of
the conservatorship;.
(A)
pay a reasonable fee to the conservator for services rendered;
(B)
adopt an appropriate budget for routine expenditures of the protected person;
(C)
reimburse the conservator for monies paid to or on behalf of the protected person.
(D)
to exercise or release the primary respondent's powers as trustee, personal
representative, custodian for minors, conservator, or donee of a power of
appointment;
(E)
enter into contracts;
(F)
to exercise options of the primary respondent to purchase securities or other
property;
The court may approve or deny any application for approval filed by the conservator under (2)
above, without notice, or may, in its discretion require the commencement of a formal proceeding
under section 62-5-428.
(2)
A conservator may apply to the court for ratification of any action taken in good faith.
The court may approve or deny such application, without notice, or may, in its discretion require
the commencement of a formal proceeding under section 62-5-428.
(3)
A conservator may request instructions concerning the conservator’s fiduciary
responsibility and may make requests for expenditure of funds for the protected person by filing
an application with the court, or by commencing a formal proceeding in accordance with section
62-5-428. If application is made, the court may approve or deny such application without notice,
or may, in its discretion require formal proceedings under section 62-5-428.
This section was formerly section 62-5-424 and has been substantially modified. This section sets
out the powers of a conservator in administration.
Subsection (1) sets out nineteen specifically itemized powers which a conservator has and may
exercise without court authorization or confirmation, unless such powers have been limited by the
court. There is a requirement that the conservator must act reasonably in the best interest of the
protected person. Subsection (1)(A) grants the conservator authority to invest and reinvest funds
of the estate as would a trustee and imposes the requirements of section 62-7-933 (the Uniform
Prudent Investment Act). Subsection (1)(T) is an additional power to “enter into a lease of a
residence for the protected person for a term not exceeding one year.”
Subsection (2) has been revised to require the conservator to file an application to the court
requesting authority to exercise any of the sixteen powers set forth. Upon the filing of such an
application, the court may approve or deny without notice or may require the conservator to
commence a formal proceeding under section 62-5-428.
Subsection (3) allows the conservator to file an application for ratification of an action taken in
good faith. The court may approve or deny without notice or may require the conservator to
commence a formal proceeding under section 62-5-428.
Subsection (4) allows the conservator to file an application requesting instructions or expenditures
or to commence a formal proceeding under section 62-5-428. If an application is filed, the court
may approve or deny without notice or may require a formal proceeding under section 62-5-428.
SECTION 62-5-423425. Distributive duties and powers of conservator.
(a) A conservator may expend or distribute sums from the principal of the estate, without further
court authorization, or confirmation for the healthsupport, education, maintenance and
supportcare, or benefit of the protected person and his dependents in accordance with the
following principles:
(A)
The expenditures must be consistent with the court-approved plan under section
62-5-414, if any.
(1) The conservator is to consider recommendations relating to the appropriate standard of
healthsupport, education, maintenance and supportbenefit for the protected person made by a
parent or guardian, if any. The conservatorHe may not be surcharged for sums paid to persons or
organizations actually furnishing healthsupport, education, maintenance or supportcare to the
protected person pursuant to the recommendations of a parent or guardian of the protected
person unless the conservator has actual knowledgehe knows that the parent or guardian is
deriving personal financial benefit therefrom, including relief from any personal duty of support,
or unless the recommendations are clearly not in the best interests of the protected person.
(2) The conservator is to expend or distribute sums reasonably necessary for the healthsupport,
education, maintenance and supportcare, or benefit of the protected person with due regard to (i)
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 which
has been conserved for him; (ii) the accustomed standard of living of the protected person and
members of his household; and (iii) other funds or sources used for the support of the protected
person.
(3) The conservator may expend funds of the estate for the support of persons legally dependent
on the protected person.
(4) Funds expended under this subsection may be paid by the conservator to any person, including
the protected person, to reimburse for expenditures which the conservator might have made, 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.
(B)
If the conservator determines that it is reasonably necessary to supply funds to the
protected person, the conservator may provide such funds to the protected person
through reasonable financial methods, including, but not limited to, checks,
currency, debit card, or allowance. All funds so provided shall be reported on the
accountings as required by the court.
(2)
(b) When a personminor who is incapacitated solely by reason of minority has not been
adjudged disabled under Section 62-5-401(2) attains the age of eighteen (18) his majority or is
emancipated, his conservator, after meeting all prior claims and expenses of administration, shall
pay over and distribute all remaining funds and properties to the now-adult or emancipatedformer
protected person as soon as practicable, unless:
(A)
A protective order has been issued because the protected person is incapacitated,
or
(B)
A protective proceeding or other petition with regard to the protected person is
pending.
A protected personpossible. An individual under the age of eighteen who is also married shall
remain a minor for purposes of this subsection until attaining eighteen (18)majority or
emancipatedemancipation.
(A) c)(1) When the conservator is satisfied that a protected person’s incapacitydisability (other
than minority) has ceased, the conservatorthen he shall petition the court, and after determination
by the court that the incapacitydisability has ceased in accordance with Section 62-5-428430, the
conservator, after paying outstanding meeting all prior claims and expenses of administration and
any claims approved by the court, shall pay over and distribute all remaining funds and properties
to the former protected person as soon as practicable.possible.
(B) 2) When the conservator is satisfied that a protected person’s estate has a value of less than
tenfive thousand dollars, he may file an application with the court for termination of the
conservatorship and permission to pay the remaining funds and properties to or for benefit of the
protected person in accordance with section 62-5-103. The court may approve or deny such
application, without notice, or may, in its discretion require the commencement of a formal
proceeding under section 62-5-428. If the court determines that the then he may petition the
court, and after determination by the court that the protected person’s estate has a value of less
than tenfive thousand dollars, the court may on its own accord, in its discretion, may terminate the
conservatorship and order the conservator, after paying outstanding meeting all prior claims and
expenses of administration and any claims approved by the court, to pay over and distribute all
remaining funds and properties to or for the protected person as soon as practicablepossible and
in accordance with Section 62-5-103.
(4) d) 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'shis possession,
inform the personal representativeexecutor or a beneficiary named therein of such deliverythat he
has done so, and retain the estate for delivery to a duly appointed personal representative of the
deceased protected persondecedent or other persons entitled thereto. If after thirty days from the
death of the protected person no other person has been appointed personal representative and no
application or petition for appointment is pending inbefore the court, the conservator may apply
for appointment to exercise the powers and duties of a personal representative so that he may
proceed to administer and distribute the decedent’s estate. Upon application for an order granting
the powers of a personal representative to a conservator, after notice to any person demanding
notice under Section 62-3-204 and to any person nominated executor in any will of which the
applicant is aware, the court may order the conferral of the power upon determining that there is
no objection, and endorse the letters of the conservator to note that the formerly protected person
is deceased and that the conservator has acquired all of the powers and duties of a personal
representative. The making and entry of an order under this section shall have the effect of an
order of appointment of a personal representative as provided in Section 62-3-308 and Parts 6
through 10 of Article 3 [Sections 62-3-601 et seq. through Sections 62-3-1001 et seq.] except
that estate in the name of the conservator, after administration, may be distributed to the
decedent’s successors without prior retransfer to the conservator as personal representative. The
conservator shall deliver the estate of the deceased protected person to his duly appointed
personal representative or other persons entitled thereto under the law.
(5)
e) A person shall not be disqualified as a personal representative an executor of a deceased
protected person solely by reason of his having been appointed orand acting as conservator for
that protected person.
This section was formerly section 62-5-425. This section sets out the principles to be followed by
the conservator in making distributions. Subsection (1)(A) is an addition and requires that if there
is a court approved plan under section 62-5-414, expenditures must be consistent with that plan.
Subsection (1)(F) is an addition allowing the conservator, when reasonably necessary, to allow
the protected person access to funds through mechanisms including a checking account, a debit
card, or cash.
Subsection (2) directs distribution to a former minor when he/she attains majority unless there is
an existing protective order based on incapacity or a protective proceeding or other petition is
pending.
Subsection (3)(A) provides that the conservator shall petition the court for a redetermination of
capacity of the protected person if the conservator is satisfied that the incapacity has ceased.
Subsection (3)(B) allows the conservator to file an application for termination of the
conservatorship if the conservator is satisfiedof that the protected person’s estate is less than
$10,000.00. Even without application, the court may terminate the conservatorship if the value is
less than $10,000.00.protected person.
Subsection (4) provides for distribution at the death of the protected person. The conservator is
required to deliver any will of the protected person in his/her possession to the court and to notify
the personal representative or a beneficiary that he/she has done so.
Subsection (5) merely provides that previous service as a conservator for the protected person
does not disqualify the conservator from serving as personal representative of the estate of the
protected person.
SECTION 62-5-424426. Enlargement or limitation of powers of conservator.
The court may, at the time of appointment or at any time thereafterlater, limit the powers of a
conservator otherwise conferred by Sections 62--5-422-424 and 62-5-423425, or previously
conferred by the court, and may at any time relieve the conservatorhim of any limitation
previously imposed by the court.. If the court limits any power conferred on the conservator by
Section 62--5-422-424 or Section 62-5-423425, the limitation shall be endorsed upon his letters
of appointment and upon any certificate evidencing his appointment. Notwithstanding the
foregoing, the failure to endorse any limitation upon the conservator's letters or certificate shall
not relieve the conservator of the limitation imposed by order of the court.
This section was formerly section 62-5-426 and permits the court to limit the powers of a
conservator or relieve the conservator of a previously imposed limitation. It further provides that
limitations be endorsed on the letters of appointment, but failure to so endorse does not relieve
the conservator of the limitations.
SECTION 62-5-425427. Preservation of estate plan.
In investing the estate, and in selecting assets of the estate for distribution under subsections (a)
and (b) of Section 62-5-425, in utilizing powers of revocation or withdrawal available for the
support of the protected person, and exercisable by the conservator or the court, the conservator
and the court mustshould take into account any known estate plan of the protected person, any
revocable trust of which the protected personhe is settlor, and any contract, transfer, or joint
ownership arrangement with provisions for payment or transfer of benefits or interests at his death
to another or others which the protected personhe may have originated.
This section was formerly SECTION 62--5-427 and provides that the-428. Claims against
protected person; enforcement.
(a)(1) A conservator and the court “must” take into account any known pay from the estate plan
of the all just claims against the estate and against the protected person, in making investments, in
distribution of assets, and in exercising certain other powers. arising before or after the
conservatorship upon their presentation and allowance. A claim may be presented by either of the
following methods:
SECTION 62-5-426. Claims against protected person; enforcement.
If a creditor has notice of appointment of a conservator, all pleadings must be served upon (i) the
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;
(ii) the claimant may file a written statement of the claim, in the form prescribed by rule, with the
clerk of court and deliver or mail a copy of the statement to the conservator. Within
(2) A claim is considered presented on the first to occur of receipt of the written statement of
claim by the conservator or the filing of the claim with the court. Every claim which 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 in the court or commences a proceeding
against the conservator not later than thirty days after the conservator becomes aware of a
proceeding in which the mailing of the notice of disallowance or partial disallowance if the notice
warns the claimant of the impending bar. The presentation of a claim tolls any statute of
limitation relating to the claim until thirty days after its disallowance.
(b) A claimant whose claim has not been paid may petition, by service of the summons and the
petition, the court for determination of his claim at any time before it is barred by the applicable
statute of limitation, and, upon due proof, procure an order for its allowance and payment from
the estate. If a proceeding is initiated against a protected person is a party, the conservator must
notify the court. The conservator may request instructions from the court as necessary. , the
moving party must give notice of the proceeding to the conservator if the outcome is to constitute
a claim against the estate.
This section was formerly section 62-5-428 but has been substantially modified as the
requirements set forth in the prior version were drawn from the creditor’s claims statute for a
decedent’s estate. Since the protected person is still living, it was deemed more appropriate to
require creditors to pursue the same remedies which would be available to collect a debt from any
person. If the creditor has notice that there is a conservator appointed, the conservator must be
served with the pleadings. When the conservator becomes aware of such a proceeding, he/she
must notify the court and may seek instructions.
(c) If it appears that the estate in conservatorship is 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.
SECTION 62-5-427429. Individual liability of conservator.
(a) Unless otherwise provided in the contract, a conservator is not individually liable on a contract
properly entered into in his fiduciary capacity in the coursecourt of administration of the estate
unless he fails to reveal his representative capacity and 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 in the course of 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 in the course of
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 therefor.
(d) Any question of liability between the estate and the conservator individually may be
determined in a proceeding for accounting, surcharge, or indemnification, or other appropriate
proceeding or action.
This section was formerly section 62-5-429.
Subsection (1) relieves a conservator of personal liability for contracts properly entered into in
his/her fiduciary capacity unless he/she fails to reveal his/her representative capacity and identify
the estate in the contract.
Subsection (2) relieves the conservator from obligations arising from ownership or control of
property and tort liability unless he/she is personally at fault.
Subsection (3) states that claims may be asserted by proceeding against the conservator in his/her
fiduciary capacity, whether or not he/she is individually liable.
Subsection (4) addresses how questions of liability between the conservator and the estate may be
determined.
SECTION 62-5-428. Orders subsequent to appointment; Termination of430. Proceeding to
terminate conservatorship; application; notice.
(1)
(A)
Upon filing of a summons and petition with the appointing court,
(A) The protected person, the conservator, or any other interested person, by service of a
summons and petition, may request an order:
(i)
requiring bond or security or additional bond or security, or reducing bond,
(ii)
requiring an accounting for the administration ofthat the court
terminate the conservatorship ,
(iii)
directing distributions from the protected person’s estate when the conservator has
denied the request and has declined to file an application for expenditure,
(iv)
removing the conservator and appointing a temporary or successor conservator,
(v)
limiting or expanding the conservatorship,
(vi)
adjudicating liabilities pursuant to section 62-5-416(1),
(vii) authorizing a transaction involving a conflict of interest pursuant to section 62-5419,
(viii) authorizing or approving an action of the conservator pursuant to section 62-5422(3),
(ix)
accepting the resignation of the conservator and appointing a temporary or
successor conservator, if necessary,
(x)
terminating a conservatorship for reasons other than death, and
(xi)
granting other appropriate relief.
(B)
The procedure for obtaining orders subsequent to appointment are as follows:
(i)
Upon the filing of a summons and petition, the summons and petition shall
be served upon the. A protected person; the conservator; the guardian, if any; the
spouse seeking termination is entitled to the same rights and procedures as in an
original proceeding for a protective order. The court, upon determining after
notice and hearing, that the disability of the protected person; the adult children
whose whereabouts are reasonably ascertainable of has ceased, may terminate the
conservatorship.
(B) The protected person; the parents of the protected person, if there is no spouse or
adult child; any person who, under section 62-5-408, has equal or greater priority
for appointment as the appointed conservator ; any person with whom the
protected person resides outside of a health care facility, group home, homeless
shelter, or prison; and if the conservatorship is for the purpose of receiving
Veterans’ benefits, the Secretary of the Department of Veterans’ Affairs.
(ii)
The petition shall state the relief sought and the reasons such relief is
necessary, desirable or beneficial for the protected person.
(iii)
After the filing of the summons and petition with the court and service
upon the protected person, the court shall appoint a guardian ad litem for the
protected person, with the duties and responsibilities set forth in section 62-5-830.
(iv)
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 as provided in section 62-1-401.
Nothing in this section prohibits all parties not in default from waiving a hearing on
a petition and the court for good cause may entertain a consent order on any
petition.
(v)
The court may issue interim orders, for a period not to exceed ninety days,
regarding the assets of the protected person until a hearing is held and a final order
is issued.
(A) Upon the death of the protected person, the conservator or the, his personal representative
of, or the deceased protected person's estateconservator may make application for the termination
of the conservatorship and approval of the final accounting of the administration of the
conservatorship estate.when the protected person has attained his majority or if the protected
person is deceased. Notice must be given to those persons as the court may direct.
(B) Upon the death of the protected person, the conservator may make application for
the approval of payment of funeral expenses. Notice must be given to those persons as
the court may require.
(3)
Following the procedure set forth in section 62-5-428(2), the protected person or any
person interested in his welfare may petition for an order adjudicating or re-adjudicating the
protected person's incapacity. The court may issue an order to specify a minimum period, not
exceeding one year, during which no petition for adjudication that the protected person is no
longer incapacitated may be filed without special leave of the court. Subject to this restriction, the
protected person or the conservator may petition the court that the protected person is no longer
incapacitated, and for termination of the protective order, which must be proved by a
preponderance of the evidence.
This section was formerly section 62-5-430 but has been significantly expanded.
Subsection (1) addresses the procedure for requesting an order after the initial establishment of
the conservatorship.
Subsection (2) allows for termination of a conservatorship upon the death of the protected person
by application to the court. The conservator may also apply for approval of payment of funeral
expenses.
Subsection (3) addresses petitions for adjudication and re-adjudication of incapacity. The court
may restrict the filing of a petition for adjudication.
SECTION 62-5-429431. Payment of debt and delivery of property to foreign conservator
without local proceedings.
Any 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:
(1) that no protective proceeding relating to the protected person is pending in this State;
(2) that the foreign conservator is entitled to payment or to receive delivery.
If the person to whom the affidavit is presented is not aware of any protective proceeding pending
in this State, payment or delivery in response to the demand and affidavit discharges the debtor or
possessor.
This section was formerly section 62-5-431 and was not changed. It provides for payment of
debts and delivery of property to foreign conservator without local proceedings.
SECTION 62-5-430. 432. Foreign conservator; proof of authority; bond; powers.
If ano local conservator has not been appointed in this state and ano petition forin a protective
orderproceeding is not pending in this State, then, except as provided in Section 62-5-431, a
domiciliary foreign conservator appointed in another state, after giving notice tomay file with the
appointing court of an intent to register, may register the protective order in this State by filing in
in all counties in which property belonging to the protected person is located, authenticated copies
of his appointment and of any appropriate county of this state a certified copy of the letters of
office in the register of deeds and also filing a clocked copy of the letters of office, a certified
copy of the order, and any official bond in the probate court.
Upon registration of a protective order from another state, the conservatorhe has given.
Thereafter, he may exercise as to assets in this State all powers authorized in the order of
appointment except as prohibited under the laws of this state, including maintainingof a local
conservator and maintain 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
generally.
A court of this state may grant any relief available under this part and other law of this state to
enforce a registered order.
Reporter’s comments
This section was formerly 62-5-432, but has been changed to match sections 62-5-717 and 62-5718 which address registration of a protective order from another state when the protected person
is an adult. It is included here to clarify that this would also apply to protective orders for minors.
SECTION 62-5-431. Additional and alternative requirements for matters involving payment of
Veterans’ benefits
(1)
For purposes of this section:
(A)
The term "VA" means the United States Department of Veterans' Affairs or its
successor.
(B)
The terms "estate" and "income" shall include only monies received by a
conservator from the VA, all real and personal property acquired in whole or in
part with such monies, and all earnings, interest, and profits derived therefrom.
(C)
The term "benefits" means all monies payable by the United States through the
VA.
(D)
The term "Secretary" means the Secretary of the United States Department of
Veterans' Affairs or its successor.
(E)
The term "protected person" means a beneficiary of the VA.
(F)
The term "conservator" means any person acting as a fiduciary for any protected
person.
(2)
Whenever, pursuant to any law of the United States or regulation of the VA, the Secretary
requires, prior to payment of benefits, that a conservator be appointed for a protected person,
such appointment shall be made in the manner provided in sections 62-5-403, 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.
(3)
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 any monies due the protected person by the VA, such
certificate shall be prima facie evidence of the necessity for such appointment and no examiner’s
report shall be required.
(4)
Except as hereinafter provided or as otherwise permitted by the VA, no person shall serve
as conservator of any protected person if such proposed conservator shall at that time be acting as
conservator for five (5) protected persons. Upon presentation of a petition by an attorney of the
VA under this section alleging that a conservator is acting in a fiduciary capacity for more than
five (5) protected persons and requesting his discharge as a conservator of any such protected
person for that reason, the court, upon proof substantiating the petition, shall require a final
accounting forthwith from such conservator and shall discharge such conservator in all requested
cases. The limitations of this section shall not apply when the conservator is a bank or trust
company acting for protected persons' estates.
(5)
The conservator shall file such inventory, accountings, exhibits or other pleadings with the
court as provided by law and copies shall be filed with the VA.
(6)
Every conservator shall invest the surplus funds in his protected person's estate in such
securities, or otherwise, as allowed by law, and in which the conservator shall have no interest.
Such funds may be invested, without prior court authorization, in direct interest-bearing
obligations of this state or of the United States and in obligations the interest and principal of
which are both unconditionally guaranteed by the United States Government.
(7)
Whenever a copy of any public record is required by the VA to be used in determining the
eligibility of any person to participate in benefits made available by the VA, the official charged
with the custody of such public record shall without charge provide the applicant for such benefits
or any person acting on his behalf or the representative of the VA with a certified copy of such
record.
(8)
The Secretary or his successor is and shall be a party in interest:
(A)
in any proceeding brought under any law of this state for the appointment,
confirmation, recognition, or removal of any conservator of a minor, or of a
mentally incompetent person, to whom or on whose behalf benefits have been paid
or are payable by the VA, its predecessor or successor;
(B)
in any conservatorship proceeding involving such person or his estate;
(C)
in any suit or other proceeding arising out of the administration of such person's
estate or assets; and
(D)
in any proceeding the purpose of which is the removal of the disability of minority
or of mental incompetency of such person.
(9)
In any case or proceeding involving property or funds of such minor or mentally
incompetent person not derived from the VA, the VA shall not be a necessary party but may be a
proper party to such proceedings. This section shall not apply unless the VA designates in a
writing filed with the Secretary of State, the name and address of its chief attorney, acting chief
attorney or other agent within this state as a person authorized to accept service of process or
upon whom process may be served.
(10) For services as conservator of funds paid from the VA, compensation payable to the
conservator shall not exceed five per cent of the income of the protected person during any year.
If extraordinary services are rendered by any such conservator the court may, upon application of
the conservator and notice to the VA as provided herein, authorize additional compensation
payable from the estate of the protected person. No compensation shall be allowed on the corpus
of an estate derived from payments from the VA. The conservator may be allowed reimbursement
from the estate of his protected person for reasonable premiums paid by him to any corporate
surety upon his bond.
This section is a distillation of provisions of the Uniform Veterans’ Guardianship Act, which was
formerly Part 6 of Title 62. This section should be taken into consideration whenever the primary
respondent is receiving or will receive moneys from the VA. In general, the proceeding is the
same as that contained in section 62-5-403, except that a certificate of the Secretary or his
representative replaces the necessity for an examiner and there may be a limit on the number of
persons for whom a conservator may act.
SECTION 62-5-432. 433. Definitions; procedures for settlement of claims in favor of or against
minors or incapacitated persons.
(1)
(1)
(A)(1) For purposes of this section, the following definitions shall apply:
(A)
“Court” means,
(i)
and for purposes of any claim exceeding one hundredtwenty-five thousand
dollars in favor of or against any minor or incapacitated person, “court” means the
circuit court of the county in which the minor or incapacitated person resides or
the circuit court in the county in which the suit is pending;
(ii) . For purposes of this section and for any claim not exceeding one hundredtwenty-five
thousand dollars in favor of or against any minor or incapacitated person, “court” means either the
circuit court or the probate court of the county in which the minor or incapacitated person resides
or the circuit court or probate court in the county in which the suit is pending; and.
(iii)
for the purposes of (4) (B) (iv) of this section, the probate court of the
county in which the minor or incapacitated resides.
(2) “Claim” means the net or actual amount payableaccruing to or on behalf of or paid by the
minor or incapacitated person as a result of the settlement of a legal matter resulting in the
payment of money or the delivery of real or personal property.
(B)
For purposes of this section, “conservator(3) “Petitioner” means
(i)
for residents of this stateeither a conservator appointed by the probate
court for the minor or incapacitated person byor the probate court for the county
in whichguardian or guardian ad litem of the minor or incapacitated person resides;
and
(ii) for a nonresident of this state, a personif a conservator has not been appointed by a court in
the state of residence of the minor or incapacitated person and who has authority and duties
similar to those of a conservator in this state or a person appointed conservator for a nonresident
by a probate court in this state in a county where the nonresident has property or the right to take
legal action..
(B) The settlement of any claim over twenty-five thousand dollars in favor of or against any minor
or incapacitated person, for whom a conservator has previously been appointed and is serving,
may only be effected by the conservator for such minor or incapacitated person. for the payment
of money or the possession of personal property must be effected on his behalf in the following
manner:
(2)
The settlement of any claim that does not exceed ten thousand dollars ($10,000.00) in
favor of or against any minor or incapacitated person shall be effected by the conservator for the
minor or incapacitated person or, if no conservator has previously been appointed, may be
effected by (i) the parent or guardian of the minor, (ii) a guardian appointed under Part 3 of this
Article for an incapacitated person, or (iii) a guardian ad litem appointed by the court for the
minor or incapacitated person. The settlement of the claim may be effected without court
approval and without the subsequent appointment of a conservator for the minor or incapacitated
person. If the settlement requires the payment of money or the delivery of personal property for
the benefit of the minor or incapacitated person, the payment or delivery must be made to a
conservator previously appointed for the minor or incapacitated person or, if no conservator has
been previously appointed, shall be made in accordance with section 62-5-103, in which case the
person receiving the money or personal property on behalf of the minor or incapacitated person
shall be authorized to execute a proper receipt and release and/or or covenant not to sue therefor,
which shall be binding upon the minor or incapacitated person.
(3)
The settlement of any claim over ten thousand dollars($10,000.00) in favor of or against
any minor or incapacitated person may only be effected by a conservator for such minor or
incapacitated person, and shall be effected in the following manner:
(A)
Unless the authority of the conservator has been limited by the probate court or
other court appointing the conservator, if the claim is twenty-five thousand dollars
($25,000.00) or less, the conservator may settle the claim without court
authorization or confirmation; or the conservator may petition the court for
approval as provided in (B)(i) through (B)(v) below. If the settlement requires
the payment of money or the delivery of personal property for the benefit of the
minor or incapacitated person, the conservator shall receive the money or personal
property and execute a proper receipt and release or covenant not to sue therefore,
which shall be binding upon the minor or incapacitated person.
(B)
If the claim is more than twenty-five thousand dollars ($25,000.00), the
conservator must effect the settlement in the following manor:
(i) The conservator(1) The petitioner must file with the court a summons and 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 conservatorpetitioner, the proposed
settlement is fair and reasonable and should be approved by. For all claims that exceed
twenty-five thousand dollars, the court. Theverified petition must include a statement by the
conservatorpetitioner that, in his opinion, the proposed settlement is in the best interests of the
minor or incapacitated person. The petition must be served on the minor or incapacitated
person's guardian, the spouse, any adult children whose whereabouts are known or reasonably
ascertainable, and if there is no spouse or adult children, the parents.
(ii) 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 person, the court shall issue its order approving the
settlement and authorizing the conservatorpetitioner 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 person, to receive the money or personal property and execute a proper receipt and
release or covenant not to sue thereforetherefor, which shall beis binding upon the minor or
incapacitated person.
(iii)
Except as provided in (iv) below,3) The order authorizing the settlement
must require that payment or delivery of the money or personal property to or in
favor of a minor or incapacitated person be paid tobe made through the
conservator for the benefit of the minor or incapacitated person.
(iv)
. If baseda conservator has not been appointed, the petitioner shall, upon
the facts set forth in the verified petition or presented during the hearing, the
probate receiving the money or personal property, pay and deliver it to the court
finds it is in the best interest of the minor or incapacitated person, the court may
order any settlement proceeds placed in a special needs trust which complies with
the provisions of 42 USC 1396p(d)(4)(A) or in a pooled fund trust which complies
with the provisions of 42 USC 1396p(d)(4)(C).
(v) 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, such party may be found to be 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 any claim that does not exceed twenty-five thousand dollars in favor of or
against a minor or incapacitated person 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 person,
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 person.
(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 person 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.
This section was formerly 62-5-433 but has been substantially modified. It addresses(D) The
settlement of claims any claim that does not exceed two thousand five hundred dollars in favor of
or against aany minor or incapacitated person.
Subsection (1) contains definitions applicable to this section.
Subsection (2) states that if a conservatorship is in place, only for the payment of money or the
conservator may settle the claim.
Subsection (3) addresses claims not in excess of $10,000.00. Such claims may possession of
personal property may be effected by a conservator. If there is no conservator, the claim may be
settled by the the parent, or guardian or guardian ad litem of athe minor or by a guardian for an
incapacitated person without court approval of the settlement and without the appointment of a
conservator. If there is a conservator, any funds or property would be delivered to the
conservator. If there is no conservator, funds or property could be delivered in accordance with
62-5-103.
Subsection (4) addresses claims over $10,000.00 and If the settlement requires the appointment
of a conservator to effect the settlement. For claims of $25,000.00 or less, payment of money or
the conservator (unless his/her authority has been limited by delivery of personal property for the
court) may settle the claim without court approval or may petition for approval in either the
circuit court or the probate court. For claims in excess of $25,000.00, the conservator must file a
summons and verified petition.
SECTION 62-5-433. Creation of a Special Needs Trust.
(1)
An adult, who is not incapacitated but is disabled, may petition the court to create and
establish a special needs trust for his benefit in compliance with 42 USC 1396p(d)(4)(A). Upon
the filing of an application together with the written statement of a physician stating that the
petitioner is competent to manage his the minor or incapacitated person, the parent or guardian
shall receive the money or personal property, the court may issue an order creating and
establishing a special needs trust in the form and substance submitted by the petitioner. The court
shall have no responsibility to assure the validity of the trust or its effectiveness in accomplishing
the intended purpose and shall have no ongoing responsibility to monitor the trust.
(2)
The court shall have authority to create and establish a special needs trust for an and
execute a proper receipt and release or covenant not to sue therefor, which is binding upon the
minor or incapacitated person in compliance with 42 USC 1396(d)(4)(A) and to order the
placement of the incapacitated person’s funds into such a trust or into a pooled trust in
compliance with 42 USC 1396(d)(4)(C) for the benefit of incapacitated persons under its
authority to issue protective orders pursuant to the procedure set forth in section 62-5-401 et seq.
(3)
In the case of a disabled minor primary respondent, the court shall have authority to create
and establish a special needs trust in compliance with 42 USC 1396(d)(4)(A) if the court
determines it is in the primary respondent’s best interest. The court shall also have the authority
to order the placement of the minor’s funds into such a trust. The payment or into a pooled trust
in compliance with 42 USC 1396(d)(4)(C) for the benefit of minor under its authority to issue
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.
This is a new section.
Subsection (1) clarifies that the court has jurisdiction to create a special needs trust for an adult
who is disabled, but not incapacitated. The court is authorized to create such a trust in the form
submitted by the petitioner and is not responsible for the validity of the trustdelivery of money or
for monitoring of the trust.
Subsection (2) affirms the court’s authority under prior law to create a special needs trust for an
incapacitated person and to order the placement of the incapacitated person’s funds into a special
needs trust personal property to or a pooled trust.
Subsection (3) confirms the court’s authority to create a special needs trust for a disabled for a
minor and to order the placement of the disabled minor’s funds into a special needs trust or
pooled trust even though the trust extends beyond the age of majority.incapacitated person must
be made in accordance with Section 62-5-103.
A special needs trust or pooled trust is only appropriate for SECTION 62-5-434. Settlement of
claims involving minors completed between July 1, 1987, and September 24, 1987, presumed
valid.
The settlement of any claim involving a minor completed between July 1, 1987, and September
24, 1987, is presumed facially valid whether effectuated with or without court approval.
SECTION 62-5-435. Liability for approving or adultcompleting settlement.
Neither the court which may have approved a settlement nor a person who completed the
settlement of a minor’s claim but did not seek court approval during this time period is liable for
their good faith exercise of discretion in approving or completing the settlement.
PART 6.
UNIFORM VETERANS’ GUARDIANSHIP ACT
SECTION 62-5-601. Short title.
This part [Sections 62-5-601 et seq.] may be cited as the “Uniform Veterans’ Guardianship Act”.
SECTION 62-5-602. Definitions.
As used in this part [Sections 62-5-601 et seq.]:
(1) The term “Veterans’ Administration” means the United States Veterans’ Administration or its
successor.
(2) The terms “estate” and “income” shall include only monies received by the guardian from the
Veterans’ Administration and all earnings, interest, and profits derived therefrom.
(3) The term “benefits” means all monies payable by the United States through the Veterans’
Administration.
(4) The term “Administrator” means the Administrator of Veterans’ Affairs of the United States
or his successor.
(5) The term “ward” means a beneficiary of the Veterans’ Administration.
(6) The term “guardian” means any person acting as a fiduciary for any ward, including a
committee for a person over twenty-one years old.
SECTION 62-5-603. Appointment of guardians.
Whenever, pursuant to any law of the United States or regulation of the Veterans’
Administration, the Administrator requires, prior to payment of benefits, that a guardian be
appointed for a ward, such appointment shall be made in the manner hereinafter provided.
SECTION 62-5-604. Persons who may file summons and petition for appointment.
A summons and petition for the appointment of a guardian may be filed in any court of competent
jurisdiction by or on behalf of any person who meetsunder existing law is entitled to priority of
appointment. If there be no person so entitled or if the person so entitled shall neglect or refuse
to file such a summons and petition within thirty days after the mailing of notice by the Veterans’
Administration to the last known address of such person indicating the necessity of such filing, a
summons and petition for such appointment may be filed in any court of competent jurisdiction by
or on behalf of any responsible person residing in this State.
SECTION 62-5-605. Contents of petition for appointment of guardian.
The petition for such an appointment shall set forth (a) the name, age and place of residence of
the ward, (b) the names and places of residence of the nearest relatives, if known, (c) the fact that
such ward is entitled to receive monies payable by or through the Veterans’ Administration and
(d) the amount of monies then due and the amount of probable future payments.
The petition shall also set forth the name and address of the person or institution, if any, having
actual custody of the ward.
In the case of a mentally incompetent ward the petition shall show that such ward has been rated
incompetent on examination by the Veterans’ Administration in accordance with the laws and
regulations governing the Veterans’ Administration.
SECTION 62-5-606. Facts that constitute prima facie evidence of need for guardian of a minor
ward.
When a petition is filed for the appointment of a guardian of a minor ward a certificate of the
Administrator or his representative, setting forth the age of such minor as shown by the records of
the Veterans’ Administration and the fact that the appointment of a guardian is a condition
precedent to the payment of any monies due the minor by the Veterans’ Administration, shall be
prima facie evidence of the necessity for such an appointment.
SECTION 62-5-607. Facts that constitute prima facie evidence of need for guardian of a
mentally incompetent ward.
When a petition is filed for the appointment of a guardian of a mentally incompetent ward a
certificate of the Administrator or his representative, setting forth the fact that such person has
been rated incompetent by the Veterans’ Administration on examination in accordance with the
laws and regulations governing the Veterans’ Administration and that the appointment of a
guardian is a condition precedent to the payment of any monies due such person by the Veterans’
Administration, shall be prima facie evidence of the necessity for such appointment.
SECTION 62-5-608. Notice of summons and petition.
Upon the filing and service of summons and petition for the appointment of a guardian, under the
provisions of this part the court shall cause such notice to be given as is provided by law.
SECTION 62-5-609. Fitness of guardian; bond.
Before making an appointment under the provisions of this part [Sections 62-5-601 et seq.], the
court shall be satisfied that the guardian whose appointment is sought is a fit and proper person to
be appointed. Upon the appointment being made the guardian shall execute and file a bond to be
approved by the court in an amount not less than the sum then due and estimated to become
payable during the ensuing year. The bond shall be in the form and be conditioned as required of
guardians appointed under the general guardianship laws of this State. The court may, from time
to time, require the guardian to file an additional bond.
When a bond is tendered by a guardian with personal sureties, such sureties shall file with the
court a certificate under oath which shall describe the property owned by them both real and
personal, and that they are each worth the sum named in the bond as the penalty thereof over and
above all their debts and liabilities and exclusive of property exempt from execution.
SECTION 62-5-610. Limitation on number of wards of one guardian.
Except as hereinafter provided it shall be unlawful for any person to accept appointment as
guardian of any ward if such proposed guardian shall at that time be acting as guardian for five
wards. Upon presentation of a petition by an attorney of the Veterans’ Administration under this
section alleging that a guardian is acting in a fiduciary capacity for more than five wards and
requesting his discharge as a guardian of any such ward for that reason, the court, upon proof
substantiating the petition, shall require a final accounting forthwith from such guardian and shall
discharge such guardian in such case.
The limitations of this section shall not apply when the guardian is a bank or trust company acting
for the wards’ estates only. An individual may be guardian of more than five wards if they are all
members of the same family.
SECTION 62-5-611. Annual account of guardians receiving funds from Veterans’
Administration.
Every guardian who has received or shall receive on account of his ward any monies from the
Veterans’ Administration, its predecessors or successors, shall file with the court, annually, on the
anniversary date of the appointment, in addition to such other accounts as may be required by the
court, a full, true, and accurate account under oath of all monies so received by him and of all
disbursements thereof and showing the balance thereof in his hands at the date of such account
and how such balance is invested.
SECTION 62-5-612. Exhibit of securities at time of filing account.
Such guardian, at the time of filing his account, shall exhibit all securities or investments shown by
the account to have been acquired with funds so received and then on hand and described therein
to (a) an officer of the bank or other depository wherein such securities are held for safekeeping,
(b) an authorized representative of the corporation which is surety on his bond, (c) the clerk or
other officer of a court of record in this State or (d) upon the request of the guardian or other
interested party, to any other reputable person designated by the court. The person to whom such
assets are so exhibited shall certify in writing that he has examined such securities or investments
and identified them as those described in the account; provided, however, if such depository is
the guardian, such certifying officer shall be an officer other than the officer verifying the account.
Or, in lieu of exhibiting such securities to any of the persons mentioned above, the guardian may
exhibit such securities or investments to the court, who shall endorse on the account and copy
thereof a certificate that the securities or investments shown therein as on hand were each in fact
exhibited to him and that those exhibited to him were the same as those shown in the account.
Such certificate and the certificate of an official of the bank in which are deposited any funds for
which the guardian is accountable, showing the amount of the deposit, shall be filed by the
guardian with his account.
SECTION 62-5-613. Effect of failure to account.
If any guardian shall fail to file any account of the monies received by him from the Veterans’
Administration on account of his ward within thirty days after such account is required by either
the court or the Administration or shall fail to furnish the Veterans’ Administration a copy of his
accounts as required by this part [Sections 62-5-601 et seq.], such failure shall be grounds for
removal.
SECTION 62-5-614. Accountability for funds not received from Administration.
If the guardian is accountable for property derived from sources other than the Veterans’
Administration, he shall be accountable as is or may be required under the applicable law of this
State pertaining to the property of minors or persons of unsound mind who are not beneficiaries
of the Veterans’ Administration.
SECTION 62-5-615. Investments that guardians may make.
Every guardian shall invest the surplus funds in his ward’s estate in such securities, or otherwise,
as allowed by law, and in which the guardian shall have no interest, but only upon prior order of
the court. Such funds may be invested, without prior court authorization, in direct
interest-bearing obligations of this State or of the United States and in obligations the interest and
principal of which are both unconditionally guaranteed by the United States Government.
SECTION 62-5-616. Use of estate for support of persons other than ward.
A guardian shall not apply any portion of the estate of his ward for the support and maintenance
of any person other than his ward, except upon order of the court after a hearing, notice of which
has been given the proper office of the Veterans’ Administration in the manner provided in
Sections 62-5-622 and 62-5-623.
SECTION 62-5-617. Copies of public records shall be furnished without charge.
Whenever a copy of any public record is required by the Veterans’ Administration to be used in
determining the eligibility of any person to participate in benefits made available by the
Administration, the official charged with the custody of such public record shall without charge
provide the applicant for such benefits or any person acting on his behalf or the representative of
the Veterans’ Administration with a certified copy of such record.
SECTION 62-5-618. Compensation of guardians.
Compensation payable to guardians shall not exceed five per cent of the income of the ward
during any year. If extraordinary services are rendered by any such guardian the court may, upon
petition and after hearing thereon, authorize additional compensation therefor payable from the
estate of the ward. Notice of such petition and hearing shall be given the proper office of the
Veterans’ Administration in the manner provided in Sections 62-5-622 and 62-5-623. No
compensation shall be allowed on the corpus of an estate received from a preceding guardian.
The guardian may be allowed from the estate of his ward reasonable premiums paid by him to any
corporate surety upon his bond.
SECTION 62-5-619. Final discharge of guardian; paying out funds less than one thousand
dollars.
When a minor ward for whom a guardian has been appointed under the provisions of this chapter
or other laws of this State has attained his majority and, if incompetent, is declared competent by
the Veterans’ Administration and the court and when any incompetent ward, not a minor, is
declared competent by the Administration and the court, the guardian shall, upon making a
satisfactory accounting, be discharged upon a petition filed for that purpose.
If no further income is anticipated by the guardian and the funds held by the guardian do not
exceed one thousand dollars, the guardian may pay such funds to the ward if the ward is eighteen
years of age and is competent. If the ward is incompetent, the guardian may pay the sum to his
conservator if one has been previously appointed. If no conservator exists, then the guardian shall
pay to the father or mother of the ward, if living, or either, and if neither is living then to a duly
appointed conservator. When the final disbursement has been made and satisfactorily accounted
for, the guardian may then be discharged upon a petition filed for that purpose.
SECTION 62-5-620. Proceedings in which administrator shall be a party in interest.
The Administrator or his successor is and shall be a party in interest (a) in any proceeding brought
under any law of this State for the appointment, confirmation, recognition, or removal of any
guardian of a minor, or of a mentally incompetent person, to whom or on whose behalf benefits
have been paid or are payable by the Veterans’ Administration, its predecessor or successor, (b) in
any guardianship proceeding involving such person or his estate, (c) in any suit or other
proceeding arising out of the administration of such person’s estate or assets and (d) in any
proceeding the purpose of which is the removal of the disability requirements referenced in
42USC1396(d)(4).of minority or of mental incompetency of such person. In any case or
proceeding involving property or funds of such minor or mentally incompetent person not derived
from the Veterans’ Administration, the Veterans’ Administration shall not be a necessary party
but may be a proper party to such proceedings. This section shall not apply unless the Veterans’
Administration shall designate in writing filed with the Secretary of State, its chief attorney, acting
chief attorney or other agent within this State as a person authorized to accept service of process
or upon whom process may be served.
ARTICLE 5 SECTION 5AUGUST 2011, REVISIONS
PART 5
DURABLE POWER OF ATTORNEY
Section 62-5-501.
Section 62-5-502.
Section 62-5-503.
Section 62-5-504.
Section 62-5-505.
Section 62-5-506.
Section 62-5-507.
Section 62-5-508.
Section 62-5-509.
Section 62-5-510.
Section 62-5-511.
Section 62-5-512.
Section 62-5-513.
Section 62-5-514.
Section
Section 62-5-515.
Section 62-5-516.
Creation and Effectiveness of Durable Power of Attorney.
Effect of Creation of Durable Power of Attorney.
Activation of Durable Power of Attorney.
Creation of Durable Health Care Power of Attorney.
Definition of Physical Disability and Mental Incompetence.
Successors.
Agent’s Acceptance.
Agent’s Resignation and Principal’s Removal, Notice.
Agent’s Duties.
Authority that Requires Specific Grant; Grant of General Authority..
Incorporation of Authority .
Construction of Authority.
Construction of Authority Regarding Real Property Construction of
Authority Regarding Tangible Personal Property.
Authority Not Revoked Until Notice of Death or Disability.
Acceptance of and Reliance upon Power of Attorney, Exoneration from
Liability.
Agent’s Certification.
Agent’s Liability.
Reimbursement and Compensation of Agent.
Judicial Relief.
Jurisdiction.
Validity of Durable Power of Attorney. (prior draft Section 62-5-505)
Section 62-5-517.
Section 62-5-518.
Section 62-5-519.
Section 62-5-520.
Section 62-5-521.
Section 62-5-522.
Section 62-5-523.
Court Appointment of Fiduciary.
Section 62-5-522.
Health care power of attorney; definitions; form.
Section 62-5-501
(A)
Creation and Effectiveness of Durable Power of Attorney.
To create a durable power of attorney, a principal must
1.
2.
Designate another his as agent by a power of attorney in a written instrument, and
Provide in the instrument the principal’s intent that the authority conferred is
exercisable notwithstanding the physical disability or mental incompetence of the
principal, using the words “This power of attorney is not affected by physical disability
or mental incompetence of the principal which renders the principal incapable of
managing his own estate” or the words “This power of attorney becomes effective
upon the physical disability or mental incompetence of the principal”, or words of
similar intent, and
3.
Execute the instrument in accordance with Section 62-2-502 and Section 30-5-30,
and
4.
Record the instrument in the same manner as a deed in the county where the
principal resides at the time the instrument is recorded (executed) eexcept that
recording is not necessary if the authority of the agent relates solely to the person of
the principal or if the instrument is a Health Care Power of Attorney pursuant to 62-5524.
(B)
Notwithstanding the provisions of Section 30-5-30, a valid durable power of
attorney executed in another jurisdiction may be recorded as though it complies with Section 305-30.
(C)
After recordation, whether recorded before or after the onset of the principal's
physical disability or mental incompetence, an instrument that meets the requirements set forth in
(A) above is effective notwithstanding the physical disability or mental incompetence of the
principal. Furthermore, an instrument meeting the requirements set forth in (A) above must be
recorded in order to be effective during the principal's physical disability or mental incompetence.
Formatted: Font: Times New Roman, 12 pt
Section 62-5-502 Effect of Creation of Durable Power of Attorney.
(A)
The agent under a durable power of attorney has a fiduciary relationship with the principal
and is accountable and responsible as a fiduciary pursuant to the provisions of this part and of
South Carolina law.herein.
(B)
Except as set forth in this part??below, the authority of the agent to act on behalf of the
principal under a power of attorney must be set forth in the power and may relate to any act,
power, duty, right, or obligation which the principal has or may acquire relating to the principal or
any matter, transaction, or property, including the power to consent or withhold consent on behalf
of the principal to health care.
(C )
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.
(D)
All acts done by the agent pursuant to a durable power of attorney during a period of
physical disability or mental incompetence or uncertainty as to whether the principal is dead or
alive have the same effect and inure to the benefit of and bind the principal or his heirs, devisees,
legatees, and personal representative as if the principal were alive, mentally competent, and not
disabled physically.
(E)
Except as provided in the instrument or as otherwise provided by law, a photocopy or an
electronically transmitted copy of an original recorded durable power of attorney has the same
effect as the original.
Section 62-5-503. Activation of Durable Power of Attorney.
Formatted: Font: Times New Roman, 12 pt,
Bold, Underline
(A) A durable power of attorney is effective when executed unless the instrument provides that it
becomes effective at a future date or upon the occurrence of a future event or contingency.
Not Bold, No underline
(B) If a durable power of attorney becomes effective upon the occurrence of a future event or
contingency, the principal may authorize in the instrument itself one or more persons to determine
in writing that the event or contingency has occurred.
Section 62-5-504. Creation of Durable Health Care Power of Attorney.
(A)
A durable health care power of attorney that relates to health care may be created under
the provisions of Section 62-5-524 or may be created pursuant to other provisions of law.
(B)
If the durable power of attorney relates solely to health care then it is not required to be
recorded as set forth in Section 501 in order to be effective during the principal's physical
disability or mental incompetence.
(C ) A properly executed durable power of attorney that authorizes an agent to make health
care decisions regarding the principal is valid whether or not it was executed after May 14, 1990.
(D)
The validity of a durable power of attorney that authorizes an attorney to make health care
decisions regarding the principal properly executed pursuant to Section 62-5-501 of the 1976
Code before or after the effective date of this act is not affected by the amendments to Part 5,
Article 5, Title 62 of the 1976 Code contained in this act.
62-3-505. Definition of Physical Disability and Mental Incompetence
Bold, Underline
(A)
The instrument may define “physical disability” or “mental incompetence” and may set
forth the procedures for determining whether the principal is physically disabled or mentally
incompetent.
(B)
If a power of attorney becomes effective upon the principal's physical disability or mental
incompetence, the principal may authorize one or more persons to determine that that the
principal is incapacitated. A person authorized by the principal to make such a determination may
act as the principal’s Personal Representative as defined in and pursuant to the Health Insurance
Portability and Accountability Act, Section 1171 through 1179 of the Social Security Act, 42
U.S.C. 1320d, as amended, and applicable regulations, to obtain access ot the principal’s health
care information and may communicate with the principal’s health care providers.
(C)
If a power of attorney becomes effective upon the Principal's physical disability or mental
incompetence and the principal has not authorized a person to determine that the pPrincipal is
incapacitated, or the person authorized is unable or unwilling to make the determination, then the
power of attorney becomes effective upon a determination in a writing or other record that:
(1) The pPrincipal is incapacitated, pursuant to the definitions or procedures set
forth in the power of attorney for determining the pPrincipal's physical disability or mental
incompetence, as certified under penalty of perjury by a licensed physician who has personally
examined the pPrincipal; or
(2) If the power of attorney does not define physical disability or mental
incompetence, then a pPrincipal shall be deemed incapacitated when a licensed physician, who has
personally examined the pPrincipal, has certified under penalty of perjury that the pPrincipal has
the inability to receive and evaluate information or make or communicate decisions to such an
extent that a person, even with appropriate technological assistance, (A) is unable to provide for
his physical health, safety, or self-care, or (B) is unable to manage his property.
(D)
If no person authorized by the principal is able or willing to determine that the principal is
incapacitated, then a person having priority to make health care decisions for the principal
pursuant to S.C. Code Section 44-66-30, as amended, may act as the principal’s Personal
Representative as defined in and pursuant to the Health Insurance Portability and Accountability
Act, Section 1171 through 1179 of the Social Security Act, 42 U.S.C. 1320d, as amended, and
applicable regulations, to obtain access ot the principal’s health care information and may
communicate with the principal’s health care providers.
(E) No licensed physician who, in good faith, makes a determination as set forth above of the
principal’s physical disability or mental incompetence shall be subject to liability because of such
determination.
Section 62-5-5065. Successors.
Formatted: Keep lines together
An instrument to which this section is applicable also A power of attorney may provide for
successor attorneys in fact to any agent and provide conditions for their succession, which may
include an authorization for the court or the agent to appoint a successor, and the succession may
occur whether or not the principal then is physically disabled or mentally incompetent when the
succession occurs.
Section 62-5-5076. 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 any
other assertion or conduct indicating acceptance.
Section 62-5-5078. Agent’s Resignation and Principal’s Removal, 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 the principal and, if the principal is incapacitated within the
meaning of section 62-5-101, written notice must also be given as follows:mentally incompetent
(1) to the conservator or guardian, if one has been appointed for the principal, and a coagent or successor agent; or
(2) if there is no person described in paragraph (1), to:
(a) the principal’s caregiver;
(b) another person reasonably believed by the agent to have sufficient interest in
the principal’s welfare; or
(c) a governmental agency having authority to protect the welfare of the principal.
(B) Unless the power of attorney provides a different method for an agent’s removal by the
principal, the principal may remove an agent by giving written notice to the agent.
(C) If the power of attorney was recorded, the agent’s written notice of resignation and the
principal’s written notice of removal must be recorded in the same manner as a deed in the county
where the power of attorney was recorded. If the power of attorney was not recorded, the
agent’s written notice of resignation and the principal’s notice of removal may be recorded in the
same manner as a deed in the county where the principal resides at the time of resignation or
removal.
(D) Upon such resignation or removal and recording thereof, the attorney shall thereupon be
divested of all authority under the power of attorney.
(E) An agent’s authority terminates when:
(1) the principal revokes the authority,
(2) the principal dies, or
(3) unless the power of attorney otherwise provides, as to a spouse named as an agent,
when an action is filed for divorce, annulment, or for termination of all marital property rights or
for equitable distribution.
Section 62-5-5089. Agent’s Duties.
(A) Notwithstanding provisions in the power of attorney, an agent that has accepted appointment
is a fiduciary who shall:
(1) act in good faith; and
(2) act 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 in accordance with the principal’s reasonable expectations to the extent actually
known by the agent and, otherwise, in the principal’s best interest;
(2) act loyally for the principal’s benefit;
(3) 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;
(4) act with the care, competence, and diligence ordinarily exercised by agents in similar
circumstances;
(5) keep a record of all receipts, disbursements, and transactions made on behalf of the
principal and account to the principal or the principal’s designeeated agent upon demand of the
principal or the principal’s designatedee agent;
(6) 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, otherwise, act in the principal’s best interest; and
(7) 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, generationskipping transfer, and gift taxes; and
(d) eligibility for a benefit, a program, or assistance under a statute or regulation.
(C) An agent that acts in good faith is not liable to any beneficiary of the principal’s estate plan
for failure to preserve the principal’s estate plan.
(D) An agent that acts with care, competence, and diligence for the best interest of the principal
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 reasonable care, competence, and
diligence in selecting and monitoring the person.
Section 62-5-51009. Authority that Requires Specific Grant; Grant of General Authority.
(A) Notwithstanding anything contained in Section 62-5-5181, 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 written agreement or instrument to which the authority or
property is subject:
(1) make a gift;
(2) create or change rights of survivorship;
(3) create or change a beneficiary designation;
(4) delegate authority granted under the power of attorney;
(5) waive the principal’s right to be a beneficiary of a joint and survivor annuity, including
a survivor benefit under a retirement plan;
(6) exercise fiduciary powers that the principal has authority to delegate; or
(7) disclaim property, including a power of appointment; or
(8) access any safe deposit box rented by the principal.
(B) Notwithstanding a grant of authority to do an act described in subsection (A), unless the
power of attorney otherwise expressly provides, an agent that is not an ancestor, spouse, or
descendant of the principal, may not 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) Subject to subsections (A), (B), (C), 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, which
includes, but is not limited to, those acts described in Sections 62-5-5118 through 5-52114.
(D) Subject to subsections (A), (B), and (E), if the subjects over which authority is granted in a
power of attorney are similar or overlap, the broadest authority controls.
(E) 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.
(F) 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. (SAME AS 502D)
Section 62-5-5110. Incorporation of Authority.
(A) An agent has authority described in this article if the power of attorney refers to general
authority with respect to the descriptive term for the subjects stated in Sections 204 62-5-5128
through 52141 or cites the section in which the authority is described.
(B) A reference in a power of attorney to general authority with respect to the descriptive term
for a subject in Sections 204 62-5-5182 through 217 52114 or a citation to a section of Sections
204 62-5-5128 through 217 52114 incorporates the entire section as if it were set out in full in the
power of attorney.
(C) Notwithstanding the foregoing, a principal may expressly modify authority incorporated by
reference.
Section 62-5-5121. Construction of Authority.
Except as otherwise provided in the power of attorney, by executing a power of attorney
that incorporates by reference a subject described in Sections 62-5-52013 through 52141 or that
grants to an agent authority to do all acts that a principal could do pursuant to Section 62-5510(C)7(c), a principal 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 any 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 him 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;
(7) prepare, execute, and file a record, report, application, appeal, or other document to
safeguard or promote the principal’s interest under a statute or regulation;
(8) communicate with any 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;
(10) waive, release, or renounce any fiduciary position to which the principal has been
appointed.
(11) deposit money in and withdraw money from accounts in a regulated financial-service
institution in the name of the principal, including by automatic withdrawals and electronic debts
and other forms of electronic processing;
(12) borrow money, with or without security, and mortgage or pledge property for a
period within or extending beyond the life of the principal;
(123) 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;
(143) 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 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;
(15) pay or contest any claim, settle a claim by or against the principal, and release,
in whole or in part, a claim belonging to the principal;
(146) pay taxes, assessments, compensation of employees of the principal and of
employees and agents of the principal, and other expenses incurred in carrying out the powers
given to the agent;
(157) prepare or cause to be prepared and file tax returns for federal, state, and local
Formatted: Indent: Left: 0.49"
taxes;
(168) create, contribute to, and make withdrawals from any employee benefit or
retirement plan, annuity, or life insurance owned by the principal and exercise the principal’s
rights there under to roll over, borrow against, exchange, and transfer the account to a new
custodian;
(19) pledge property to guarantee loans made by others to the principal;
(2017) prosecute or defend an action, claim, or judicial proceeding in any jurisdiction for or
against the principal;
(1821) expend sums for the health, education, maintenance and support of the principal
and the principal’s dependents;
(1922) apply for government benefits for the principal;
(203) file a claim for an elective share or other statutory entitlement in any proceeding
involving the principal;
(214) enter into agreements for the admission, discharge, and care of the principal with
any assisted living, nursing home, hospital, rehabilitative, respite, in home, or other care providers,
including hiring and firing home health care and other providers of services to the principal;
(225) do any other lawful act with respect to the subject and all property related to the
subject.
These are what I recollect, please check the minutes
Section 62-5-5132. Construction of Authority Regarding Real Property.
Unless the power of attorney otherwise provides and subject to the provisions of 62-55107, 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.
Underline
Section 62-5-514. 3 Construction of Authority Regarding Tangible Personal Property.
Underline
Unless the power of attorney otherwise provides and subject to the provisions of 62-55107,, 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; and
change the form of title of an interest in tangible personal property.
Section §62-5-5154. Authority Not Revoked Until Notice of Death or Disability.
(A) The death, disability, or incompetence of any principal who has executed a power of
attorney in writing does not revoke or terminate the agency as to the attorney-in-fact, agent, or
other person who, without actual knowledge of the death, disability, or incompetence of the
principal, acts in good faith under the power of attorney or agency. Any action so taken, unless
otherwise invalid or unenforceable, binds the principal and his heirs, devisees, and personal
representatives.
(B) An affidavit, executed by the attorney-in-fact or agent stating that he did not have, at
the time of doing an act pursuant to the power of attorney, actual knowledge of the revocation or
termination of the power of attorney by death, disability, or incompetence, is, in the absence of
fraud, conclusive proof of the nonrevocation or nontermination of the power at that time. If the
exercise of the power requires execution and delivery of any instrument which is recordable, the
affidavit when authenticated for record is likewise recordable.
(C) This section shall not be construed to alter or affect any provision for revocation or
termination contained in the power of attorney.
Section 62-5-5165. Acceptance of and Reliance upon Power of Attorney, Exoneration from
Liability.
(A)(1) A third person who receives or is presented with a valid power of attorney, executed and
recorded as provided in 62-5-501herein, or a recorded copy thereof, and who has not received
actual written notice of its revocation or termination, must not refuse to honor the power of
attorney if it contains the following provision or a substantially similar provision:
“No person who may act in reliance upon the representations of my attorney-in-fact for the scope
of authority granted to the attorney-in-fact shall incur any liability as to me or to my estate as a
result of permitting the attorney-in-fact to exercise this authority, nor is any such person who
deals with my attorney-in-fact responsible to determine or ensure the proper application of funds
or property.”
As used in this subsection, “to honor” a power of attorney means to deal with the attorney-in-fact
as if the attorney-in-fact were the principal, personally present and acting on his own behalf within
the scope of the powers granted to the attorney-in-fact.
(2) Unless the third person actually has received written notice of the revocation or
termination of a valid power of attorney executed in accordance with this section, a third person
in this State who receives or is presented with a power of attorney:
(a) does not incur liability to the principal or the principal's estate by reason of acting upon
the authority of it or permitting the attorney-in-fact to exercise authority;
(b) is not required to inquire whether the attorney-in-fact has power to act or is properly
exercising the power; or
(c) is not responsible to determine or ensure the proper application of assets, funds, or
property belonging to the principal.
(3) A “third person” means an individual, a corporation, an organization, or other legal entity
for purposes of this subsection.
(B) A person that is asked to accept a power of attorney executed in compliance with Section
62-5-501this section, which does not contain the language set forth in subsection (A)(1) above
may request, and rely upon, without further investigation,:
(1) an agent’s certification under penalty of perjury of any factual matter concerning the
principal, agent, or power of attorney that is relevant to the validity of or the agent’s authority
under such power of attorney.
(2) an English translation of the power of attorney if the power of attorney contains, in
whole or in part, language other than English; and
(3) an opinion of counsel as to any matter of law concerning the power of attorney if the
person making the request provides in a writing or other record the reason for the request.
(C) An English translation or an opinion of counsel requested under this section must be
provided unless the request is made more than seven business days after the power of attorney is
presented for acceptance.
(D) For purposes of this section, 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.
Section 62-5-5176. Agent’s Certification.
The following optional form or a similar 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) if the power of attorney was drafted to become effective upon the happening of an
event or contingency, the event or contingency has occurred;
(3) if I was named as a successor agent, the prior agent is no longer able or willing to
serve; and
(4)
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
__________________
(Insert other relevant statements)
SIGNATURE AND ACKNOWLEDGMENT
____________________________________________
Agent’s Signature
____________________________________________
Agent’s Name Printed
____________________________________________
____________________________________________
Agent’s Address
____________________________________________
Agent’s Telephone Number
This document was acknowledged before me on __________________________,
(Date)
by______________________________________.
(Name of Agent)
____________________________________________
Signature of Notary
My commission expires: ________________________
(Seal)
Effect of 2011 Amendments.
The 2011 amendments adopt the form set forth in Section 302 of the Uniform Act as an
example of a form to be used to certify facts concerning a power of attorney.
Section 662-5-5187. Agent’s Liability.
In addition to other remedies provided by law and except as otherwise provided in the power of
attorney, an agent that violates the provisions of section 62-5-501 et seq. 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
reasonable attorney’s fees and costs paid by the principal or the principal’s
successors in interest or on the principal’s behalf. behalf on the agent’s
behalf.
Section 62-5-5198. Reimbursement and Compensation of Agent.
(A)
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. If two or more attorneys-in-fact are serving together, the compensation
paid must be divided by them in a manner as they agree or as determined by a court of competent
jurisdiction if they fail to agree.
(B)
An interested person as defined in section 62-5-50920 may petition a court of competent
jurisdiction to review the propriety and reasonableness of payment for reimbursement or
compensation to the attorney-in-fact, and an attorney-in-fact who has received excessive payment
may be ordered to make appropriate refunds to the principal.
Section 62-5-52019. Judicial Relief.
(A) The following persons may petition a court of competent jurisdiction to construe a power of
attorney, to review the agent’s conduct, and to 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 an intestate 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 under this section,
unless the court finds that the principal lacks capacity to revoke the agent’s authority or the
power of attorney.
Section§ 62-5-5210. Jurisdiction.
The probate court has concurrent jurisdiction with the circuit courts of this State over all subject
matter related to the creation, exercise, and termination of powers of attorney governed by the
provisions of this Part. including the approval of the sale of real and personal property by an
attorney in fact.
Section 62-5-5221. Court Appointment of Fiduciary.
The appointment of an agent under this section does not prevent a person or his representative
from applying to the court for the appointment of a guardian or conservator for the principal.
and having a guardian or conservator appointed. To the extent the court determines that the
appointment of a guardian or conservator is appropriate and 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 the 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.
Not Bold
Not Bold
Not Bold
Section 62-5-523. Validity of Durable Power of Attorney.
Bold, Underline
(A) A durable power of attorney executed in this state after the effective date of this section is
valid if executed in compliance 62-5-501.
(B) A durable power of attorney executed in this state before the effective date of this section is
valid if its execution complied with the laws of this state as they existed at the time of execution.
(C) A durable power of attorney executed other than in this state is valid in this state if, when the
power of attorney was executed, the execution complied with:
(1) the law of the jurisdiction that determines the meaning and effect of the power of
attorney pursuant to Section 62-5-502; or
(2) the 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 act, a photocopy or electronically
transmitted copy of an original recorded power of attorney has the same effect as the original
recorded power of attorney.
Copy former 62-5-505 in you last draft here.
Section § 62-5-5242. Health care power of attorney; definitions; form.
(A) As used in this section:
(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 section.
(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 which 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.
(B )(1) A health care power of attorney is a durable power of attorney pursuant to Section 62-5501. Sections 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 section.
(2) 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
Section 62-5-501 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.
(3) To the extent not inconsistent with this section, 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.
(4) 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 under Section 44-66-20(6), 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.
(5) To the extent that a WHERE IS THE REST OF THIS??
(C)(1) A health care power of attorney must:
(a) be substantially in the form set forth in subsection (D) of this section;
(b) 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;
(c) 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 an affidavit as set forth in
subsection (D) of this section 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 any 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 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;
(d) 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.
(2) 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.
(D) 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. A 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. ANY 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 OLD 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 shall 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 USC 1320d and 45 CFR 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 such 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 any hospital,
nursing care facility, or similar facility or service.
D. To take any other action necessary to making, documenting, and assuring implementation of
decisions concerning my health care, including, but not limited to, granting any waiver or
release from liability required by any 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.
However, if the terms of the Declaration of a Desire for a Natural Death conflict with the
Health Care Power of Attorney, the terms of the Declaration of a Desire for a Natural Death
shall control if it is signed at the same time as or after this Health Care Power of Attorney.
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 lifesustaining 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 INITIAL ANY OF THE STATEMENTS IN PARAGRAPH 8, YOUR AGENT WILL STILL
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 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: .......................................................................................................................................................................................
(E) A health care agent has, in addition to the powers set forth in the health care power of
attorney, the following specific powers:
(1) to 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) to 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) to hire and fire medical, social service, and other support personnel responsible for the
principal’s care;
(4) to 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.
(F)(1) 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.
(2) 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.
(G) 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.
(H) 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 petition the probate court
for an order determining the authority of the agent to give the directive.
(I) 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 Title 44, Chapter 77, 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. To the extent that the terms of a Declaration of a Desire for a Natural Death and a
health care power of attorney conflict, the terms of the later executed document shall control,
provided that the terms of a Declaration of a Desire for a Natural Death shall control if the two
documents are executed simultaneously.
However, nothing herein prevents the principal or a
person designated by the principal in the declaration from revoking the declaration as provided in
Section 44-77-80.
(J)(1) 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.
(2) 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.
(3) 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.
(K)(1) 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.
(2) 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.
(3) 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.
(L)(1) A health care power of attorney may be revoked in the following ways:
(a) 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
(b) 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 under Section 62-5501 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.
(2) 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.
(M) The execution and effectuation of a health care power of attorney does not constitute suicide
for any purpose.
(N) No person may 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.
(O) 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.
(P) 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.
(Q)(1) 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.
(2) Nothing in this section prohibits a person from informing another person of the
existence of this section, delivering to another person a copy of this section 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.
(3) 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.
(R) 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.
(S)(1) Notwithstanding the requirements of subsections (C) and (D) of this section, any
document or writing containing the following provisions is deemed to comply with the
requirements of this section:
(a) the name and address of the person who meets the requirements of subsection
(C)(1)(d) and is authorized to make health care related decisions if the principal becomes
mentally incompetent;
(b) the types of health care related decisions that the health care agent is authorized
to make;
(c) the signature of the principal;
(d) the signature of at least two persons who witnessed the principal’s signature
and who meet the requirements of subsection (C)(1)(c); and
(e) the attestation of a notary public.
(2) Additionally, any document that meets the requirements of subsection (S)(1) 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:
(a) organ donations;
(b) life-sustaining treatment;
(c) tube feeding;
(d) other kinds of medical treatment that the principal wishes to have or not to
have;
(e) comfort and treatment issues;
(f) provisions for interment or disposal of the body after death; and
(g) any written statements that the principal may wish to have communicated on
his behalf.
SECTION 62-5-621. Copies of accounts, certificates, or pleadings shall be sent to Veterans’
Administration.
A certified copy of each of the accounts filed pursuant to Section 62-5-611 and a signed duplicate
of each of the certificates filed with the court shall be sent by the guardian to the office of the
Veterans’ Administration having jurisdiction over the area in which such court is located. A
duplicate signed copy or certified copy of any petition, motion, or other pleading which is filed in
the guardianship proceeding or in any proceeding for the purpose of removing the disability of
minority or of mental incapacity shall be furnished by the person filing the same to the office of
the Veterans’ Administration concerned.
SECTION 62-5-622. Time, place, and notice of hearing on account, petition, or other pleading.
The court, unless hearing be waived in writing by an attorney of the Veterans’ Administration,
shall fix a time and place for the hearing on such account, petition, or other pleading not less than
fifteen days nor more than thirty days from the date of filing the same, unless a different available
date be stipulated in writing. Unless waived in writing, written notice of the time and place of
such hearing shall be given to the aforesaid Veterans’ Administration office not less than fifteen
days prior to the date fixed for the hearing. Such notice may be given by mail, in which event it
shall be deposited in the mails not less than fifteen days prior to such date.
SECTION 62-5-623. Notice of hearings shall be given to guardian; orders.
Notice of such hearing shall in like manner be given to the guardian and to any other person
entitled to notice. The court, or clerk thereof, shall mail to the Veterans’ Administration office a
copy of each order entered in any guardianship proceeding wherein the Veterans’ Administration
is an interested party.
SECTION 62-5-624. Construction.
This part shall be construed liberally to secure the beneficial intents and purposes thereof and shall
apply only to beneficiaries of the Veterans’ Administration. This part shall also be so interpreted
and construed as to effectuate its general purpose to make uniform the law of those states which
enact substantially identical legislation.
PART 7.
SOUTH CAROLINA ADULT GUARDIANSHIP AND PROTECTIVE PROCEEDINGS
JURISDICTION ACT
GENERAL PROVISIONS
SECTION 62-5-700. Short title.
This partact may be cited as the “South Carolina Adult Guardianship and Protective Proceedings
Jurisdiction Act.”.
The title to the Act succinctly describes the Act’s scope. The Act applies only to court jurisdiction
and related topics for adults for whom the appointment of a guardian or conservator or other
protective order is being sought or has been issued.
The drafting committee of the Uniform Law Commission elected to limit the Act to adults for two
reasons. First, jurisdictional issues concerning guardians for minors are subsumed by the Uniform
Child Custody Jurisdiction and Enforcement Act (1997). Second, while the UCCJEA does not
address conservatorship and other issues involving the property of minors, all of the problems and
concerns that led the Uniform Law Commission to appoint a drafting committee involved adults.
Part 7 is a slightly modified version of the Uniform Adult Guardianship and Protective
Proceedings Jurisdiction Act drafted by the Uniform Law Commission
SECTION 62-7--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.
All guardianship proceedings and protective proceedings for an adult incapacitated person must
comply with the provisions of Part 7.
SECTION 62-5-702. Definitions.
Definitions pertaining to
As used in this part may be found in 62-5-101., the term:
SECTION 62-5-703. International application of this part.
A court of this state may treat a foreign country as if it were a state for the purpose of applying
this part.
This section addresses application of the Act to guardianship and protective orders issued in other
countries. A foreign order is not enforceable pursuant to the registration procedures of Article 4,
but a court in this country may otherwise apply this Act to a foreign proceeding as if the foreign
country were an American state. Consequently, a court may conclude that the court in the foreign
country has jurisdiction because it constitutes the primary respondent’s “home state” or
“significant-connection state” and may therefore decline to exercise jurisdiction on the ground
that the court of the foreign country has a higher priority under Section 203. Or the court may
treat the foreign country as if it were a state of the United States for purposes of applying the
transfer provisions of Article 3.
This section addresses similar issues to but differs in result from Section 105 of the Uniform
Child Custody Jurisdiction and Enforcement Act (1997). Under the UCCJEA, the United States
court must honor a custody order issued by the court of a foreign country if the order was issued
under factual circumstances in substantial conformity with the jurisdictional standards of the
UCCJEA. Only if the child custody law violates fundamental principles of human rights is
enforcement excused. Because guardianship regimes vary so greatly around the world,
particularly in civil law countries, it was concluded that under this Act a more flexible approach
was needed. Under this Act, a court may but is not required to recognize the foreign order.
The fact that a guardianship or (1) “Adult” means an individual who has attained eighteen years
of age or who has been emancipated by a court of competent jurisdiction.
(2) “Conservator” means a person appointed by a court to manage an estate of a protected
person.
(3) “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.
(4) “Emergency” means circumstances that will likely result in substantial harm to a respondent’s
health, safety, or welfare or substantial economic loss or expense.
(5) “Guardian” means a person who has qualified as a guardian of an incapacitated person
pursuant to a court appointment, but excludes one who is a guardian ad litem or a statutory
guardian.
(6) “Guardianship order” means an order appointing a guardian.
(7) “Guardianship proceeding” means a judicial proceeding in which an order for the appointment
of a guardian is sought or has been issued.
(8) “Home state” means the state in which the respondent was physically present, including a
period of temporary absence, for at least six consecutive months immediately before the filing of a
petition for a protective order or the appointment of a guardian; or if none, the state in which the
respondent was physically present, including a period of temporary absence, for at least six
consecutive months ending within the six months prior to the filing of the petition.
(9) “Incapacitated person” means an adult for whom a guardian or conservator has been
appointed.
(10) “Party” means the respondent, petitioner, guardian, conservator, or other person allowed by
the court to participate in a guardianship or protective proceeding.
(11) “Person”, except in the term “incapacitated person” or “protected 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.
(12) “Protected person” means an adult for whom a protective order has been issued.
(13) “Protective order” means an order appointing a conservator or a court order relating to the
management of property of an incapacitated person.
(14) “Protective proceeding” means a judicial proceeding in which a protective order of a foreign
country cannot be enforcedis sought or has been issued.
(15) “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.
(16) “Respondent” means an adult for whom a protective order or the appointment of a guardian
is sought.
(17) “Significant-connection state” means a state, other than the home state, with which a
respondent has a significant connection other than mere physical presence and in which substantial
evidence concerning the respondent is available. In determining pursuant to theSections 62-5-707
and 62-5-714(E) whether a respondent has a significant connection with a particular state, the
court shall consider the:
(a) location of the respondent’s family and other persons required to be notified of the
guardianship or protective proceeding;
(b) length of time the respondent at any time was physically present in the state and the duration
of any absence;
(c) location of the respondent’s property; and
(d) extent to which the respondent has ties to the state such as voting registration, state or local
tax return filing, vehicle registration procedures of Article 4 does not preclude enforcement by the
court under some other provision or rule of law., driver’s license, social relationship, and receipt
of services.
(18) “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 a territory or insular possession
subject to the jurisdiction of the United States.
(19) “Ward” means a person for whom a guardian has been appointed.
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.
SECTION 62-5-704. Communication between courts.Court communication with court in
another state; record required; exceptions; participation of parties.
(A) The court of this state may communicate with a court in another state concerning a
proceeding arising underpursuant to this partarticle. 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 (2B), 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 (2B),
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. The A court may allow the parties to a
proceeding to participate in any communications held pursuant to this subsection.
This section emphasizes the importance of communications among courts with an interest in a
particular matter. Most commonly, this would include communication between courts of different
states to resolve an issue of which court has jurisdiction to proceed under Article 2. It would also
include communication between courts of different states to facilitate the transfer of a
guardianship or conservatorship to a different state under Article 3. Communication can occur in
a variety of ways, including by electronic means. This section does not prescribe the use of any
particular means of communication.
The court may authorize the parties to participate in the communication; but, unless there is to be
a discussion on the merits, the Act does not mandate participation or require that the court give
the parties notice of any communication. Communication between courts is often difficult to
schedule and participation by the parties may be impractical. Phone calls or electronic
communications often have to be made after-hours or whenever the schedules of judges allow.
When issuing a jurisdictional or transfer order, the court should set forth the extent to which a
communication with another court may have been a factor in the decision.
South Carolina amended the Uniform Act to provide that the parties to a proceeding must be
given an opportunity to participate in any discussion between courts on the merits of a
proceeding.
This section does not prescribe the extent of the record that the court must make, leaving that
issue to the court. A record might include notes or transcripts of a court reporter who listened to
a conference call between the courts, an electronic recording of a telephone call, a memorandum
summarizing a conversation, and email communications. No record need be made of relatively
inconsequential matters such as scheduling, calendars, and court records.
Section 110 of the Uniform Child Custody Jurisdiction and Enforcement Act (1997) addresses
similar issues as this section but is more detailed. As is the case with several other provisions of
this Act, the drafters of this Act concluded that the more varied circumstances of adult
guardianship and protective proceedings suggested a need for greater flexibility
SECTION 62-5-705. Cooperation between Courts. Requests to court of another state; requests
from court of another state.
(A) In a guardianship or protective proceeding in this State, athe court of this state 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 or give evidence or give testimony pursuant to
procedures of that state;
(3) order that an evaluation or assessment be made of the primary respondent, or;
(4) order anyan appropriate investigation of a person involved in a proceeding;
(5) forward to the court of this state a certified copy of the transcript or other record of a hearing
under paragraph (Apursuant to item (1) or any otheranother proceeding, any evidence otherwise
presented under paragraph (Bproduced pursuant to item (2), and anyan evaluation or assessment
prepared in compliance with the request under paragraph (Can order pursuant to item (3) or (4);
(6) issue any otheran 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 primary
respondent or the incapacitated 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 (1), aA), the court of this state has
jurisdiction for the limited purpose of granting the request or making reasonable efforts to comply
with the request.
Subsection (1) of this section is similar to Section 112(a) of the Uniform Child Custody
Jurisdiction and Enforcement Act (1997), although modified to address issues of concern in adult
guardianship and protective proceedings and with the addition of subsection (1)(F), which
addresses the release of health information protected under HIPAA. Subsection (2), which
clarifies that a court has jurisdiction to respond to requests for assistance from courts in other
states even though it might otherwise not have jurisdiction over the proceeding, is not found in
although probably implicit in the UCCJEA.
Court cooperation is essential to the success of this Act. This section is designed to facilitate such
court cooperation. It provides mechanisms for courts to cooperate with each other in order to
decide cases in an efficient manner without causing undue expense to the parties. Courts may
request assistance from courts of other states and may assist courts of other states.
This section does not address assessment of costs and expenses, leaving that issue to local law.
Should a court have acquired jurisdiction because of a party’s unjustifiable conduct, Section
711(2) authorizes the court to assess against the party all costs and expenses, including attorney’s
fees.
SECTION 62-5-706. Taking testimonyTestimony of witness located in another state.; permitted
means of giving testimony; lack of original writing.
(A) In a guardianship or protective proceeding, in addition to other procedures that may be
available, testimony of witnessesa witness who areis 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.
A The court of this state shall cooperate with courtsthe court of the other statesstate 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 do not produce an original writing may not be excluded from evidence on an objection
based on the means of transmission.
This section is similar to Section 111 of the Uniform Child Custody Jurisdiction and Enforcement
Act (1997). That section was in turn derived from Section 316 of the Uniform Interstate Family
Support Act (1992) and the much earlier and now otherwise obsolete Uniform Interstate and
International Procedure Act (1962).
This section is designed to fill the vacuum that often exists in cases involving an adult with
interstate contacts when much of the essential information about the individual is located in
another state.
Subsection (1) empowers the court to initiate the gathering of out-of-state evidence, including
depositions, written interrogatories and other discovery devices. The authority granted to the
court in no way precludes the gathering of out-of-state evidence by a party, including the taking
of depositions out-of-state.
Subsections (2) and (3) clarify that modern modes of communication are permissible for the
taking of depositions and receipt of documents into evidence.
This section is consistent with and complementary to the Uniform Interstate Depositions and
Discovery Act (2007), which specifies the procedure for taking depositions in other states.
SECTION 62-5-707. Initial Jurisdiction. of court.
The court has jurisdiction to appoint a guardian or issue a protective order for a primary
respondent if:
(1) this State is the primary respondent’s home state;
(2) on the date the petition is filed, this State is a significant--connection state; and :
(a) the primary respondent does not have a home state or a court of the primary respondent’s
home state has declined to exercise jurisdiction because this State is a more appropriate forum; or
(b) the primary respondent 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:
(i) a petition for an appointment or order is not filed in the primary respondent’s home state;
(ii) an objection to the court’s jurisdiction is not filed by a person required to be notified of the
proceeding; and
(iii) the court concludes that it is an appropriate forum pursuant to the factors
provided in Section 62--5--710(C);
(3);
) this State does not have jurisdiction pursuant to either item (1) or (2), the primary respondent’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
(4) the requirements for special jurisdiction pursuant to Section 62--5--708 are met.
Similar to the Uniform Child Jurisdiction and Enforcement Act (1997), this Act creates a threelevel priority for determining which state has jurisdiction to appoint a guardian or issue a
protective order; the home state (62-5-101(8)),followed by a significant-connection state (62-5101(18)), followed by other jurisdictions. The principal objective of this section is to eliminate the
possibility of dual appointments or orders except for the special circumstances specified in Section
708.
While this section is the principal provision for determining whether a particular court has
jurisdiction to appoint a guardian or issue a protective order, it is not the only provision. As
indicated in the cross-reference in Section 707(4), a court that does not otherwise have
jurisdiction under Section 707 may have jurisdiction under the special circumstances specified in
Section 708.
Pursuant to Section 707(1), the home state has primary jurisdiction to appoint a guardian or
conservator or issue another type of protective order. This jurisdiction terminates if the state
ceases to be the home state, if a court of the home state declines to exercise jurisdiction under
Section 710 on the basis that another state is a more appropriate forum, or, as provided in Section
709, a court of another state has appointed a guardian or issued a protective order consistent with
this Act. The standards by which a home state that has enacted the Act may decline jurisdiction on
the basis that another state is a more appropriate forum are specified in Section 710. Should the
home state not have enacted the Act, Section 707(1) does not require that the declination meet
the standards of Section 710.
Once a petition is filed in a court of the primary respondent’s home state, that state does not cease
to be the primary respondent’s home state upon the passage of time even though it may be many
months before an appointment is made or order issued and during that period the primary
respondent is physically located. Only upon dismissal of the petition can the court cease to be the
home state due to the passage of time. Under the definition of “home state,” the six-month
physical presence requirement is fulfilled or not on the date the petition is filed.
A significant-connection state has jurisdiction under two possible bases; Section 707(2)(A) and
Section 707(2)(B). Under Section 707(2)(A), a significant-connection state has jurisdiction if the
individual does not have a home state or if the home state has declined jurisdiction on the basis
that the significant-connection state is a more appropriate forum.
Section 707(2)(B) is designed to facilitate consideration of cases where jurisdiction is not in
dispute. Section 707(2)(B) allows a court in a significant-connection state to exercise jurisdiction
even though the primary respondent has a home state and the home state has not declined
jurisdiction. The significant-connection state may assume jurisdiction under these circumstances,
however, only in situations where the parties are not in disagreement concerning which court
should hear the case. Jurisdiction may not be exercised by a significant-connection state under
Section 707(2)(B) if (1) a petition has already been filed and is still pending in the home state or
other significant-connection state; or (2) prior to making the appointment or issuing the order, a
petition is filed in the primary respondent’s home state or an objection to the court’s jurisdiction is
filed by a person required to be notified of the proceeding. Additionally, the court in the
significant-connection state must conclude that it is an appropriate forum applying the factors
listed in Section 710.
There is nothing comparable to Section 707(2)(B) in the Uniform Child Custody Jurisdiction and
Enforcement Act (1997). Under Section 201 of the UCCJEA a court in a significant-connection
state acquires jurisdiction only if the child does not have a home state or the court of that state has
declined jurisdiction. The drafters of this Act concluded that cases involving adults differed
sufficiently from child custody matters that a different rule is appropriate for adult proceedings in
situations where jurisdiction is uncontested.
Pursuant to Section 707(3), a court in a state that is neither the home state nor a significantconnection state has jurisdiction if the home state and all significant-connection states have
declined jurisdiction or the primary respondent does not have a home state or significantconnection state. The state must have some connection with the proceeding, however. As Section
707(3) clarifies, jurisdiction in the state must be consistent with the state and United States
constitutions.
SECTION 62-5-708. Special jurisdiction.
(A) The court of this state lacking jurisdiction underpursuant to Section 62-5-707(1)-() through
(3) 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 six
monthsninety days for a primary respondent who is physically locatedpresent 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 or protected person for whom a
provisional order to transfer the proceeding from another state has been issued as provided
inpursuant to procedures similar to Section 62-5-715.714.
(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 primary respondent’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.
This section lists the special circumstances where a court without jurisdiction under the general
rule of Section 707 has jurisdiction for limited purposes. The three purposes are (1) the
appointment of a guardian in an emergency for a term not exceeding six months for a primary
respondent who is physically located in the state (subsection (1)(A)); (2) the issuance of a
protective order for a primary respondent who owns an interest in real or tangible personal
property located in the state (subsection (1)(B)); and (3) the grant of jurisdiction to consider a
petition requesting the transfer of a guardianship or conservatorship proceeding from another
state (subsection (1)(C)). If the court has jurisdiction under Section 707, reference to Section 708
is unnecessary. The general jurisdiction granted under Section 707 includes within it all of the
special circumstances specified in this section.
When an emergency arises, action must often be taken on the spot in the place where the primary
respondent happens to be physically located at the time. This place may not necessarily be located
in the primary respondent’s home state or even a significant-connection state. Subsection (1)(A)
assures that the court where the primary respondent happens to be physically located at the time
has jurisdiction to appoint a guardian in an emergency but only for a limited period of six months.
As provided in subsection (2), the emergency jurisdiction is also subject to the authority of the
court in the primary respondent’s home state to request that the emergency proceeding be
dismissed. The theory here is that the emergency appointment in the temporary location should
not be converted into a de facto permanent appointment through repeated temporary
appointments.
Subsection (1)(B) grants a court jurisdiction to issue a protective order with respect to real and
tangible personal property located in the state even though the court does not otherwise have
jurisdiction. Such orders are most commonly issued when a conservator has been appointed but
the protected person owns real property located in another state. The drafters specifically rejected
using a general reference to any property located in the state because of the tendency of some
courts to issue protective orders with respect to intangible personal property such as a bank
account where the technical situs of the asset may have little relationship to the protected person.
Subsection (1)(C) is closely related to and is necessary for the effectiveness of Section 62-5-714,
which addresses transfer of a guardianship or conservatorship to another state. A “Catch-22”
arises frequently in such cases. The court in the transferring state will not allow the incapacitated
or protected person to move and will not terminate the case until the court in the transferee state
has accepted the matter. But the court in the transferee state will not accept the case until the
incapacitated or protected person has physically moved and presumably become a resident of the
transferee state. Subsection (1)(C), which grants the court in the transferee state limited
jurisdiction to consider a petition requesting transfer of a proceeding form another state, is
intended to unlock the stalemate.
Not included in this section but a provision also conferring special jurisdiction on the court is
Section 105(2), which grants the court jurisdiction to respond to a request for assistance from a
court of another state.
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 partarticle has exclusive and continuing jurisdiction over
the proceeding until it is terminated by the court or the appointment or order expires by its own
terms.
While this Act relies heavily on the Uniform Child Jurisdiction and Enforcement Act (1997) for
many basic concepts, the identity is not absolute. Section 202 of the UCCJEA specifies a variety
of circumstances whereby a court can lose jurisdiction based on loss of physical presence by the
child and others, loss of a significant connection, or unavailability of substantial evidence. Section
203 of the UCCJEA addresses the jurisdiction of the court to modify a custody determination
made in another state. Nothing comparable to either UCCJEA section is found in this Act. Under
this Act, a guardianship or protective order may be modified only upon request to the court that
made the appointment or issued the order, which retains exclusive and continuing jurisdiction over
the proceeding. Unlike child custody matters, guardianships and protective proceedings are
ordinarily subject to continuing court supervision. Allowing the court’s jurisdiction to terminate
other than by its own order would open the possibility of competing guardianship or
conservatorship appointments in different states for the same person at the same time, the problem
under current law that enactment of this Act is designed to avoid. Should the incapacitated or
protected person and others with an interest in the proceeding relocate to a different state, the
appropriate remedy is to seek transfer of the proceeding to the other state as provided in Section
62-5-714.
The exclusive and continuing jurisdiction conferred by this section only applies to guardianship
orders made and protective orders issued under Section 707. Orders made under the special
jurisdiction conferred by Section 708 are not exclusive. And as provided in Section 708(B), the
jurisdiction of a court in a state other than the home state to appoint a guardian in an emergency is
subject to the right of a court in the home state to request that the proceeding be dismissed and
any appointment terminated.
Section 62-5-714 authorizes a guardian or conservator to petition to transfer the proceeding to
another state. Upon the conclusion of the transfer, the court in the accepting state will appoint the
guardian or conservator as guardian or conservator in the accepting state and the court in the
transferring estate will terminate the local proceeding, whereupon the jurisdiction of the
transferring court terminates and the court in the accepting state acquires exclusive and continuing
jurisdiction as provided in Section 709.
SECTION 62-5-710. Declining jurisdiction; more appropriate forum; dismissal or stay of
proceeding.
(A) The court of this state having jurisdiction underpursuant 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.
(1)
(B) If athe court of this state declines to exercise its jurisdiction over a guardianship or
protective proceeding underpursuant to subsection (1A), it shall either dismiss the proceeding or
stay the proceeding. The court may impose any other condition the court considers just and
proper, including the condition that a petition for the appointment of a guardian or protective
order be promptly filed in another state.
(2)
In determining whether it is an appropriate forum, the court shall consider:
(A)
any expressed preference of the primary respondent;
(B)
whether abuse, neglect, or exploitation of the primary respondent has occurred or
is likely to occur and which state could best protect the primary respondent from
the abuse, neglect, or exploitation;
(C)
the length of time the primary respondent was physically present in or was a legal
resident of this or another state;
(D)
the distance of the primary respondent from the court in each state;
(E)
the financial circumstances of the primary respondent’s estate;
(F)
the nature and location of the evidence;
(G)
the ability of the court in each state to decide the issue expeditiously and the
procedures necessary to present evidence;
(H)
the familiarity of the court of each state with the facts and issues in the proceeding;
and
(I)
(J)
if an appointment were made, the court’s ability to monitor the conduct of the
guardian or conservator; and
such other information as the court deems relevant in evaluating the
appropriateness of the forum.
This section authorizes a court otherwise having jurisdiction to decline jurisdiction on the basis
that a court in another state is in a better position to make a guardianship or protective order
determination. The effect of a declination of jurisdiction under this section is to rearrange the
priorities specified in Section 707. A court of the home state may decline in favor of a court of a
significant-connection or other state and a court in a significant-connection state may decline in
favor of a court in another significant-connection or other state. The court declining jurisdiction
may either dismiss or stay the proceeding. The court may also 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.
This section is similar to Section 207 of the Uniform Child Custody Jurisdiction and Enforcement
Act (1997) except that the factors in Section 710(3) of this Act have been adapted to address
issues most commonly encountered in adult guardianship and protective proceedings as opposed
to child custody determinations.
Under Section 707(2)(B), the factors specified in subsection (3) of this section are to be employed
in determining whether a court of a significant-connection state may assume jurisdiction when a
petition has not been filed in the primary respondent’s home state or in another significantconnection state. Under Section 711(1)(C)(2), the court is to consider these factors in deciding
whether it will retain jurisdiction when unjustifiable conduct has occurred.
(C) In determining whether it is an appropriate forum, the court shall consider all relevant factors,
including:
(1) the expressed preference of the respondent;
(2) whether abuse, neglect, or exploitation of the respondent has occurred or is likely to occur
and which state could best protect the respondent from the abuse, neglect, or exploitation;
(3) the length of time the respondent was physically present in or was a legal resident of this or
another state;
(4) the distance of the respondent from the court in each state;
(5) the financial circumstances of the respondent’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.
SECTION 62-5-711. Jurisdiction declined by reason of acquired due to unjustifiable conduct. ;
assessment of reasonable expenses against responsible party.
(A) If at any time athe court of this state 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 primary respondent or the protection of the primary
respondent’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:
(i) a) the extent to which the primary respondent and all persons required to be notified of the
proceedings have acquiesced in the exercise of the court’s jurisdiction;
(ii) b) whether it is a more appropriate forum than the court of any other state underpursuant to
the factors set forthprovided in Section 62-5-710(3);C); and
(iii) c) whether the court of any other state would have jurisdiction under factual circumstances in
substantial conformity with the jurisdictional standards of Section 62-5-707.708.
(B) If athe court of this state 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 part.article.
This section is similar to the Section 208 of the Uniform Child Custody Jurisdiction and
Enforcement Act (1997). Like the UCCJEA, this Act does not attempt to define “unjustifiable
conduct,” concluding that this issue is best left to the courts. However, a common example could
include the unauthorized removal of an adult to another state, with that state acquiring emergency
jurisdiction under Section 708 immediately upon the move and home state jurisdiction under
Section 707 six months following the move if a petition for a guardianship or protective order is
not filed during the interim in the soon-to-be former home state. Although child custody cases
frequently raise different issues than do adult guardianship matters, the element of unauthorized
removal is encountered in both types of proceedings. For the caselaw on unjustifiable conduct
under the predecessor Uniform Child Custody Jurisdiction Act (1968), see David Carl Minneman,
Parties’ Misconduct as Grounds for Declining Jurisdiction Under §8 of the Uniform Child
Custody Jurisdiction Act (UCCJA), 16 A.L.R. 5th 650 (1993).
Subsection (1) gives the court authority to fashion an appropriate remedy when it has acquired
jurisdiction because of unjustifiable conduct. The court may decline to exercise jurisdiction;
exercise jurisdiction for the limited purpose of fashioning an appropriate remedy to ensure the
health, safety, and welfare of the primary respondent or the protection of the primary
respondent’s property or prevent a repetition of the unjustifiable conduct; or continue to exercise
jurisdiction after considering several specified factors. Under subsection (1), the unjustifiable
conduct need not have been committed by a party.
Subsection (2) authorizes a court to assess costs and expenses, including attorney’s fees, against a
party whose unjustifiable conduct caused the court to acquire jurisdiction. Subsection (2) applies
only if the unjustifiable conduct was committed by a party and allows for costs and expenses to be
assessed only against that party. Similar to Section 208 of the UCCJEA, the court may not assess
fees, costs, or expenses of any kind against this state or a governmental subdivision, agency, or
instrumentality of the state unless authorized by other law.
SECTION 62-5-712. Notice of proceedingrequirements to respondent’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 primary respondent’s home state on the date a petition for the
appointment of a guardian or protective order was filed, or within six months before the date the
petition was filed, in addition to complying with the notice requirements of this State, notice of
the proceedingpetition must be given by the petitioner to those persons who would be entitled to
notice of the petition if thea proceeding were brought in the primary respondent’s home state, if
any.. The notice must be given in the same manner as notice is required to be given in this State.
While this Act tries not to interfere with a state’s underlying substantive law on guardianship and
protective proceedings, the issue of notice is fundamental. Under this section, when a proceeding
is brought other than in the primary respondent’s home state, the petitioner must give notice in
the method provided under local law not only to those entitled to notice under local law but also
to the persons required to be notified were the proceeding brought in the primary respondent’s
home state. Frequently, the respective lists of persons to be notified will be the same. But where
the lists are different, notice under this section will assure that someone with a right to assert that
the home state has a primary right to jurisdiction will have the opportunity to make that assertion
SECTION 62-5-713. ProceedingsRules for dealing with conflicting petitions in more than
onethis 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 as provided in pursuant to Section
62-5-708(A)(1)(A) or (B2), if a summons and petition for the appointment of a guardian or
issuance of a protective order is filed and served in this State and in another state and neither
petition has been dismissed or withdrawn, the following rules apply:
(1) if the court in this state has jurisdiction underpursuant 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.
(2) if the court in this state does not have jurisdiction underpursuant 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 does not determinehas 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, the court in this state shall dismiss the petition..
Similar to Section 206 of the Uniform Child Custody Jurisdiction and Enforcement Act (1997),
this section addresses the issue of which court has the right to proceed when proceedings for the
same primary respondent are brought in more than one state. The provisions of this section,
however, have been tailored to the needs of adult guardianship and protective proceedings and the
particular jurisdictional provisions of this Act. Emergency guardianship appointments and
protective proceedings with respect to property in other states (Sections 708(1)(A) and (1)(B))
are excluded from this section because the need for dual appointments is frequent in these cases;
for example, a petition will be brought in the primary respondent’s home state but emergency
action will be necessary in the place where the primary respondent is temporarily located, or a
petition for the appointment of a conservator will be brought in the primary respondent’s home
state but real estate located in some other state needs to be brought under management.
Under the Act only one court in which a petition is pending will have jurisdiction under Section
707. If a petition is brought in the primary respondent’s home state, that court has jurisdiction
over that of any significant-connection or other state. If the petition is first brought in a
significant-connection state, that jurisdiction will be lost if a petition is later brought in the home
state prior to an appointment or issuance of an order in the significant-connection state.
Jurisdiction will also be lost in the significant-connection state if the primary respondent has a
home state and an objection is filed in the significant-connection state that jurisdiction is properly
in the home state. If petitions are brought in two significant-connection states, the first state has a
right to proceed over that of the second state, and if a petition is brought in any other state, any
claim to jurisdiction of that state is subordinate to that of the home state and all significantconnection states.
Under this section, if the court has jurisdiction under Section 707, it has the right to proceed
unless a court of another state acquires jurisdiction prior to the first court making an appointment
or issuing a protective order. If the court does not have jurisdiction under Section 707, it must
defer to the court with jurisdiction unless that court determines that the court in this state is the
more appropriate forum and it thereby acquires jurisdiction. While the rules are straightforward,
factual issues can arise as to which state is the home state or significant-connection state.
Consequently, while under Section 707 there will almost always be a court having jurisdiction to
proceed, reliance on the communication, court cooperation, and evidence gathering provisions of
Sections 704-706 will sometimes be necessary to determine which court that might be.
TRANSFER OF GUARDIANSHIP OR CONSERVATORSHIP
Following are two separate sections 62-5-714 and 62-5-715, but they are part of one integrated
procedure. Section 62-5-714 authorizes a guardian or conservator to petition the court to transfer
the guardianship or conservatorship proceeding to a court of another state. Such a transfer is
often appropriate when the incapacitated or protected person has moved or has been placed in a
facility in another state, making it impossible for the original court to adequately monitor the
proceeding. Section 62-5-714 authorizes a transfer of a guardianship, a conservatorship, or both.
There is no requirement that both categories of proceeding be administered in the same state.
Section 62-5-714 addresses procedures in the transferring state. Section 62-5-715 addresses
procedures in the accepting state.
A transfer begins with the filing of a petition by the guardian or conservator as provided in
Section 714(1). Notice of this petition must be given to the persons who would be entitled to
notice were the petition a petition for an original appointment. Section 714(2). A hearing on the
petition is required if requested or on the court’s own motion, unless all necessary parties have
consented . Assuming the court in the transferring state is satisfied that the grounds for transfer
stated in Section 714(4) (guardianship) or 714(5) (conservatorship) have been met, one of which
is that the court is satisfied that the court in the other state will accept the case, the court must
issue a provisional order approving the transfer. The transferring court will not issue a final order
dismissing the case until, as provided in Section 714(6), it receives a copy of the provisional order
from the accepting court accepting the transferred proceeding.
Following issuance of the provisional order by the transferring court, a petition must be filed in
the accepting court as provided in Section 715(1). Notice of that petition must be given to those
who would be entitled to notice of an original petition for appointment in both the transferring
state and in the accepting state. Section 715(2). A hearing must be held if requested or on the
court’s own motion, unless all necessary parties have consented. Section 715(3). The court must
issue a provisional order accepting the case unless it is established that the transfer would be
contrary to the incapacitated or protected person’s interests or the guardian or conservator is
ineligible for appointment in the accepting state. Section 715(4). The term “interests” as opposed
to “best interests” was chosen because of the strong autonomy values in modern guardianship
law. Should the court decline the transfer petition, it may consider a separately brought petition
for the appointment of a guardian or issuance of a protective order only if the court has a basis for
jurisdiction under Sections 707 or 708 other than by reason of the provisional order of transfer.
Section 715(8).
The final steps are largely ministerial. Pursuant to Section 714(6), the provisional order from the
accepting court must be filed in the transferring court. The transferring court will then issue a final
order terminating the proceeding, subject to local requirements such as filing of a final report or
account and the release of any bond. Pursuant to Section 715(5), the final order terminating the
proceeding in the transferring court must then be filed in the accepting court, which will then
convert its provisional order accepting the case into a final order appointing the petitioning
guardian or conservator as guardian or conservator in the accepting state.
Because guardianship and conservatorship law and practice will likely differ between the two
states, the court in the accepting state must within 90 days after issuance of a final order
determine whether the guardianship or conservatorship needs to be modified to conform to the
law of the accepting state. Section 715(6). The drafters specifically did not try to design the
procedures in Article 3 for the difficult problems that can arise in connection with a transfer when
the guardian or conservator is ineligible to act in the second state, a circumstance that can occur
when a financial institution is acting as conservator or a government agency is acting as guardian.
Rather, the procedures in Sections 714 and 715 are designed for the typical case where the
guardian or conservator is legally eligible to act in the second state. Should that particular
guardian or conservator not be the best person to act in the accepting state, a change of guardian
or conservator can be initiated once the transfer has been secured.
The transfer procedure in this article responds to numerous problems that have arisen in
connection with attempted transfers under the existing law of most states. Sometimes a court will
dismiss a case on the assumption a proceeding will be brought in another state, but such
proceeding is never filed. Sometimes a court will refuse to dismiss a case until the court in the
other state accepts the matter, but the court in the other state refuses to consider the petition until
the already existing guardianship or conservatorship has been terminated. Oftentimes the court
will conclude that it is without jurisdiction to make an appointment until the primary respondent is
physically present in the state, a problem which Section 708(1)(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) addresses by granting a court special jurisdiction to consider a petition to accept a proceeding
from another state. But the most serious problem is the need to prove the case in the second state
from scratch, including proving the primary respondent’s incapacity and the choice of guardian or
conservator. Sections 714 and 715 eliminate this problem. Section 715(7) requires that the court
accepting the case recognize a guardianship or conservatorship order from the other state,
including the determination of the incapacitated or protected person’s incapacity and the
appointment of the guardian or conservator, if otherwise eligible to act in the accepting state.
SECTION 62-5-714. Transfer of guardianship or conservatorship to another state.
(1)
Following the appointment of a guardian or conservator, the guardian or conservator may
petition the court to transfer the guardianship or conservatorship to another state.
(2)
Notice of the petition to pursuant to subsection (1) must be given by the petitioner to
those persons that would be entitled to notice of a petition in this state for the appointment of a
guardian or conservator.
On the court’s own motion or on request of the guardian or conservator, the incapacitated 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 (1);A), except that no hearing shall 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 a provisionalan 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 incapacitated person is physically locatedpresent 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 incapacitated person;
and
the court is satisfied that(3) plans for care and services for the incapacitated person in the other
state are reasonable and sufficient; and.
(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 locatedpresent 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 set forthprovided in Section 62-5-101(18);707(2)(b);
(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
the court is satisfied that(3) adequate arrangements will be made for management of the protected
person’s property.
Upon(F) The court shall issue a final order confirming the transfer and terminating the
guardianship or conservatorship upon its receipt from the court of the other state 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 to accept a guardianship
or conservatorship transferred under this section and the filing of ; and
(2) the documents required in this state to terminate a guardianship or conservatorship , the court
shall issue an order confirming the transfer of the proceeding to the other state and terminating
the guardianship or conservatorship in this State.
SECTION 62-5-715. AcceptingConfirmation of transfer from another state; petition to accept
guardianship or conservatorship; notice; hearing; provisional and final orders; determination of
needed modification.
(A) To confirm transfer of a guardianship or conservatorship transferred from another state.
Upon issuance of a provisional order in another state to transfer a guardianship or conservatorship
to this State under proceduresprovisions similar to those in Section 62-5-714, the guardian or
conservator shallmust 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 underpursuant to subsection (1) to accept a guardianship or
conservatorship from another stateA) must be given by the petitioner 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 incapacitated 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 (1) to accept a guardianship or conservatorship
from another state, except that no hearing shall be required if a consent order is signed by all
parties who have pled or otherwise defended as provided by the South Carolina Rules of Civil
Procedure.A).
(D) The court shall issue a provisionalan order approvingprovisionally granting a petition filed
underpursuant 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 incapacitated 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 from the court from which
the proceeding is being transferred of a final order issued pursuant to provisions similar to Section
62--5--714 transferring the proceeding to this State.
(F) Not later than ninety days after the 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 underpursuant to this section, the court shall recognize a guardianship
or conservatorship order from the other state, including the determination of the incapacitated or
protected person’s incapacity and the appointment of the guardian or conservator, if the guardian
or conservator is eligible to act in this state.
(1)
(H) The denial by the court of a petition filed under subsection (1) to accept a
guardianship or conservatorship transferred from another state does not affect the ability of athe
guardian or conservator appointed by a court in another state to seek appointment as guardian of
the incapacitated person or conservator of the protected person under Parts 3 and 4in 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.
REGISTRATION AND RECOGNITION OF ORDERD FROM OTHER STATES
Sections 716, 717, and 718 are designed to facilitate the enforcement of guardianship and
protective orders in other states. These sections do not make distinctions among the types of
orders that can be enforced. These sections are applicable whether the guardianship or
conservatorship is full or limited. While some states have expedited procedures for sales of real
estate by conservators appointed in other states, few states have enacted statutes dealing with
enforcement of guardianship orders, such as when a care facility questions the authority of a
guardian appointed in another state. Sometimes, these sorts of refusals necessitate that the
proceeding be transferred to the other state or that an entirely new petition be filed, problems that
could often be avoided if guardianship and protective orders were entitled to recognition in other
states.
These sections provides for such recognition. The key concept is registration. Section 716
provides for registration of guardianship orders, and Section 717 for registration of protective
orders. Following registration of the order in the appropriate county of the other state, and after
giving notice to the appointing court of the intent to register the order in the other state, Section
718 authorizes the guardian or conservator to thereafter exercise all powers authorized in the
order of appointment except as prohibited under the laws of the registering state.
The drafters of the Act concluded that the registration of certified copies provides sufficient
protection and that it was not necessary to mandate the filing of authenticated copies.
SECTION 62-5-716. Registration of guardianship orders. orders from another state; powers in
this state.
(A) If a guardian has not been appointed in thisanother state and a petition for the appointment of
a guardian is not pending in this State, athe guardian appointed in anotherthe 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 a court, in any appropriate county of this State a,
certified copycopies of the order and letters of office in the register of deeds and also filing a
clocked copy of the letters of office and a certified copy of the order of appointment in the
probate court.
SECTION 62-5-717. Registration of protective orders.
(B) If a conservator has not been appointed in thisanother state and a petition for a protective
order is not pending in this State, athe conservator appointed in anotherthe 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 any appropriate county a court of this State a , in any
county in which property belonging to the protected person is located, certified copycopies of the
order and letters of office in the registerand of deeds and also filing a clocked copy of the letters
of office, a certified copy of the order, and any bond in the probate court..
SECTION 62-5-718. Effect of registration.
(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 underpursuant to the provisions of
this partarticle and other lawlaws of this State to enforce a registered order.
PART 8
GUARDIAN AD LITEM UNDER ARTICLE 5
SECTION 62-5-810. Appointment.
The court has discretion in determining who will be appointed as a guardian ad litem in each case,
subject to the requirements set forth in 62-5-820, and shall issue an order of appointment after
obtaining the consent of the proposed guardian ad litem.
The previous version of the Probate Code required that an attorney be appointed for the alleged
incapacitated person and that the attorney have the powers and duties of a guardian ad litem.
There was no guidance provided as to what those powers and duties should include and the dual
role of attorney and guardian ad litem resulted in potential conflicts of interest. This Part 8 is
based on the guardian ad litem statutes found in South Carolina Code of Laws, Title 63, Chapter
3, Article 7, concerning the family court guardian ad litem. This section sets out the basic
authority and procedure for the appointment of a guardian ad litem in the Probate Court.
SECTION 62-5-820. Qualifications.
(1) To be appointed as a guardian ad litem pursuant to section 62-5-810 a person must have the
requisite knowledge or expertise to perform the required duties and must have completed the
required training approved for guardians ad litem by the probate court making the appointment.
These training requirements are:
(A)
if the guardian ad litem is a non-lawyer,
(i) for initial qualification, a minimum of six hours;
(ii) every three years after the year of initial qualification, a minimum of six
additional
hours;
(B) if the guardian ad litem is a lawyer,
(i) for initial qualification, a minimum of three hours
(ii) every three years after the year of initial qualification, a minimum of three
additional
hours,
(iii) these requirements may be waived by the court for good cause shown.
(2) The training for a guardian ad litem serving in the probate court shall include a review of:
(A) Title 62, article 5, parts 1 through 4 of this Code;
(B) The qualifications, responsibilities and duties of a guardian ad litem as set forth in
Title 62, Article 5, part 8 of this Code;
(C) issues commonly encountered by guardians ad litem, including, but not limited to:
(i) resources, such as Social Security, Medicare, Medicaid, VA Benefits, and
(ii) probate court procedures.
(3) Upon accepting the appointment as guardian ad litem, a guardian ad litem must certify to the
court that (s)he meets the statutory qualifications.
(4) A person whose eligibility has lapsed may again become eligible for appointment as a
guardian ad litem by completing the additional training required after initial qualification.
(5) For appointments made in the first year following enactment of this section, the court may
waive the initial training requirement.
This revision allows both lawyers and non-lawyers to be appointed as guardian ad litem, specifies
the requirements for eligibility and appointment of the guardian ad litem, and is based upon the
family court requirements found in 63-3-82(A).
Subsection (5) allows the court to waive the training requirement for appointments made in the
year after enactment in order to allow time for the creation and dissemination of training
programs.
SECTION 62-5-830. Responsibilities.
(1)
(A)
(B)
(C)
(D)
(E)
(F)
(G)
The responsibilities and duties of a guardian ad litem include, but are not limited to:
acting in the best interest of the primary respondent;
conducting an independent, balanced, and impartial investigation to determine
the facts relevant to the situation of the primary respondent. An investigation must
include, but is not limited to:
(i)
obtaining and reviewing relevant documents. The guardian ad litem shall
have access to the primary respondent’s medical records, state and federal
tax records, financial records, public benefits records, and any other
relevant records. The guardian ad litem shall have, on behalf of the primary
respondent, the right to institute or participate in discovery and in any
proceedings to the same extent as any party to the action.
(ii)
meeting with, observing, and interviewing the primary respondent on at
least one occasion;
(iii)
conveying to the primary respondent the substance of the petition, the
nature, purpose and effect of the proceeding, and the primary respondent’s
rights at the hearing;
(iv)
informing the primary respondent of the right to retain counsel or request
the court to appoint counsel in accordance with the provisions of section
62-5-303(5) or section 62-5-404(8), as applicable;
(v)
interviewing the petitioner, the proposed guardian, the proposed
conservator, and any party who files an answer in the matter;
(vi)
visiting the residence of the primary respondent, if deemed appropriate;
(vii)
interviewing caregivers, relatives, and others with knowledge relevant to
the case;
(viii) reviewing the criminal history of any individual proposed as guardian or
conservator when deemed appropriate; and
(ix)
considering the wishes of the primary respondent;
advocating for the best interest of the primary respondent by making specific and
clear suggestions, including such information and recommendations regarding
resources as may be appropriate or available to benefit the primary respondent.
attending all probate court hearings, except when attendance is excused by the
court or the absence is stipulated by all parties present at the hearing.. The
guardian ad litem must provide accurate, current information directly to the court;
making recommendations regarding the appropriateness of the appointment of a
guardian or conservator and any limitations to be imposed;
presenting an oral report at the hearing on the information gathered, findings, and
recommendations of the guardian ad litem, unless a written report has been
submitted pursuant to paragraph (G) and attendance has been excused pursuant to
paragraph (D);
upon request by the court, presenting to the court and all parties clear and
comprehensive written reports including, but not limited to, a final written report
regarding the best interest of the primary respondent. The written report, when
requested, must be submitted to the court and all parties by the deadline set by the
court, but at least forty-eight hours prior to the hearing, unless otherwise waived
by the court. The guardian ad litem is subject to cross-examination on the facts
and conclusions contained in the report.
(2)
A guardian ad litem may submit reports, recommendations, briefs, memoranda, affidavits,
or other documents on behalf of the primary respondent, in a manner consistent with the South
Carolina Rules of Evidence and other state law. A guardian ad litem’s notes are his work product
and are not subject to subpoena.
(3)
The guardian ad litem shall submit to the court a report that includes:
(A)
the date and place of the meeting of the guardian ad litem with the primary
respondent;
(B)
whether or not the primary respondent approves of:
(i)
the appointment of a guardian or conservator, as requested in the
petition(s),
(ii)
the person(s) to be appointed,
(iii)
the extent of the requested authority;
(C)
a description of the appearance of the primary respondent;
(D)
a description of the condition of the place of the meeting (if appropriate);
(E)
the diagnosis of the primary respondent;
(F)
any prior action with the Department of Social Services or law enforcement
concerning the primary respondent or the proposed guardian or conservator, of
which the guardian ad litem is aware;
(G)
a statement as to any prior relationship between the guardian ad litem and
the petitioner, primary respondent, or any other party to the action;
(I)
the signature of the guardian ad litem and the date of the report.
(4)
The court may extend or limit the responsibilities and/or authority of the guardian ad litem
upon good cause shown.
The listed responsibilities are adapted from the requirements for a guardian ad litem serving in the
family court found in South Carolina Code of Laws Section 63-3-830. Subsection 1 codifies the
responsibilities of the guardian ad litem. Subsection 2 specifically allows the guardian ad litem
to introduce documents and protects the guardian ad litem’s work. The new reporting
requirement in Subsection 3 incorporates information gathered by the guardian ad litem into a
minimum of one report, and includes information previously reported by an appointed visitor (the
visitor appointment is now optional for the court).
SECTION 62-5-840. Compensation.
(1)
At the time of appointment of a guardian ad litem, the court must set forth the rate of
compensation for the guardian ad litem based on the factors set forth in paragraph (2) hereof.
The court may set an overall maximum fee or an hourly rate of compensation. If the guardian ad
litem determines that it is necessary to exceed the fee initially authorized by the judge, the
guardian ad litem may move the court for additional compensation.
(2)
A guardian ad litem appointed by the court is entitled to reasonable compensation, and
reimbursement for expenses, subject to the review and approval of the court. In determining the
reasonableness of the fees and costs, the court must take into account:
(A)
the novelty and difficulty of the issues before the court and the skill requisite to
perform the responsibilities properly;
(B)
the contentiousness of the proceedings;
(C)
the time expected to be expended by the guardian ad litem;
(D)
the likelihood that the acceptance of the appointment will preclude other
employment of the guardian ad litem;
(E)
the time limitations imposed by the circumstances;
(F)
the experience, reputation and ability of the person being appointed by the court;
(G)
the financial ability of each party to pay fees and costs; and
(H)
any other factors the court considers necessary.
(2)
If so directed by the court, the guardian ad litem must submit an itemized billing statement
of hours, expenses, costs, and fees to the court.
(3)
At any time during the action, a party may petition the court to review the reasonableness
of the fees and costs submitted by the guardian ad litem.
This section is based upon SECTION 63-3-850, which addresses compensation for the
guardian ad litem in family court.
SECTION 62-5-850. Disclosure.
Any guardian ad litem appointed by the court must, upon request of the court or any party,
provide written disclosure to each party:
(1)
of the nature, duration, and extent of any relationship the guardian ad litem (or any
member of the guardian ad litem’s immediate family) has with any party; and
(2)
of any interest adverse to any party or any party’s attorney which might cause the
impartiality of the guardian ad litem to be challenged.
This section is based upon SECTION 63-3-860, which addresses disclosure for the guardian
ad litem in family court.
SECTION 62-5-860. Resignation, removal, and termination.
(1)
A guardian ad litem may resign or be removed from a case at the discretion of the court.
(2)
Upon the appointment of a guardian or issuance of a protective order, the appointment of
the guardian ad litem automatically terminates unless otherwise specified in the court order.
Subsection 1 is based upon SECTION 63-3-870, which addresses removal of the guardian ad
litem in family court. Subsection 2 is an addition to terminate the responsibilities of a
guardian ad litem unless the court requires further action by the guardian ad litem on
behalf of the primary respondent.
SECTION 62-5-870. Guardian ad litem immunity.
A guardian ad litem appointed under this Title 62, Article 5, Part 8 and acting in the course and
scope of the appointment is not liable for damages arising from an act or omission of the guardian
ad litem committed in good faith. The immunity granted by this section does not apply if the
conduct constitutes willful or wanton misconduct or gross negligence.
This addition provides statutory protection for lawyer and non-lawyer guardians ad litem. See
Fleming v. Asbill, 326 S.C. 49, 483 S.E.2d 751 (1997)326 at 56-57, and Vaughan v. McLeod
Regional Medical Center, 372 S.C. 505, 510, 642 S.E.2d 744, 746-47 (2007).
PART 2
MULTIPLE-PERSON ACCOUNTS—
Title 62. South Carolina Probate Code
Article 6. Nonprobate Transfers
Part 1. Multiple-Party Accounts (Refs & Annos)
§ 62-6-101. Definitions.
In this part [§§ 62-6-101 et seq.], unless the context otherwise requires:
(1) “Account” means a contract of deposit of funds between a depositor and a
financial institution, and includes a checking account, savings account,
certificate of deposit, share account, and other like arrangement.
(2) “Beneficiary” means a person named in a trust account as one for whom a
party to the account is named as trustee.
(3) “Financial institution” means any organization authorized to do business
under state or federal laws relating to financial institutions, including,
without limitation, banks and trust companies, savings banks, building and
loan associations, savings and loan companies or associations, and credit
unions.
(4) “Joint account” means an account payable on request to one or more of two
or more parties (whether “and”, “or”, “and/or”, or any other designation),
whether or not mention is made of any right of survivorship.
(5) A “Multiple-Party account” is any of the following types of account: (i) a
joint account, (ii) a P.O.D. account, or (iii) a trust account. It does not
include accounts established for deposit of funds of a partnership, joint
venture, or other association for business purposes, or accounts controlled by
one or more persons as the duly authorized agent or trustee for a corporation,
unincorporated association, charitable or civic organization, or a regular
fiduciary or trust account where the relationship is established other than by
deposit agreement.
(6) “Net contribution” of a party to a joint account as of any given time is
the sum of all deposits thereto made by or for him, less all withdrawals made
by or for him which have not been paid to or applied to the use of any other
party, plus a prorata share of any interest or dividends included in the
current balance. The term includes, in addition, any proceeds of deposit life
insurance added to the account by reason of the death of the party whose net
contribution is in question.
(7) “Party” means a person who, by the terms of the account, has a present
right, subject to request, to payment from a multiple-party account. A P.O.D.
payee or beneficiary of a trust account is a party only after the account
becomes payable to him by reason of his surviving the original payee or
trustee. Unless the context otherwise requires, it includes a guardian,
conservator, personal representative, or assignee, including an attaching
creditor, of a party. It also includes a person identified as a trustee of an
account for another whether or not a beneficiary is named, but it does not
include any named beneficiary unless he has a present right of withdrawal.
(8) “Payment” of sums on deposit includes withdrawal, payment on check or
other directive of a party, and any pledge of sums on deposit by a party and
any set-off, or 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 § 62-1-107.
(10) “P.O.D. account” means an account payable on request to one person during
his lifetime and on his death to one or more P.O.D. payees, or to one or more
persons during their lifetimes and on the death of all of them to one or more
P.O.D. payees.
(11) “P.O.D. payee” means a person designated on a P.O.D. account as one to
whom the account is payable on request after the death of one or more persons.
(12) “Request” means a proper request for withdrawal, or a check or order for
payment, which complies with all conditions of the account, including special
requirements concerning necessary signatures and regulations of the financial
institution; but if the financial institution conditions withdrawal or payment
on advance notice, for purposes of this part the request for withdrawal or
payment is treated as immediately effective and a notice of intent to withdraw
is treated as a request for withdrawal.
(13) “Sums On Deposit” means the balance payable on a multiple-party account
including interest, dividends, and in addition any deposit life insurance
proceeds added to the account by reason of the death of a party.
(14) “Trust account” means an account in the name of one or more parties as
trustee for one or more beneficiaries where the relationship is established by
the form of the account and the deposit agreement with the financial
institution and there is no subject of the trust other than the sums on
deposit in the account; it is not essential that payment to the beneficiary be
mentioned in the deposit agreement. A trust account does not include a regular
trust account under a testamentary trust or a trust agreement which has
significance apart from the account, or a fiduciary account arising from a
fiduciary relationship such as attorney-client.
(15) “Withdrawal” includes payment to a third person pursuant to check or
other directive of a party.
CREDIT(S)
HISTORY: 1986 Act No. 539, § 1.
REPORTER'S COMMENTS
Section 62-6-101 defines the terms of the application of Part 1 generally to
the “joint” (4), the “P.O.D.” (10) and the “trust” (14) versions of the
“multiple-party” (5) “accounts” (1) offered by “financial institutions” (3),
with certain types of accounts expressly excluded (5) and (14), and also the
application of Part 1 more specifically to the “withdrawal” (15) or “payment”
(8) of the “net contributions” of a party (6) or of the “sums on deposit” (13)
in such accounts, as per the “request” (12) of a “party,” or his
representative (7), of a “P.O.D. payee” (11) or of a “beneficiary” (2),
perhaps on some “proof of death” (9).
§ 62-6-102. Ownership as between parties and others; protection of financial
institutions.
The provisions of §§ 62-6-103 to 62-6-105 concerning beneficial ownership as
between parties, or as between parties and P.O.D. payees or beneficiaries of
multiple-party accounts, are relevant only to controversies between these
persons and their creditors and other successors, and have no bearing on the
power of withdrawal of these persons as determined by the terms of account
contracts. The provisions of §§ 62-6-108 to 62-6-113 govern the liability of
financial institutions who make payments pursuant thereto and their set-off
rights.
CREDIT(S)
HISTORY: 1986 Act No. 539, § 1.
REPORTER'S COMMENTS
Section 62-6-102 serves to protect financial institutions against the claims
of contributing parties, their creditors, noncontributing parties, and any
other persons, founded on the alleged mispayment of the funds on deposit in
multiple-party accounts. If the financial institution makes payment of the
funds in accordance with the terms of the account contract, then Sections 6108 through 6-113 apply to protect it.
§ 62-6-103. Ownership during lifetime.
(a) A joint account belongs, during the lifetime of all parties, to the
parties in proportion to the net contributions by each to the sums on deposit,
unless there is clear and convincing evidence of a different intent.
(b) A P.O.D. account belongs to the original payee during his lifetime and not
to the P.O.D. payee or payees; if two or more parties are named as original
payees, during their lifetimes rights as between them are governed by
subsection (a) of this section.
(c) Unless a contrary intent is manifested by the terms of the account or the
deposit agreement or there is clear and convincing evidence of an irrevocable
trust, a trust account belongs beneficially to the trustee during his
lifetime, and if two or more parties are named as trustee on the account,
during their lifetimes beneficial rights as between them are governed by
subsection (a) of this section. If there is an irrevocable trust, the account
belongs beneficially to the beneficiary.
CREDIT(S)
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 69.
REPORTER'S COMMENTS
Section 62-6-103 establishes the beneficial ownership of the funds on deposit
in multiple-party accounts, first, as among the living parties, contributing
and noncontributing, and, second, as between the living parties and the P.O.D.
payees and trust account beneficiaries.
First, under Section 62-6-103(a), (b), and (c), living parties, as defined in
Section 62-6-101(7), as among themselves, share beneficial ownership of the
funds on deposit not only in joint accounts but also in P.O.D. accounts, as
original payees, as well as in trust accounts, as trustees. They always share
in proportion to the individual net contributions made by or for them, as
defined in Section 62-6-101(6). Deceased parties' ownership, if any, is
governed by Sections 62-6-104, 62-6-105, and 62-6-107.
Second, under Section 62-6-103(b) and (c), living parties do not share
beneficial ownership with P.O.D. payees and with trust account beneficiaries;
instead, the living parties exclude the others from ownership during their own
lives, unless, under Section 62-6-103(c), an irrevocable trust is shown, and
then the trust account beneficiary beneficially owns the funds on deposit even
during the life of the living party, trustee.
§ 62-6-104. Right of survivorship.
(a) Sums remaining on deposit at the death of a party to a joint account
belong to the surviving party or parties as against the estate of the decedent
unless there is a writing filed with the financial institution at the time the
account is created (or subsequently as provided under § 62-6-105) which
indicates a different intention. If there are two or more surviving parties,
their respective ownerships during lifetime shall be in proportion to their
previous ownership interests under § 62-6-103 augmented by an equal share for
each survivor of any interest the decedent may have owned in the account
immediately before his death; and the right of survivorship continues between
the surviving parties.
(b) If the account is a P.O.D. account:
(1) on death of one of two or more original payees the rights to any sums
remaining on deposit are governed by subsection (a);
(2) on death of the sole original payee or of the survivor of two or more
original payees, any sums remaining on deposit belong to the P.O.D. payee or
payees if surviving, or to the survivor of them if one or more die before the
original payee; if two or more P.O.D. payees survive, there is no right of
survivorship in the event of death of a P.O.D. payee thereafter unless the
terms of the account or deposit agreement expressly provide for survivorship
between them.
(c) If the account is a trust account:
(1) on death of one of two or more trustees, the right to any sums remaining
on deposit are governed by subsection (a);
(2) on death of the sole trustee or the survivor of two or more trustees, any
sums remaining on deposit belong to the person or persons named as
beneficiaries, if surviving, or to the survivor of them if one or more die
before the trustee, unless there is clear evidence of a contrary intent; if
two or more beneficiaries survive, there is no right of survivorship in event
of death of any beneficiary thereafter unless the terms of the account on
deposit agreement expressly provide for survivorship between them.
(d) In other cases, the death of any party to a multiple party account has no
effect on beneficial ownership on the account other than to transfer the
rights of the decedent as part of his estate.
(e) A right to survivorship arising from the express terms of the account or
under this section, a beneficiary designation in a trust account, or a P.O.D.
payee designation, cannot be changed by will; however, a party who owns a
joint account under the provisions of Section 62-6-103(a) may effect such
change by will to the extent of his ownership if the will contains clear and
convincing evidence of his intent to do so.
(f) The provisions of § 62-6-104(a), (b), and (c) are applicable to all
multiple-party accounts created subsequent to the effective date of this
section, and unless there is clear and convincing evidence of a different
intention at the time the account was created, to all multiple-party accounts
created prior to the effective date of this section.
CREDIT(S)
HISTORY: 1986 Act No. 539, § 1; 1987 Act No. 171, § 70; 1990 Act No. 521, §
88.
REPORTER'S COMMENTS
Section 62-6-104 establishes the beneficial ownership of the funds on deposit
in multiple-party accounts, as between, first, the estates of deceased parties
and, second, the yet living parties, P.O.D. payees and trust account
beneficiaries; it establishes the right of survivorship. Under Section 62-6104(a), (b), (c), and (f), the estates of deceased parties, as defined at
Section 62-6-101(7), lose their shares of ownership of the funds on deposit in
both joint accounts as well as in P.O.D. accounts, as original payees, and in
trust accounts, as trustees. The surviving party or parties, whether as such,
Section 62-6-104(a) and (f), or as original payees, Section 62-6-104(b)(1), or
as trustees, Section 62-6-104(c)(1), and whether one or more survives,
continue as beneficial owners of the funds on deposit in the multiple-party
account. They continue as such owners individually if only one survives and,
if more than one survives, they continue as owners as under Section 62-6-103,
with some adjustment, however, to dispose of the deceased party's share. In
those cases in which no parties, as original payees or as trustees, survive
beyond the death of the deceased party, the surviving P.O.D. payees or the
surviving trust account beneficiaries become the beneficial owners of the
funds on deposit in the multiple-party account, individually, however, whether
one or more than one survives, and without any right of survivorship as among
themselves.
The provisions of Section 62-6-104 establishing the right of survivorship will
normally apply, even to accounts established prior to the effective date of
this statute, Section 62-6-104(f), but they may be overcome by sufficient
expressions of an intention to the contrary, as in a writing filed with the
financial institution under either of Sections 62-6-104(a), 62-6-104(b)(2),
and 62-6-104(c)(2), or 62-6-105, and also as in the will of a party, who by
way of his net contributions owns some part of an account under Section 62-6103(a), as under the proviso to Section 62-6-104(e), but otherwise not by
will. Once the provisions of Section 62-6-104 are overcome the death of a
party does not occasion the passing by right of survivorship of any funds on
deposit, Section 62-6-104(d).
§ 62-6-105. Effect of written notice to financial institution.
The provisions of § 62-6-104 as to rights of survivorship are determined by
the form of the account at the death of a party. This form may be altered by
written order given by a party to the financial institution to change the form
of the account or to stop or vary payment under the terms of the account. The
order or request must be signed by a party, received by the financial
institution during the party's lifetime, and not countermanded by other
written order of the same party during his lifetime.
CREDIT(S)
HISTORY: 1986 Act No. 539, § 1.
REPORTER'S COMMENTS
Section 62-6-105 allows a writing signed by one of the parties and filed with
the financial institution to overcome the normally applicable provisions of
Section 62-6-104 establishing the right of survivorship with respect to a
multiple-party account. See the comment to Section 62-6-104. Either a
contributing party or a noncontributing party may alone order the alteration
of the right of survivorship, consistent with the rule of Section 62-6-103(a),
that funds on deposit in a joint account belong to the living parties in
proportion to their respective net contributions, and with the rules of
Section 62-6-108 et seq., as to the noncontributing parties' rights.
62-6-106. Accounts and transfers nontestamentary.
Any transfers resulting from the application of § 62-6-104 are effective by
reason of the account contracts involved and this statute and are not to be
considered as testamentary or subject to Articles 1 through 4 [§§ 62-1-101
thru 62-4-101 et seq.] except as a consequence of, and to the extent directed
by, § 62-6-107.
CREDIT(S)
HISTORY: 1986 Act No. 539, § 1.
REPORTER'S COMMENTS
Section 62-6-106 establishes the theoretical basis for the legally effective
transfer at death by survivorship right of multiple-party account assets, more
practically established by Sections 62-6-104 and 62-6-105. The transfers are
effective as third party beneficiary contracts to make gifts, and by statutory
allowance, even though they are testamentary in their nature, and they are not
to be governed by this Code's provisions otherwise governing testamentary
transfers except so far as they are affected by Section 62-6-107.
62-6-107. Rights of creditors.
Subject to the provisions contained in § 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, P.O.D. payee, 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 two years 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
thereof 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.
CREDIT(S)
REPORTER'S COMMENTS
Section 62-6-107, in derogation of the survivorship rights established in
Sections 62-6-104 through 62-6-106, establishes in the estate of a deceased
party a limited beneficial ownership of the funds on deposit in a multipleparty account, limited, however, to the payment of the debts, taxes, and the
expenses of administration of the estate of the deceased party, and existing
only if other assets of that estate are insufficient to that purpose, only up
to the amount to which the deceased party was beneficially entitled prior to
death, and only if a creditor's claim proceeding is brought within two years
of the deceased party's death.
§ 62-6-108. Financial institution protection; payment on signature of one
party.
Financial institutions may enter into multiple-party accounts to the same
extent that they may enter into single-party accounts. Any multiple-party
account may be paid, on request, to any one or more of the parties, unless a
contrary intent is manifested by the terms of the account or the deposit
agreement. A financial institution may not be required to inquire as to the
source of funds received for deposit to a multiple-party account, or to
inquire as to the proposed application of any sum withdrawn from an account,
for purposes of establishing net contributions.
CREDIT(S)
REPORTER'S COMMENTS
Section 62-6-108 allows the financial institution to make payment, on request,
to any one or more of the parties to any multiple-party account. See Section
62-6-101(7) for the definition of “party,” and see Sections 62-6-109, 62-6110, and 62-6-111 for more specific provisions concerning the several commonly
available versions of the multiple-party account. Under Section 62-6-108, the
financial institution need not inquire of the source of funds deposited or of
the application of funds withdrawn.
§ 62-6-109. Financial institution protection; payment after death or
disability; joint account.
Unless a contrary intent is manifested by the terms of the account or the
deposit agreement, any sums in a joint account may be paid, on request, to any
party without regard to whether any other party is incapacitated or deceased
at the time the payment is demanded; but payment may not be made to the
personal representative or heirs of a deceased party unless proofs of death
are presented to the financial institution showing that the decedent was the
last surviving party or unless there is no right of survivorship under § 62-6104.
CREDIT(S)
REPORTER'S COMMENTS
Section 62-6-109 allows the financial institution to make payment of a “joint
account,” on request, to any party, not only to contributing parties but also
to noncontributing parties, whether any other party, e.g., a contributing
party, is then dead or is yet alive and even though the other party is not
only then alive but also is incapacitated. Notwithstanding the limits on the
rights of noncontributing parties as against those of yet living contributing
parties, established under Section 62-6-103(a), the financial institution may
make payment of a joint account to any party and will be protected.
Because of the survivorship aspect of the rights of the respective parties to
a joint account, assumed under Section 62-6-104(a), unless negated as provided
for in Sections 62-6-104(a), 62-6-104(e), or 62-6-105; under Section 62-6-109
the financial institution may not make payment of a joint account to the
representatives of a deceased party unless it is shown that he was the
survivor of all the parties.
§ 62-6-110. Financial institution protection; payment of P.O.D. account.
deposit agreement, any P.O.D. account may be paid, on request, to any original
party to the account. Payment may be made, on request, to the P.O.D. payee or
to the personal representative or heirs of a deceased P.O.D. payee upon
presentation to the financial institution of proof of death showing that the
P.O.D. payee survived all persons named as original payees. Payment may be
made to the personal representative or heirs of a deceased original payee if
proof of death is presented to the financial institution showing that his
decedent was the survivor of all other persons named on the account either as
an original payee or as P.O.D. payee.
CREDIT(S)
REPORTER'S COMMENTS
Section 62-6-110 allows the financial institution to make payment of a “P.O.D.
account,” on request, to any party, “original party,” thereby invoking the
application of Section 62-6-109 to P.O.D. accounts to the extent that as
between the several parties themselves such accounts may be described as
“joint accounts.” See Section 62-6-103(a) and (b) and the comment to Section
62-6-109. However, the last sentence of Section 62-6-110 also concerns a
matter which is part of the concern of Section 62-6-109, but goes further than
does Section 62-6-109 to preclude the financial institution from making
payment of a P.O.D. account to the representatives of a deceased party, unless
it is shown that he was the survivor of both all the parties and also all the
P.O.D. payees. That is consistent with the rights established under Section
62-6-104(b)(2).
Section 62-6-110 allows the financial institution to make payment of a “P.O.D.
account” to a P.O.D. payee, or his representative, only if it is shown that he
was the survivor of all of the parties, “original payees.” That is consistent
with the limitation of the rights of a P.O.D. payee to a right of
survivorship, as under Sections 62-6-103(b) and 62-6-104(b)(2).
§ 62-6-111. Financial institution protection; payment of trust account.
deposit agreement, any trust account may be paid, on request, to any trustee.
Unless the financial institution has received written notice that the
beneficiary has a vested interest not dependent upon his surviving the
trustee, payment may be made to the personal representative or heirs of a
deceased trustee if proof of death is presented to the financial institution
showing that his decedent was the survivor of all other persons named on the
account either as trustee or beneficiary. Payment may be made, on request, to
the beneficiary or to the personal representative or heirs of a deceased
beneficiary upon presentation to the financial institution of proof of death
showing that the beneficiary or beneficiaries survived all persons named as
trustees.
CREDIT(S)
REPORTER'S COMMENTS
Section 62-6-111 allows the financial institution to make payment of a “trust
account,” on request, to any party, “trustee,” without regard to whether the
trust is irrevocable and without regard to whether the beneficiary has a
vested interest, thereby preserving the administrative control of the trustee
of the funds on deposit. The application of Section 62-6-109 to trust accounts
is invoked to the extent that as between the several parties themselves, if
there are several, such accounts may be described as “joint accounts.” See
Section 62-6-103(a) and (c) and the comment to Section 62-6-109. However, the
second sentence of Section 62-6-111 also concerns a matter which is part of
the concern of Section 62-6-109, but goes further than does Section 62-6-109
to preclude the financial institution from making payment of a trust account
to the representatives of a deceased party, not only unless it is shown that
he was the survivor of both all the parties and also all the beneficiaries,
consistent with the rights established under Section 62-6-104(c)(2), but also
if the beneficiary is shown to have had a vested interest not dependent upon
his surviving the trustee, as projected as a possibility by Section 62-6103(c).
Section 62-6-111 allows the financial institution to make payment of a “trust
account” to a beneficiary, only if it is shown that he was the survivor of all
the parties, “trustees.” That is consistent with the limitation of the rights
of a trust account beneficiary to a right of survivorship, as under Sections
62-6-103(c) and 62-6-104(c)(2), which obtains unless some greater right is
shown to have been intended.
§ 62-6-112. Financial institution protection; discharge.
Payment made pursuant to § 62-6-108, 62-6-109, 62-6-110, or 62-6-111
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, P.O.D. payees, or beneficiaries, or their
successors. The protection here given does not extend to payments made after a
financial institution has received written notice from any party able to
request present payment to the effect that withdrawals in accordance with the
terms of the account should not be permitted. Unless the notice is withdrawn
by the person giving it, the successor of any deceased party must concur in
any demand for withdrawal if the financial institution is to be protected
under this section. No other notice or any other information shown to have
been available to a financial institution shall affect its right to the
protection provided here. The protection here provided shall have no bearing
on the rights of parties in disputes between themselves or their successors
concerning the beneficial ownership of funds in, or withdrawn from, multipleparty accounts.
CREDIT(S)
HISTORY: 1986 Act No. 539, § 1.
REPORTER'S COMMENTS
Under Section 62-6-112, notwithstanding its receipt of other notice or
information, the financial institution is discharged of all responsibility in
the matter of the competing rights of the contributing parties, of their
creditors and of the noncontributing parties, unless a party has given written
notice to, and unless a creditor of a deceased party has served a probate
court order on, the financial institution not to permit withdrawals in
accordance with the terms of the account, Section 62-6-107.
§ 62-6-113. Financial institution protection; 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.
CREDIT(S)
HISTORY: 1986 Act No. 539, § 1.
REPORTER'S COMMENTS
Section 62-6-113 allows the financial institution, as creditor of a party, to
set off in its own favor an amount from a multiple-party account to cover the
indebtedness of that party, but that set-off is limited to affect the amount
to which the party is, or was, beneficially entitled.
§ 62-6-201. Provisions for payment or transfer at death.
(a) Any of the following provisions in an insurance policy, contract of
employment, bond, mortgage, or other security interest, promissory note,
deposit agreement, pension plan, trust agreement, conveyance, or any other
written instrument otherwise effective as a contract, gift, conveyance, or
trust is deemed to be nontestamentary, and this Code does not invalidate the
instrument or any provision:
(1) that money or other benefits theretofore due to, controlled, or owned by a
decedent shall be paid after his death to a person designated by the decedent
in either the instrument or a separate writing, including a will, executed at
the same time as the instrument or subsequently;
(2) that any money due or to become due under the instrument shall cease to be
payable in event of the death of the promisee or the promissor before payment
or demand; or
(3) that any property which is the subject of the instrument shall pass to a
person designated by the decedent in either the instrument or a separate
writing, including a will, executed at the same time as the instrument or
subsequently.
(b) Nothing in this section limits the rights of creditors under other laws of
this State.
CREDIT(S)
HISTORY: 1986 Act No. 539, § 1.
REPORTER'S COMMENTS
Section 62-6-201(a) establishes the blanket rule that, so long as a form of
ownership involves a written instrument and is otherwise supportable on one of
the theories of contract, gift, conveyance, or trust, that form's provisions
for the transfer of assets to a survivor at the death of their owner is valid
although the provision is not contained in a duly executed will.
Section 62-6-201(b) will preserve to creditors of decedents all of the rights
they otherwise may have to assert claims against such assets as pass by the
right of survivorship recognized under Section 62-6-201(a).
Subpart 1. Definitions And General Provisions
Section 62-6-101. Definitions.
In this part:
(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 death of all parties or for whom a party is named as
trustee.
(4)
"Financial institution" means an 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 §62-1-107.
(10)
"POD 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; but, for purposes of this part, 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 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.
COMMENT
This and the sections that follow are designed to reduce certain questions concerning many forms
of multiple-person accounts. A "payable on death" designation and an "agency" designation are
also authorized for both single-party and multiple-party accounts. An agent (paragraph (2)) may
not be a party. The agency designation must be signed by all parties, and the agent is the agent of
all parties. See Section 62--6-105 (designation of agent).
A "beneficiary" of a party (paragraph (3)) may be a POD beneficiary. See paragraph (10) ("POD
designation" defined). The definition of "beneficiary" refers to a "person," who may be an
individual, corporation, organization, or other legal entity Thus a church, trust company, family
corporation, or other entity, as well as any individual, may be designated as a beneficiary.
The term "multiple-party account" (paragraph 5) is used in this part in a broad sense to include
any account having more than one owner with a present interest in the account. Thus an account
may be a "multiple-party account" within the meaning of this part regardless of whether the terms
of the account refer to it as "joint tenancy" or as "tenancy in common," regardless of whether the
parties named are coupled by "or" or "and," and regardless of whether any reference is made to
survivorship rights, whether expressly or by abbreviation such as JTWROS or JT TEN.
Survivorship rights in a multiple-party account are determined by the terms of the account, by
statute and by the intent of the party, and survivorship is not a necessary incident of a
multiple-party account. See Section 62-6-202 (rights at death).
"Net contribution" as defined in paragraph (6) has no application to the financial
institution-depositor relationship. Rather, it is relevant only to controversies that may arise
between parties to a multiple-party account. See Section 62-6-201 (ownership during lifetime).
Under paragraph (7), a "party" is a person with a present right to payment from an account.
Therefore, present owners of a multiple-party account are parties, as is the present owner of an
account with a POD designation. The beneficiary of an account with a POD designation is not a
party, but is entitled to payment only on the death of all parties. An agent with the right of
withdrawal on behalf of a party is not itself a party. A person claiming on behalf of a party such as
a guardian or conservator, or claiming the interest of a party such as a creditor, is not itself a
party, and the right of such a person to payment is governed by general law other than this part.
Various signature requirements may be involved in order to meet the payment requirements of the
account. A "request" (paragraph (12)) involves compliance with these requirements. A party is
one to whom an account is presently payable without regard to whose signature may be required
for a "request."
Section 62-6-102. Limitation On Scope Of Part.
This part 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.
COMMENT
The reference to a fiduciary or trust account in item (iii) includes a regular trust account under a
testamentary trust or a trust agreement that has significance apart from the account, and a
fiduciary account arising from a fiduciary relation such as attorney-client.
Section 62-6-103. Types Of Account; Existing 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 the effective date of this part, 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 part, and is governed by this part.
COMMENT
In the case of an account established after the effective date of this part that is not in substantially
the form provided in Section 62- 6-104, the account is governed by the provisions of this part
applicable to the type of account that most nearly conforms to the depositor's intent. See Section
62-6-104 (forms).
Thus, a tenancy in common account established before or after the effective date of this part
would be classified as a "multiple-party account" for purposes of this part. See Section 626-101(5) ("multiple-party account" defined). On death of a party there would not be a right of
survivorship since the tenancy in common title would be treated as a multiple-party account
without right of survivorship. See Section 62-6-202(c). It should be noted that a POD designation
may not be made in a multiple-party account without right of survivorship. See Sections 626-101(10) ("POD designation" defined), 62-6-104 (forms), and 62-66-202 (rights at death).
Section 62-6-104. Forms.
(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
part applicable to an account of that type:
UNIFORM SINGLE-OR MULTIPLE-PARTY ACCOUNT FORM
1.
PARTIES [Name One or More Parties]:
_________________________________
2.
_____________________________________
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.
3.
RIGHTS AT DEATH [Select One And Initial]:
a.
If Single Party Account is chosen in 2. above, choose one of following:
i.
SINGLE-PARTY ACCOUNT
At death of party, ownership passes as part of party's estate.
ii.
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.
b.
If Multiple Party Account is chosen in 2. above, choose one of following:
i.
MULTIPLE-PARTY ACCOUNT WITH RIGHT OF SURVIVORSHIP
At death of party, ownership passes to surviving parties. The last surviving party
inherits the entire account. (Note: This can be overridden by clear and convincing
evidence of a contrary intent.)
ii.
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.
iii.
MULTIPLE-PARTY ACCOUNT WITHOUT RIGHT OF
SURVIVORSHIP
At death of party, deceased party's ownership passes as part of deceased party's
estate.
4.
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 part applicable to the type of account that
most nearly conforms to the depositor's intent.
COMMENT
This section provides short forms for single- and multiple-party accounts which, if used, bring the
accounts within the terms of this part. A financial institution that uses the statutory form language
in its accounts is protected in acting in reliance on the form of the account. See also Section 62-6306 (discharge).
The forms provided in this section enable a person establishing a multiple-party account to state
expressly in the account whether there are to be survivorship rights between the parties. The
account forms permit greater flexibility than traditional account designations.
An account that is not substantially in the form provided in this section is nonetheless governed by
this part. See Section 62-6-103 (types of account; existing accounts).
Section 62-6-105. Designation Of Agent.
(a) 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.
(b) 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.
(c)
Death of the sole party or last surviving party terminates the authority of an agent.
(d) An agent serving under a durable power of attorney can change, modify, or revoke an
agent designated on an account.
COMMENT
An agent has no beneficial interest in the account. See Section 62-6-201 (ownership during
lifetime). The agency relationship is governed by the general law of agency of the state, except to
the extent this part provides express rules, including the rule that the agency survives the disability
or incapacity of a party.
A financial institution may make payments at the direction of an agent notwithstanding disability,
incapacity, or death of the party, subject to receipt of a stop notice. Section 62-6-306
(discharge); see also Section 62-6-304 (payment to designated agent).
The rule of subsection (b) applies to agency designations on all types of accounts, including
nonsurvivorship as well as survivorship forms of multiple-party accounts.
Section 62-6-106. Applicability Of Part.
The provisions of Subpart 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. Subpart 3 governs the liability and set-off rights of financial institutions that
make payments pursuant to it.
Subpart 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.
COMMENT
This section reflects the assumption that a person who deposits funds in an account normally does
not intend to make an irrevocable gift of all or any part of the funds represented by the deposit.
Rather, the person usually intends no present change of beneficial ownership. The section permits
parties to accounts to be as definite, or as indefinite, as they wish in respect to the matter of how
beneficial ownership should be apportioned between them.
The assumption that no present change of beneficial ownership is intended may be disproved by
showing that a gift was intended. For example, under subsection (b) it is presumed that the
beneficiary of a POD designation has no present ownership interest during lifetime. However, it is
possible that in the case of a POD designation in trust form an irrevocable gift was intended.
It is important to note that the section is limited to ownership of an account while parties are
alive. Section 62-6-202 prescribes what happens to beneficial ownership on the death of a party.
The section does not undertake to describe the situation between parties if one party withdraws
more than that party is then entitled to as against the other party. Sections 62-6-301 and 62-6-306
protect a financial institution in that circumstance without reference to whether a withdrawing
party may be entitled to less than that party withdraws as against another party. Rights between
parties in this situation are governed by general law other than this part.
The theory of these sections is that the basic relationship of the parties is that of individual
ownership of values attributable to their respective deposits and withdrawals, and not equal and
undivided ownership that would be an incident of joint tenancy.
Section 62-6-202. Rights At Death.
(a)
Except as otherwise provided in this part, 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 62-6201, 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.
COMMENT
The effect of subsection (a) is to make an account payable to one or more of two or more parties
a survivorship arrangement unless a nonsurvivorship arrangement is specified in the terms of the
account.
The account characteristics described in this section must be determined by reference to the form
of the account and the impact of Sections 62-6-103 and 62-6-104 on the admissibility of extrinsic
evidence tending to confirm or contradict intention as signalled by the form.
.
Section 62-6-203. Alteration Of Rights.
(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 62-6202 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.
COMMENT
Under this section, rights of parties and beneficiaries are determined by the type of account at the
time of death. It is to be noted that only a "party" may give notice blocking the provisions of
Section 62-6-202 (rights at death). "Party" is defined by Section 62-6-101(7). Thus if there is an
account with a POD designation in the name of A and B with C as beneficiary, C cannot change
the right of survivorship because C has no present right to payment and hence is not a party.
Section 62-6-204. Accounts And Transfers Nontestamentary.
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 I through IV
(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.
COMMENT
The purpose of classifying the transactions contemplated by this part as nontestamentary is to
bolster the explicit statement that their validity as effective modes of transfers on death is not to
be determined by the requirements for wills.
Section 62-6-205 Liability Of Multiple Party Accounts For Creditor Claims.
Subject to the provisions contained in § 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 two years 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 thereof 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.
COMMENT
Section 62-6-205, in derogation of the survivorship rights established in Sections 62-6-202
through 62-6-204, establishes in the estate of a deceased party a limited beneficial ownership of
the funds on deposit in a multiple-party account, limited, however, to the payment of debts, taxes,
and the expenses of administration of the estate of the deceased party, and existing only if other
assets of that estate are insufficient to that purpose, only up to the amount to which the deceased
party was beneficially entitled prior to death, and only if a creditor’s claim proceeding is brought
within two years of the deceased party’s death.
Subpart 3. Protection Of Financial Institutions
Section 62-6-301. Authority Of Financial Institution.
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.
COMMENT
Section 62-6-301 is substantially the same as prior law under former S.C. Code Section 62-6-108,
with the additional reference to POD and agency designations. The provisions governing
payment on request of one or more parties, previously covered in former S.C. Code Section 6 26-108, is now found in S.C. Code Section 62-6-302.
The provisions of this subpart relate only to protection of a financial institution that makes
payment as provided in the subpart. Nothing in this subpart affects the beneficial rights of persons
to sums on deposit or paid out. Ownership as between parties, and others, is governed by Subpart
2. See Section 62-6-106 (applicability of part).
Section 62-6-302. Payment On Multiple-Party Account.
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; or
(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.
COMMENT
Section 62-6-302 expands upon former 62-6-108 and recognizes multiple party accounts may be
paid on request to one or more parties. Subsection (2) is a departure from prior law in that it
does not contain the former provision providing for payment to heirs or devisees if there is no
personal representative. Now, in such a circumstance, Subsection (3) allows for payment in
accordance with a court order. Section 62-6-302 is consistent with the result of Trotter v. First
Federal Sav. and Loan Ass'n, 298 S.C. 85, 378 S.E.2d 267 (Ct. App. 1989), which recognized
that a bank was authorized to make a payment from a joint account to satisfy the debt of one of
the signatories, even though the other (non-consenting) signatory had contributed the funds to the
account
A financial institution that makes payment on proper request under this section is protected unless
the financial institution has received written notice not to. Section 62-6-306 (discharge).
Paragraph (1) applies to both a multiple-party account with right of survivorship and a
multiple-party account without right of survivorship (including an account in tenancy in common
form). Paragraph (2) is limited to a multiple-party account with right of survivorship; payment to
the personal representative or heirs or devisees of a deceased party to an account without right of
survivorship is governed by the general law of the state relating to the authority of such persons
to collect assets alleged to belong to a decedent.
Section 62-6-303. Payment On POD Designation.
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.
COMMENT
Section 62-6-303 is substantially the same as prior 62-6-110, with the addition of Subsection (4)
which allows payment in accordance with a court order.
A financial institution that makes payment on proper request under this section is protected unless
the financial institution has received written notice not to. See Section 62-6-306 (discharge).
Payment to the personal representative of a deceased beneficiary who would be entitled to
payment under paragraph (2) is governed by the general law of the state relating to the authority
of such persons to collect assets alleged to belong to a decedent.
Section 62-6-304. Payment To Designated 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.
COMMENT
Section 62-6-304 is new and recognizes the ability to pay to an agent under an agency
designation. Designation of an agent is governed by S.C. Code Section 62-6-105 and this
Section is in accordance with the concept of adding a non-party agent to an account, as
commonly provided in account agreements. Section 62-6-304 is consistent with former S.C.
Code §62-6-111 governing payments of a trust account to a trustee, though this Section is
broader in that the definition of agent under S.C. Code Section 62-2-101(2) includes any "person
authorized to make account transactions for a party."
This section is intended to protect a financial institution that makes a payment pursuant to an
account with an agency designation even though the agency may have terminated at the time of
the payment due to disability, incapacity, or death of the principal. The protection does not apply
if the financial institution has received notice under Section 62-6-306 not to make payment or
notice that the agency has terminated. This section applies whether or not the agency survives the
party's disability or incapacity under Section 62- 6-105 (designation of agent).
Section 62-6-305. Payment To Minor.
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.
COMMENT
Section 6-225 is intended to avoid the need for a guardianship or other protective proceeding in
situations where the Uniform Transfers to Minors Act may be used.
Section 62-6-306. Discharge.
(a)
Payment made pursuant to this part 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.
COMMENT
Section 62-6-305 is new and allows payment to minors as provided by S.C. Code §62-5-103 or as
ordered by a court.
The provision of subsection (a) protecting a financial institution for payments made after the
death, disability, or incapacity of a party is a specific elaboration of the general protective
provisions of this section and is drawn from Uniform Commercial Code Section 4-405.
Knowledge of disability, incapacity, or death of a party does not affect payment on request of an
agent, whether or not the agent's authority survives disability or incapacity. See Section 62- 6-304
(payment to designated agent). But under subsection (b), the financial institution may not make
payments on request of an agent after it has received written notice not to, whether because the
agency has terminated or otherwise.
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.
COMMENT
Section 62-6-307 is substantially similar to former S.C. Code §62-6-113. As with former Section
62-6-113, Section 62-6-307 allows the financial institution, as creditor of a party, to set off in its
own favor an amount from a multiple party account to cover the indebtedness of that party. This
Section is in addition to any other statutory, common law, or contractual remedies, liens or rights
of set-off.
South Carolina General Assembly
116th Session, 2005-2006
A66, R80, S422
STATUS INFORMATION
General Bill
Sponsors: Senators McConnell, Hayes and Campsen
Document Path: l:\council\bills\swb\6290mm05.doc
Companion/Similar bill(s): 3487
Introduced in the Senate on February 8, 2005
Introduced in the House on March 29, 2005
Last Amended on March 17, 2005
Passed by the General Assembly on May 13, 2005
Governor's Action: May 23, 2005, Signed
Summary: Uniform Trust Code
HISTORY OF LEGISLATIVE ACTIONS
Date
2/8/2005
2/8/2005
3/16/2005
3/17/2005
3/17/2005
3/23/2005
3/29/2005
3/29/2005
4/29/2005
5/11/2005
5/12/2005
5/12/2005
5/13/2005
5/18/2005
5/23/2005
5/25/2005
5/25/2005
5/27/2005
Body
Senate
Senate
Senate
Senate
Senate
Senate
House
House
House
House
House
House
Action Description with journal page number
Introduced and read first time SJ-12
Referred to Committee on Judiciary SJ-12
Committee report: Favorable with amendment Judiciary SJ-17
Amended SJ-15
Read second time SJ-15
Read third time and sent to House SJ-23
Introduced and read first time HJ-16
Referred to Committee on Judiciary HJ-18
Scrivener's error corrected
Committee report: Favorable Judiciary HJ-5
Read second time HJ-7
Unanimous consent for third reading on next legislative day HJ-10
Read third time and enrolled HJ-3
Ratified R 80
Signed By Governor
Copies available
Effective date 01/01/06
Act No. 66
View the latest legislative information at the LPITS web site
VERSIONS OF THIS BILL
2/8/2005
3/16/2005
3/17/2005
4/29/2005
5/11/2005
(A66, R80, S422)
AN ACT TO AMEND ARTICLE 7, TITLE 62 OF THE CODE OF LAWS OF SOUTH
CAROLINA, 1976, RELATING TO TRUST ADMINISTRATION, SO AS TO ENACT
THE UNIFORM TRUST CODE BY PROVIDING A COMPREHENSIVE
CODIFICATION OR RECODIFICATION OF MUCH OF EXISTING TRUST LAW AND
SUPPLEMENTING EXISTING COMMON LAW UNLESS THE CODE SPECIFICALLY
CONTRADICTS IT, AND PROVIDING, AMONG OTHER THINGS, FOR GENERAL
PROVISIONS AND DEFINITIONS INCLUDING A DEFINITION FOR “QUALIFIED
BENEFICIARY” AND AN APPLICATION OF THE STATE’S WILL CONSTRUCTION
RULES TO THE CONSTRUCTION OF TRUSTS WHEN APPROPRIATE; FOR
JUDICIAL PROCEEDINGS AND REPRESENTATION BY OTHERS, ESSENTIALLY
RECODIFYING EXISTING VENUE, JURISDICTION, AND REPRESENTATION
PROVISIONS; FOR THE RULES FOR CREATION OF TRUSTS INCLUDING THAT A
SELF-SETTLED TRUST MUST BE IN WRITING, THAT A TRUST PURPOSE BE
LAWFUL AND ACHIEVABLE, THAT A VALID NONCHARITABLE TRUST MAY BE
CREATED WITHOUT DEFINITE BENEFICIARIES IN ONLY CERTAIN INSTANCES,
THAT AN EARLY TERMINATION OR MODIFICATION OF A NONAMENDABLE
IRREVOCABLE TRUST REQUIRES COURT APPROVAL, THAT A COURT MAY
MODIFY THE ADMINISTRATIVE OR DISPOSITIVE PROVISIONS OF A TRUST,
AND THAT A TRUST MAY BE TERMINATED IF IT CANNOT JUSTIFY ITS
ADMINISTRATIVE COSTS, MODIFIED TO ACCOMPLISH THE SETTLOR’S TAX
OBJECTIVES, OR DIVIDED OR COMBINED WITH OTHERS TO FACILITATE
ADMINISTRATION; FOR RETENTION OF THE ABILITY OF THE SETTLOR’S
CREDITORS TO REACH THE TRUST PROPERTY IN A TRUST; FOR THE
VALIDITY SPENDTHRIFT PROVISION EXCEPT AS TO CHILD SUPPORT AND
PROTECTION OF THE SPECIAL NEEDS TRUST; FOR THE PRESUMED
REVOCABILITY INSTEAD OF IRREVOCABILITY OF A TRUST, CLARIFICATION
OF THE MENTAL CAPACITY FOR CREATING A REVOCABLE TRUST, AND A
STATUTE OF LIMITATIONS FOR CONTESTING A REVOCABLE TRUST; AND FOR
RULES FOR THE OFFICE OF TRUSTEE, INCLUDING RESIGNATION AND
REMOVAL, DUTIES AND POWERS OF TRUSTEES, INCLUDING THE ESSENCE OF
SOUTH CAROLINA’S UNIFORM TRUSTEES POWERS ACT AND THE UNIFORM
PRUDENT INVESTORS ACT, ADDING A BROADER TRUSTEE POWER AND A
STANDARD OF CARE FOR TRUSTEE MATTERS IN ADDITION TO INVESTMENT
AND MANAGEMENT, AND THE UNIFORM PRINCIPAL AND INCOME ACT
GOVERNING
FIDUCIARY
ACCOUNTING
PRINCIPALS,
SUBSTANTIAL
RETENTION OF EXISTING LAW CONCERNING LIABILITY OF TRUSTEES AND
RIGHTS OF PERSONS DEALING WITH THEM, AND APPLICATION OF THESE
PROVISIONS TO EXISTING RELATIONSHIPS; TO AMEND SECTION 27-6-50,
RELATING TO EXCEPTIONS TO THE RULE AGAINST PERPETUITIES, SECTION
33-31-152, RELATING TO RIGHTS OF STATES AS TO CORPORATIONS, SECTION
34-15-10, AS AMENDED, RELATING TO A BANK ACTING AS FIDUCIARY,
SECTION 62-3-703, RELATING TO GENERAL DUTIES OF A PERSONAL
REPRESENTATIVE, SECTION 62-3-913, RELATING TO DISTRIBUTION BY A
PERSONAL REPRESENTATIVE TO A TRUSTEE, AND SECTION 62-5-417,
1
RELATING TO THE GENERAL DUTY OF A CONSERVATOR, ALL SO AS TO
AMEND CROSS REFERENCES TO CONFORM TO THIS ACT; AND TO REPEAL
SECTION 27-5-70.
Be it enacted by the General Assembly of the State of South Carolina:
Uniform Trust Code
SECTION 1. Article 7, Title 62 of the 1976 Code is amended to read:
“Article 7
Uniform Trust Code
Part 1
General Provisions and Definitions
General Comment
The South Carolina version of the Uniform Trust Code is referred to as the South Carolina
Trust Code or sometimes the SCTC throughout this article. The Uniform Trust Code is
sometimes referred to as the UTC. The South Carolina Probate Code, South Carolina Code Ann.
Section 62-1-100 et seq., is sometimes referred to as the SCPC. The sections of the South
Carolina Trust Code are codified at Title 62, Article 7 and consequently become a part of the
comprehensive South Carolina Probate Code. Depending on context, general references to
“article” in the UTC Comments may correlate to “Part” in the SCTC.
The Uniform Trust Code is primarily a default statute. Most of the Code’s provisions can be
overridden in the terms of the trust. The provisions not subject to override are scheduled in
Section 105(b). These include the duty of a trustee to act in good faith and with regard to the
purposes of the trust, public policy exceptions to enforcement of spendthrift provisions, the
requirements for creating a trust, and the authority of the court to modify or terminate a trust on
specified grounds.
The remainder of the article specifies the scope of the Code (Section 102), provides definitions
(Section 103), and collects provisions of importance not amenable to codification elsewhere in the
Uniform Trust Code. Sections 106 and 107 focus on the sources of law that will govern a trust.
Section 106 clarifies that despite the Code’s comprehensive scope, not all aspects of the law of
trusts have been codified. The Uniform Trust Code is supplemented by the common law of trusts
and principles of equity. Section 107 addresses selection of the jurisdiction or jurisdictions whose
laws will govern the trust. A settlor, absent overriding public policy concerns, is free to select the
law that will determine the meaning and effect of a trust’s terms.
Changing a trust’s principal place of administration is sometimes desirable, particularly to lower
a trust’s state income tax. Such transfers are authorized in Section 108. The trustee, following
notice to the “qualified beneficiaries,” defined in Section 103(12), may without approval of court
transfer the principal place of administration to another State or country if a qualified beneficiary
does not object and if the transfer is consistent with the trustee’s duty to administer the trust at a
2
place appropriate to its purposes, its administration, and the interests of the beneficiaries. The
settlor, if minimum contacts are present, may also designate the trust’s principal place of
administration.
Sections 104 and 109 through 111 address procedural issues. Section 104 specifies when
persons, particularly persons who work in organizations, are deemed to have acquired knowledge
of a fact. Section 109 specifies the methods for giving notice and excludes from the Code’s
notice requirements persons whose identity or location is unknown and not reasonably
ascertainable. Section 110 allows beneficiaries with remote interests to request notice of actions,
such as notice of a trustee resignation, which are normally given only to the qualified beneficiaries.
Section 111 ratifies the use of nonjudicial settlement agreements. While the judicial settlement
procedures may be used in all court proceedings relating to the trust, the nonjudicial settlement
procedures will not always be available. The terms of the trust may direct that the procedures not
be used, or settlors may negate or modify them by specifying their own methods for obtaining
consents. Also, a nonjudicial settlement may include only terms and conditions a court could
properly approve.
The Uniform Trust Code does not prescribe the rules of construction to be applied to trusts
created under the Code. The Code instead recognizes that enacting jurisdictions are likely to take
a diversity of approaches, just as they have with respect to the rules of construction applicable to
wills. Section 112 accommodates this variation by providing that the State’s specific rules on
construction of wills, whatever they may be, also apply to the construction of trusts.
South Carolina Comment
The South Carolina version of the Uniform Trust Code is referred to as the South Carolina
Trust Code or sometimes the SCTC throughout this article. The Uniform Trust Code is
sometimes referred to as the UTC. The South Carolina Probate Code, South Carolina Code Ann.
Section 62-1-100 et seq., is sometimes referred to as the SCPC. The sections of the South
Carolina Trust Code are codified at Title 62, Article 7 and consequently become a part of the
comprehensive South Carolina Probate Code.
By rule, the Comments to the Uniform Trust Code cannot be changed. However, because the
South Carolina Trust Code differs in some respects from the Uniform Trust Code, the Uniform
Trust Code Comments, although included, are not always appropriate for South Carolina.
Consequently, when appropriate, the South Carolina Comments include guidance to those
portions of the Uniform Trust Code Comments not appropriate for South Carolina. However,
portions of the UTC Comments not distinguished by the SCTC Comments may nevertheless be
inappropriate for the SCTC, especially with respect to cross-references. Depending on context,
general references to “article” in the UTC Comments may correlate to “Part” in the SCTC.
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’ shall mean the South Carolina Trust Code.
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
3
not limited to, all trusts defined in Section 62-1-201(44). 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.
Comment
This section provides a concise statement of the positive inclusion of express trusts within the
scope of the SCTC.
South Carolina has another comprehensive statement of the scope of applicable South Carolina
trust law, contained in the definition paragraph of the South Carolina Probate Code Section
62-1-201(44), which contains an expanded statement of the inclusion of express trusts and further
contains detailed statements of the trusts and trust type arrangements that are excluded from the
scope. This statement is now included in Section 62-7-102 with reference to Section
62-1-201(44). Former Section 62-7-702(1), in the South Carolina Uniform Trustee’s Powers
Act, which is repealed by the SCTC, also contained a comprehensive statement of applicable
South Carolina trust law.
The Uniform Trust Code, while comprehensive, applies only to express trusts. Excluded from
the Code’s coverage are resulting and constructive trusts, which are not express trusts but
remedial devices imposed by law. For the requirements for creating an express trust and the
methods by which express trusts are created, see Sections 62-7-401 and 62-7-402. The Code
does not attempt to distinguish express trusts from other legal relationships with respect to
property, such as agencies and contracts for the benefit of third parties. For the distinctions, see
Restatement (Third) of Trusts Sections 2, 5 (Tentative Draft No. 1, approved 1996); Restatement
(Second) of Trusts Sections 2, 5-16C (1959).
The Uniform Trust Code is directed primarily at trusts that arise in an estate planning or other
donative context, but express trusts can arise in other contexts. For example, a trust created
pursuant to a divorce action would be included, even though such a trust is not donative but is
created pursuant to a bargained-for exchange. Commercial trusts come in numerous forms,
including trusts created pursuant to a state business trust act and trusts created to administer
specified funds, such as to pay a pension or to manage pooled investments. Commercial trusts are
often subject to special-purpose legislation and case law, which in some respects displace the
usual rules stated in this Code. See John H. Langbein, The Secret Life of the Trust: The Trust as
an Instrument of Commerce, 107 Yale L.J. 165 (1997).
Express trusts also may be created by means of court judgment or decree. Examples include
trusts created to hold the proceeds of personal injury recoveries and trusts created to hold the
assets of a protected person in a conservatorship proceeding. See, e.g., Uniform Probate Code
Section 5-411(a)(4).
This section provides a concise statement of the positive inclusion of express trusts within the
scope of the SCTC.
4
South Carolina has another comprehensive statement of the scope of applicable South Carolina
trust law, contained in the definition paragraph of the South Carolina Probate Code Section
62-1-201(44), which contains an expanded statement of the inclusion of express trusts and further
contains detailed statements of the trusts and trust type arrangements that are excluded from the
scope. This statement is now included in Section 62-7-102 with reference to Section
62-1-201(44). Former Section 62-7-702(1), in the South Carolina Uniform Trustee’s Powers
Act, which is repealed by the SCTC, also contained a comprehensive statement of applicable
South Carolina trust law.
Section 62-7-103. Definitions (which are not in alphabetical order). 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
5
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.
(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 roperty of a trust from a trustee, other
than as a creditor or purchaser.
(26) "Trust Investment Advisor," is any person, committee of persons or entity who is/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 any person, committee of persons or entity who is/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.
Comment
There are a number of definitions in Section 62-7-103 referred to throughout the South
Carolina Trust Code that have no equivalent in other portions of the South Carolina Code. These
include “Action,” “Charitable trust,” “Environmental law,” “Interests of the beneficiaries,”
6
“Jurisdiction,” “Power of withdrawal,” “Qualified beneficiary,” “Revocable,” “Settlor,”
“Spendthrift provision,” “Terms of a trust,” and “Trust instrument.” In the interest of uniformity,
such terms are included in the South Carolina Trust Code except as noted below.
A definition of “action” (paragraph (1)) is included for drafting convenience, to avoid having to
clarify in the numerous places in the Uniform Trust Code where reference is made to an “action”
by the trustee that the term includes a failure to act.
“Beneficiary” (paragraph (2)) refers only to a beneficiary of a trust as defined in the Uniform
Trust Code. In addition to living and ascertained individuals, beneficiaries may be unborn or
unascertained. Pursuant to Section 62-7-402(cb), a trust is valid only if a beneficiary can be
ascertained now or in the future. The term “beneficiary” includes not only beneficiaries who
received their interests under the terms of the trust but also beneficiaries who received their
interests by other means, including by assignment, exercise of a power of appointment, resulting
trust upon the failure of an interest, gap in a disposition, operation of an antilapse statute upon the
predecease of a named beneficiary, or upon termination of the trust. The fact that a person
incidentally benefits from the trust does not mean that the person is a beneficiary. For example,
neither a trustee nor persons hired by the trustee become beneficiaries merely because they receive
compensation from the trust. See Restatement (Third) of Trusts Section 48 cmt. c (Tentative
Draft No. 2, approved 1999); Restatement (Second) of Trusts Section 126 cmt. c (1959).
While the holder of a power of appointment is not considered a trust beneficiary under the
common law of trusts, holders of powers are classified as beneficiaries under the Uniform Trust
Code. Holders of powers are included on the assumption that their interests are significant
enough that they should be afforded the rights of beneficiaries. A power of appointment as used
in state trust law and this Code is as defined in state property law and not federal tax law although
there is considerable overlap between the two definitions.
A power of appointment is authority to designate the recipients of beneficial interests in
property. See Restatement (Second) of Property: Donative Transfers Section 11.1 (1986). A
power is either general or nongeneral and either presently exercisable or not presently exercisable.
A general power of appointment is a power exercisable in favor of the holder of the power, the
power holder’s creditors, the power holder’s estate, or the creditors of the power holder’s estate.
See Restatement (Second) of Property: Donative Transfers Section 11.4 (1986). All other
powers are nongeneral. A power is presently exercisable if the power holder can currently create
an interest, present or future, in an object of the power. A power of appointment is not presently
exercisable if exercisable only by the power holder’s will or if its exercise is not effective for a
specified period of time or until occurrence of some event. See Restatement (Second) of
Property: Donative Transfers Section 11.5 (1986). Powers of appointment may be held in either
a fiduciary or nonfiduciary capacity. The definition of “beneficiary” excludes powers held by a
trustee but not powers held by others in a fiduciary capacity.
While all categories of powers of appointment are included within the definition of
“beneficiary,” the Uniform Trust Code elsewhere makes distinctions among types of powers. A
“power of withdrawal” (paragraph (10)) is defined as a presently exercisable general power of
appointment other than a power exercisable only upon consent of the trustee or a person holding
an adverse interest. Under Section 62-7-302, the holder of a testamentary general power of
appointment may represent and bind persons whose interests are subject to the power.
The definition of “beneficiary” includes only those who hold beneficial interests in the trust.
Because a charitable trust is not created to benefit ascertainable beneficiaries but to benefit the
community at large (see Section 62-7-405(a)), persons receiving distributions from a charitable
7
trust are not beneficiaries as that term is defined in this Code. However, pursuant to Section 627-110(b), charitable organizations expressly designated to receive distributions under the terms of
a charitable trust, even though not beneficiaries as defined, are granted the rights of qualified
beneficiaries under the Code.
The Uniform Trust Code leaves certain issues concerning beneficiaries to the common law.
Any person with capacity to take and hold legal title to intended trust property has capacity to be
a beneficiary. See Restatement (Third) of Trusts Section 43 (Tentative Draft No. 2, approved
1999); Restatement (Second) of Trusts Sections 116-119 (1959). Except as limited by public
policy, the extent of a beneficiary’s interest is determined solely by the settlor’s intent. See
Restatement (Third) of Trusts Section 49 (Tentative Draft No. 2, approved 1999); Restatement
(Second) of Trusts Sections 127-128 (1959). While most beneficial interests terminate upon a
beneficiary’s death, the interest of a beneficiary may devolve by will or intestate succession the
same as a corresponding legal interest. See Restatement (Third) of Trusts Section 55(1)
(Tentative Draft No. 2, approved 1999); Restatement (Second) of Trusts Sections 140, 142
(1959).
Under the Uniform Trust Code, when a trust has both charitable and noncharitable beneficiaries
only the charitable portion qualifies as a “charitable trust” (paragraph (3)). The great majority of
the Code’s provisions apply to both charitable and noncharitable trusts without distinction. The
distinctions between the two types of trusts are found in the requirements relating to trust creation
and modification. Pursuant to Sections 62-7-405 and 62-7-413 of the USCTC, a charitable trust
must have a charitable purpose and charitable trusts may be modified or terminated under the
doctrine of equitable deviationcy pres. South Carolina courts have refused to recognize the
doctrine of cy pres (see Section 62-7-413 comment); however, a charitable trust in South
Carolina may be modified or terminated under the doctrine of equitable deviation. Also,
Section 62-7-411 allows a noncharitable trust to in certain instances be terminated by its
beneficiaries while charitable trusts do not have beneficiaries in the usual sense. To the extent of
these distinctions, a split-interest trust is subject to two sets of provisions, one applicable to the
charitable interests, the other the noncharitable.
Subsection (4) is modified to reflect the definition of “conservator” contained in South Carolina
Probate Code Section 62-1-201(6).For further discussion of the definition of “conservator”
(paragraph (4)), see the definition of “guardian” (paragraph (6)).
To encourage trustees to accept and administer trusts containing real property, the Uniform
Trust Code contains several provisions designed to limit exposure to possible liability for violation
of “environmental law” (paragraph (5)). Section 62-7-701(c)(2) authorizes a nominated trustee
to investigate trust property to determine potential liability for violation of environmental law or
other law without accepting the trusteeship.
Section 62-7-816(13) grants a trustee
comprehensive and detailed powers to deal with property involving environmental risks. Section
62-7-1010(b) immunizes a trustee from personal liability for violation of environmental law arising
from the ownership and control of trust property.
Under the Uniform Trust Code, a “guardian” (paragraph (6)) makes decisions with respect to
personal care; a “conservator” (paragraph (4)) manages property. The terminology used in the
UTC is that employed in Article V of the Uniform Probate Code, and in its free-standing Uniform
Guardianship and Protective Proceedings Act. Enacting jurisdictions not using these terms in the
defined sense should substitute their own terminology. For this reason, both terms have been
placed in brackets in the UTC version. The UTC definition of “guardian” accommodates those
jurisdictions which allow appointment of a guardian by a parent or spouse in addition to
8
appointment by a court. Enacting jurisdictions, such as South Carolina, which allow appointment
of a guardian solely by a court should have deleted the bracketed language “a parent, or a
spouse.” Further, The South Carolina Probate Code (Section 62-1-201(16)) specifically excludes
“a statutory guardian” and this modification was incorporated into the SCTC definition.
The phrase “interests of the beneficiaries” (paragraph (7)) is used with some frequency in the
Uniform Trust Code. The definition clarifies that the interests are as provided in the terms of the
trust and not as determined by the beneficiaries. Absent authority to do so in the terms of the
trust, Section 62-7-108 prohibitsdictates that a trustee is under a continuing dutyfrom changing a
trust’s principal place of administration if the transfer would violate the trustee’s duty to
administer the trust at a place appropriate to the interests of the beneficiaries. Section 62-7706(b) conditions certain of the grounds for removing a trustee on the court’s finding that
removal of the trustee will best serve the interests of the beneficiaries. Section 62-7-801 requires
the trustee to administer the trust in the interests of the beneficiaries, and Section 62-7-802 makes
clear that a trustee may not place its own interests above those of the beneficiaries. Section 62-7808(d) requires the holder of a power to direct who is subject to a fiduciary obligation to act with
regard to the interests of the beneficiaries. Section 62-7-1002(b) may impose greater liability on a
cotrustee who commits a breach of trust with reckless indifference to the interests of the
beneficiaries. Section 62-7-1008 invalidates an exculpatory term to the extent it relieves a trustee
of liability for breach of trust committed with reckless indifference to the interests of the
beneficiaries.
“Jurisdiction” (paragraph (8)), when used with reference to a geographic area, includes a state
or country but is not necessarily so limited. Its precise scope will depend on the context in which
it is used. “Jurisdiction” is used in Sections 62-7-107 and 62-7-403 to refer to the place whose
law will govern the trust. The term is used in Section 62-7-108 to refer to the trust’s principal
place of administration. The term is used in Section 62-7-816 to refer to the place where the
trustee may appoint an ancillary trustee and to the place in whose courts the trustee can bring and
defend legal proceedings.
The definition of “property” (paragraph (11)) is intended to be as expansive as possible and to
encompass anything that may be the subject of ownership. Included are choses in action, claims,
and interests created by beneficiary designations under policies of insurance, financial instruments,
and deferred compensation and other retirement arrangements, whether revocable or irrevocable.
Any such property interest is sufficient to support creation of a trust. See Section 62-7-401
comment.
Due to the difficulty of identifying beneficiaries whose interests are remote and contingent, and
because such beneficiaries are not likely to have much interest in the day-to-day affairs of the
trust, the Uniform Trust Code uses the concept of “qualified beneficiary” (paragraph (12)) to limit
the class of beneficiaries to whom certain notices must be given or consents received. The
definition of qualified beneficiaries is used in Section 62-7-705 to define the class to whom notice
must be given of a trustee resignation. The term is used in Section 62-7-813 to define the class to
be kept informed of the trust’s administration. Section 62-7-417 requires that notice be given to
the qualified beneficiaries before a trust may be combined or divided. Actions which may be
accomplished by the consent of the qualified beneficiaries include the appointment of a successor
trustee as provided in Section 62-7-704. Prior to transferring a trust’s principal place of
administration, SCTC Section 62-7-108(e) (UTC Section 108(d)) requires that the trustee give at
least 60 days notice to the qualified beneficiaries.
The qualified beneficiaries consist of the beneficiaries currently eligible to receive receiving a
9
distribution from the trust together with those who might be termed the first-line remaindermen.
These are the beneficiaries who would become eligible to receive distributions were the event
triggering the termination of a beneficiary’s interest or of the trust itself to occur on the date in
question. Such a terminating event will typically be the death or deaths of the beneficiaries
currently eligible to receive the income. Should a qualified beneficiary be a minor, incapacitated,
or unknown, or a beneficiary whose identity or location is not reasonably ascertainable, the
representation and virtual representation principles of Article 3 may be employed, including the
possible appointment by the court of a representative to represent the beneficiary’s interest.
The qualified beneficiaries who take upon termination of the beneficiary’s interest or of the trust
can include takers in default of the exercise of a power of appointment. The term can also include
the persons entitled to receive the trust property pursuant to the exercise of a power of
appointment. Because the exercise of a testamentary power of appointment is not effective until
the testator’s death and probate of the will, the qualified beneficiaries do not include appointees
under the will of a living person. Nor would the term include the objects of an unexercised inter
vivos power.
Charitable trusts and trusts for a valid noncharitable purpose do not have beneficiaries in the
usual sense. However, certain persons, while not technically beneficiaries, do have an interest in
seeing that the trust is enforced. Section 62-7-110 expands the definition of qualified beneficiaries
to encompass this wider group. UTC Section 110 It grants the rights of qualified beneficiaries to
the attorney general of the state and charitable organizations expressly designated to receive
distributions under the terms of a charitable trust; SCTC Section 62-7-110 grants the rights of
qualified beneficiaries only to charitable organizations expressly designated to receive distributions
under the terms of a charitable trust. It Section 62-7-110 also grants the rights of qualified
beneficiaries to persons appointed by the terms of the trust or by the court to enforce a trust
created for an animal or other noncharitable purpose.
The definition of “revocable” (paragraph (13)) clarifies that revocable trusts include only trusts
whose revocation is substantially within the settlor’s control. The consequences of classifying a
trust as revocable are many. The Uniform Trust Code contains provisions relating to liability of a
revocable trust for payment of the settlor’s debts (Section 62-7-505), the standard of capacity for
creating a revocable trust (Section 62-7-601), the procedure for revocation (Section 62-7-602),
the subjecting of the beneficiaries’ rights to the settlor’s control (Section 62-7-603), the period for
contesting a revocable trust (Section 62-7-604), the power of the settlor of a revocable trust to
direct the actions of a trustee (Section 62-7-808(a)), notice to the qualified beneficiaries upon the
settlor’s death (Section 62-7-813(b)), and the liability of a trustee of a revocable trust for the
obligations of a partnership of which the trustee is a general partner (Section 62-7-1011(d)).
Because under UTC Section 603(c) (now, UTC Section 603(b) as a 2001 amendment deleted
former subsection (b)) the holder of a power of withdrawal has the rights of a settlor of a
revocable trust, the definition of “power of withdrawal” (paragraph (10)), and “revocable”
(paragraph (13)) are similar. Both exclude individuals who can exercise their power only with the
consent of the trustee or person having an adverse interest. SCTC Section 62-7-603 does not
include UTC subsection 603(b).
The definition of “settlor” (paragraph (14)) refers to the person who creates, or contributes
property to, a trust, whether by will, self-declaration, transfer of property to another person as
trustee, or exercise of a power of appointment. For the requirements for creating a trust, see
Section 62-7-401. Determining the identity of the “settlor” is usually not an issue. The same
person will both sign the trust instrument and fund the trust. Ascertaining the identity of the
10
settlor becomes more difficult when more than one person signs the trust instrument or funds the
trust. The fact that a person is designated as the “settlor” by the terms of the trust is not
necessarily determinative. For example, the person who executes the trust instrument may be
acting as the agent for the person who will be funding the trust. In that case, the person funding
the trust, and not the person signing the trust instrument, will be the settlor. Should more than
one person contribute to a trust, all of the contributors will ordinarily be treated as settlors in
proportion to their respective contributions, regardless of which one signed the trust instrument.
See Section 62-7-602(b).
In the case of a revocable trust employed as a will substitute, gifts to the trust’s creator are
sometimes made by placing the gifted property directly into the trust. To recognize that such a
donor is not intended to be treated as a settlor, the definition of “settlor” excludes a contributor to
a trust that is revocable by another person or over which another person has a power of
withdrawal. Thus, a parent who contributes to a child’s revocable trust would not be treated as
one of the trust’s settlors. The definition of settlor would treat the child as the sole settlor of the
trust to the extent of the child’s proportionate contribution. Pursuant to UTC Section 603(c)
(now, UTC Section 603(b) as a 2001 amendment deleted former subsection (b)), the child’s
power of withdrawal over the trust would also result in the child being treated as the settlor with
respect to the portion of the trust attributable to the parent’s contribution.
Ascertaining the identity of the settlor is important for a variety of reasons. It is important for
determining rights in revocable trusts. See Sections 62-7-505(a)(1), (3) (creditor claims against
settlor of revocable trust), 62-7-602 (revocation or modification of revocable trust), and 62-7-604
(limitation on contest of revocable trust). It is also important for determining rights of creditors in
irrevocable trusts. See Section 62-7-505(a)(2) (creditors of settlor can reach maximum amount
trustee can distribute to settlor). While the settlor of an irrevocable trust traditionally has no
continuing rights over the trust except for the right under Section 62-7-411 to terminate the trust
with the beneficiaries’ consent, the Uniform Trust Code also authorizes the settlor of an
irrevocable trust to petition for removal of the trustee and to enforce or modify a charitable trust.
See Sections 62-7-405(c) (standing to enforce charitable trust), 62-7-413 (doctrine of cy pres or,
in South Carolina, doctrine of equitable deviation), and 62-7-706 (removal of trustee).
“Spendthrift provision” (paragraph (15)) means a term of a trust which restrains the transfer of
a beneficiary’s interest, whether by a voluntary act of the beneficiary or by an action of a
beneficiary’s creditor or assignee, which at least as far as the beneficiary is concerned, would be
involuntary. A spendthrift provision is valid under the Uniform Trust Code only if it restrains
both voluntary and involuntary transfer. For a discussion of this requirement and the effect of a
spendthrift provision in general, see Section 62-7-502. The insertion of a spendthrift provision in
the terms of the trust may also constitute a material purpose sufficient to prevent termination of
the trust by agreement of the beneficiaries under Section 62-7-411, although the Code does not
presume this result.
“Terms of a trust” (paragraph (17)) is a defined term used frequently in the Uniform Trust
Code. While the wording of a written trust instrument is almost always the most important
determinant of a trust’s terms, the definition is not so limited. Oral statements, the situation of the
beneficiaries, the purposes of the trust, the circumstances under which the trust is to be
administered, and, to the extent the settlor was otherwise silent, rules of construction, all may
have a bearing on determining a trust’s meaning. See Restatement (Third) of Trusts Section 4
cmt. a (Tentative Draft No. 1, approved 1996); Restatement (Second) of Trusts Section 4 cmt. a
(1959). If a trust established by order of court is to be administered as an express trust, the terms
11
of the trust are determined from the court order as interpreted in light of the general rules
governing interpretation of judgments. See Restatement (Third) of Trusts Section 4 cmt. f
(Tentative Draft No. 1, approved 1996).
A manifestation of a settlor’s intention does not constitute evidence of a trust’s terms if it
would be inadmissible in a judicial proceeding in which the trust’s terms are in question. See
Restatement (Third) of Trusts Section 4 cmt. b (Tentative Draft No. 1, approved 1996);
Restatement (Second) of Trusts Section 4 cmt. b (1959). See also Restatement (Third) Property:
Donative Transfers Sections 10.2, 11.1-11.3 (Tentative Draft No. 1, approved 1995). For
example, South Carolina has chosen to recognize the creation of an oral trust, in many states a
trust of real property is unenforceable unless evidenced by a writing, although Section 62-7-407
of this Code does not so require, leaving this issue to be covered by separate statute if the
enacting jurisdiction so elects. Evidence otherwise relevant to determining the terms of a trust
may also be excluded under other principles of law, such as the parol evidence rule.
“Trust instrument” (paragraph (18)) is a subset of the definition of “terms of a trust”
(paragraph (17)), referring to only such terms as are found in an instrument executed by the
settlor. Section 62-7-403 provides that a trust is validly created if created in compliance with the
law of the place where the trust instrument was executed. Pursuant to Section 62-7-604(a)(2),
the contest period for a revocable trust can be shortened by providing the potential contestant
with a copy of the trust instrument plus other information. UTC Section 813(b)(1) and SCTC
Sections 62-7-813(b)(1) and (3) requires that the trustee upon request furnish a beneficiary with a
copy of the trust instrument. To allow a trustee to administer a trust with some dispatch without
concern about liability if the terms of a trust instrument are contradicted by evidence outside of
the instrument, Section 62-7-1006 protects a trustee from liability to the extent a breach of trust
resulted from reasonable reliance on those terms. Section 62-7-1013 allows a trustee to substitute
a certification of trust in lieu of providing a third person with a copy of the trust instrument.
Section 62-7-1106(a)(4) provides that unless there is a clear indication of a contrary intent, rules
of construction and presumptions provided in the Uniform Trust Code apply to trust instruments
executed before the effective date of the Code.
The definition of “trustee” (paragraph (19)) includes not only the original trustee but also an
additional and successor trustee as well as a cotrustee. Section 62-1-201 of the South Carolina
Probate Code contains the additional language “whether or not appointed or confirmed by court”
and the South Carolina Trust Code retains that additional language. Because the definition of
trustee includes trustees of all types, any trustee, whether original or succeeding, single or
cotrustee, has the powers of a trustee and is subject to the duties imposed on trustees under the
Uniform Trust Code. Any natural person, including a settlor or beneficiary, has capacity to act as
trustee if the person has capacity to hold title to property free of trust. See Restatement (Third)
of Trusts Section 32 (Tentative Draft No. 2, approved 1999); Restatement (Second) of Trusts
Section 89 (1959). State banking statutes normally impose additional requirements before a
corporation can act as trustee.
Subsections (21) (defining “distributee”), (25) (defining “permissible distributee”), (26)
(defining “Trust Investment Advisor”), and (27) (defining “Trust Protector”) are South Carolina
additions.
The South Carolina version of Section 62-7-103 expresses the intent that the definitions
contained in the South Carolina Probate Code that are not otherwise defined within the South
Carolina Trust Code and that do not conflict with the definitions contained in the South Carolina
Trust Code shall continue to apply to the law governing trusts in South Carolina.
12
There are a number of definitions in Section 62-7-103 referred to throughout the South
Carolina Trust Code that have no equivalent in other portions of the South Carolina Code. These
include “Action,” “Charitable trust,” “Environmental law,” “Interests of the beneficiaries,”
“Jurisdiction,” “Power of withdrawal,” “Qualified beneficiary,” “Revocable,” “Settlor,”
“Spendthrift provision,” “Terms of a trust,” and “Trust instrument.” In the interest of uniformity,
such terms are included in the South Carolina Trust Code except as noted below.
Subsection (4) is modified to reflect the definition of “conservator” contained in South Carolina
Probate Code Section 62-1-201(6).
Subsection (6) defines “guardian.” The South Carolina Probate Code (Section 62-1-201(16))
specifically excludes “a statutory guardian” and this modification was incorporated into the
definition.
Subsection (19) defines the term “trustee.” Section 62-1-201 of the South Carolina Probate
Code contains the additional language “whether or not appointed or confirmed by court” and the
South Carolina Trust Code retains that additional language.
Subsection (21) defining “distributee” is a South Carolina addition.
The South Carolina version of Section 62-7-103 expresses the intent that the definitions
contained in the South Carolina Probate Code that are not otherwise defined within the South
Carolina Trust Code and that do not conflict with the definitions contained in the South Carolina
Trust Code shall continue to apply to the law governing trusts in South Carolina.
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.
Comment
This section specifies when a person is deemed to know a fact. Subsection (a) states the
general rule. Subsection (b) provides a special rule dealing with notice to organizations. Pursuant
to subsection (a), a fact is known to a person if the person had actual knowledge of the fact,
received notification of it, or had reason to know of the fact’s existence based on all of the
circumstances and other facts known to the person at the time. Under subsection (b), notice to an
organization is not necessarily achieved by giving notice to a branch office. Nor does the
13
organization necessarily acquire knowledge at the moment the notice arrives in the organization’s
mailroom. Rather, the organization has notice or knowledge of a fact only when the information
is received by an employee having responsibility to act for the trust, or would have been brought
to the employee’s attention had the organization exercised reasonable diligence.
“Know” is used in its defined sense in Sections 62-7-109 (methods and waiver of notice), 62-7305 (appointment of representative), 62-7-604(b) (limitation on contest of revocable trust), 62-7UTC Section 812 (collecting trust property), 1009 (nonliability of trustee upon beneficiary’s
consent, release, or ratification), and 62-7-1012 (protection of person dealing with trustee). But
as to certain actions, a person is charged with knowledge of facts the person would have
discovered upon reasonable inquiry. See Section 62-7-1005 (limitation of action against trustee
following report of trustee).
This section is based on Uniform Commercial Code Section 1-202 (2000 Annual Meeting
Draft).
The reference to Uniform Trust Code Section 812 in the Uniform Trust Code Comment is
inapplicable to the South Carolina Trust Code because the SCTC does not include the UTC
version of Section 812.
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 62-7-602(e);
(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.
Comment
Section 62-7-105(a) begins with the premise that the provisions of the South Carolina Trust
14
Code govern trusts when the terms of a trust do not otherwise direct. While this Code provides
numerous procedural rules on which a settlor may wish to rely, the settlor is generally free to
override these rules and to prescribe the conditions under which the trust is to be administered.
However, subsection (b) lists eleven separate requirements that may not be waived and will be
controlled by the terms of the SCTC irrespective of the terms of the trust.
Subsection (a) emphasizes that the Uniform Trust Code is primarily a default statute. While this
Code provides numerous procedural rules on which a settlor may wish to rely, the settlor is
generally free to override these rules and to prescribe the conditions under which the trust is to be
administered. With only limited exceptions, the duties and powers of a trustee, relations among
trustees, and the rights and interests of a beneficiary are as specified in the terms of the trust.
Subsection (b) lists the items not subject to override in the terms of the trust. Because
subsection (b) refers specifically to other sections of the Code, enacting jurisdictions modifying
these other sections may also need to modify subsection (b).
Subsection (b)(1) confirms that the requirements for a trust’s creation, such as the necessary
level of capacity and the requirement that a trust have a legal purpose, are controlled by statute
and common law, not by the settlor. For the requirements for creating a trust, see Sections 62-7401-409. Subsection (b)(912) makes clear that the settlor may not reduce any otherwise
applicable period of limitations for commencing a judicial proceeding. See Sections 62-7-604
(period of limitations for contesting validity of revocable trust), and 62-7-1005 (period of
limitation on action for breach of trust). Similarly, a settlor may not so negate the responsibilities
of a trustee that the trustee would no longer be acting in a fiduciary capacity. Subsection (b)(2)
provides that the terms may not eliminate a trustee’s duty to act in good faith and in accordance
with the purposes of the trust. Subsection (b)(3) provides that the terms may not eliminate the
requirement that a trust and its terms must be for the benefit of the beneficiaries.
Subsection (b)(3) also provides that the terms may not eliminate the requirement that the trust
have a purpose that is lawful , not contrary to public policy, and possible to achieve.
Subsection (b)(2)-(3) are echoed in Sections 62-7-404 (trust and its terms must be for benefit of
beneficiaries; trust must have a purpose that is lawful, not contrary to public policy, and possible
to achieve), 62-7-801 (trustee must administer trust in good faith, in accordance with its terms
and purposes and the interests of the beneficiaries), 62-7-802(a) (trustee must administer trust
solely in interests of the beneficiaries), 62-7-814 (trustee must exercise discretionary power in
good faith and in accordance with its terms and purposes and the interests of the beneficiaries),
and 62-7-1008 (exculpatory term unenforceable to extent it relieves trustee of liability for breach
of trust committed in bad faith or with reckless indifference to the purposes of the trust and the
interests of the beneficiaries). SCTC Section 62-7-404 does not include the words “not contrary
to public policy,” found in UTC Section 404, recognizing that existing South Carolina law would
invalidate trusts that are contrary to public policy.
The UTC provides that the terms of a trust may not deny a court authority to take such action
as necessary in the interests of justice, including requiring that a trustee furnish bond. UTC
Subsections (b)(6), (13). The SCTC does not include the UTC version of subsection 105(b)(6).
Section 62-7-702 of the South Carolina Trust Code provides the situations for which the Trustee
must provide bond.
Additionally, should the jurisdiction adopting this Code enact the optional provisions on
subject-matter jurisdiction and venue, UTC subsection (b)(14) and SCTC subsection (b)(12)
similarly provides that such provisions cannot be altered in the terms of the trust. The power of
the court to modify or terminate a trust under Sections 62-7-410 through 62-7-416 is not subject
15
to variation in the terms of the trust. Subsection (b)(4). However, all of these Code sections
involve situations which the settlor could have addressed had the settlor had sufficient foresight.
These include situations where the purpose of the trust has been achieved, a mistake was made in
the trust’s creation, or circumstances have arisen that were not anticipated by the settlor.
Section 62-7-813 imposes a general obligation to keep the beneficiaries informed as well as
several specific notice requirements. UTC Subsections (b)(8) and (b)(9) specify limits on the
settlor’s ability to waive these information requirements. The South Carolina Trust Code does
not include the UTC version of subsections 105(b)(8)-(9). Under the UTC, With with respect to
beneficiaries age 25 or older, a settlor may dispense with all of the requirements of Section 62-7813 except for the duties to inform the beneficiaries of the existence of the trust, of the identity of
the trustee, and to provide a beneficiary upon request with such reports as the trustee may have
prepared. Among the specific requirements that a settlor may waive include the duty to provide a
beneficiary upon request with a copy of the trust instrument (Section 62-7-813(b)(31)), and the
requirement that the trustee provide annual reports to distributees, permissible distributees or
other the qualified beneficiaries (Section 813(c)(1)). The furnishing of a copy of the entire trust
instrument and preparation of annual reports may be required in a particular case, however, if
such information is requested by a beneficiary and is reasonably related to the trust’s
administration.
Responding to the desire of some settlors that younger beneficiaries not know of the trust’s
bounty until they have reached an age of maturity and self-sufficiency, subsection (b)(8) allows a
settlor to provide that the trustee need not even inform beneficiaries under age 25 of the existence
of the trust. However, pursuant to subsection (b)(9), if the younger beneficiary learns of the trust
and requests information, the trustee must respond. More generally, subsection (b)(9) prohibits a
settlor from overriding the right provided to a beneficiary in Section 813(a) to request from the
trustee of an irrevocable trust copies of trustee reports and other information reasonably related to
the trust’s administration.
During the drafting of the Uniform Trust Code, the drafting committee discussed and rejected a
proposal that the ability of the settlor to waive required notice be based on the nature of the
beneficiaries’ interest and not on the beneficiaries’ age. Advocates of this alternative approach
concluded that a settlor should be able to waive required notices to the remainder beneficiaries,
regardless of their age. Enacting jurisdictions preferring this alternative should substitute the
language “adult and current or permissible distributees of trust income or principal” for the
reference to “qualified beneficiaries” in subsection (b)(8). They should also delete the reference
to beneficiaries “who have attained the age of 25 years.”
Waiver by a settlor of the trustee’s duty to keep the beneficiaries informed of the trust’s
administration does not otherwise affect the trustee’s duties. The trustee remains accountable to
the beneficiaries for the trustee’s actions.
Neither subsection (b)(8) nor (b)(9) apply to revocable trusts. The settlor of a revocable trust
may waive all reporting to the beneficiaries, even in the event the settlor loses capacity. If the
settlor is silent about the subject, reporting to the beneficiaries will be required upon the settlor’s
loss of capacity. See Section 603.
In conformity with traditional doctrine, the Uniform Trust Code limits the ability of a settlor to
exculpate a trustee from liability for breach of trust. The limits are specified in Section 62-71008. UTC Subsection (b)(10) and SCTC Subsection (b)(8) of this section provides a
cross-reference. Similarly, subsection (b)(7) provides a cross-reference to Section 708(b), which
limits the binding effect of a provision specifying the trustee’s compensation.
16
Finally, UTC subsection (b)(11) and SCTC subsection (b)(9) clarifies clarify that a settlor is not
free to limit the rights of third persons, such as purchasers of trust property. Subsection (b)(5)
clarifies that a settlor may not restrict the rights of a beneficiary’s creditors except to the extent a
spendthrift restriction is allowed as provided in Article 5.
2001 Amendment. By amendment in 2001, subsection (b)(3), (8) and (9) were revised to read
as above. The language in subsection (b)(3) “that the trust have a purpose that is lawful , not
contrary to public policy, and possible to achieve” is new. This addition clarifies that the settlor
may not waive this common law requirement, which is codified in the Code at Section 62-7-404.
SCTC Section 62-7-404 does not include the words “not contrary to public policy,” found in
UTC Section 404, recognizing that existing South Carolina law would invalidate trusts that are
contrary to public policy. As a result, SCTC subsection (b)(3) does not include the words “not
contrary to public policy.”
The SCTC does not include the UTC version of Subsections 105Subsection (b)(8) -and (9)
thus the 2001 Amendment which applies to Subsections 105 (b)(8)-(9) is not applicable.formerly
provided:
(8) the duty to notify the qualified beneficiaries of an irrevocable trust who have attained 25
years of age of the existence of the trust, and of their right to request trustee’s reports and other
information reasonably related to the administration of the trust;
(9) the duty to respond to the request of a beneficiary of an irrevocable trust for trustee’s
reports and other information reasonably related to the administration of a trust.
The amendment clarifies that the information requirements not subject to waiver are requirements
specified in Section 813 of the Code.
2010 Amendment to the SCTC. The 2010 amendment added subsection (b)(6) relating to
limitations on a settlor’s agent; and redesignated former subsections (b)(6) through (b)(11) as
subsections (b)(7) through (b)(12), respectively.
Section 62-7-105(a) begins with the premise that the provisions of the South Carolina Trust
Code govern trusts when the terms of a trust do not otherwise direct. However, subsection (b)
lists eleven separate requirements that may not be waived and will be controlled by the terms of
the SCTC irrespective of the terms of the trust.
Subsection 105(b)(6) of the UTC prohibits a Settlor from forgoing a bond requirement of their
Trustee. The reference to Uniform Trust Code subsection 105(b)(6) in the Uniform Trust Code
Comment is inapplicable to the South Carolina Trust Code because the SCTC does not include
the UTC version of subsection 105(b)(6). Section 62-7-702 of the South Carolina Trust Code
provides the situations for which the Trustee must provide bond. The references to Uniform
Trust Code subsection 105(b)(8)-(9) in the Uniform Trust Code Comment are inapplicable to the
South Carolina Trust Code because the SCTC does not include the UTC versions of subsection
105(b)(8)-(9). The other references to subsection 105(b) in the Uniform Trust Code Comment
should be read to accommodate the SCTC’s failure to include UTC subsection 105(b)(6), (8), and
(9). For example, the reference to UTC subsection 105(b)(10) in the UTC Comment should be
read to apply to SCTC Section 62-7-105(b)(7).
17
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.
Comment
The Uniform Trust Code codifies those portions of the law of express trusts that are most
amenable to codification. The Code is supplemented by the common law of trusts, including
principles of equity, particularly as articulated in the Restatement of Trusts, Restatement (Third)
of Property: Wills and Other Donative Transfers, and the Restatement of Restitution. The
common law of trusts is not static but includes the contemporary and evolving rules of decision
developed by the courts in exercise of their power to adapt the law to new situations and
changing conditions. It also includes the traditional and broad equitable jurisdiction of the court,
which the Code in no way restricts.
The statutory text of the Uniform Trust Code is also supplemented by these Comments, which,
like the Comments to any Uniform Act, may be relied on as a guide for interpretation. See
Acierno v. Worthy Bros. Pipeline Corp., 656 A.2d 1085, 1090 (Del. 1995) (interpreting Uniform
Commercial Code); Yale University v. Blumenthal, 621 A.2d 1304, 1307 (Conn. 1993)
(interpreting Uniform Management of Institutional Funds Act); 2 Norman Singer, Statutory
Construction Section 52.05 (6th ed. 2000); Jack Davies, Legislative Law and Process in a
Nutshell Section 55-4 (2d ed. 1986).
See also South Carolina Probate Code Section 62-1-103.
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.
Comment
This section provides rules for determining the law that will govern the meaning and effect of
particular trust terms. The law to apply to determine whether a trust has been validly created is
determined under Section 62-7-403.
Under prior South Carolina law, there was no statutory counterpart to this section; common
law principles controlled.
Paragraph (1) allows a settlor to select the law that will govern the meaning and effect of the
terms of the trust. The jurisdiction selected need not have any other connection to the trust. The
settlor is free to select the governing law regardless of where the trust property may be physically
located, whether it consists of real or personal property, and whether the trust was created by will
or during the settlor’s lifetime. This section does not attempt to specify the strong public policies
sufficient to invalidate a settlor’s choice of governing law. These public policies will vary
depending upon the locale and may change over time. See, however, Russell v. Wachovia Bank,
353 S.C. 208, 578 S.E.2d 329 (2003), in which the South Carolina Supreme Court cited language
from the Restatement (Second) of Conflict of Laws Sections 268-270 (1971) in adopting a rule
similar to that of UTC Section 107.
18
Paragraph (2) provides a rule for trusts without governing law provisions - the meaning and
effect of the trust’s terms are to be determined by the law of the jurisdiction having the most
significant relationship to the matter at issue. Factors to consider in determining the governing
law include the place of the trust’s creation, the location of the trust property, and the domicile of
the settlor, the trustee, and the beneficiaries. See Restatement (Second) of Conflict of Laws
Sections 270 cmt. c and 272 cmt. d (1971). Other more general factors that may be pertinent in
particular cases include the relevant policies of the forum, the relevant policies of other interested
jurisdictions and degree of their interest, the protection of justified expectations and certainty, and
predictability and uniformity of result. See Restatement (Second) of Conflict of Laws Section 6
(1971). Usually, the law of the trust’s principal place of administration will govern administrative
matters and the law of the place having the most significant relationship to the trust’s creation will
govern the dispositive provisions.
This section is consistent with and was partially patterned on the Hague Convention on the Law
Applicable to Trusts and on their Recognition, signed on July 1, 1985. Like this section, the
Hague Convention allows the settlor to designate the governing law. Hague Convention art. 6.
Absent a designation, the Convention provides that the trust is to be governed by the law of the
place having the closest connection to the trust. Hague Convention art. 7. The Convention also
lists particular public policies for which the forum may decide to override the choice of law that
would otherwise apply. These policies are protection of minors and incapable parties, personal
and proprietary effects of marriage, succession rights, transfer of title and security interests in
property, protection of creditors in matters of insolvency, and, more generally, protection of third
parties acting in good faith. Hague Convention art. 15.
For the authority of a settlor to designate a trust’s principal place of administration, see UTC
Section 108(a) or SCTC Section 62-7-108(b). Because SCTC Section 62-7-108 includes an
additional paragraph not in the UTC, which is at SCTC Section 62-7-108(a), the reference to
UTC Section 108(a) in the UTC Comment is appropriate for SCTC Section 62-7-108(b).
Under prior South Carolina law, there was no statutory counterpart to this section; common
law principles controlled.
Subsection (1) of UTC Section 107 was revised to give a settlor the ability to dictate applicable
state law without restriction. See, however, Russell v. Wachovia Bank, 353 S.C. 208, 578 S.E.2d
329 (2003), in which the South Carolina Supreme Court cited language from the Restatement
(Second) of Conflict of Laws Sections 268-270 (1971) in adopting a rule similar to that of UTC
Section 107. Because SCTC Section 62-7-108 includes an additional paragraph not in the UTC,
which is at SCTC Section 62-7-108(a), the reference to UTC Section 108(a) in the UTC
Comment is appropriate for SCTC Section 62-7-108(b).
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
19
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 60 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 60 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.
Comment
This section prescribes rules relating to a trust’s principal place of administration. Locating a
trust’s principal place of administration will ordinarily determine which court has primary if not
exclusive jurisdiction over the trust. It may also be important for other matters, such as payment
of state income tax or determining the jurisdiction whose laws will govern the trust. See Section
62-7-107 comment.
Because of the difficult and variable situations sometimes involved, the Uniform Trust Code
does not attempt to further define principal place of administration. A trust’s principal place of
administration ordinarily will be the place where the trustee is located. Determining the principal
place of administration becomes more difficult, however, when cotrustees are located in different
states or when a single institutional trustee has trust operations in more than one state. In such
cases, other factors may become relevant, including the place where the trust records are kept or
trust assets held, or in the case of an institutional trustee, the place where the trust officer
responsible for supervising the account is located.
A concept akin to principal place of administration is used by the Office of the Comptroller of
the Currency. Reserves that national banks are required to deposit with state authorities is based
20
on the location of the office where trust assets are primarily administered. See 12 C.F.R.
Section 9.14(b).
Under the Uniform Trust Code, the fixing of a trust’s principal place of administration will
determine where the trustee and beneficiaries have consented to suit (Section 202), and the rules
for locating venue within a particular state (Section 204). It may also be considered by a court in
another jurisdiction in determining whether it has jurisdiction, and if so, whether it is a convenient
forum.
Because SCTC Section 62-7-108 includes an additional paragraph not in the UTC, which is at
SCTC Section 62-7-108(a), the references to the subsections of UTC Section 108 in the UTC
Comment have been adjusted correspondingly for SCTC Section 62-7-108.
SCTC Section 62-7-108(a) incorporates the provisions of former SCPC Section 62-7-202
(which dealt with venue), except SCTC subsection 108(a) is not limited to matters of venue.
A settlor expecting to name a trustee or cotrustees with significant contacts in more than one
state may eliminate possible uncertainty about the location of the trust’s principal place of
administration by specifying the jurisdiction in the terms of the trust. Under UTC subsection (a)
and SCTC subsection (b), a designation in the terms of the trust is controlling if (1) a trustee is a
resident of or has its principal place of business in the designated jurisdiction, or (2) all or part of
the administration occurs in the designated jurisdiction. Designating the principal place of
administration should be distinguished from designating the law to determine the meaning and
effect of the trust’s terms, as authorized by Section 62-7-107. A settlor is free to designate one
jurisdiction as the principal place of administration and another to govern the meaning and effect
of the trust’s provisions.
UTC Subsection (b) and SCTC subsection (c) provides that 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. “Interests of the beneficiaries,” defined in Section 62-7-103(7), means the
beneficial interests provided n the terms of the trust. Ordinarily, absent a substantial change or
circumstances, the trustee may assume that the original place of administration is also the
appropriate place of administration. The duty to administer the trust at an appropriate place may
also dictate that the trustee not move the trust.
UTC Subsections (c)-(f) and SCTC subsections (d)-(g) provide a procedure for changing the
principal place of administration to another state or country. Such changes are often beneficial.
A change may be desirable to secure a lower state income tax rate, or because of relocation of the
trustee or beneficiaries, the appointment of a new trustee, or a change in the location of the trust
investments. The procedure for transfer specified in this section applies only in the absence of a
contrary provision in the terms of the trust. See Section 62-7-105. To facilitate transfer in the
typical case, where all concur that a transfer is either desirable or is at least not harmful, a transfer
can be accomplished without court approval unless a qualified beneficiary objects. To allow the
qualified beneficiaries sufficient time to review a proposed transfer, the trustee must give the
qualified beneficiaries at least 60 days prior notice of the transfer. Notice must be given not only
to qualified beneficiaries as defined in Section 62-7-103(12) but also to those granted the rights of
qualified beneficiaries under Section 62-7-110. To assure that those receiving notice have
sufficient information upon which to make a decision, minimum contents of the notice are
specified. If a qualified beneficiary objects, a trustee wishing to proceed with the transfer must
seek court approval.
SCTC Section 62-7-108(e), which corresponds to UTC subsection 108(d), adds to the UTC
version the introductory phrase “unless otherwise designated in the trust.”
21
In connection with a transfer of the principal place of administration, the trustee may transfer
some or all of the trust property to a new trustee located outside of the state. The appointment of
a new trustee may also be essential if the current trustee is ineligible to administer the trust in the
new place. UTC Subsection (f) and SCTC subsection (g) clarifies that the appointment of the
new trustee must comply with the provisions on appointment of successor trustees as provided in
the terms of the trust or under Section 62-7-704. Absent an order of succession in the terms of
the trust, Section 62-7-704(c) provides the procedure for appointment of a successor trustee of a
noncharitable trust, and Section 62-7-704(d) the procedure for appointment of a successor trustee
of a charitable trust.
While transfer of the principal place of administration will normally change the governing law
with respect to administrative matters, a transfer does not normally alter the controlling law with
respect to the validity of the trust and the construction of its dispositive provisions. See 5A
Austin W. Scott & William F. Fratcher, The Law of Trusts Section 615 (4th ed. 1989).
Because SCTC Section 62-7-108 includes an additional paragraph not in the UTC, which is at
SCTC Section 62-7-108(a), the references to the subsections of UTC Section 108 in the UTC
Comment should be adjusted correspondingly for SCTC Section 62-7-108.
SCTC Section 62-7-108(a) incorporates the provisions of former SCPC Section 62-7-202
(which dealt with venue), except SCTC subsection 108(a) is not limited to matters of venue.
SCTC Section 62-7-108(e), which corresponds to UTC subsection 108(d), adds to the UTC
version the introductory phrase “unless otherwise designated in the trust.”
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
22
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.
Comment
Subsection (a) clarifies that notices under the Uniform Trust Code may be given by any method
likely to result in its receipt by the person to be notified. The specific methods listed in the
subsection are illustrative, not exhaustive. Subsection (b) relieves a trustee of responsibility for
what would otherwise be an impossible task, the giving of notice to a person whose identity or
location is unknown and not reasonably ascertainable by the trustee. The section does not define
when a notice is deemed to have been sent or delivered or person deemed to be unknown or not
reasonably ascertainable, the drafters preferring to leave this issue to the enacting jurisdiction’s
rules of civil procedure.
Under the Uniform Trust Code, certain actions can be taken upon unanimous consent of the
beneficiaries or qualified beneficiaries. See Sections 62-7-411 (termination of noncharitable
irrevocable trust) and 62-7-704 (appointment of successor trustee). UTC Subsection (b) of this
section only authorizes waiver of notice. A consent required from a beneficiary in order to
achieve unanimity is not waived because the beneficiary is missing. But the fact a beneficiary
cannot be located may be a sufficient basis for a substitute consent to be given by another person
on the beneficiary’s behalf under the representation principles of Article 3.
In a nonjudicial context, SCTC Section 62-7-109(b) does not require notification of a person
whose identity or location is unknown or cannot be reasonably ascertainable.
To facilitate administration, subsection (c) allows waiver of notice by the person to be notified
or sent the document. Among the notices and documents to which this subsection can be applied
are notice of a proposed transfer of principal place of administration (UTC Section 108(d) and
SCTC Section 62-7-108(e)) or of a trustee’s report (Section 62-7-813(c)). This subsection also
applies to notice to qualified beneficiaries of a proposed trust combination or division (Section 627-417), of a temporary assumption of duties without accepting trusteeship (Section 62-7701(c)(1)), and of a trustee’s resignation (Section 62-7-705(a)(1)).
Notices under the Uniform Trust Code are nonjudicial. Pursuant to UTC subsection (d), notice
of a judicial proceeding must be given as provided in the applicable rules of civil procedure.
Previous South Carolina law had no precise counterpart. However, the South Carolina Probate
Code contains various provisions respecting notice. The general notice section, SCPC Section
62-1-401 provides that notice of a hearing or other petition shall be delivered at least twenty (20)
days before the time set for the hearing by certified, registered, or ordinary first class mail, or by
delivering a copy to the person being notified at least twenty (20) days before the time set for
hearing. That section also provides for the service of notice of hearing by publication if the
address or identity of the person cannot be ascertained with reasonable diligence. SCTC Section
62-7-109(d) differs from the UTC version and incorporates the substance of SCPC Section
62-1-401.
The SCTC adds Subsections 62-7-109(e) and (f), which are not in UTC Section 109. The
references in the UTC Comment to the subsections of UTC Section 109 should be adjusted
appropriately.
23
Previous South Carolina law had no precise counterpart. However, the South Carolina Probate
Code contains various provisions respecting notice. The general notice section, SCPC Section
62-1-401 provides that notice of a hearing or other petition shall be delivered at least twenty (20)
days before the time set for the hearing by certified, registered, or ordinary first class mail, or by
delivering a copy to the person being notified at least twenty (20) days before the time set for
hearing. That section also provides for the service of notice of hearing by publication if the
address or identity of the person cannot be ascertained with reasonable diligence. SCTC Section
62-7-109(d) differs from the UTC version and incorporates the substance of SCPC Section
62-1-401. The SCTC adds Subsections 62-7-109(e) and (f), which are not in UTC Section 109.
The references in the UTC Comment to the subsections of UTC Section 109 should be adjusted
appropriately.
In a nonjudicial context, SCTC Section 62-7-109(b) does not require notification of a person
whose identity or location is unknown or cannot be reasonably ascertainable.
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.
Comment
Former South Carolina law had no statutory counterpart.
Under the Uniform Trust Code, certain notices need be given only to the “qualified”
beneficiaries. For the definition of “qualified beneficiary,” see Section 62-7-103(12). Among
these notices are notice of a transfer of the trust’s principal place of administration (UTC
Section 108(d) and SCTC Section 62-7-108(e)), notice of a trust division or combination
(Section 62-7-417), notice of a trustee resignation (Section 62-7-705(a)(1)), and notice of a
trustee’s annual report (Section 62-7-813(c)). Subsection (a) of this section authorizes other
beneficiaries to receive one or more of these notices by filing a request for notice with the trustee.
Under the Code, certain actions, such as the appointment of a successor trustee, can be
accomplished by the consent of the qualified beneficiaries. See, e.g., Section 62-7-704 (filling
vacancy in trusteeship). Subsection (a) only addresses notice, not required consent. A person
who requests notice under subsection (a) does not thereby acquire a right to participate in actions
24
that can be taken only upon consent of the qualified beneficiaries.
Charitable trusts do not have beneficiaries in the usual sense. However, certain persons, while
not technically beneficiaries, do have an interest in seeing that the trust is enforced. In the case of
a charitable trust, this includes the state’s attorney general and charitable organizations expressly
designated to receive distributions under the terms of the trust, who under subsections (b)-(c) are
granted the rights of qualified beneficiaries. Under subsection (b), charitable organizations
expressly designated in the terms of the trust to receive distributions and who would qualify as a
qualified beneficiary were the trust noncharitable, are granted the rights of qualified beneficiaries.
Because the charitable organization must be expressly named in the terms of the trust and must be
designated to receive distributions, excluded are organizations who maythat might receive
distributions only in the trustee’s discretion but that are not named in the trust’s termsand
organizations holding remainder interests subject to a contingency. Requiring that the
organization have an interest similar to that of a beneficiary of a private trust also denies the rights
of a qualified beneficiary to organizations holding remote interests. For further discussion of the
definition of “qualified beneficiary,” see Section 62-7-103 comment.
Subsection (bc) similarly grants the rights of qualified beneficiaries to persons appointed by the
terms of the trust or by the court to enforce a trust created for an animal or other trust with a
valid purpose but no ascertainable beneficiary. For the requirements for creating such trusts, see
Sections 62-7-408 and 62-7-409.
“Attorney general” is placed in brackets in subsection (cd) to accommodate jurisdictions which
grant enforcement authority over charitable trusts to another designated official. Because states
take various approaches to enforcement of charitable trusts, by a 2004 amendment subsection (d)
was placed in brackets in its entirety. For a discussion, see 2004 Amendment below.
Section 62-7-110 does not include a counterpart to UTC subsection 110(d), in the 2004 UTC
Amendments, which gives the state Attorney General the rights of a qualified beneficiary in
certain cases. See, however, SCTC Section 62-7-405, which provides certain rights and powers
to the South Carolina Attorney General.
This sectionSubsection (d) does not limit other means by which the attorney general or other
designated official can enforce a charitable trust.
2001 Amendment. By amendment in 2001, “charitable organization expressly designated to
receive distributions” was substituted for “charitable organization expressly entitled to receive
benefits” in subsection (b). The amendment conforms the language of this section to terminology
used elsewhere in the Code.
2004 Amendment. Subsection (b) is amended to better conform this provision to the Drafting
Committee's intent. Charitable trusts do not have beneficiaries in the usual sense. Yet, such trusts
are often created to benefit named charitable organizations. Under this amendment,
which is based on the definition of qualified beneficiary in Section 62-7-103, a designated
charitable organization has the rights of a qualified beneficiary only if it holds an interest similar to
that of a qualified beneficiary in a noncharitable trust. The effect of the amendment is to exclude
charitable organizations that might receive distributions in the trustee’s discretion even though not
expressly mentioned in the trust’s terms. Also denied the rights of qualified beneficiaries are
charitable organizations that hold only remote remainder interests. The previous version of
subsection (b) had a similar intent but the language could be read more broadly.
The placing of subsection (d) in brackets recognizes that the role of the attorney general in the
25
enforcement of charitable trusts varies greatly in the states. In some states, the legislature may
prefer that the attorney general be granted the rights of a qualified beneficiary. In other states, the
attorney general may play a lesser role in enforcement. The expectation is that states considering
enactment will adapt this provision to the particular role that the attorney general plays in the
enforcement of charitable trusts in their state. Some states may prefer to delete this provision.
Other states might provide that the attorney general has the rights of a qualified beneficiary only
for trusts in which no charitable organization has been designated to receive distributions. Yet
other states may prefer to enact the provision without change.
Former South Carolina had no statutory counterpart. SCTC Section 62-7-110 includes
provisions contained in the 2004 Amendments to the UTC, which are not discussed in the
Comment to UTC Section 110. SCTC Section 62-7-110 does not include a counterpart to UTC
subsection 110(d), in the 2004 UTC Amendments, which gives the state Attorney General the
rights of a qualified beneficiary in certain cases. See, however, SCTC Section 62-7-405, which
provides certain rights and powers to the South Carolina Attorney General.
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.
(e) 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.
Comment
While the Uniform Trust Code recognizes that a court may intervene in the administration of a
trust to the extent its jurisdiction is invoked by interested persons or otherwise provided by law
(see Section 62-7-201(a)), resolution of disputes by nonjudicial means is encouraged. This
section facilitates the making of such agreements by giving them the same effect as if approved by
the court. To achieve such certainty, however, subsection (c) requires that the nonjudicial
settlement must contain terms and conditions that a court could properly approve. Under this
section, a nonjudicial settlement cannot be used to produce a result not authorized by law, such as
to terminate a trust in an impermissible manner.
Trusts ordinarily have beneficiaries who are minors; incapacitated, unborn or unascertained.
Because such beneficiaries cannot signify their consent to an agreement, binding settlements can
ordinarily be achieved only through the application of doctrines such as virtual representation or
26
appointment of a guardian ad litem, doctrines traditionally available only in the case of judicial
settlements. The effect of this section and the Uniform Trust Code more generally is to allow for
such binding representation even if the agreement is not submitted for approval to a court. For
the rules on representation, including appointments of representatives by the court to approve
particular settlements, see Article 3.
Subsection (d) is a nonexclusive list of matters to which a nonjudicial settlement may pertain.
Other matters which may be made the subject of a nonjudicial settlement are listed in the Article 3
General Comment. The fact that the trustee and beneficiaries may resolve a matter nonjudicially
does not mean that beneficiary approval is required. For example, a trustee may resign pursuant
to Section 62-7-705 solely by giving notice to the qualified beneficiaries, a living settlor, and any
cotrustees. But a nonjudicial settlement between the trustee and beneficiaries will frequently
prove helpful in working out the terms of the resignation.
Because of the great variety of matters to which a nonjudicial settlement may be applied, this
section does not attempt to precisely define the “interested persons” whose consent is required to
obtain a binding settlement as provided in subsection (a). However, the consent of the trustee
would ordinarily be required to obtain a binding settlement with respect to matters involving a
trustee’s administration, such as approval of a trustee’s report or resignation.
The South Carolina Probate Code has counterparts to South Carolina Trust Code Section
62-7-111. In the estate context, SCPC Section 62-3-912 provides for private agreements among
successors to a decedent, which shall be binding on the personal representative. Such agreements
are however, subject to the rights of creditors and taxing authorities. Under SCPC Section
62-3-912, successors include testamentary trusts if the trustees thereof deem it prudent to enter
such an agreement. However, “[n]othing herein relieves trustees of any duties owed to the
beneficiaries of trust.” Additionally, SCPC Sections 62-3-1101 and 62-3-1102 provide a
mechanism for compromise of controversies approved in a formal proceeding in the Probate
Court. The terms of the compromise are to be set forth in an agreement that is presented to the
Probate Court for approval. Interested persons, including parents of minor children, are to sign
the agreement. Joinder is not required in respect to interested persons whose identity cannot be
reasonably ascertained. Such compromises are subject to the rights of creditors and to taxing
authorities. Trustees of testamentary trusts, to the extent they enter the compromise, are bound
by its terms. See also S. Alan Medlin, The Law of Wills and Trusts, Volume I, Estate Planning in
South Carolina (2002) at Section 509 (modification and early termination of irrevocable and
unamendable trusts).
Uniform Trust Code Section 111 allows binding nonjudicial settlements for any trust matter,
subject to certain limitations. SCTC Section 62-7-111 is more restrictive, authorizing binding
nonjudicial settlements only for the enumerated matters. Consequently, the Comment to UTC
Section 111 should be adjusted accordingly.
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.
Comment
27
This section is patterned after Restatement (Third) of Trusts Section 25(2) and comment e
(Tentative Draft No. 1, approved 1996), although this section, unlike the Restatement, also
applies to irrevocable trusts. The revocable trust is used primarily as a will substitute, with its key
provision being the determination of the persons to receive the trust property upon the settlor’s
death. Given this functional equivalence between the revocable trust and a will, the rules for
interpreting the disposition of property at death should be the same whether the individual has
chosen a will or revocable trust as the individual’s primary estate planning instrument. Over the
years, the legislatures of the States and the courts have developed a series of rules of construction
reflecting the legislative or judicial understanding of how the average testator would wish to
dispose of property in cases where the will is silent or insufficiently clear. Few legislatures have
yet to extend these rules of construction to revocable trusts, and even fewer to irrevocable trusts,
although a number of courts have done so as a matter of judicial construction. See Restatement
(Third) of Trusts Section 25, Reporter’s Notes to cmt. d and e (Tentative Draft No. 1, approved
1996).
Because of the wide variation among the States on the rules of construction applicable to wills,
this Code does not attempt to prescribe the exact rules to be applied to trusts but instead adopts
the philosophy of the Restatement that the rules applicable to trusts ought to be the same,
whatever those rules might be.
Rules of construction are not the same as constructional preferences. A constructional
preference is general in nature, providing general guidance for resolving a wide variety of
ambiguities. An example is a preference for a construction that results in a complete disposition
and avoid illegality. Rules of construction, on the other hand, are specific in nature, providing
guidance for resolving specific situations or construing specific terms. Unlike a constructional
preference, a rule of construction, when applicable, can lead to only one result. See Restatement
(Third) of Property: Donative Transfers Section 11.3 and cmt. b (Tentative Draft No. 1,
approved 1995).
Rules of construction attribute intention to individual donors based on assumptions of common
intention. Rules of construction are found both in enacted statutes and in judicial decisions.
Rules of construction can involve the meaning to be given to particular language in the document,
such as the meaning to be given to “heirs” or “issue.” Rules of construction also address situations
the donor failed to anticipate. These include the failure to anticipate the predecease of a
beneficiary or to specify the source from which expenses are to be paid. Rules of construction
can also concern assumptions as to how a donor would have revised donative documents in light
of certain events occurring after execution. These include rules dealing with the effect of a
divorce and whether a specific devisee will receive a substitute gift if the subject matter of the
devise is disposed of during the testator’s lifetime.
Instead of enacting this section, a jurisdiction enacting this Code may wish to enact detailed
rules on the construction of trusts, either in addition to its rules on the construction of wills or as
part of one comprehensive statute applicable to both wills and trusts. For this reason and to
encourage this alternative, the section has been made optional. For possible models, see Uniform
Probate Code, Article 2, Parts 7 and 8, which was added to the UPC in 1990, and California
Probate Code Sections 21101-21630, enacted in 1994.
The most direct counterpart in the law of wills is South Carolina Probate Code Section
62-2-601 (Rules of Construction and Presumption). That section provides that the testator’s
intent controls the legal effect of his dispositions, and it refers to succeeding sections, which
contain some, but not all, rules of construction with respect to wills. Other will construction rules
28
are left to the common law in South Carolina. As to construction of wills, see S. Alan Medlin,
The Law of Wills and Trusts, Volume 1, Estate Planning in South Carolina (2002) at Section 330
et seq. South Carolina Trust Code Section 62-7-112 is in part analogous to SCPC Sections
62-1-102 and 63-1-103. SCPC Section 62-1-102, entitled “Purposes; Rule of Construction,”
provides for a liberal interpretation of the SCPC in furtherance of the policies set forth in that
section. SCPC Section 62-1-103 provides that the provisions of the SCPC supplement existing
principles of law and equity.
The most direct counterpart in the law of wills is South Carolina Probate Code Section
62-2-601 (Rules of Construction and Presumption). That section provides that the testator’s
intent controls the legal effect of his dispositions, and it refers to succeeding sections, which
contain some, but not all, rules of construction with respect to wills. Other will construction rules
are left to the common law in South Carolina. As to construction of wills, see S. Alan Medlin,
The Law of Wills and Trusts, Volume 1, Estate Planning in South Carolina (2002) at Section 330
et seq. South Carolina Trust Code Section 62-7-112 is in part analogous to SCPC Sections
62-1-102 and 63-1-103. SCPC Section 62-1-102, entitled “Purposes; Rule of Construction,”
provides for a liberal interpretation of the SCPC in furtherance of the policies set forth in that
section. SCPC Section 62-1-103 provides that the provisions of the SCPC supplement existing
principles of law and equity.
Part 2
Judicial Proceedings
General Comment
This article addresses selected issues involving judicial proceedings concerning trusts,
particularly trusts with contacts in more than one State or country. This article is not intended to
provide comprehensive coverage of court jurisdiction or procedure with respect to trusts. These
issues are better addressed elsewhere, for example in the State’s rules of civil procedure or as
provided by court rule.
Section 62-7-201 makes clear that the jurisdiction of the court is available as invoked by
interested persons or as otherwise provided by law. Proceedings involving the administration of a
trust normally will be brought in the court at the trust’s principal place of administration. Section
62-7-202 provides that the trustee and beneficiaries are deemed to have consented to the
jurisdiction of the court at the principal place of administration as to any matter relating to the
trust. Sections 203 and 62-7-204 is an are optional, bracketed provisions relating to
subject-matter jurisdiction and venue.
There is significant overlap between Part 2 of the Uniform Trust Code covering judicial
proceedings and former Part II under Article 7 of the South Carolina Probate Code. To promote
consistency and familiarity with existing South Carolina law and practice, the relevant South
Carolina Probate Code language has been maintained whenever possible under this part of the
South Carolina Trust Code. Additionally, several separate statutes formerly under the South
Carolina Probate Code regarding court jurisdiction of trusts have been consolidated into a single
section herein.
29
section herein.
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.
Said proceedings shall be formal as defined by Section 62-1-201(15); provided, however, consent
petitions shall not be 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
30
(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.
Comment
Section 62-7-201(a) grants exclusive subject matter jurisdiction to the probate court of
interested parties’ proceedings concerning the internal affairs of trusts. The subsection provides
two illustrative and nonexclusive lists of such proceedings. The lists have this in common: all
items on both lists are matters of dispute primarily between and among the trustees and the
beneficiaries of trusts, i.e., matters internal to trust administration, and are not matters
immediately involving third parties, such as creditors and debtors of trusts. Compare the actions
and proceedings concerning the external affairs of trusts, which are the subject matter of Section
62-7-204. See also the specific coverage of proceedings concerning a trustee’s compensation,
Section 62-7-205, and for this State’s Uniform Declaratory Judgments Act, see Section 155-5310 of the 1976 Code et seq., especially Section 15-53-50.
Section 62-7-201(b) makes it clear that no single proceeding in the probate court concerning
the internal affairs of a trust will have the effect of subjecting the administration of the trust to
later continuous supervision by the probate court.
SCTC subsections 62-7-201(a) and (b) incorporate former South Carolina Probate Code
Section 62-7-201 regarding the Probate Court’s exclusive jurisdiction over the internal affairs of
trusts. Subsection (3)(a) has been taken from former South Carolina Probate Code Section
62-7-205. Such exclusive jurisdiction is subject to Section 62-1-302(c) of the South Carolina
Probate Code regarding a party’s right to remove a proceeding to the circuit court.
Subsections (c) and (d) are taken from former South Carolina Probate Code Section
62-7-204(A).
Subsection (e) is taken from former South Carolina Probate Code Section 62-7-203.
Subsection (e) refers to a trust’s “principal place of administration” which is addressed under
South Carolina Trust Code Section 62-7-108.
Whereas the Uniform Trust Code encourages resolution of disputes without resort to courts
through options such as nonjudicial settlements authorized by Section 111, the South Carolina
Trust Code limits nonjudicial settlements to specified matters set forth in Section 62-7-111,
thereby generally maintaining the practice requiring court involvement for resolution of trust
disputes.
SCTC Section 62-7-201 covers matters dealt with in Uniform Trust Code Sections 201 and
203. Consequently, the UTC Comments from both sections are included below. SCTC Section
62-7-201 differs significantly from those UTC sections, however, and the UTC Comments should
therefore be used for reference purposes only.
Comment to Uniform Trust Code Section 201
While the Uniform Trust Code encourages the resolution of disputes without resort to the
courts by providing such options as the nonjudicial settlement authorized by Section 111, the
court is always available to the extent its jurisdiction is invoked by interested persons. The
jurisdiction of the court with respect to trust matters is inherent and historical and also includes
31
the ability to act on its own initiative, to appoint a special master to investigate the facts of a case,
and to provide a trustee with instructions even in the absence of an actual dispute.
Contrary to the trust statutes in some States, the Uniform Trust Code does not create a system
of routine or mandatory court supervision. While subsection (b) authorizes a court to direct that
a particular trust be subject to continuing court supervision, the court’s intervention will normally
be confined to the particular matter brought before it.
Subsection (c) makes clear that the court’s jurisdiction may be invoked even absent an actual
dispute. Traditionally, courts in equity have heard petitions for instructions and have issued
declaratory judgments if there is a reasonable doubt as to the extent of the trustee’s powers or
duties. The court will not ordinarily instruct trustees on how to exercise discretion, however. See
Restatement (Second) of Trusts Section 187, 259 (1959). This section does not limit the court’s
equity jurisdiction. Beyond mentioning petitions for instructions and actions to declare rights,
subsection (c) does not attempt to list the types of judicial proceedings involving trust
administration that might be brought by a trustee or beneficiary. Such an effort is made in
California Probate Code Section 17200. Excluding matters not germane to the Uniform Trust
Code, the California statute lists the following as items relating to the “internal affairs” of a trust:
determining questions of construction; determining the existence or nonexistence of any
immunity, power, privilege, duty, or right; determining the validity of a trust provision;
ascertaining beneficiaries and determining to whom property will pass upon final or partial
termination of the trust; settling accounts and passing upon the acts of a trustee, including the
exercise of discretionary powers; instructing the trustee; compelling the trustee to report
information about the trust or account to the beneficiary; granting powers to the trustee; fixing or
allowing payment of the trustee’s compensation or reviewing the reasonableness of the
compensation; appointing or removing a trustee; accepting the resignation of a trustee; compelling
redress of a breach of trust by any available remedy; approving or directing the modification or
termination of a trust; approving or directing the combination or division of trusts; and
authorizing or directing transfer of a trust or trust property to or from another jurisdiction.
Comment to Uniform Trust Code Section 203
This section provides a means for distinguishing the jurisdiction of the court having primary
jurisdiction for trust matters, whether denominated the probate court, chancery court, or by some
other name, from other courts in a State that may on occasion resolve disputes concerning trusts.
The section has been placed in brackets because the enacting jurisdiction may already address
subject-matter jurisdiction by other statute or court rule. The topic also need not be addressed in
States having unified court systems. For an explanation of types of proceedings which may be
brought concerning the administration of a trust, see the Comment to Section 201.
section herein.
SCTC subsections 62-7-201(a) and (b) incorporate former South Carolina Probate Code
32
Section 62-7-201 regarding the Probate Court’s exclusive jurisdiction over the internal affairs of
trusts. Subsection (3)(a) has been taken from former South Carolina Probate Code Section
62-7-205. Such exclusive jurisdiction is subject to Section 62-1-302(c) of the South Carolina
Probate Code regarding a party’s right to remove a proceeding to the circuit court.
Subsections (c) and (d) are taken from former South Carolina Probate Code Section
62-7-204(A).
Subsection (e) is taken from former South Carolina Probate Code Section 62-7-203.
Subsection (e) refers to a trust’s “principal place of administration” which is addressed under
South Carolina Trust Code Section 62-7-108.
Whereas the Uniform Trust Code encourages resolution of disputes without resort to courts
through options such as nonjudicial settlements authorized by Section 111, the South Carolina
Trust Code limits nonjudicial settlements to specified matters set forth in Section 62-7-111,
thereby generally maintaining the practice requiring court involvement for resolution of trust
disputes.
SCTC Section 62-7-201 covers matters dealt with in Uniform Trust Code Sections 201 and
203. Consequently, the UTC Comments from both sections are included hereinabove, but
because SCTC Section 62-7-201 differs significantly from those UTC sections, the UTC
Comments should be adjusted accordingly.
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.
Comment
There was no corresponding statute under the South Carolina Probate Code.
This section clarifies that the courts of the principal place of administration have jurisdiction to
enter orders relating to the trust that will be binding on both the trustee and beneficiaries. A
trust’s “principal place of administration” is addressed in SCTC Section 62-7-108. Consent to
jurisdiction does not dispense with any required notice, however. With respect to jurisdiction
over a beneficiary, the Comment to Uniform Probate Code Section 7-103, upon which portions of
this section are based, is instructive:
It also seems reasonable to require beneficiaries to go to the seat of the trust when litigation has
been instituted there concerning a trust in which they claim beneficial interests, much as the rights
of shareholders of a corporation can be determined at a corporate seat. The settlor has indicated
a principal place of administration by its selection of a trustee or otherwise, and it is reasonable to
subject rights under the trust to the jurisdiction of the Court where the trust is properly
administered.
The jurisdiction conferred over the trustee and beneficiaries by this section does not preclude
33
jurisdiction by courts elsewhere on some other basis. Furthermore, the fact that the courts in a
new State acquire jurisdiction under this section following a change in a trust’s principal place of
administration does not necessarily mean that the courts of the former principal place of
administration lose jurisdiction, particularly as to matters involving events occurring prior to the
transfer.
The jurisdiction conferred by this section is limited. Pursuant to subsection (b), until a
distribution is made, jurisdiction over a beneficiary is limited to the beneficiary’s interests in the
trust. Personal jurisdiction over a beneficiary is conferred only upon the making of a distribution.
Subsection (b) also gives the court jurisdiction over other recipients of distributions. This would
include individuals who receive distributions in the mistaken belief they are beneficiaries.
For a discussion of jurisdictional issues concerning trusts, see 5A Austin W. Scott & William F.
Fratcher, The Law of Trusts Sections 556-573 (4th ed. 1989).
There was no corresponding statute under the South Carolina Probate Code.
A trust’s “principal place of administration” is addressed in SCTC Section 62-7-108.
Section 62-7-203. [RESERVED].
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 finds that, in the interest of justice, a proceeding or file concerning a trust should
be in another court in South Carolina, the court making the finding may transfer the proceeding or
file to the other court.
Comment
South Carolina Trust Code subsections 62-7-204 (a) and (b) are taken from former South
Carolina Probate Code Section 62-7-202 and incorporate provisions of UTC Section 204.
SCTC subsections (c), (d), and (e) are taken from former South Carolina Probate Code Section
62-1-303 and do not incorporate UTC provisions.
34
SCTC Section 62-7-204 differs significantly from UTC Section 204.
This The optional, bracketed section in the UTC is made available for jurisdictions that conclude
that venue for a judicial proceeding involving a trust is not adequately addressed in local rules of
civil procedure. For jurisdictions enacting this section of the UTC, general rules governing venue
continue to apply in cases not covered by this section. This includes most proceedings where
jurisdiction over a trust, trust property, or parties to a trust is based on a factor other than the
trust’s principal place of administration. The general rules governing venue also apply when the
principal place of administration of a trust is in another locale, but jurisdiction is proper in the
enacting State.
South Carolina Trust Code subsections 62-7-204 (a) and (b) are taken from former South
Carolina Probate Code Section 62-7-202.
SCTC subsections (c), (d), and (e) are taken from former South Carolina Probate Code Section
62-1-303.
Because SCTC Section 62-7-204 differs significantly from UTC Section 204, the UTC
Comment should be adjusted accordingly.
Part 3
Representation
General Comment
This article deals with representation of beneficiaries, both representation by fiduciaries
(personal representatives, trustees, guardians, and conservators), and what is known as virtual
representation.
There is significant overlap between Part 3 of the South Carolina Trust Code covering judicial
proceedings and South Carolina Probate Code provisions concerning representation of others. To
promote consistency and familiarity with existing South Carolina law and practice, the relevant
South Carolina Probate Code language has been maintained whenever possible under this part of
the South Carolina Trust Code. Representation is a topic not adequately addressed under the
trust law of most States. Representation is addressed in the Restatement (First) of Property
Sections 180-186 (1936), but the coverage of this article is more complete.
Section 62-7-301 is the introductory section, laying out the scope of the article. The
representation principles of this article have numerous applications under this Code. The
representation principles of the article apply for purposes of settlement of disputes, whether by a
court or nonjudicially. They apply for the giving of required notices. They apply for the giving of
consents to certain actions.
Sections 62-7-302-305 cover the different types of representation. Section 62-7-302 deals with
representation by the holder of a general testamentary power of appointment. (Revocable trusts
and presently exercisable general powers of appointment are covered by Section 603, which grant
the settlor or holder of the power all rights of the beneficiaries or persons whose interests are
subject to the power). Section 62-7-303 deals with representation by a fiduciary, whether of an
estate, trust, conservatorship, or guardianship. The section also allows a parent without a conflict
of interest to represent and bind a minor or unborn child. Section 62-7-304 is the virtual
35
representation provision. It provides for representation of and the giving of a binding consent by
another person having a substantially identical interest with respect to the particular issue.
Section 62-7-305 authorizes the court to appoint a representative to represent the interests of
unrepresented persons or persons for whom the court concludes the other available representation
might be inadequate.
The provisions of this article are subject to modification in the terms of the trust. See Section
105. Settlors are free to specify their own methods for providing substituted notice and obtaining
substituted consent.
proceedings and South Carolina Probate Code provisions concerning representation of others. To
promote consistency and familiarity with existing South Carolina law and practice, the relevant
South Carolina Probate Code language has been maintained whenever possible under this part of
the South Carolina Trust Code
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.
Comment
This section applies to both judicial and nonjudicial matters involving trusts. Nonjudicial
matters may include, for example, the transfer of a trust's principal place of business, a proposed
trust combination or division, a trustee's resignation, appointment of a successor trustee by
consent, a trustee's resignation, and the consent to, release of, or affirmance of a trustee's actions.
See SCTC Section 62-7-111.
The application of this section to judicial proceedings is currently provided for in South
Carolina Probate Code Section 62-1-401.
Subsection (a) defines the terms "beneficiary representative" for purposes of this part in an
effort to avoid confusion between the Uniform Trust Code term "representative" and the familiar
term "personal representative" under the South Carolina Probate Code.
Subsection (b) of South Carolina Trust Code Section 62-7-301 confirms that notice of a
hearing on a petition in a judicial proceeding must be given in the manner prescribed under SCTC
Section 62-7-109(d). However, this section does not expressly address the manner of
commencing a judicial proceeding.
36
This section is general and introductory, laying out the scope of the article.
Subsection (a) validates substitute notice to a person who may represent and bind another
person as provided in the succeeding sections of this article. Notice to the substitute has the same
effect as if given directly to the other person. Subsection (a) does not apply to notice of a judicial
proceeding. Pursuant to Section 109(d), notice of a judicial proceeding must be given as
provided in the applicable rules of civil procedure, which may require that notice not only be
given to the representative but also to the person represented. For a model statute for the giving
of notice in such cases, see Unif. Probate Code Section 1-403(3). Subsection (a) may be used to
facilitate the giving of notice to the qualified beneficiaries of a proposed transfer of principal place
of administration (Section 108(d)), of a proposed trust combination or division (Section 417), of a
temporary assumption of duties without accepting trusteeship (Section 701(c)(1)), of a trustee’s
resignation (Section 705(a)(1)), and of a trustee’s report (Section 813(c)).
Subsection (cb) deals with the effect of a consent, whether by actual or virtual representation.
Subsection (cb) may be used to facilitate consent of the beneficiaries to modification or
termination of a trust, with or without the consent of the settlor (Section 62-7-411), agreement of
the qualified beneficiaries on appointment of a successor trustee of a noncharitable trust (Section
62-7-704(c)(2)), and a beneficiary’s consent to or release or affirmance of the actions of a trustee
(Section 62-7-1009). A consent by a beneficiary representative bars a later objection by the
person represented, but a consent is not binding if the person represented raises an objection prior
to the date the consent would otherwise become effective. The possibility that a beneficiary might
object to a consent given on the beneficiary’s behalf will not be germane in many cases because
the person represented will be unborn or unascertained. However, the representation principles of
this article will sometimes apply to adult and competent beneficiaries. For example, while the
trustee of a revocable trust entitled to a pourover devise has authority under Section 303 to
approve the personal representative’s account on behalf of the trust beneficiaries, such consent
would not be binding on a trust beneficiary who registers an objection. Subsection (b) implements
cases such as Barber v. Barber, 837 P.2d 714 (Alaska 1992), which held that the a refusal to
allow an objection by an adult competent remainder beneficiary violated due process.
Subsection (c) implements the policy of Sections 411 and 602 requiring express authority in the
power of attorney or approval of court before the settlor’s agent, conservator or guardian may
consent on behalf of the settlor to the termination or revocation of the settlor’s revocable trust.
This section applies to both judicial and nonjudicial matters involving trusts. Nonjudicial
matters may include, for example, the transfer of a trust’s principal place of business, a proposed
trust combination or division, a trustee’s resignation, appointment of a successor trustee by
consent, a trustee’s resignation, and the consent to, release of, or affirmance of a trustee’s actions.
See SCTC Section 62-7-111.
The application of this section to judicial proceedings is currently provided for in South
Carolina Probate Code Section 62-1-401. Subsection (b) of South Carolina Trust Code Section
62-7-301 confirms that notice of a hearing on a petition in a judicial proceeding must be given in
the manner prescribed under SCTC Section 62-7-109(d). However, this section does not
expressly address the manner of commencing a judicial proceeding.
Subsection (a) defines the term “beneficiary representative” for purposes of this part in an effort
to avoid confusion between the Uniform Trust Code term “representative” and the familiar term
“personal representative” under the South Carolina Probate Code.
37
Subsection (d) addressing a person who may represent an incapacitated settlor specifically
references the possibility of additional requirements imposed under Section 62-7-411 regarding
modification or termination of noncharitable irrevocable trusts by consent and Section 62-7-602
addressing revocation or amendment of revocable trusts.
Subsection (e) confirms that orders in a judicial proceeding binding a beneficiary representative
bind the person(s) represented by that beneficiary representative.
Because SCTC Section 62-7-301 differs significantly from the corresponding UTC section, the
UTC Comment should be adjusted accordingly.
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.
Comment
This section tracks the language of current South Carolina Probate Code Section 62-1-108
which defines the term "presently exercisable general power of appointment." This section does
not extend the substitute representation under this section to limited or nongeneral powers of
appointment (which are also not covered under South Carolina Probate Code Section 62-1-108).
It This section specifies the circumstances under which a holder of a general testamentary
power of appointment may receive notices on behalf of and otherwise represent and bind persons
whose interests are subject to the power, whether as permissible appointees, takers in default, or
otherwise. Such representation is allowed except to the extent there is a conflict of interest with
respect to the particular matter or dispute. Typically, the holder of a general testamentary power
of appointment is also a life income beneficiary of the trust, oftentimes of a trust intended to
qualify for the federal estate tax marital deduction. See I.R.C. Section 2056(b)(5). Without the
exception for conflict of interest, the holder of the power could act in a way that could enhance
the holder’s income interests to the detriment of the appointees or takers in default, whoever they
may be.
This section tracks the language of current South Carolina Probate Code Section 62-1-108
which defines the term “presently exercisable general power of appointment.” This section does
not extend the substitute representation under this section to limited or nongeneral powers of
appointment (which are also not covered under South Carolina Probate Code Section 62-1-108).
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:
38
(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.
Comment
This section allows for representation of persons by their fiduciaries (conservators, guardians,
agents, trustees, and personal representatives). , a principle that has long been part of the law.
Paragraph (6), which allows parents to represent their children, is more recent, having originated
in 1969 upon approval of the Uniform Probate Code. This section is not limited to representation
of beneficiaries. It also applies to representation of the settlor. Representation is not available if
the fiduciary or parent is in a conflict position with respect to the particular matter or dispute,
however. A typical conflict would be where the fiduciary or parent seeking to represent the
beneficiary is either the trustee or holds an adverse beneficial interest.
South Carolina Probate Code Section 62-1-403 is the counterpart to South Carolina Trust
Code Section 62-7-303. The SCTC, however, adds representation by an agent on behalf of the
principal under Subsection (a)(3).
The authority of a conservator or guardian under this section is subject to the authority
conferred upon conservators and guardians generally under provisions of the South Carolina
Probate Code or by court order, it not being the intent herein to enlarge a conservator's or
guardian's powers otherwise.
Subsection (a)Paragraph (2) authorizes a guardian to bind and represent a ward if a conservator
of the ward’s estate has not been appointed. Granting a guardian authority to represent the ward
with respect to interests in the trust can avoid the need to seek appointment of a conservator.
This grant of authority to act with respect to the ward’s trust interest may broaden the authority
of a guardian in some States although not in States that have adopted the Section 1-403 of the
Uniform Probate Code, from which this section was derived. Under the South Carolina Uniform
Trust Code, a “conservator” is appointed by the court to manage the ward’s property, a
“guardian” to make decisions with respect to the ward’s personal affairs. See Section 62-7-103.
Subsection (a)Paragraph (3) authorizes an agent to represent a principal only to the extent the
agent has authority to act with respect to the particular question or dispute. Pursuant to Sections
62-7-411 and 62-7-602, an agent may represent a settlor with respect to the amendment,
revocation or termination of the trust only to the extent this authority is expressly granted either in
39
the trust or the power. Otherwise, depending on the particular question or dispute, a general
grant of authority in the power may be sufficient to confer the necessary authority.
Subsection (b) prioritizes the right to act as substitute representative where more than one such
representation may apply.
South Carolina Probate Code Section 62-1-403 is the counterpart to South Carolina Trust
Code Section 62-7-303. The SCTC, however, adds representation by an agent on behalf of the
principal under Subsection (a)(3).
The authority of a conservator or guardian under this section is subject to the authority
conferred upon conservators and guardians generally under provisions of the South Carolina
Probate Code or by court order, it not being the intent herein to enlarge a conservator’s or
guardian’s powers otherwise.
Subsection (b) prioritizes the right to act as substitute representative where more than one such
representation may apply.
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.
Comment
This section authorizes a person with a substantially identically interest with respect to a
particular question or dispute to represent and bind an otherwise unrepresented minor,
incapacitated or unborn individual, or person whose location is unknown and not reasonably
ascertainable. This section is derived from Section 1-403(2)(iii) of the Uniform Probate Code, but
with several modifications. Unlike the UPC, this section does not expressly require that the
representation be adequate, the drafters preferring to leave this issue to the courts. Furthermore,
this section extends the doctrine of virtual representation to representation of minors and
incapacitated individuals. Finally, tThis section does not apply to the extent there is a conflict of
interest between the beneficiary representative and the person represented by the beneficiary
representative, consistent with current South Carolina Probate Code Section 62-1-403(2)(iii).
Restatement (First) of Property Sections 181 and 185 (1936) provide that virtual representation
is inapplicable if the interest represented was not sufficiently protected. Representation is deemed
sufficiently protective as long as it does not appear that the representative acted in hostility to the
interest of the person represented. Restatement (First) of Property Section 185 (1936). Evidence
of inactivity or lack of skill is material only to the extent it establishes such hostility. Restatement
(First) of Property Section 185 cmt. b (1936).
Typically, the interests of the beneficiary representative and the person represented will be
identical. A common example would be a trust providing for distribution to the settlor’s children
as a class, with an adult child being able to represent the interests of children who are either
minors or unborn. Exact identity of interests is not required, only substantial identity with respect
to the particular question or dispute. Whether such identity is present may depend on the nature
40
of the interest. For example, a presumptive remaindermen may be able to represent alternative
remaindermen with respect to approval of a trustee’s report but not with respect to interpretation
of the remainder provision or termination of the trust. Even if the beneficial interests of the
beneficiary representative and person represented are identical, representation is not allowed in
the event of conflict of interest. The representative may have interests outside of the trust that are
adverse to the interest of the person represented, such as a prior relationship with the trustee or
other beneficiaries. See Restatement (First) of Property Section 185 cmt. d (1936).
South Carolina Probate Code Section 62-1-403(2)(iii) is the current counterpart to this Section
62-7-304. However, the South Carolina Trust Code adds an incapacitated person to the list of
those who may be represented by another person under this section.
Whereas the Uniform Trust Code conditions the application of this provision on there being no
conflict of interest between the beneficiary representative and the person represented, South
Carolina adds the additional condition that the interest of the person represented be adequately
represented by the beneficiary representative, consistent with current South Carolina Probate
Code Section 62-1-403(2)(iii).
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.
Comment
This section is derived from Section 1-403(4) of the Uniform Probate Code. However, this
section substitutes “ representative” for “guardian ad litem” to signal that a representative under
this Code serves a different role. Unlike a guardian ad litem, under this section a representative
can be appointed to act with respect to a nonjudicial settlement or to receive a notice on a
beneficiary’s behalf. Furthermore, in making decisions, a representative may consider general
benefit accruing to living members of the family. “Representative” is placed in brackets in case
the enacting jurisdiction prefers a different term. The court may appoint a representative to act
for a person even if the person could be represented under another section of this article.
Whereas the Uniform Trust Code encourages nonjudicial settlements and authorizes court
appointment of a representative to act like a guardian ad litem but without ongoing court
involvement, South Carolina expressly limits the scope of nonjudicial settlements to those matters
specified in Section 62-7-111 and follows current practice for the appointment of guardians ad
litem and ongoing court involvement pursuant to South Carolina Probate Code Section
62-1-403(4).
Part 4
41
Creation, Validity, Modification, and Termination of Trusts
Section 62-7-401. Methods of creating trust.
(a) A trust described in Section 62-7-102 may be created by:
(1) 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;
(2) written declaration signed by the owner of property that the owner holds identifiable
property as trustee; or
(3) exercise of a power of appointment in favor of a trustee.
(b) When any conveyance shall be made of any lands or tenements by which a trust or
confidence shall or may arise or result by the implication or construction of law or be transferred
or extinguished by act or operation of law, such trust or confidence shall be of like force and
effect as it would have been without Section 62-7-401(a).
(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.
Comment
This section is based on Restatement (Third) of Trusts Section 10 (Tentative Draft No. 1,
approved 1996), and Restatement (Second) of Trusts Section 17 (1959). Under the methods
specified for creating a trust in this section, a trust is not created until it receives property. For
what constitutes an adequate property interest, see Restatement (Third) of Trusts Sections 40-41
(Tentative Draft No. 2, approved 1999); Restatement (Second) of Trusts Sections 74-86 (1959).
The property interest necessary to fund and create a trust need not be substantial. A revocable
designation of the trustee as beneficiary of a life insurance policy or employee benefit plan has
long been understood to be a property interest sufficient to create a trust. See Section 62-7103(121) (“property” defined). Furthermore, the property interest need not be transferred
contemporaneously with the signing of the trust instrument. A trust instrument signed during the
settlor’s lifetime is not rendered invalid simply because the trust was not created until property
was transferred to the trustee at a much later date, including by contract after the settlor’s death.
A pourover devise to a previously unfunded trust is also valid and may constitute the property
interest creating the trust. See Unif Testamentary Additions to Trusts Act Section 1 (1991),
codified at Uniform Probate Code Section 2-511 (pourover devise to trust valid regardless of
existence, size, or character of trust corpus). See also Restatement (Third) of Trusts Section 19
42
Section 62-7-401(a) provides different methods to create a trust, creating a distinction between
third-party-trusteed trusts in subsection (a)(1) and self-trusteed trusts in subsection (a)(2).
Subsection (a)(1) provides that, if a third party is to serve as trustee, transfer of property to that
other person, whether during life or at death, is sufficient to create a trust; no writing is required.
Subsection (a)(2) requires that, if the settlor is also to be the trustee, then some written
declaration signed by the settlor is required to create the trust. Such a declaration need not be a
trust agreement, but can be some written evidence signed by the settlor sufficient to establish that
the settlor intended to hold the property in trust.
While this section refers to transfer of property to a trustee, a trust can be created even though
for a period of time no trustee is in office. See Restatement (Third) of Trusts Section 2 cmt. g
(Tentative Draft No. 1, approved 1996); Restatement (Second) of Trusts Section 2 cmt. i (1959).
A trust can also be created without notice to or acceptance by a trustee or beneficiary. See
(Second) of Trusts Sections 35-36 (1959).
The methods specified in this section are not exclusive. Section 102 recognizes that trusts can
also be created by special statute or court order.
The methods set out in Section 62-7-401 are not the exclusive methods to create a trust as
recognized by Section 62-7-102. See also Restatement (Third) of Trusts Section 1 cmt. a
(Tentative Draft No. 1, approved 1996); Unif. Probate Code Section 2-212 (elective share of
incapacitated surviving spouse to be held in trust on terms specified in statute); Unif. Probate
Code Section 5-411(a)(4) (conservator may create trust with court approval); Restatement
(Second) of Trusts Section 17 cmt. i (1959) (trusts created by statutory right to bring wrongful
death action).
A trust can also be created by a promise that creates enforceable rights in a person who
immediately or later holds these rights as trustee. See Restatement (Third) of Trusts Section
10(e) (Tentative Draft No. 1, approved 1996). A trust thus created is valid notwithstanding that
the trustee may resign or die before the promise is fulfilled. Unless expressly made personal, the
promise can be enforced by a successor trustee. For examples of trusts created by means of
promises enforceable by the trustee, see Restatement (Third) of Trusts Section 10 cmt. g
(Tentative Draft No. 1, approved 1996); Restatement (Second) of Trusts Sections 14 cmt. h, 26
cmt. n (1959).
A trust created by self-declaration is best created by reregistering each of the assets that
comprise the trust into the settlor’s name as trustee. However, such reregistration is not
necessary to create the trust. See, e.g., In re Estate of Heggstad, 20 Cal. Rptr. 2d 433 (Ct. App.
1993); Restatement (Third) of Trusts Section 10 cmt. a (Tentative Draft No. 1, approved 1996);
Restatement (Second) of Trusts Section 17 cmt. a (1959). A declaration of trust can be funded
merely by attaching a schedule listing the assets that are to be subject to the trust without
executing separate instruments of transfer. But such practice can make it difficult to later confirm
title with third party transferees and for this reason is not recommended.
Pre-SCTC South Carolina law made a distinction between trusts for personal property and
trusts in land. Trusts in personal property could be proved, as well as created, by parol
declarations. See Harris v. Bratton, 34 S.C. 259. 13 S.E. 447 (1891). On the other hand, a valid
trust of any “land, tenements, or hereditaments” had to be proved by a writing signed by the party
creating the trust. See former South Carolina Probate Code Section 62-7-101, which did not
require that the trust be created by a writing, but merely that is be established by a writing. An
43
exception to the requirement of a writing to establish a trust in land was found in former SCPC
Section 62-7-103 for trust arising by implication of law, such as resulting and constructive trusts.
Because the Uniform Trust Code applies only to express trusts and not to trusts implied in law
(UTC Section 102), former SCPC section 62-7-103 has been incorporated as SCTC Section 627-401(b).
Former SCPC Section 62-7-112 has been retained as SCTC Section 62-7-401(c). Former
SCPC Section 627-112 was enacted after the Siefert decision, Seifert v. Southern Nat’l Bank of
South Carolina, 305 S.C. 353, 409 S.E. 2d 337 (1991), to clarify that the settlor’s retention of
substantive control over a trust, such as a right to revoke, does not render that trust invalid
While a trust created by will may come into existence immediately at the testator’s death and
not necessarily only upon the later transfer of title from the personal representative, Section 62-7701 makes clear that the nominated trustee does not have a duty to act until there is an acceptance
of the trusteeship, express or implied. To avoid an implied acceptance, a nominated testamentary
trustee who is monitoring the actions of the personal representative but who has not yet made a
final decision on acceptance should inform the beneficiaries that the nominated trustee has
assumed only a limited role. The failure so to inform the beneficiaries could result in liability if
misleading conduct by the nominated trustee causes harm to the trust beneficiaries. See
Restatement (Third) of Trusts Section 35 cmt. b (Tentative Draft No 2, approved 1999).
While this section confirms the familiar principle that a trust may be created by means of the
exercise of a power of appointment (paragraph (3)), this Code does not legislate comprehensively
on the subject of powers of appointment but addresses only selected issues. See Sections 62-7302 (representation by holder of general testamentary power of appointment); 505(b) (creditor
claims against holder of power of withdrawal); and 603(c) (rights of holder of power of
withdrawal). For the law on powers of appointment generally, see Restatement (Second) of
Property: Donative Transfers Sections 11.1-24.4 (1986); Restatement (Third) of Property: Wills
and Other Donative Transfers (in progress).
Section 62-7-401(a) provides different methods to create a trust, creating a distinction between
third-party-trusteed trusts in subsection (a)(1) and self-trusteed trusts in subsection (a)(2).
Subsection (a)(1) provides that, if a third party is to serve as trustee, transfer of property to that
other person, whether during life or at death, is sufficient to create a trust; no writing is required.
Subsection (a)(2) requires that, if the settlor is also to be the trustee, then some written
declaration signed by the settlor is required to create the trust. Such a declaration need not be a
trust agreement, but can be some written evidence signed by the settlor sufficient to establish that
the settlor intended to hold the property in trust.
Pre-SCTC South Carolina law made a distinction between trusts for personal property and
trusts in land. Trusts in personal property could be proved, as well as created, by parol
declarations. See Harris v. Bratton, 34 S.C. 259, 13 S.E. 447 (1891). On the other hand, a valid
trust of any “land, tenements, or hereditaments” had to be proved by a writing signed by the party
creating the trust. See former South Carolina Probate Code Section 62-7-101, which did not
require that the trust be created by a writing, but merely that it be established by a writing. An
exception to the requirement of a writing to establish a trust in land was found in former SCPC
Section 62-7-103 for trusts arising by implication of law, such as resulting and constructive trusts.
Because the Uniform Trust Code applies only to express trusts and not to trusts implied in law
(UTC Section 102), former SCPC section 62-7-103 has been incorporated as SCTC Section
44
62-7-401(b).
Former SCPC Section 62-7-112 has been retained as SCTC Section 62-7-401(c). Former
SCPC Section 62-7-112 was enacted after the Siefert decision, Seifert v. Southern Nat’l Bank of
South Carolina, 305 S.C. 353, 409 S.E.2d 337 (1991), to clarify that the settlor’s retention of
substantive control over a trust, such as a right to revoke, does not render that trust invalid.
The methods set out in Section 62-7-401 are not the exclusive methods to create a trust as
recognized by Section 62-7-102.
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.
(cb) A beneficiary is definite if the beneficiary can be ascertained now or in the future, subject to
any applicable rule against perpetuities.
(dc) 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.
(ed) 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.
Comment
Subsection (a) codifies the basic requirements for the creation of a trust. To create a valid
trust, the settlor must indicate an intention to create a trust. See Restatement (Third) of Trusts
Section 13 (Tentative Draft No. 1, approved 1996); Restatement (Second) of Trusts Section 23
(1959). But only such manifestations of intent as are admissible as proof in a judicial proceeding
may be considered. See Section 103(17) (“terms of a trust” defined).
To create a trust, a settlor must have the requisite mental capacity. To create a revocable or
testamentary trust, the settlor must have the capacity to make a will. To create an irrevocable
trust, the settlor must have capacity during lifetime to transfer the property free of trust. See
Section 601 (capacity of settlor to create revocable trust), and see generally Restatement (Third)
45
of Trusts Section 11 (Tentative Draft No. 1, approved 1996); Restatement (Second) of Trusts
Sections 18-22 (1959); and Restatement (Third) of Property: Wills and Other Donative Transfers
Section 8.1 (Tentative Draft No. 3, 2001).
Subsection (a)(3) requires that a trust, other than a charitable trust, a trust for the care of an
animal, or a trust for another valid noncharitable purpose, have a definite beneficiary. While some
beneficiaries will be definitely ascertained as of the trust’s creation, subsection (b) recognizes that
others may be ascertained in the future as long as this occurs within the applicable perpetuities
period. The definite beneficiary requirement does not prevent a settlor from making a disposition
in favor of a class of persons. Class designations are valid as long as the membership of the class
will be finally determined within the applicable perpetuities period. For background on the
definite beneficiary requirement, see Restatement (Third) of Trusts Sections 44-46 (Tentative
Draft No. 2, approved 1999); Restatement (Second) of Trusts Sections 112-122 (1959).
Subsection (a)(4) recites standard doctrine that a trust is created only if the trustee has duties to
perform. See Restatement (Third) of Trusts Section 2 (Tentative Draft No. 1, approved 1996);
Restatement (Second) of Trusts Section 2 (1959). Trustee duties are usually active, but a
validating duty may also be passive, implying only that the trustee has an obligation not to
interfere with the beneficiaries’ enjoyment of the trust property. Such passive trusts, while valid
under this Code, may be terminable under the enacting jurisdiction’s Statute of Uses. See
Subsection (a)(5) addresses the doctrine of merger, which, as traditionally stated, provides that
a trust is not created if the settlor is the sole trustee and sole beneficiary of all beneficial interests.
The SCTC modifies the UTC by adding the phrase “current and future” to UTC subsection
(a)(5). The doctrine of merger has been inappropriately applied by the courts in some
jurisdictions to invalidate self-declarations of trust in which the settlor is the sole life beneficiary
but other persons are designated as beneficiaries of the remainder. The doctrine of merger is
properly applicable only if all beneficial interests, both life interests and remainders, are vested in
the same person, whether in the settlor or someone else. An example of a trust to which the
doctrine of merger would apply is a trust of which the settlor is sole trustee, sole beneficiary for
life, and with the remainder payable to the settlor’s probate estate. On the doctrine of merger
generally, see Restatement (Third) of Trusts Section 69 (Tentative Draft No. 3, 2001);
Restatement (Second) of Trusts Section 341 (1959).
Subsection (c) allows a settlor to empower the trustee to select the beneficiaries even if the
class from whom the selection may be made cannot be ascertained. Such a provision would fail
under traditional doctrine; it is an imperative power with no designated beneficiary capable of
enforcement. Such a provision is valid, however, under both this Code and the Restatement, if
there is at least one person who can meet the description. If the trustee does not exercise the
power within a reasonable time, the power fails and the property will pass by resulting trust. See
Restatement (Third) of Trusts Section 46 (Tentative Draft No. 2, approved 1999). See also
Restatement (Second) of Trusts Section 122 (1959); Restatement (Second) of Property: Donative
Transfers Section 12.1 cmt. a (1986).
The SCTC adds the phrase “current and future” to UTC subsection (a)(5).
No similar statutory provisions existed under prior South Carolina law except that former
SCPC Section 62-7-603(A)(3) specified the requirements for merger of equitable and legal title.
46
Former Section 62-7-603(A)(3) has been retained as subsection (d).
South Carolina case law provides that, for a trust to exist, certain elements must be present,
including a declaration creating the trust, a trust res, and designated beneficiaries. See Whetstone
v. Whetstone, 309 S.C. 227, 231-32, 420 S.E.2d 877, 879 (Ct. App. 1992). The declaration of
trust has to be in writing when the trust property includes realty. See Id. If the declaration of
trust is in writing, the SCTC allows the grantor to sign the trust agreement, but also allows, under
Section 62-7-402 (b), the grantor to direct a third party to sign on the grantor’s behalf and in the
grantor’s presence.
The Supreme Court has found that, with respect to the spousal elective share, a revocable inter
vivos trust that conferred only custodial powers on the trustee, and that expressly barred the
trustee from exercising any powers of sale, investment, or reinvestment during the settlor’s
lifetime without the settlor’s consent, was illusory and invalid. See Seifert v. Southern Nat. Bank
of South Carolina, 409 S.E.2d 337, 305 S.C. 353 (1991). Former SCPC Section 62-7-112 was
subsequently enacted and is retained at SCTC Section 62-7-401.
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.
Comment
The validity of a trust created by will is ordinarily determined by the law of the decedent’s
domicile. No such certainty exists with respect to determining the law governing the validity of
inter vivos trusts. Generally, at common law a trust was created if it complied with the law of the
state having the most significant contacts to the trust. Contacts for making this determination
include the domicile of the trustee, the domicile of the settlor at the time of trust creation, the
location of the trust property, the place where the trust instrument was executed, and the domicile
of the beneficiary. See 5A Austin Wakeman Scott & William Franklin Fratcher, The Law of
Trusts Sections 597, 599 (4th ed. 1987). Furthermore, if the trust has contacts with two or more
states, one of which would validate the trust’s creation and the other of which would deny the
trust’s validity, the tendency is to select the law upholding the validity of the trust. See 5A Austin
Wakeman Scott &.William Franklin Fratcher, The Law of Trusts 600 (4th ed. 1987).
Former South Carolina Probate Code Section 62-7-106 recognized religious, educational, or
charitable trusts validly created in the Settlor’s state of domicile where a beneficiary or object of
the trust resided or was located in South Carolina. The remainder of this SCTC section appears
to have no prior South Carolina statutory equivalent.
Section 62-7-403 is comparable to South Carolina Probate Code Section 62-2-505 recognizing
the validity of wills executed in compliance with the law of a variety of places where the testator
had a significant contact, but expands the possible jurisdictions beyond those allowed for a valid
will.
Section 62-7-403 extends the common law rule by validating a trust if its creation complies
with the law of any of a variety of states in which the settlor or trustee had significant contacts.
Pursuant to Section 62-7-403, a trust not created by will is validly created if its creation complies
47
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 the settlor was domiciled, had a place of abode, or
was a national; the trustee was domiciled or had a place of business; or any trust property was
located.
Section 403 is comparable to Section 2-506 of the Uniform Probate Code, which validates wills
executed in compliance with the law of a variety of places in which the testator had a significant
contact. Unlike the UPC, however, Section 403 is not limited to execution of the instrument but
applies to the entire process of a trust’s creation, including compliance with the requirement that
there be trust property. In addition, unlike the UPC, Section 403 validates a trust valid under the
law of the domicile or place of business of the designated trustee, or if valid under the law of the
place where any of the trust property is located.
The section does not supercede local law requirements for the transfer of real property, such
that title can be transferred only by recorded deed.
Former South Carolina Probate Code Section 62-7-106 recognized religious, educational, or
charitable trusts validly created in the Settlor’s state of domicile where a beneficiary or object of
the trust resided or was located in South Carolina. The remainder of this SCTC section appears
to have no prior South Carolina statutory equivalent.
Section 62-7-403 is comparable to South Carolina Probate Code Section 62-2-505 recognizing
the validity of wills executed in compliance with the law of a variety of places where the testator
had a significant contact, but expands the possible jurisdictions beyond those allowed for a valid
will.
Section 62-7-404. Trust purposes.
A trust may be created only to the extent its purposes are lawful and possible to achieve. A
trust and its terms must be for the benefit of its beneficiaries.
Comment
For an explication of the requirement that a trust must not have a purpose that is unlawful or
against public policy, see Restatement (Third) of Trusts Sections 27-30 (Tentative Draft No. 2,
approved 1999); Restatement (Second) of Trusts Sections 59-65 (1959). A trust with a purpose
that is unlawful or against public policy is invalid. Depending on when the violation occurred, the
trust may be invalid at its inception or it may become invalid at a later date. The invalidity may
also affect only particular provisions. Generally, a trust has a purpose, which is illegal if (1) its
performance involves the commission of a criminal or tortious act by the trustee; (2) the settlor’s
purpose in creating the trust was to defraud creditors or others; or (3) the consideration for the
creation of the trust was illegal. See Restatement (Third) of Trusts Section 28 cmt. a (Tentative
Draft No. 2, approved 1999); Restatement (Second) of Trusts Section 60 cmt. a (1959).
Purposes violative of public policy include those that tend to encourage criminal or tortious
conduct, that interfere with freedom to marry or encourage divorce, that limit religious freedom,
or which are frivolous or capricious.South Carolina Trust Code Section 62-7-404 does not
include the words “not contrary to public policy,” found in Uniform Trust Code Section 404,
recognizing that existing South Carolina law would invalidate trusts that are contrary to publich
policy. The failure to include these words from the uniform act is not intended to change the
48
existing common law. See Restatement (Third) of Trusts Section 29 cmt. d-h (Tentative Draft
No. 2, 1999); Restatement (Second) of Trusts Section 62 (1959).
Pursuant to Section 62-7-402(a), a trust must have an identifiable beneficiary unless the trust is
of a type that does not have beneficiaries in the usual sense, such as a charitable trust or, as
provided in Sections 62-7-408 and 62-7-409, trusts for the care of an animal or other valid
noncharitable purpose. The general purpose of trusts having identifiable beneficiaries is to benefit
those beneficiaries in accordance with their interests as defined in the trust’s terms. The
requirement of this section that a trust and its terms be for the benefit of its beneficiaries, which is
derived from Restatement (Third) of Trusts Section 27(2) (Tentative Draft No. 2, approved
1999), implements this general purpose. While a settlor has considerable latitude in specifying
how a particular trust purpose is to be pursued, the administrative and other nondispositive trust
terms must reasonably relate to this purpose and not divert the trust property to achieve a trust
purpose that is invalid, such as one which is frivolous or capricious.
See Restatement (Third) of Trusts Section 27 cmt. b (Tentative Draft No. 2, approved 1999).
Section 62-7-412(b), which allows the court to modify administrative terms that are
impracticable, wasteful, or impair the trust’s administration, is a specific application of the
requirement that a trust and its terms be for the benefit of the beneficiaries. The fact that a settlor
suggests or directs an unlawful or other inappropriate means for performing a trust does not
invalidate the trust if the trust has a substantial purpose that can be achieved by other methods.
See Restatement (Third) of Trusts Section 28 cmt. e (Tentative Draft No. 2, approved 1999).
South Carolina Trust Code Section 62-7-404 does not include the words “not contrary to
public policy,” found in Uniform Trust Code Section 404, recognizing that existing South
Carolina law would invalidate trusts that are contrary to public policy. The failure to include
these words from the uniform act is not intended to change the existing common law.
There was no South Carolina statutory provision that correlated with UTC Section 404. South
Carolina case law has been consistent with UTC Section 404 in refusing to impose an express
trust, resulting trust, or constructive trust on property in favor of a transferor attempting to
impose a trust on property he transferred to the transferee, when the facts indicate no written
agreement between them existed, the transferor had a fraudulent purpose for the transfers, and the
transferee committed no fraud or deceit. See Settlemeyer v. McCluney, 359 S.C. 317, 596 S.E.2d
514 (S.C. Ct. App. 2004); All v. Prillaman, 200 S.C. 279, 20 S.E.2d 741 (S.C. 1942). “The law
will not permit a party to deliberately put his property out of his control for a fraudulent purpose,
and then, through intervention of a court of equity, regain the same after his fraudulent purpose
has been accomplished” All v. Prillaman, 200 S.C. 279, 308, 20 S.E.2d 741, 753, quoting Jolly v.
Graham, 78 N.E. 919, 920 (Ill. 1906). See also Colin McK. Grant Home V. Medlock, 292 S.C.
466, 349 S.E.2d 655 (Ct. App. 1987), involving a charitable trust, in which the equitable doctrine
of equitable deviation was used to eliminate the racial restrictions from a charitable trust’s
requirements. See also Buck v. Toler, 146 S.C. 294, 141 S.E. 1 (1928), in which a testamentary
trust that violated the rule against perpetuities and that was determined to have been created by
the Testatrix merely to tie up the property was found to be void.
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
49
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 excepted by statute or rule or regulation of the Attorney General, the trustees of
charitable trusts in existence on the effective date of this article, or thereafter created, under the
laws of this State, shall file a certified copy of the trust instrument with the Attorney General
within ninety days after such date or within sixty days after the creation of the trust, whichever is
later.
(e) The Attorney General may make such rules and regulations relating to the information to
be contained with the filing of a trust as required by this part.
(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.
Comment
The required purposes of a charitable trust specified in subsection (a) restate the
well-established categories of charitable purposes listed in Restatement (Third) of Trusts Section
28 (Tentative Draft No. 3, approved 2001), and Restatement (Second) of Trusts Section 368
(1959), which ultimately derive from the Statute of Charitable Uses, 43 Eliz. I, c.4 (1601). The
directive to the courts to validate purposes the achievement of which are beneficial to the
community has proved to be remarkably adaptable over the centuries. The drafters concluded
that it should not be disturbed.
South Carolina Trust Code Section 62-7-405 adds “distress” to the Uniform Trust Code
version, to cover disasters or sudden catastrophes I addition to “poverty.” The SCTC also adds
“scientific, literary and benevolent” to the UTC version. Practically, the specified charitable
purposes will be identical to Internal Revenue Code Section 501 (c)(3).
Charitable trusts are subject to the restriction in Section 62-7-404 that a trust purpose must be
legal and not contrary to public policy. This would include trusts that involve invidious
discrimination. See Restatement (Third) of Trusts Section 28 cmt. f (Tentative Draft No. 3,
approved 2001).
Under subsection (b), a trust that states a general charitable purpose does not fail if the settlor
neglected to specify a particular charitable purpose or organization to receive distributions. The
court may instead validate the trust by specifying particular charitable purposes or recipients, or
delegate to the trustee the framing of an appropriate scheme. See Restatement (Second) of Trusts
Section 397 cmt. d (1959). Subsection (b) of this section is a corollary to Section 413, which
states the doctrine of cy pres. Under Section 62-7-413(a), a trust with a particular charitable
purpose which is impracticable or impossible to achieve failing to state a general charitable
50
purpose does not fail upon failure of the particular means specified in the terms of the trust. The
court must instead apply the trust property in a manner consistent with the settlor’s charitable
purposes to the extent they can be ascertained.
Subsection (b) does not apply to the long-established estate planning technique of delegating to
the trustee the selection of the charitable purposes or recipients. In that case, judicial intervention
to supply particular terms is not necessary to validate the creation of the trust. The necessary
terms instead will be supplied by the trustee. See Restatement (Second) of Trusts Section 396
(1959). Judicial intervention under subsection (b) will become necessary only if the trustee fails
to make a selection. See Restatement (Second) of Trusts Section 397 cmt. d (1959). Pursuant to
Section 110(b), the charitable organizations selected by the trustee would not have the rights of
qualified beneficiaries under this Code because they are not expressly designated to receive
distributions under the terms of the trust.
Contrary to Restatement (Second) of Trusts Section 391 (1959), subsection (c) grants a settlor
standing to maintain an action to enforce a charitable trust. The grant of standing to the settlor
does not negate the right of the state attorney general or persons with special interests to enforce
either the trust or their interests. For the law on the enforcement of charitable trusts, see Susan
N. Gary, Regulating the Management of Charities: Trust Law, Corporate Law, and Tax Law, 21
U. Hawaii L. Rev. 593 (1999).
South Carolina Trust Code Section 62-7-405 adds “distress” to the Uniform Trust Code
version, to cover disasters or sudden catastrophes in addition to “poverty.” The SCTC also adds
“scientific, literary and benevolent” to the UTC version. Practically, the specified charitable
purposes will be identical to Internal Revenue Code Section 501 (c)(3).
Section 62-7-405(b) must be read in conjunction with SCTC Sections 62-7-404 and 62-7-413.
SCTC Section 62-7-413 would incorporate the doctrine of equitable deviation in South Carolina
law. See the South Carolina Comment to SCTC Section 62-7-413.
SCTC Section 62-7-405(c) adds “the trustee and the Attorney General” to those who may
maintain a proceeding to enforce the trust under the UTC version.
Former South Carolina Probate Code Sections 62-7-501 through 62-7-507, Part 5 of Article 7
of Title 62, covered charitable trusts. These sections are revised and incorporated in SCTC
Section 62-7-405.
SCPC Section 62-7-501 required individual trustees of certain charitable trusts to file a copy of
the trust with the Attorney General. Section 62-7-405(e) makes this initial filing applicable to all
charitable trusts.
SCPC Section 62-7-502 required that certain charitable trusts file annual reports with the
attorney general.
SCPC Section 62-7-505 exempted many charitable trusts from the filing requirements of Part
Five:
“… trusts or trustees of the following: Churches, cemeteries, orphanages operated in
conjunction with churches, hospitals, colleges, or universities, or school districts, nor shall it apply
to banking institutions which act as trustees under the supervision of the State Board of Financial
Institutions or under the supervision of federal banking agencies.”
SCPC Sections 62-7-502 and 62-7-505 are repealed. The exemption is anachronistic. SCTC
Section 62-7-405(d) requires that every charitable trust make an initial filing at inception with the
Attorney General.
51
SCPC Section 62-7-504 is retained at Section 62-7-405(e), empowering the Attorney General
to issue regulations to require further reporting from charitable trusts.
SCPC Section 62-7-506 incorporated the prohibited transaction provisions applicable to private
foundations and charitable trusts into every trust and is retained in SCTC Section 62-7-405(f).
(Existing Section 33-31-150 applies the restrictions to not-for-profit South Carolina
corporations.)
SCPC Section 62-7-507 made clear that incurring an excise tax for violation of the prohibited
transaction provisions will not result in trust termination, and is retained in Section 62-7-405(g).
South Carolina expressly rejects the portion of the UTC Comment which makes “public policy”
or “invidious discrimination” a basis to find that a trust violates Section 62-7-404.
Charitable trusts are subject to the restriction in Section 404 that a trust purpose must be legal
and not contrary to public policy. This would include trusts that involve invidious discrimination.
See Restatement (Third) of Trusts Section 28 cmt. f (Tentative Draft No. 3, approved 2001).
South Carolina common law does not allow enforcement of a trust for an unlawful purpose.
South Carolina’s existing case law is sufficient to prohibit discrimination in a charitable trust.
Contrary to Restatement (Second) of Trusts Section 391 (1959), subsection (c) grants a settlor
standing to maintain an action to enforce a charitable trust. The grant of standing to the settlor
does not negate the right of the state attorney general or persons with special interests to enforce
either the trust or their interests. For the law on the enforcement of charitable trust, see Susan N.
Gary, Regulating the Management of Charities: Trust Law, Corporate Law, and Tax Law, 21 U.
Hawaii L. Rev. 593 (1999).
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.
Comment
This section is a specific application of Restatement (Third) of Trusts Section 12 (Tentative
Draft No. 1, approved 1996), and Restatement (Second) of Trusts Section 333 (1959), which
provide that a trust can be set aside or reformed on the same grounds as those which apply to a
transfer of property not in trust, among which include undue influence, duress, and fraud, and
mistake. This section addresses undue influence, duress, and fraud. For reformation of a trust on
grounds of mistake, see Section 415. See also Restatement (Third) of Property: Wills and Other
Donative Transfers Section 8.3 (Tentative Draft No. 3, approved 2001), which closely tracks the
language above. Similar to a will, the invalidity of a trust on grounds of undue influence, duress,
or fraud may be in whole or in part.
The South Carolina version of this section changes the word “void” to “voidable” to eliminate
any suggestion that a trust might be void ab initio or that the trustee’s actions might be invalid
even though taken in good faith and before any determination that the trust is void.
Third parties dealing with the trustee of a voidable trust will be protected by South Carolina
Trust Code Section 62-7-1012.
This section is similar to present South Carolina law regarding the validity of wills.
Section 62-7-407. Evidence of oral trust.
Except as otherwise required by statute, a trust need not be evidenced by a trust instrument.
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The creation of an oral trust and its terms may be established only by clear and convincing
evidence.
Comment
While it is always advisable for a settlor to reduce a trust to writing, the Uniform Trust Code
follows established law in recognizing oral trusts. Such trusts are viewed with caution, however.
The requirement of this section that an oral trust can be established only by clear and convincing
evidence is a higher standard than is in effect in many States. See Restatement (Third) of Trusts
Section 20 Reporter’s Notes (Tentative Draft No. 1, approved 1996).
This section is in accordance with existing South Carolina law requiring oral trusts to be proved
by clear and convincing evidence. However, South Carolina statutory law has consistently
required that the declaration or creation of trusts in lands, tenements or hereditaments be
manifested and proved by some writing such as a trust agreement or last will. Absent such a
writing, the trust would be void, per former South Carolina Probate Code Section 62-7-101 et
seq. Historically, a distinction has been made between the creation of the trust and the
conveyance of real property thereto, but the writing must manifest a previous trust. This section
no longer distinguishes between trusts funded with real estate from those funded with personalty.
Both must be established by clear and convincing evidence. Bee Beckham v. Short 380 S.E. 2d
826 (S.C. 1989).
Absent some specific statutory provision, such as a provision requiring that transfers of real
property be in writing, a trust need not be evidenced by a writing. States with statutes of frauds
or other provisions requiring that the creation of certain trusts must be evidenced by a writing
may wish specifically to cite such provisions.
For the Statute of Frauds generally, see Restatement (Second) of Trusts Sections 40-52 (1959).
For a description of what the writing must contain, assuming that a writing is required, see
(Second) of Trusts Section 46-49 (1959). For a discussion of when the writing must be signed,
see Restatement (Third) of Trusts Section 23 (Tentative Draft No. 1, approved 1996);
Restatement (Second) of Trusts Section 41-42 (1959). For the law of oral trusts, see
This section is in accordance with existing South Carolina law requiring oral trusts to be proved
by clear and convincing evidence. However, South Carolina statutory law has consistently
required that the declaration or creation of trusts in lands, tenaments or hereditaments be
manifested and proved by some writing such as a trust agreement or last will. Absent such a
writing, the trust would be void, per former South Carolina Probate Code Section 62-7-101 et.
seq. Historically, a distinction has been made between the creation of the trust and the
conveyance of real property thereto, but the writing must manifest a previous trust. This section
no longer distinguishes between trusts funded with real estate from those funded with personalty.
Both must be established by clear and convincing evidence. See Beckham v. Short, 380 S.E. 2d
826 (S.C. 1989).
South Carolina Trust Code Section 62-7-401(a)(2) requires a writing to create a declaration of
trust (a self-trusteed trust).
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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.
Comment
This section and the next section of the Code validate so called honorary trusts. Unlike
honorary trusts created pursuant to the common law of trusts, which are arguably no more than
powers of appointment, the trusts created by this and the next section are valid and enforceable.
For a discussion of the common law doctrine, see Restatement (Third) of Trusts Section 47
(Tentative Draft No. 2, approved 1999); Restatement (Second) of Trusts Section 124 (1959).
This section addresses a particular type of honorary trust, the trust for the care of an animal.
Section 62-7-409 specifies the requirements for trusts without ascertainable beneficiaries that are
created for other noncharitable purposes. A trust for the care of an animal may last for the life of
the animal. While the animal will ordinarily be alive on the date the trust is created, an animal may
be added as a beneficiary after that date as long as the addition is made prior to the settlor’s death.
Animals in gestation but not yet born at the time of the trust’s creation may also be covered by its
terms. A trust authorized by this section may be created to benefit one designated animal or
several designated animals.
South Carolina Trust Code Section 62-7-408 differs in several minor ways from the uniform
version. Two provisions found in the UTC Comment have been added to the body of Section 627-408(a): (1) that the trust can benefit animals alive during the settlor’s lifetime, regardless of
whether they are alive at the time te trust is created, and (2) that animals in gestation at the
settlor’s death can be included in the trust. Surplus language I the UTC has also been omitted
from the SCTC version.
Subsection (b) addresses enforcement. SCTC Section 62-7-408(b) modifies the UTC version,
attempting to clarify that a person need only be concerned for an animal’s welfare to petition the
court. That person does not have to have a legally cognizable interest in the animal.
Noncharitable trusts ordinarily may be enforced by their beneficiaries. Charitable trusts may be
enforced by the State’s attorney general or by a person deemed to have a special interest. See
Restatement (Second) of Trusts Section 391 (1959). But at common law, a trust for the care of
an animal or a trust without an ascertainable beneficiary created for a noncharitable purpose was
unenforceable because there was no person authorized to enforce the trustee’s obligations.
Sections 62-7-408 and 62-7-409 close this gap. The intended use of a trust authorized by
either section may be enforced by a person designated in the terms of the trust or, if none, by a
person appointed by the court. In either case, Section 62-7-110(b) grants to the person appointed
54
the rights of a qualified beneficiary for the purpose of receiving notices and providing consents. If
the trust is created for the care of an animal, a person with an interest in the welfare of the animal
has standing to petition for an appointment. The person appointed by the court to enforce the
trust should also be a person who has exhibited an interest in the animal’s welfare. The concept of
granting standing to a person with a demonstrated interest in the animal’s welfare is derived from
the Uniform Guardianship and Protective Proceedings Act, which allows a person interested in
the welfare of a ward or protected person to file petitions on behalf of the ward or protected
person. See, e.g., Uniform Probate Code Sections 5-210(b), 5-414(a).
Subsection (c) addresses the problem of excess funds. If the court determines that the trust
property exceeds the amount needed for the intended purpose and that the terms of the trust do
not direct the disposition, a resulting trust is ordinarily created in the settlor or settlor’s successors
in interest. See Restatement (Third) of Trusts Section 47 (Tentative Draft No. 2, approved
1999); Restatement (Second) of Trusts Section 124 (1959). Successors in interest include the
beneficiaries under the settlor’s will, if the settlor has a will, or in the absence of an effective will
provision, the settlor’s heirs. The settlor may also anticipate the problem of excess funds by
directing their disposition in the terms of the trust. The disposition of excess funds is within the
settlor’s control: See Section 62-7-105(a). While a trust for an animal is usually not created until
the settlor’s death; subsection (a) allows such a trust to be created during the settlor’s lifetime.
Accordingly, if the settlor is still living, subsection (c) provides for distribution of excess funds to
the settlor, and not to the settlor’ s successors in interest.
Should the means chosen not be particularly efficient, a trust created for the care of an animal
can also be terminated by the trustee or court under Section 62-7-414. Termination of a trust
under that section, however, requires that the trustee or court develop an alternative means for
carrying out the trust purposes. See Section 62-7-414(c).
This section and the next section are suggested by Section 2-907 of the Uniform Probate Code,
but much of this and the following section is new.
South Carolina Trust Code Section 62-7-408 differs in several minor ways from the uniform
version. Two provisions found in the UTC Comment have been added to the body of Section
62-7-408(a): (1) that the trust can benefit animals alive during the settlor’s lifetime, regardless of
whether they are alive at the time the trust is created, and (2) that animals in gestation at the
settlor’s death can be included in the trust. Surplus language in the UTC has also been omitted
from the SCTC version.
SCTC Section 62-7-408(b) modifies the UTC version, attempting to clarify that a person need
only be concerned for an animal’s welfare to petition the court. That person does not have to
have a legally cognizable interest in the animal.
A trust created under this section would not be recognized under former South Carolina law.
Thus, this section creates a new concept for South Carolina.
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 the South
Carolina Uniform Statutory Rule Against Perpetuities (S.C. Code Section 27-6-10 et. seq.),
55
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.
Comment
South Carolina Trust Code Section 62-7-409 had no exact statutory counter part under prior
South Carolina law, although this Section continues South Carolina’s allowance of trusts for the
perpetual care of cemetery plots as set forth in S. C. Code Section 27-5-70.
This section authorizes two types of trusts without ascertainable beneficiaries; trusts for general
but noncharitable purposes, and trusts for a specific noncharitable purpose other than the care of
an animal, on which see Section 62-7-408. Examples of trusts for general noncharitable purposes
include a bequest of money to be distributed to such objects of benevolence as the trustee might
select. Unless such attempted disposition was interpreted as charitable, at common law the
disposition was honorary only and did not create a trust. Under this section, however, the
disposition is enforceable as a trust for a period of up to 21 years, although that number is placed
in brackets to indicate that States may wish to select a different time limit.
The most common example of a trust for a specific noncharitable purpose is a trust for the care
of a cemetery plot. The lead-in language to the section recognizes that some special purpose
trusts, particularly those for care of cemetery plots, are subject to other statutes. These trusts are
allowed to run for the maximum period allowed under the South Carolina Uniform Rule Against
Perpetuities, S.C. Code Section 27-6-10 et seq. – a longer period than the 21 years allowed under
the Uniform Trust Code version of Section 409. The rule against perpetuities limitation does not
apply to cemeteries, cemetery plots, grave sites, mausoleums, columbaria, grave markers, or
monuments. Such legislation will typically endeavor to facilitate perpetual care as opposed to
care limited to 21 years as under this section.
Perpetual care cemeteries are addressed in Title 40, Chapter 8, Sections 40-8-110 et.seq.
For the requirement that a trust, particularly the type of trust authorized by this section, must
have a purpose that is not capricious, see Section 62-7-404 Comment. For examples of the types
of trusts authorized by this section, see Restatement (Third) of Trusts Section 47 (Tentative Draft
No. 2, approved 1999), and Restatement (Second) of Trusts Section 62 cmt. W and Section 124
(1959). The case law on capricious purposes is collected in 2 Austin W. Scott & William F.
Fratcher, The Law of Trusts Section 124.7 (4th ed. 1987).
This section is similar to Section 62-7-408, although less detailed. Much of the Comment to
Section 62-7-408 also applies to this section.
South Carolina Trust Code Section 62-7-409 had no exact statutory counterpart under prior
South Carolina law, although this Section continues South Carolina’s allowance of trusts for the
perpetual care of cemetery plots as set forth in S. C. Code Section 27-5-70. These trusts are
allowed to run for the maximum period allowed under the South Carolina Uniform Rule Against
56
Perpetuities, S.C. Code Section 27-6-10 et. seq. – a longer period than the 21 years allowed
under the Uniform Trust Code version of Section 409. The rule against perpetuities limitation
does not apply to cemeteries, cemetery plots, grave sites, mausoleums, columbaria, grave
markers, or monuments.
Perpetual care cemeteries are addressed in Title 40, Chapter 8, Sections 40-8-10 et. seq.
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.
Comment
Subsection (a) lists the grounds on which trusts typically terminate. For a similar formulation,
see Restatement (Third) of Trusts Section 61 (Tentative Draft No. 3, approved 2001).
Terminations under subsection (a) may be in either whole or in part. Other types of terminations,
all of which require action by a court, trustee, or beneficiaries, are covered in Sections 411-414,
which also address trust modification. Of these sections, all but Section 411 apply to charitable
trusts and all but Section 413 apply to noncharitable trusts.
Withdrawal of the trust property is not an event terminating a trust. The trust remains in
existence although the trustee has no duties to perform unless and until property is later
contributed to the trust.
Subsection (b) specifies the persons who have standing to seek court approval or disapproval of
proposed trust modifications, terminations, combinations, or divisions. An approval or
disapproval may be sought for an action that does not require court permission, including a
petition questioning the trustee’s distribution upon termination of a trust under $50,000 (Section
414), and a petition to approve or disapprove a proposed trust division or consolidation (Section
417). Subsection (b) makes the settlor an interested person with respect to a judicial proceeding
brought by the beneficiaries under Section 411 to terminate or modify a trust. Contrary to
Restatement (Second) of Trusts Section 391 (1959), subsection (b) grants a settlor standing to
petition the court under Section 413 to apply cy pres to modify the settlor’s charitable trust.
South Carolina Trust Code Section 62-7-410 provides for the automatic termination of trusts.
This SCTC Section does not adopt the provisions of Uniform Trust Code Section 62-7-410,
calling for termination of the trust when “no purpose of the trust remains to be achieved, or the
purposes of the trust have become unlawful, contrary to public policy, or impossible to achieve.”
These may be grounds to terminate a trust under the SCTC, but only upon appropriate notice to
interested parties in interest and an opportunity for a hearing. A declaratory judgment may be
sought to determine if the trust has terminated.
57
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.
Comment
This section describes the circumstances in which termination or modification of a noncharitable
irrevocable trust may be compelled by the beneficiaries, with or without the concurrence of the
settlor, but with court approval. For provisions governing modification or termination of trusts
without the need to seek beneficiary consent, see Sections 62-7-412 (modification or termination
due to unanticipated circumstances or inability to administer trust effectively), 62-7-414
(termination or modification of uneconomic noncharitable trust), and 62-7-416 (modification to
achieve settlor’s tax objectives). If the trust is revocable by the settlor, the method of revocation
specified in Section 62-7-602 applies. South Carolina Trust Code Section 62-7-411(a) adds the
phrase “with court approval” to the first sentence of the Uniform Trust Code version and the
phrase “modification or” to the second sentence of the UTC version. The SCTC omits UTC
subsection 411(c), which provided that a spendthrift provision would not be presumed to
constitute a material purpose of the trust. SCTC Section 62-7-411(c) substitutes the phrase “as
ordered by the court” to the UTC version of subsection (d) for the phrase “as agreed by the
beneficiaries.”
Subsection (a) states the test for termination or modification by the beneficiaries with the
concurrence of the settlor. Subsection (b) states the test for termination or modification by
unanimous consent of the beneficiaries without the concurrence of the settlor. The rules on trust
termination in subsections (a)-(b) carries forward the Claflin rule, first stated in the famous case
of Claflin v. Claflin, 20 N.E. 454 (Mass. 1889). Subsection (c) addresses the effect of a
spendthrift provision. Subsection (d) directs how the trust property is to be distributed following
58
a termination under either subsection (a) or (b). Subsection (e) creates a procedure for judicial
approval of a proposed termination or modification when the consent of less than all of the
beneficiaries is available.
Under this section, a trust may be modified or terminated over a trustee’s objection. However,
pursuant to Section 62-7-410, the trustee has standing to object to a proposed termination or
modification.
The settlor’s right to join the beneficiaries in terminating or modifying a trust under this section
does not rise to the level of a taxable power. See Treas. Reg. Section 20.2038-1(a)(2). No gift
tax consequences result from a termination as long as the beneficiaries agree to distribute the trust
property in accordance with the value of their proportionate interests.
The provisions of Article 3 on representation, virtual representation and the appointment and
approval of representatives appointed by the court apply to the determination of whether all
beneficiaries have signified consent under this section. The authority to consent on behalf of
another person, however, does not include authority to consent over the other person’s objection.
See Section 62-7-301(cb). Regarding the persons who may consent on behalf of a beneficiary,
see Sections 62-7-302 through 62-7-305. A consent given by a representative is invalid to the
extent there is a conflict of interest between the representative and the person represented. Given
this limitation, virtual representation of a beneficiary’s interest by another beneficiary pursuant to
Section 62-7-304 will rarely be available in a trust termination case, although it should be
routinely available in cases involving trust modification, such as a grant to the trustee of additional
powers. If virtual or other form of representation is unavailable, Section 62-7-305 of the Code
permits the court to appoint a representative who may give the necessary consent to the proposed
modification or termination on behalf of the minor, incapacitated, unborn, or unascertained
beneficiary. The ability to use virtual and other forms of representation to consent on a
beneficiary’s behalf to a trust termination or modification has not traditionally been part of the
law, although there are some notable exceptions. Compare Restatement (Second) Section 337(1)
(1959) (beneficiary must not be under incapacity), with Hatch v. Riggs National Bank, 361 F.2d
559 (D.C. Cir. 1966) (guardian ad litem authorized to consent on beneficiary’s behalf).
Subsection (a) also addresses the authority of an agent, conservator, or guardian to act on a
settlor’s behalf. Consistent with Section 62-7-602 on revocation or modification of a revocable
trust, the section assumes that a settlor, in granting an agent general authority, did not intend for
the agent to have authority to consent to the termination or modification of a trust, authority that
could be exercised to radically alter the settlor’s estate plan. In order for an agent to validly
consent to a termination or modification of the settlor’s revocable trust, such authority must be
expressly conveyed either in the power or in the terms of the trust.
Subsection (a), however, does not impose restrictions on consent by a conservator or guardian,
other than prohibiting such action if the settlor is represented by an agent. The section instead
leaves the issue of a conservator’s or guardian’s authority to local law. Many conservatorship
statutes recognize that termination or modification of the settlor’s trust is a sufficiently important
transaction that a conservator should first obtain the approval of the court supervising the
conservatorship. See, e.g., Unif Probate Code Section 5-411(a)(4). Because the Uniform Trust
Code uses the term “conservator” to refer to the person appointed by the court to manage an
individual’s property (see Section 103(4)), a guardian may act on behalf of a settlor under this
section only if a conservator has not been appointed.
Subsection (a) is similar to Restatement (Third) of Trusts Section 65(2) (Tentative Draft No. 3,
approved 2001), and Restatement (Second) of Trusts Section 338(2) (1959), both of which
59
permit termination upon joint action of the settlor and beneficiaries. Unlike termination by the
beneficiaries alone under subsection (b), termination with the concurrence of the settlor does not
require a finding that the trust no longer serves a material purpose. No finding of failure of
material purpose is required because all parties with a possible interest in the trust’s continuation,
both the settlor and beneficiaries, agree there is no further need for the trust. Restatement Third
goes further than subsection (b) of this section and Restatement Second, however, in also
allowing the beneficiaries to compel termination of a trust that still serves a material purpose if the
reasons for termination outweigh the continuing material purpose.
Subsection (b), similar to Restatement Third but not Restatement Second, allows modification
by beneficiary action. The beneficiaries may modify any term of the trust if the modification is not
inconsistent with a material purpose of the trust. Restatement Third, though, goes further than
this Code in also allowing the beneficiaries to use trust modification as a basis for removing the
trustee if removal would not be inconsistent with a material purpose of the trust. Under the Code,
however, Section 62-7-706 is the exclusive provision on removal of trustees. Section 62-7706(b)(4) recognizes that a request for removal upon unanimous agreement of the qualified
beneficiaries is a factor for the court to consider, but before removing the trustee the court must
also find that such action best serves the interests of all the beneficiaries, that removal is not
inconsistent with a material purpose of the trust, and that a suitable cotrustee or successor trustee
is available. Compare Section 62-7-706(b)(4), with Restatement (Third) Section 65 cmt. f
The requirement that the trust no longer serve a material purpose before it can be terminated by
the beneficiaries does not mean that the trust has no remaining function. In order to be material,
the purpose remaining to be performed must be of some significance:
Material purposes are not readily to be inferred. A finding of such a purpose generally requires
some showing of a particular concern or objective on the part of the settlor, such as concern with
regard to the beneficiary’s management skills, judgment, or level of maturity. Thus, a court may
look for some circumstantial or other evidence indicating that the trust arrangement represented
to the settlor more than a method of allocating the benefits of property among multiple
beneficiaries, or a means of offering to the beneficiaries (but not imposing on them) a particular
advantage. Sometimes, of course, the very nature or design of a trust suggests its protective
nature or some other material purpose.
Restatement (Third) of Trusts Section 65 cmt. d (Tentative Draft No. 3, approved 2001).
Subsection (c) of this section deals with the effect of a spendthrift provision on the right of a
beneficiary to concur in a trust termination or modification. Spendthrift terms have sometimes
been construed to constitute a material purpose without inquiry into the intention of the particular
settlor. For examples, see Restatement (Second) of Trusts Section 337 (1959); George G. Bogert
& George T. Bogert, The Law of Trusts and Trustees Section 1008 (Rev. 2d ed. 1983); and 4
Austin W. Scott & William F. Fratcher, The Law of Trusts Section 337 (4th ed. 1989). This
result is troublesome because spendthrift provisions are often added to instruments with little
thought. Subsection (c), similar to Restatement (Third) of Trusts Section 65 cmt. a (Tentative
Draft No. 3, approved 2001), does not negate the possibility that continuation of a trust to assure
spendthrift protection might have been a material purpose of the particular settlor. The question
of whether that was the intent of a particular settlor is instead a matter of fact to be determined on
the totality of the circumstances.
Subsection (d) recognizes that the beneficiaries’ power to compel termination of the trust
includes the right to direct how the trust property is to be distributed. While subsection (a)
60
requires the settlor’s consent to terminate an irrevocable trust, the settlor does not control the
subsequent distribution of the trust property. Once termination has been approved, how the trust
property is to be distributed is solely for the beneficiaries to decide.
Subsection (e), similar to Restatement (Third) of Trusts Section 65 cmt. c (Tentative Draft
No. 3, approved 2001), and Restatement (Second) of Trusts Sections 338(2) & 340(2) (1959),
addresses situations in which a termination or modification is requested by less than all the
beneficiaries, either because a beneficiary objects, the consent of a beneficiary cannot be obtained,
or representation is either unavailable or its application uncertain. Subsection (e) allows the court
to fashion an appropriate order protecting the interests of the nonconsenting beneficiaries while at
the same time permitting the remainder of the trust property to be distributed without restriction.
The order of protection for the nonconsenting beneficiaries might include partial continuation of
the trust, the purchase of an annuity, or the valuation and cashout of the interest.
South Carolina Trust Code Section 62-7-411(a) adds the phrase “with court approval” to the
first sentence of the Uniform Trust Code version and the phrase “modification or” to the second
sentence of the UTC version. The SCTC omits UTC subsection 411(c), which provided that a
spendthrift provision would not be presumed to constitute a material purpose of the trust. SCTC
Section 62-7-411(c) substitutes the phrase “as ordered by the court” to the UTC version of
subsection (d) for the phrase “as agreed by the beneficiaries.”
No similar statutory provisions existed under prior South Carolina law.
Under existing South Carolina law, a court has the power to alter or modify an irrevocable trust
to effectuate the intent of the settler, but it is the duty of the courts to preserve, not destroy,
trusts. See Chiles v. Chiles, 270 S.C. 379, 242 S.E.2d 426 (S.C. 1978). When a settler sought
modification of an irrevocable trust without the consent of the beneficiaries, the court would
modify the trust to effectuate the Settlor’s intent only when some exigency or emergency made
the modification indispensable to the preservation of the trust. See Chiles.
Under existing South Carolina law, a spendthrift trust cannot be terminated by agreement of all
beneficiaries when the purpose of the trust is to provide an income stream for life or until the trust
fund was exhausted, since to do so would defeat a material purpose of the trust. See Germann v.
New York Life Insurance Co, 286 S.C. 34 , 331 S.E.2d 385(S.C. Ct. App. 1985).
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.
Comment
This section broadens the court’s ability to apply equitable deviation to terminate or modify a
trust. South Carolina Trust Code Section 62-7-412(a) conceptually broadens the traditional
61
authority of the court to modify trust provisions because of unanticipated circumstances,
especially with respect to dispositive provisions. Subsection (a) allows a court to modify the
dispositive provisions to increase support of a beneficiary might be appropriate if the beneficiary
has become unable to provide for support due to poor health or serious injury. Subsection (a) is
similar to Restatement (Third) of Trusts Section 66(1) (Tentative Draft No. 3, approved 2001),
except that this section, unlike the Restatement, does not impose a duty on the trustee to petition
the court if the trustee is aware of circumstances justifying judicial modification. The purpose of
the “equitable deviation” authorized by subsection (a) is not to disregard the settlor’s intent but to
modify inopportune details to effectuate better the settlor’s broader purposes. Among other
things, equitable deviation may be used to modify administrative or dispositive terms due to the
failure to anticipate economic change or the incapacity of a beneficiary. For numerous
illustrations, see Restatement (Third) of Trusts Section 66 cmt. b (Tentative Draft No. 3,
approved 2001). While it is necessary that there be circumstances not anticipated by the settlor
before the court may grant relief under subsection (a), the circumstances may have been in
existence when the trust was created. This section thus complements Section 62-7-415, which
allows for reformation of a trust based on mistake of fact or law at the creation of the trust.
Subsection (b) broadens the court’s ability to modify the administrative terms of a trust. The
standard under subsection (b) is similar to the standard for applying cy presequitable deviation to
a charitable trust. See Section 62-7-413(a). Just as a charitable trust may be modified if its
particular charitable purpose becomes impracticable or wasteful, so can the administrative terms
of any trust, charitable or non-charitable. Subsections (a) and (b) are not mutually exclusive.
Many situations justifying modification of administrative terms under subsection (a) will also
justify modification under subsection (b). Subsection (b) is also an application of the requirement
in Section 62-7-404 that a trust and its terms must be for the benefit of its beneficiaries. See also
Restatement (Third) of Trusts Section 27(2) & cmt. b (Tentative Draft No. 2, approved 1999).
Although the settlor is granted considerable latitude in defining the purposes of the trust, the
principle that a trust have a purpose which is for the benefit of its beneficiaries precludes
unreasonable restrictions on the use of trust property. An owner’s freedom to be capricious about
the use of the owner’s own property ends when the property is impressed with a trust for the
benefit of others. See Restatement (Second) of Trusts Section 124 cmt. g (1959). Thus, attempts
to impose unreasonable restrictions on the use of trust property will fail. See Restatement (Third)
of Trusts Section 27 Reporter’s Notes to cmt. b (Tentative Draft No. 2, approved 1999).
Subsection (b), unlike subsection (a), does not have a direct precedent in the common law, but
various states have insisted on such a measure by statute. See, e.g., Mo. Rev. Stat. Section
456.590.1.
Upon termination of a trust under this section, subsection (c) requires that the trust be
distributed in a manner consistent with the purposes of the trust. As under the doctrine of cy
pres, effectuating a distribution consistent with the purposes of the trust requires an examination
of what the settlor would have intended had the settlor been aware of the unanticipated
circumstances.
Typically, such terminating distributions will be made to the qualified
beneficiaries, often in proportion to the actuarial value of their interests, although the section does
not so prescribe. For the definition of qualified beneficiary, see Section 103(12).
Modification under this section, because it does not require beneficiary action, is not precluded
by a spendthrift provision.
62
South Carolina Trust Code Section 62-7-412(a) conceptually broadens the traditional authority
of the court to modify trust provisions because of unanticipated circumstances, especially with
respect to dispositive provisions.
South Carolina Trust Code Section 62-7-412(c) modifies the uniform version to provide that,
upon termination, trust property is to be distributed as ordered by the court.
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 the South Carolina Uniform Statutory
Rule Against Perpetuities (S.C. Code Section 27-6-10 et seq.) have elapsed since the date of the
trust’s creation.
Comment
This section clarifies and codifies in part existing South Carolina law that recognizes “Equitable
Deviation,” which is the power of a court in certain situations to change the provisions of a
charitable trust. The words “cy pres” in the Uniform Trust Code version have been deleted and
replaced with “Equitable Deviation” because South Carolina courts have refused to recognize the
doctrine of cy pres. See e.g.. Mars v. Gilbert, 93 S.C. 455, 77 S.E. 131 (S.C. 1913) (expressly
rejecting the doctrine of equitable cy pres. But making clear that literal compliance with the terms
of a will is not always required when the conditions have changes). See also All Saints Parish,
Waccamaw, a South Carolina non-profit corporation, a/k/a The Episcopal Church af All Saints
and a/k/a The Vestry and Church Wardens of the Episcopal Church of All Saints Parish, 358
S.C. 209; 595 S.E. 2d 253 (S.C. Ct. App 2004).
South Carolina has long recognized the doctrine of equitable deviation, which permits a court
of equity to deviate from the strict terms of a trust when changed conditions render the
accomplishment of the charitable purpose impossible or impracticable.
Subsection (a)
codifies the court’s inherent authority to apply equitable deviationcy pres. The power may be
applied to modify an administrative or dispositive term. The court may order the trust terminated
and distributed to other charitable entities. Partial termination may also be ordered if the trust
property is more than sufficient to satisfy the trust’s current purposes. Subsection (a), which is
similar to Restatement (Third) of Trusts Section 67 (Tentative Draft No. 3, approved 2001),
modifies the doctrine of cy pres by presuming that the settlor had a general charitable intent when
a particular charitable purpose becomes impossible or impracticable to achieve. Traditional
doctrine did not supply that presumption, leaving it to the courts to determine whether the settlor
had a general charitable intent. If such an intent is found, the trust property is applied to other
63
Italic
Italic
charitable purposes. If not, the charitable trust fails. See Restatement (Second) of Trusts
Section 399 (1959). In the great majority of cases the settlor would prefer that the property be
used for other charitable purposes. Courts are usually able to find a general charitable purpose to
which to apply the property, no matter how vaguely such purpose may have been expressed by
the settlor. Under subsection (a), if the particular purpose for which the trust was created
becomes impracticable, unlawful, impossible to achieve, or wasteful, the trust does not fail. The
court instead must either modify the terms of the trust or distribute the property of the trust in a
manner consistent with the settlor’s charitable purposes.
The settlor, with one exception, may mandate that the trust property pass to a noncharitable
beneficiary upon failure of a particular charitable purpose. Responding to concerns about the
clogging of title and other administrative problems caused by remote default provisions upon
failure of a charitable purpose, subsection (b) invalidates a gift over to a noncharitable beneficiary
upon failure of a particular charitable purpose unless the trust property is to revert to a living
settlor or fewer than 21 years have elapsed since the trust’s creation. Subsection (b) will not
apply to a charitable lead trust, under which a charity receives payments for a term certain with a
remainder to a noncharity. In the case of a charitable lead trust, the settlor’s particular charitable
purpose does not fail upon completion of the specified trust term and distribution of the remainder
to the noncharity. Upon completion of the specified trust term, the settlor’s particular charitable
purpose has instead been fulfilled. For a discussion of the reasons for a provision such as
subsection (b), see Ronald Chester, Cy Pres of Gift Over: The Search for Coherence in Judicial
Reform of Failed Charitable Trusts, 23 Suffolk U. L. Rev. 41 (1989).
The doctrine of cy pres is applied not only to trusts, but also to other types of charitable
dispositions, including those to charitable corporations. This Section does not control
dispositions made in nontrust form. However, in formulating rules for such dispositions, the
courts often refer to the principles governing charitable trusts, which would include this Code.
For the definition of charitable purpose, see Section 405(a). Pursuant to Sections 405(c) and
410(b), a petition requesting a court to enforce a charitable trust or to apply cy pres may be
maintained by a settlor. Such actions can also be maintained by a cotrustee, the state attorney
general, or by a person having a special interest in the charitable disposition. See Restatement
(Second) of Trusts Section 391 (1959).
This section clarifies and codifies in part existing South Carolina law that recognizes “Equitable
Deviation,” which is the power of a court in certain situations to change the provisions of a
charitable trust. The words “cy pres” in the Uniform Trust Code version have been deleted and
replaced with “Equitable Deviation” because South Carolina courts have refused to recognize the
doctrine of cy pres. See, e.g., Mars v. Gilbert, 93 S.C. 455, 77 S.E. 131 (S.C. 1913) (expressly
rejecting the doctrine of equitable cy pres, but making clear that literal compliance with the terms
of a will is not always required when the conditions have changed). See also All Saints Parish,
Waccamaw, a South Carolina non-profit corporation, a/k/a The Episcopal Church of All Saints
and a/k/a The Vestry and Church Wardens of the Episcopal Church of All Saints Parish, 358
S.C. 209; 595 S.E.2d 253 (S.C. Ct. App.2004).
South Carolina has long recognized the doctrine of equitable deviation, which permits a court
of equity to deviate from the strict terms of a trust when changed conditions render the
accomplishment of the charitable purpose impossible or impracticable.
64
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.
Comment
Subsection (a) assumes that a trust with a value of $5100,000 or less is sufficiently likely to be
inefficient to administer that a trustee should be able to terminate it without the expense of a
judicial termination proceeding. Also, in subsection (c) a phrase added to the uniform version
clarifies that the court may specify how the trust assets should be distributed – e.g., in cases when
the court is involved in a termination under subsection (b).
The amount has been placed in brackets to signal to enacting jurisdictions that they may wish to
designate a higher or lower figure. Because subsection (a) is a default rule, a settlor is free to set
a higher or lower figure or to specify different procedures or to prohibit termination without a
court order. See Section 62-7-105 and Article 4 General Comment.
Subsection (b) allows the court to modify or terminate a trust if the costs of administration
would otherwise be excessive in relation to the size of the trust. The court may terminate a trust
under this section even if the settlor has forbidden it. See Section 62-7-105(b)(4). Judicial
termination under this subsection may be used whether or not the trust is larger or smaller than
$1050,000.
When considering whether to terminate a trust under either subsection (a) or (b), the trustee or
court should consider the purposes of the trust. Termination under this Section is not always
wise. Even if administrative costs may seem excessive in relation to the size of the trust,
protection of the assets from beneficiary mismanagement may indicate that the trust be continued.
The court may be able to reduce the costs of administering the trust by appointing a new trustee.
Upon termination of a trust under this section, subsection (c) requires that the trust property be
distributed in a manner consistent with the purposes of the trust. In addition to outright
distribution to the beneficiaries, Section 62-7-816(21) authorizes payment to be made by a variety
of alternate payees. Distribution under this section will typically be made to the qualified
beneficiaries in proportion to the actuarial value of their interests.
If the trustee or cotrustee is a beneficiary and would receive part or all of the trust assets upon
termination of a trust under subsection (a), then the trustee’s power to terminate is subject to the
limitations in SCTC Section 62-7-814.
Even though not accompanied by the usual trappings of a trust, the creation and transfer of an
easement for conservation or preservation will frequently create a charitable trust. The
organization to whom the easement was conveyed will be deemed to be acting as trustee of what
will ostensibly appear to be a contractual or property arrangement. Because of the fiduciary
obligation imposed, the termination or substantial modification of the easement by the “trustee”
65
could constitute a breach of trust. The drafters of the Uniform Trust Code concluded that
easements for conservation or preservation are sufficiently different from the typical cash and
securities found in small trusts that they should be excluded from this section, and subsection (d)
so provides. Most creators of such easements, it was surmised, would prefer that the easement be
continued unchanged even if the easement, and hence the trust, has a relatively low market value.
For the law of conservation easements, see Restatement (Third) of Property: Servitudes
Section 1.6 (2000).
While this Section is not directed principally at honorary trusts, it may be so applied. See
Sections 62-7-408 and, 62-7-409.
Because termination of a trust under this Section is initiated by the trustee or ordered by the
court, termination is not precluded by a spendthrift provision.
South Carolina Trust Code Section 62-7-414(a) sets the floor for termination of a small trust at
$100,000. Also, in subsection (c) a phrase added to the uniform version clarifies that the court
may specify how the trust assets should be distributed -- e.g., in cases when the court is involved
in a termination under subsection (b).
If the trustee or cotrustee is a beneficiary and would receive part or all of the trust assets upon
termination of a trust under subsection (a), then the trustee’s power to terminate is subject to the
limitations in SCTC Section 62-7-814.
Subsection (a) had no counterpart in prior South Carolina law, though a trust document might
contain similar provisions.
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 that both the settlor’s intent and
the terms of the trust were affected by a mistake of fact or law, whether in expression or
inducement.
Comment
Reformation of inter vivos instruments to correct a mistake of law or fact is a long-established
remedy. Restatement (Third) of Property: Donative Transfers Section 12.1 (Tentative Draft
No. 1, approved 1995), which this section copies, clarifies that this doctrine also applies to wills.
There was no comparable South Carolina statutory provision authorizing a court to reform an
unambiguous trust to conform to the settlor’s intent.
South Carolina Trust Code Section 62-7-415 would permit the introduction of parol evidence
to show the settlor’s intent and the existence of a mistake of fact or law, provided that the
evidence is clear and convincing to protect against the possibility of unreliable or fraudulent
evidence. This section permits consideration of evidence relevant to the settlor’s intention even
when contradicted by the plain meaning of the words in the instrument.
This section applies whether the mistake is one of expression or one of inducement. A mistake
of expression occurs when the terms of the trust misstate the settlor’s intention, fail to include a
term that was intended to be included, or include a term that was not intended to be excluded. A
mistake in the inducement occurs when the terms of the trust accurately reflect what the settlor
intended to be included or excluded but this intention was based on a mistake of fact or law. See
Restatement (Third) of Property: Donative Transfers Section 12.1 cmt. i (Tentative Draft No. 1,
66
approved 1995). Mistakes of expression are frequently caused by scriveners’ errors while
mistakes of inducement often trace to errors of the settlor.
Reformation is different from resolving an ambiguity. Resolving an ambiguity involves the
interpretation of language already in the instrument. Reformation, on the other hand, may involve
the addition of language not originally in the instrument, or the deletion of language originally
included by mistake, if necessary to conform the instrument to the settlor’s intent. Because
reformation may involve the addition of language to the instrument, or the deletion of language
that may appear clear on its face, reliance on extrinsic evidence is essential. To guard against the
possibility of unreliable or contrived evidence in such circumstance, the higher standard of clear
and convincing proof is required. See Restatement (Third) of Property: Donative Transfers
Section 12.1 cmt. e (Tentative Draft No. 1, approved 1995).
In determining the settlor’s original intent, the court may consider evidence relevant to the
settlor’s intention even though it contradicts an apparent plain meaning of the text. The objective
of the plain meaning rule, to protect against fraudulent testimony, is satisfied by the requirement
of clear and convincing proof. See Restatement (Third) of Property: Donative Transfers
Section 12.1 cmt. d and Reporter’s Notes (Tentative Draft No. 1, approved 1995). See also
John H. Langbein & Lawrence W. Waggoner, Reformation of Wills on the Ground of Mistake:
Change of Direction in American Law?, 130 U. Pa. L. Rev. 521 (1982).
For further discussion of the rule of this section and its application to illustrative cases, see
Restatement (Third) of Property: Donative Transfers Section 12.1 cmts. and Reporter’s Notes
There was no comparable South Carolina statutory provision authorizing a court to reform an
unambiguous trust to conform to the settlor’s intent.
South Carolina Trust Code Section 62-7-415 would permit the introduction of parol evidence
to show the settlor’s intent and the existence of a mistake of fact or law, provided that the
evidence is clear and convincing to protect against the possibility of unreliable or fraudulent
evidence. This section permits consideration of evidence relevant to the settlor’s intention even
when contradicted by the plain meaning of the words in the instrument.
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.
Comment
This section is copied from Restatement (Third) of Property: Donative Transfers Section 12.2
(Tentative Draft No. 1, approved 1995). “Modification” under this section is to be distinguished
from the “reformation” authorized by Section 62-7-415. Reformation under Section 62-7-415 is
available when the terms of a trust fail to reflect the donor’s original, particularized intention. The
mistaken terms are then reformed to conform to this specific intent. The modification authorized
here allows the terms of the trust to be changed to meet the settlor’s tax-saving objective as long
as the resulting terms, particularly the dispositive provisions, are not inconsistent with the settlor’s
probable intent. The modification allowed by this subsection is similar in concept to the cy
presequitabe deviation doctrine for charitable trusts (see Section 62-7-413), and the deviation
67
doctrine for unanticipated circumstances (see Section 62-7-412).
There was no South Carolina statutory provision that correlates with this Section. Former
Section 62-7-211 of the South Carolina Probate Code provided for division or consolidation of
trusts, provided that the consolidation or division was not inconsistent with the intent of the
trustor, the action would facilitate trust administration, and the action would be in the best
interests of all beneficiaries and not materially impair their interests. See South Carolina Trust
Code Section 62-7-417.
Whether a modification made by the court under this section will be recognized under federal
tax law is a matter of federal law. Absent specific statutory or regulatory authority, binding
recognition is normally given only to modifications made prior to the taxing event, for example,
the death of the testator or settlor in the case of the federal estate tax. See Rev. Rul. 73-142,
1973-1 C.B. 405. Among the specific modifications authorized by the Internal Revenue Code or
Service include the revision of split-interest trusts to qualify for the charitable deduction,
modification of a trust for a noncitizen spouse to become eligible as a qualified domestic trust, and
the splitting of a trust to utilize better the exemption from generation-skipping tax.
For further discussion of the rule of this section and the relevant case law, see Restatement
(Third) of Property: Donative Transfers Section 12.2 cmts. and Reporter’s Notes (Tentative Draft
No. 1, approved 1995).
There was no South Carolina statutory provision that correlates with this Section. Former
Section 62-7-211 of the South Carolina Probate Code provided for division or consolidation of
trusts, provided that the consolidation or division was not inconsistent with the intent of the
trustor, the action would facilitate trust administration, and the action would be in the best
interests of all beneficiaries and not materially impair their interests. See South Carolina Trust
Code Section 62-7-417.
South Carolina case law indicates that the courts will not allow a beneficiary’s interest to be
negated if the beneficiary objects, regardless of the tax benefit desired. See Chiles v. Chiles, 270
S.C. 379, 242 S.E.2d 426 (S.C. 1978) (the Supreme Court reversed, with respect to the one
appellant only, the lower court’s extinguishment of certain noncharitable beneficiaries’ interests to
vest a charitable contribution deduction for federal estate tax purposes).
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.
Comment
This section, which authorizes the combination or division of trustsThis section expands former
South Carolina Probate Code Section 62-7-211, which allowed the division or consolidation of
trusts only with court approval when such action was not authorized by the trust instrument and ,
is subject to contrary provision in the terms of the trust. See Section 105 and Article 4 General
Comment. Many trust instruments and standardized estate planning forms include comprehensive
provisions governing combination and division of trusts. Except for the requirement that the
qualified beneficiaries receive advance notice of a proposed combination or division, this section is
similar to Restatement (Third) of Trusts Section 68 (Tentative Draft No. 3, approved 2001).
68
This section allows a trustee to combine two or more trusts even though their terms are not
identical. Typically the trusts to be combined will have been created by different members of the
same family and will vary on only insignificant details, such as the presence of different
perpetuities savings periods. The more the dispositive provisions of the trusts to be combined
differ from each other the more likely it is that a combination would impair some beneficiary’s
interest, hence the less likely that the combination can be approved. Combining trusts may
prompt more efficient trust administration and is sometimes an alternative to terminating an
uneconomic trust as authorized by Section 62-7-414. Administrative economies promoted by
combining trusts include a potential reduction in trustees’ fees, particularly if the trustee charges a
minimum fee per trust, the ability to file one trust income tax return instead of multiple returns,
and the ability to invest a larger pool of capital more effectively. Particularly if the terms of the
trust are identical, available administrative economies may suggest that the trustee has a
responsibility to pursue a combination. See Section 62-7-805 (duty to incur only reasonable
costs).
Division of trusts is often beneficial and, in certain circumstances, almost routine. Division of
trusts is frequently undertaken due to a desire to obtain maximum advantage of exemptions
available under the federal generation-skipping tax. While the terms of the trusts which result
from such a division are identical, the division will permit differing investment objectives to be
pursued and allow for discretionary distributions to be made from one trust and not the other.
Given the substantial tax benefits often involved, a failure by the trustee to pursue a division might
in certain cases be a breach of fiduciary duty. The opposite could also be true if the division is
undertaken to increase fees or to fit within the small trust termination provision. See Section 627-414.
This section authorizes a trustee to divide a trust even if the trusts that result are dissimilar.
Conflicts among beneficiaries, including differing investment objectives, often invite such a
division, although as in the case with a proposed combination of trusts, the more the terms of the
divided trusts diverge from the original plan, the less likely

SOUTH CAROLINA PROBATE CODE ARTICLE I Parts 1

Transcription

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