PRIOR PRINTER'S NO. 652 PRINTER'S NO. 1080
No. 635 Session of 1981
INTRODUCED BY SNYDER, GEKAS, REIBMAN, KELLEY AND SHAFFER,
MARCH 31, 1981
SENATOR GEKAS, JUDICIARY, AS AMENDED, JUNE 23, 1981
AN ACT
1 Amending Title 20 (Decedents, Estates and Fiduciaries) of the
2 Pennsylvania Consolidated Statutes, clarifying certain
3 provisions relating to spouses' elections; PROVIDING FOR <--
4 PAYMENT FROM A PATIENT'S CARE ACCOUNT TO DECEDENT'S FAMILY;
5 authorizing the payment of proceeds from insurance policies
6 to decedent's family; adding a provision concerning
7 information services; providing for the apportionment of
8 death taxes; changing certain provisions relating to gifts to
9 minors; clarifying provisions relating to distributions of
10 income and principal made during incompetency; adding
11 provisions concerning powers of attorney; authorizing the
12 termination of certain trusts; clarifying certain provisions
13 relating to compensation to a fiduciary; and making technical <--
14 and editorial changes; AND MAKING A REPEAL. <--
15 The General Assembly of the Commonwealth of Pennsylvania
16 hereby enacts as follows:
17 Section 1. Sections 2206, 2209 and 2210 of Title 20, act of
18 November 25, 1970 (P.L.707, No.230), known as the Pennsylvania
19 Consolidated Statutes, are amended to read:
20 § 2206. Right of election personal to surviving spouse.
21 The right of election of the surviving spouse may be
22 exercised in whole or in part only during his lifetime by him or
23 by his attorney-in-fact in accordance with section 5603(d)
1 (relating to implementation of power of attorney). In the case
2 of a minor [or an incompetent] spouse, the right of election may
3 be exercised in whole or in part only by the spouse's guardian;
4 in the case of an incompetent spouse, the right of election may
5 be exercised in whole or in part only by the spouse's guardian
6 or by his attorney-in-fact in accordance with section 5603(d) if
7 the power of attorney qualifies as a durable power of attorney
8 under section 5604 (relating to durable powers of attorney);
9 provided, that, in each case, the election shall be exercised
10 only upon order of the court having jurisdiction of the minor's
11 or the incompetent's estate, after finding that exercise of the
12 right is advisable.
13 § 2209. Surviving spouse as witness.
14 [The] A person who is or claims to be the surviving spouse
15 shall be a competent witness as to all matters pertinent to his
16 rights under this chapter other than the creation of his status
17 as the surviving spouse.
18 § 2210. Procedure for election; time limit.
19 (a) How election made.--A surviving spouse's election to
20 take or not to take his elective share shall be by a writing
21 signed by him and filed with the clerk of the orphans' court
22 division of the county where the decedent died domiciled. Notice
23 of the election shall be given to the decedent's personal
24 representative, if any.
25 (b) Time limit.--The election must be filed with the clerk
26 before the expiration of six months after the decedent's death
27 or before the expiration of six months after the date of
28 probate, whichever is later. The court may extend the time for
29 election for such period and upon such terms and conditions as
30 the court shall deem proper under the circumstances on
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1 application of the surviving spouse filed with the clerk within
2 the foregoing time limit. Failure to file an election in the
3 manner and within the time limit set forth in this section shall
4 be deemed a waiver of the right of election.
5 (c) Costs.--The costs of filing and recording the election
6 shall be reimbursed out of the estate as a part of the
7 administration expenses.
8 Section 2. Section 3101(C) of Title 20, ADDED JULY 11, 1980 <--
9 (P.L.565, NO.118), is amended by adding a subsection AND A <--
10 SUBSECTION IS ADDED to read:
11 § 3101. Payments to family and funeral directors.
12 * * *
13 (C) [PAYMENTS TO FUNERAL DIRECTORS] PATIENT'S CARE <--
14 ACCOUNT.--WHEN THE DECEDENT WAS A QUALIFIED RECIPIENT OF MEDICAL
15 ASSISTANCE FROM THE DEPARTMENT OF PUBLIC WELFARE, THE FACILITY
16 IN WHICH HE WAS A PATIENT MAY MAKE PAYMENT OF FUNDS, IF ANY,
17 REMAINING IN THE PATIENT'S CARE ACCOUNT, FOR THE DECEDENT'S
18 BURIAL EXPENSES TO A LICENSED FUNERAL DIRECTOR IN AN AMOUNT NOT
19 EXCEEDING $1,000 WHETHER OR NOT A PERSONAL REPRESENTATIVE HAS
20 BEEN APPOINTED. AFTER THE PAYMENT OF DECEDENT'S BURIAL EXPENSES,
21 THE FACILITY MAY PAY THE BALANCE OF DECEDENT'S PATIENT'S CARE
22 ACCOUNT, AS LONG AS THE PAYMENTS INCLUDING THE PAYMENT FOR
23 BURIAL EXPENSES DOES NOT EXCEED $1,500, TO THE SPOUSE, ANY
24 CHILD, THE FATHER OR MOTHER OR ANY SISTER OR BROTHER (PREFERENCE
25 BEING GIVEN IN THE ORDER NAMED) OF THE DECEASED PATIENT. ANY
26 FACILITY MAKING SUCH A PAYMENT SHALL BE RELEASED TO THE SAME
27 EXTENT AS IF PAYMENT HAD BEEN MADE TO A DULY APPOINTED PERSONAL
28 REPRESENTATIVE OF THE DECEDENT AND IT SHALL NOT BE REQUIRED TO
29 SEE TO THE APPLICATION THEREOF. ANY LICENSED FUNERAL DIRECTOR OR
30 OTHER PERSON TO WHOM PAYMENT IS MADE SHALL BE ANSWERABLE
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1 THEREFOR TO ANYONE PREJUDICED BY AN IMPROPER DISTRIBUTION.
2 (d) Life insurance payable to estate.--Any insurance company
3 which upon the death of an individual residing in this
4 Commonwealth owes his estate a total amount of $11,000 or less
5 under any policies POLICY of life, endowment, accident or health <--
6 insurance, or under any annuity or pure endowment contract or <--
7 contract, may at any time after 60 days after such death pay <--
8 FOLLOWING HIS DEATH PAY ALL OR ANY PART OF that amount with <--
9 interest to the spouse, any child, the father or mother or any
10 sister or brother of the decedent (preference being given in the
11 order named) provided that at the time of such THE payment no <--
12 written claim for that sum MONEY has been received at the home <--
13 office of the company SPECIFIED IN THE POLICY OR CONTRACT FOR <--
14 THE RECEIPT OF CLAIMS from any duly appointed personal
15 representative of the decedent. Any insurance company making any
16 payments PAYMENT in accordance with this section to an adult may <--
17 rely on the affidavit of any of the persons named in this
18 subsection concerning the existence and relationship of these
19 persons and shall be released to the same extent as if payment
20 had been made to a duly appointed personal representative of the
21 decedent and the insurance company shall not be required to see
22 to the application thereof. Any person to whom payment is made
23 shall be answerable therefor to anyone prejudiced by an improper
24 distribution.
25 Section 3. Section 3132.1(b) of Title 20 is amended to read:
26 § 3132.1. Self-proved wills.
27 * * *
28 (b) Acknowledgment and affidavits.--An attested will may at
29 the time of its execution or at any subsequent date be made
30 self-proved by the acknowledgment thereof by the testator and
19810S0635B1080 - 4 -
1 the affidavits of the witnesses, each made before an officer
2 authorized to administer oaths under the laws of this
3 Commonwealth, or under the laws of the state where execution
4 occurs, and evidenced by the officer's certificate, under
5 official seal, attached or annexed to the will. A separate
6 affidavit may be used for each witness whose affidavit is not
7 taken at the same time as the testator's acknowledgment. The
8 acknowledgment and affidavits shall in form and content be
9 substantially as set forth in the Uniform Probate Code or as
10 follows:
11 Acknowledgment
12 Commonwealth of Pennsylvania (or state of)
13 County of
14 I, _____________________________________, testat--__________,
15 whose name is signed to the attached or foregoing instrument,
16 having been duly qualified according to law, do hereby acknow-
17 ledge that I signed and executed the instrument as my Last Will;
18 that I signed it willingly; and that I signed it as my free and
19 voluntary act for the purposes therein expressed.
20 Sworn or affirmed to and acknowledged before me, by _________
21 _______________, the testat--___________, this __________ day of
22 _________, 19______.
23 ________________________________
24 (SEAL) ________________________________
25 (Official capacity of officer)
26 Affidavit
27 Commonwealth of Pennsylvania (or state of)
28 County of
29 We, [_____________,] ________________ and ________________,
19810S0635B1080 - 5 -
1 the witnesses whose names are signed to the attached or fore-
2 going instrument, being duly qualified according to law, do
3 depose and say that we were present and saw testat--______sign
4 and execute the instrument as his Last Will; that _______ signed
5 willingly and that __________ executed it as __________ free and
6 voluntary act for the purposes therein expressed; that each of
7 us in the hearing and sight of the testat--________ signed the
8 will as witnesses; and that to the best of our knowledge the
9 testat--________ was at that time 18 or more years of age, of
10 sound mind and under no constraint or undue influence.
11 Sworn or affirmed to and subscribed to before me by [________
12 __________________,]_____________________ and _________________,
13 witnesses, this ___________ day of _________________, 19 ______.
14 ________________________________
15 Witness
16 ________________________________
17 Witness
18 [________________________________
19 Witness]
20 ________________________________
21 (SEAL) ________________________________
22 (Official capacity of officer)
23 Section 4. Title 20 is amended by adding a section to read:
24 § 3539. Information services.
25 An agreement between a distributee and a person or
26 corporation that has informed the distributee of his interest in
27 an estate which provides for compensation to the informant,
28 shall, upon request of a party, be subject to review and <--
29 adjustment by the court as justice and equity require. The <--
30 provisions of this section may not be waived IF A DISTRIBUTEE <--
19810S0635B1080 - 6 -
1 CAN SHOW THAT THE AGREEMENT IS UNCONSCIONABLE OR IS A RESULT OF
2 FRAUD OR DURESS PERPETRATED BY THE INFORMANT.
3 Section 5. Chapter 37 of Title 20 is repealed and a chapter
4 is added to read:
5 CHAPTER 37
6 APPORTIONMENT OF DEATH TAXES
7 Sec.
8 3701. Power of decedent.
9 3702. Equitable apportionment of Federal estate tax.
10 3703. Apportionment of Pennsylvania inheritance tax.
11 3704. Apportionment of Pennsylvania estate tax.
12 3705. Apportionment of Federal generation-skipping tax.
13 3706. Enforcement of contribution or exoneration of Federal
14 estate tax.
15 § 3701. Power of decedent.
16 A testator, settlor, donor or possessor of any appropriate
17 power of appointment may direct how the Federal estate tax or
18 the Federal generation-skipping tax due because of his death,
19 including interest and penalties, shall be apportioned or may
20 grant a discretionary power to another so to direct but any
21 direction regarding apportionment of the Federal generation-
22 skipping tax must expressly refer to that tax. Any such
23 direction shall take precedence over the provisions of this
24 chapter insofar as the direction provides for the payment of the
25 tax or any part thereof from property the disposition of which
26 can be controlled by the instrument containing the direction or
27 delegating the power to another.
28 § 3702. Equitable apportionment of Federal estate tax.
29 (a) General rule.--Subject to the provisions of section 3701
30 (relating to power of decedent), the Federal estate tax shall be
19810S0635B1080 - 7 -
1 apportioned equitably among all parties interested in property
2 includible in the gross estate for Federal estate tax purposes
3 in proportion to the value of the interest of each party subject
4 to the rules stated in this section.
5 (b) Pre-residuary.--
6 (1) No Federal estate tax shall be apportioned against a
7 beneficiary of any pre-residuary gift made by will. Any
8 Federal estate tax attributable thereto shall be paid
9 entirely from the residue of the estate and charged in the
10 same manner as a general administration expense of the estate
11 except that when a portion of the residue of the estate is
12 allowable as a deduction for Federal estate tax purposes the
13 tax shall be paid to the extent possible from the portion of
14 the residue which is not so allowable.
15 (2) No Federal estate tax shall be apportioned against a
16 beneficiary of any pre-residuary gift made by inter vivos
17 trust. Any Federal estate tax attributable thereto shall be
18 paid entirely from the residue of the trust and charged in
19 the same manner as a general administration expense of the
20 trust except that when a portion of the residue of the trust
21 is allowable as a deduction for Federal estate tax purposes
22 the tax shall be paid to the extent possible from the portion
23 of the residue which is not so allowable.
24 (c) Deductions.--No Federal estate tax shall be apportioned
25 against an interest allowable as a Federal estate tax marital,
26 orphan's or charitable deduction (determined and valued without
27 regard to any Pennsylvania inheritance tax or other state or
28 foreign death taxes apportioned against such interest) except as
29 otherwise provided in subsections (b) and (g).
30 (d) Credits.--Any Federal estate tax credit for state or
19810S0635B1080 - 8 -
1 foreign death taxes on property includible in the gross estate
2 for Federal estate tax purposes shall inure to the benefit of
3 the parties chargeable with the payment of the state or foreign
4 death taxes in proportion to the amount of the taxes paid by
5 each party but any credit inuring to the benefit of a party
6 shall not exceed the Federal estate tax apportionable to that
7 party. Any unified credit against Federal estate tax, credit for
8 tax on prior transfers (sometimes called the credit for property
9 previously taxed) or credit for gift taxes paid by the decedent
10 or his estate with respect to gifts made by the decedent before
11 January 1, 1977 shall inure to the benefit of all parties liable
12 to apportionment in proportion to the amount of Federal estate
13 tax apportioned against each party under the other provisions of
14 this chapter. Any Federal estate tax credit for gift taxes paid
15 by the donee of a gift made before January 1, 1977 shall inure
16 to the benefit of the donee.
17 (e) Election by spouse.--Property passing to a spouse who
18 elects to take an elective share under Chapter 22 (relating to
19 elective share of surviving spouse) shall be exempt from
20 apportionment of Federal estate tax only to the extent provided
21 in subsection (c).
22 (f) Additional Federal estate tax.--Any additional Federal
23 estate tax due because a qualified heir disposes of qualified
24 real property or ceases to use it for the qualified use shall be
25 apportioned against the qualified heir notwithstanding the
26 provisions of subsection (b).
27 (g) Present and future interests.--When both a present and a
28 future interest are involved, the Federal estate tax
29 apportioned, including interest and penalties, shall be paid
30 entirely from principal, except as otherwise provided in
19810S0635B1080 - 9 -
1 subsection (h), even if the future interest qualifies for a
2 Federal estate tax charitable deduction or the holder of the
3 present interest also has rights in the principal or the
4 principal is otherwise exempt from apportionment.
5 (h) Interest and penalties.--Interest and penalties shall be
6 apportioned in the same manner as the principal amount of the
7 Federal estate tax unless the court finds it inequitable to do
8 so by reason of special circumstances in which case the court
9 may direct a different apportionment of interest and penalties.
10 (i) Values.--The values used in determining the amount of
11 Federal estate tax liability shall be used for Federal estate
12 tax apportionment purposes.
13 § 3703. Apportionment of Pennsylvania inheritance tax.
14 The Pennsylvania inheritance tax shall be apportioned as
15 provided in the act of June 15, 1961 (P.L.373, No.207), known as
16 the "Inheritance and Estate Tax Act of 1961."
17 § 3704. Apportionment of Pennsylvania estate tax.
18 The Pennsylvania estate tax shall be apportioned in the same
19 manner as the Federal estate tax.
20 § 3705. Apportionment of Federal generation-skipping tax.
21 Subject to the provisions of section 3701 (relating to power
22 of decedent), the Federal generation-skipping tax shall be
23 apportioned as provided by Federal law and, to the extent not
24 provided by Federal law, shall be apportioned by analogy to the
25 rules specified in section 3702 (relating to equitable
26 apportionment of Federal estate tax).
27 § 3706. Enforcement of contribution or exoneration of Federal
28 estate tax.
29 (a) Duty to pay.--Parties liable for apportionment of the
30 Federal estate tax, whether residents or nonresidents of this
19810S0635B1080 - 10 -
1 Commonwealth, shall pay the amounts apportioned against them
2 respectively.
3 (b) Duty of fiduciary.--The fiduciary charged with the duty
4 to pay the Federal estate tax may recover from parties liable to
5 apportionment the amounts of Federal estate tax apportionable to
6 them respectively.
7 (c) Suspending distribution.--Distribution of property to
8 any party, other than a fiduciary charged with a duty to pay the
9 Federal estate tax, shall not be required of any fiduciary until
10 the Federal estate tax apportionable with respect thereto is
11 paid or, if the Federal estate tax has not been determined and
12 apportionment made, until adequate security for payment is
13 furnished to the fiduciary making the distribution.
14 (d) Court decrees.--The court, upon petition or at an
15 accounting or in any appropriate action or proceeding, shall
16 make such decrees or orders as it shall deem advisable
17 apportioning the Federal estate tax. The court may direct a
18 fiduciary to collect the apportioned amounts from the property
19 or interests in his possession of any parties against whom
20 apportionment has been made and may direct all other parties
21 against whom the Federal estate tax has been or may be
22 apportioned or from whom any part of the Federal estate tax may
23 be recovered to make payment of the apportioned amounts to the
24 fiduciary. When a fiduciary holds property of a party liable to
25 apportionment insufficient to satisfy the apportioned Federal
26 estate tax, the court may direct that the balance of the
27 apportioned amount of Federal estate tax shall be paid to the
28 fiduciary by the party liable. Should an overpayment of the
29 Federal estate tax be made by any party or on his behalf, the
30 court may direct an appropriate reimbursement for the
19810S0635B1080 - 11 -
1 overpayment. If the court apportions any part of the Federal
2 estate tax against any party interested in nontestamentary
3 property or among the respective interests created by any
4 nontestamentary instrument, the court, in its discretion, may
5 assess against those properties or interests an equitable share
6 of the expenses incurred in connection with the determination
7 and apportionment of the Federal estate tax. If the fiduciary
8 cannot recover the Federal estate tax apportioned against a
9 party benefited, the unrecovered amount shall be charged in such
10 manner as the court may determine.
11 Section 6. Section 4102(b) of Title 20 is amended to read:
12 § 4102. Powers with respect to securities and bank accounts.
13 * * *
14 (b) Bank accounts.--When there is no administration in [the]
15 this Commonwealth, a foreign fiduciary[, upon submission to the
16 financial institution of:] shall have all the powers of a
17 similar local fiduciary with respect to money deposited or
18 invested in a financial institution located in this Commonwealth
19 and shall not be required to comply with the conditions and
20 limitations of section 4101 if he has submitted to the financial
21 institution
22 [(i)] a certificate of his appointment[;] and
23 [(ii)] an affidavit stating that after diligent
24 search and inquiry the estate of which he is fiduciary is
25 not, to his knowledge[,] or so far as he has been able to
26 discover, indebted to any person in [the] this
27 Commonwealth and that any taxes owing by such estate to
28 the Commonwealth or any subdivision thereof have been
29 paid or provided for [shall have all the powers of a
30 similar local fiduciary with respect to money deposited
19810S0635B1080 - 12 -
1 or invested in a financial institution located in
2 Pennsylvania and shall not be required to comply with the
3 conditions and limitations of section 4101].
4 * * *
5 Section 7. Sections 5144, 5147(2) and 5153 of Title 20 are
6 amended to read:
7 § 5144. Powers, duties and liabilities identical with
8 personal representatives.
9 The provisions concerning the powers, duties and liabilities
10 of a guardian appointed by the court shall be the same as those
11 set forth in the following provisions of this title for the
12 administration of a decedent's estate: [with regard to the
13 following:
14 (1) Liability insurance, as in section 3313 (relating to
15 liability insurance).
16 (2) Continuation of business, as in section 3314
17 (relating to continuation of business).
18 (3) Incorporation of business, as in section 3315
19 (relating to incorporation of estate's business).
20 (4) Claims against co-guardian, as in section 3317
21 (relating to claims against co-fiduciary).
22 (5) Revival of judgment against guardian, as in section
23 3318 (relating to revival of judgments against personal
24 representative).
25 (6) Power of attorney and delegation of power over
26 subscription rights and fractional shares, as in section 3319
27 (relating to power of attorney; delegation of power over
28 subscription rights and fractional shares; authorized
29 delegations).
30 (7) Voting stock by proxy, as in section 3320 (relating
19810S0635B1080 - 13 -
1 to voting stock by proxy).
2 (8) Nominee registration; corporate fiduciary as
3 attorney-in-fact, as in section 3321 (relating to nominee
4 registration; corporate fiduciary as attorney-in-fact;
5 deposit of securities in a clearing corporation; book-entry
6 securities).
7 (9) Acceptance of deed in lieu of foreclosure, as in
8 section 3322 (relating to acceptance of deed in lieu of
9 foreclosure).
10 (10) Compromise of controversies, as in section 3323
11 (relating to compromise of controversies).
12 (11) When guardian dies or becomes incompetent, as in
13 section 3324 (relating to death or incompetency of
14 fiduciary).
15 (12) Surviving or remaining guardian, as in section 3327
16 (relating to surviving or remaining personal
17 representatives).
18 (13) Disagreement of guardians, as in section 3328
19 (relating to disagreement of personal representatives).
20 (14) Liability of guardian on contracts, as in section
21 3331 (relating to liability of personal representative on
22 contracts).
23 (15) Inherent powers and duties, as in section 3332
24 (relating to inherent powers and duties).]
25 Section 3313 (relating to liability insurance).
26 Section 3314 (relating to continuation of business).
27 Section 3315 (relating to incorporation of estate's
28 business).
29 Section 3317 (relating to claims against co-fiduciary).
30 Section 3318 (relating to revival of judgments against
19810S0635B1080 - 14 -
1 personal representative).
2 Section 3319 (relating to power of attorney; delegation
3 of power over subscription rights and fractional shares;
4 authorized delegations).
5 Section 3320 (relating to voting stock by proxy).
6 Section 3321 (relating to nominee registration; corporate
7 fiduciary as attorney-in-fact; deposit of securities in a
8 clearing corporation; book-entry securities).
9 Section 3322 (relating to acceptance of deed in lieu of
10 foreclosure).
11 Section 3323 (relating to compromise of controversies).
12 Section 3324 (relating to death or incompetency of
13 fiduciary).
14 Section 3327 (relating to surviving or remaining personal
15 representatives).
16 Section 3328 (relating to disagreement of personal
17 representatives).
18 Section 3331 (relating to liability of personal
19 representatives on contracts).
20 Section 3332 (relating to inherent powers and duties).
21 § 5147. Proceedings against guardian.
22 Any proceeding may be brought against a guardian or the
23 surety on his bond in the court having jurisdiction of the
24 estate, and if he does not reside in the county, process may be
25 served on him personally, or as follows:
26 * * *
27 (2) When a nonresident of the Commonwealth.--By the
28 sheriff of the county of the court having jurisdiction of the
29 estate [sending, by registered mail, return receipt
30 requested, a true and attested copy of the process to the
19810S0635B1080 - 15 -
1 Department of State, accompanied by the fee prescribed by
2 law, and to the guardian or surety at his last known address,
3 with an endorsement thereon showing that service has been so
4 made upon the Department of State].
5 § 5153. Provisions identical to other estates.
6 The provisions concerning guardians and minors' estates shall
7 be the same as those set forth in the following provisions of
8 this title for personal representatives and for the
9 administration of decedents' estates: [with regard to the
10 following:
11 (1) (Repealed).
12 (2) Restraint of sale, as in section 3355 (relating to
13 restraint of sale).
14 (3) Purchase by guardian, as in section 3356 (relating
15 to purchase by personal representative).
16 (4) Collateral attack, as in section 3358 (relating to
17 collateral attack).
18 (5) Record of proceedings; county where real estate
19 lies, as in section 3359 (relating to record of proceedings;
20 county where real estate lies).
21 (6) Contracts, inadequacy of consideration or better
22 offer; brokers' commissions, as in section 3360 (relating to
23 contracts, inadequacy of consideration or better offer;
24 brokers' commissions).]
25 Section 3355 (relating to restraint of sale).
26 Section 3356 (relating to purchase by personal
27 representative).
28 Section 3358 (relating to collateral attack).
29 Section 3359 (relating to record of proceedings; county
30 where real estate lies).
19810S0635B1080 - 16 -
1 Section 3360 (relating to contracts, inadequacy of
2 consideration or better offer; brokers' commissions).
3 Section 8. Sections 5302, 5303, 5305(e), (f) and (g),
4 5308(a), (b), (d) and (e) and 5309 of Title 20 are amended to
5 read:
6 § 5302. Definitions.
7 The following words[, terms] and phrases when used in this
8 chapter shall have the meaning [ascribed] given to them in this
9 section[, except where the context clearly indicates a different
10 meaning] unless the context clearly indicates otherwise:
11 [An "adult" is a person who has attained the age of 21
12 years.]
13 [A "bank" is a] "Bank." A bank, bank and trust company,
14 trust company, savings and loan association, building and loan
15 association, national banking association or institution,
16 savings bank, or credit union incorporated under the laws of the
17 United States or under the laws of this Commonwealth.
18 [A "broker" is a] "Broker." A person engaged in the business
19 of effecting transactions in securities for the account of
20 others. The term includes a bank which effects such
21 transactions. The term also includes a person lawfully engaged
22 in buying and selling securities, for his own account, through a
23 broker or otherwise as a part of a regular business.
24 ["Court" means the] "Court." The orphans' court division
25 having jurisdiction over the minor or the property.
26 ["The custodial property" includes:
27 (i) all securities, money, life or endowment
28 insurance policies and annuity contracts under the
29 supervision of the same custodian for the same minor as a
30 consequence of a gift or gifts made to the minor in a
19810S0635B1080 - 17 -
1 manner prescribed in this chapter;
2 (ii) the income from the custodial property; and
3 (iii) the proceeds, immediate and remote, from the
4 sale, exchange, conversion, investment, reinvestment or
5 other disposition of such securities, money, life or
6 endowment insurance policies and annuity contracts and
7 income.]
8 "Custodial property." Includes:
9 (1) Personal property in any form including, without
10 limitation, securities, interests in partnerships, money,
11 life or endowment insurance policies, annuity contracts and
12 tangible personal property, and interests in real property
13 located in this Commonwealth, under the supervision of the
14 same custodian for the same minor as a consequence of a gift
15 or gifts made to the minor in a manner prescribed in this
16 chapter.
17 (2) The income from the custodial property.
18 (3) The proceeds, immediate and remote, from the sale,
19 exchange, conversion, investment, reinvestment, surrender or
20 other disposition of custodial property.
21 [A "custodian" is a] "Custodian." A person so designated in
22 a manner prescribed in this chapter; the term includes a
23 successor custodian.
24 [A "guardian"] "Guardian." A guardian of a minor includes
25 the general guardian, guardian, tutor or curator of his
26 property, estate or person.
27 [An "issuer" is a] "Issuer." A person who places or
28 authorizes the placing of his name on a security (other than as
29 a transfer agent) to evidence that it represents a share,
30 participation or other interest in his property or in an
19810S0635B1080 - 18 -
1 enterprise, or to evidence his duty or undertaking to perform an
2 obligation evidenced by the security, or who becomes responsible
3 for or in place of any such person.
4 [A "legal representative"] "Legal representative." A legal
5 representative of a person is his executor or the administrator,
6 general guardian, guardian, committee, conservator, tutor or
7 curator of his property or estate.
8 "Life or endowment insurance policies and annuity contracts."
9 Includes only life or endowment insurance policies and annuity
10 contracts on the life of an individual in whose life the minor
11 has an insurable interest.
12 [A "member" of a "minor's family" means any] "Member of a
13 minor's family." Any of the minor's parents, grandparents,
14 brothers, sisters, uncles and aunts, whether of the whole blood
15 or the half blood, or by or through legal adoption.
16 [A "minor" is a] "Minor." A person who has not attained the
17 age of 21 years.
18 [A "security" includes] "Security." Includes any note,
19 stock, treasury stock, bond, debenture, evidence of
20 indebtedness, certificate of interest or participation in an
21 oil, gas or mining title or lease, or in payments out of
22 production under such title or lease, collateral trust
23 certificate, transferable share, voting trust certificate, or,
24 in general, any interest or instrument commonly known as a
25 security, or any certificate of interest or participation in any
26 temporary or interim certificate, receipt or certificate of
27 deposit for or any warrant or right to subscribe to or purchase
28 any of the foregoing. The term does not include a security of
29 which the donor is the issuer. A security is in "registered
30 form" when it specifies a person entitled to it, or to the
19810S0635B1080 - 19 -
1 rights it evidences, and its transfer may be registered upon
2 books maintained for that purpose by or on behalf of the issuer.
3 [A "transfer agent" is a] "Transfer agent." A person who
4 acts as authenticating trustee, transfer agent, registrar or
5 other agent for an issuer in the registration of transfers of
6 its securities or in the issue of new securities or in the
7 cancellation of surrendered securities.
8 [A "trust company" is any] "Trust company." Any corporation
9 authorized under the laws of this Commonwealth to act as a
10 fiduciary.
11 ["Life or endowment insurance policies and annuity contracts"
12 means only life or endowment insurance policies and annuity
13 contracts on the life of an individual in whose life the minor
14 has an insurable interest.]
15 § 5303. Manner of making gift.
16 (a) [General rule] Lifetime gifts.--[An adult] A person who
17 has attained the age of 18 years may, during his lifetime, make
18 a gift of [a security, money, a life or endowment insurance
19 policy or an annuity contract] custodial property to a person
20 who is a minor on the date of the gift:
21 (1) If the subject of the gift is a security in
22 registered form, by registering it in the name of the donor,
23 another [adult] person[,] who has attained the age of 18
24 years or a trust company, followed in substance by the words
25 "as custodian for [....................] (name of minor)
26 [(name of minor)]
27 under the Pennsylvania Uniform Gifts to Minors Act."
28 (2) If the subject of the gift is a security not in
29 registered form, or is any other asset (except cash) where
30 title can pass by delivery, by delivering it to [a guardian
19810S0635B1080 - 20 -
1 of the minor] another person who has attained the age of 18
2 years or a trust company, accompanied by a statement of
3 gift in the following form in substance, signed by the
4 donor and the person designated as custodian.
5 "Gift under the Pennsylvania
6 Uniform Gifts to Minors Act
7 I [.........................] (name of donor) hereby
8 [(name of donor)]
9 deliver to [...........................] (name of custodian)
10 [(name of custodian)]
11 as custodian for [.............] (name of minor) under the
12 [(name of minor)]
13 Pennsylvania Uniform Gifts to Minors Act, the following
14 security(ies) or asset(s): (insert an appropriate
15 description of the security or securities or other assets
16 delivered sufficient to identify it or them).
17 ...........................
18 (signature of donor)
19 I [........................] (name of custodian) hereby
20 [(name of custodian)]
21 [acknowledges] acknowledge receipt of the above described
22 security(ies) or asset(s) as custodian for the above minor
23 under the Pennsylvania Uniform Gifts to Minors Act.
24 Dated..................
25 ..............................
26 (signature of custodian)."
27 (2.1) If the subject of the gift is an interest in a
28 limited partnership, the donor shall cause the ownership of
29 the interest to be recorded on the books of the limited
30 partnership in the name of the donor, another person who has
19810S0635B1080 - 21 -
1 attained the age of 18 years or a trust company, followed in
2 substance by the words "as custodian for (name of minor)
3 under the Pennsylvania Uniform Gifts to Minors Act" and shall
4 obtain an acknowledgment of the recordation from the limited
5 partnership a copy of which shall be delivered to the person
6 in whose name it is thus recorded as custodian.
7 (3) If the subject of the gift is money, by paying
8 or delivering it to a broker or a bank, for credit to an
9 account in the name of the donor, another [adult] person[,
10 an adult member of the minor's family, a guardian of the
11 minor,] who has attained the age of 18 years or a [bank with
12 trust powers] trust company, followed in substance by
13 the words "as custodian for [.........................]
14 [(name of minor)]
15 (name of minor) under the Pennsylvania Uniform Gifts to
16 Minors Act."
17 (4) If the subject of the gift is a life or
18 endowment insurance policy or an annuity contract the
19 donor shall cause the ownership of such policy or contract to
20 be recorded on a form satisfactory to the insurance company
21 or fraternal benefit society, in the name of the donor,
22 another [adult] person[, a guardian of the minor,] who has
23 attained the age of 18 years or a [bank with trust powers]
24 trust company followed in substance by the words[,] "as
25 custodian for [..................] (name of minor) under the
26 [(name of minor)]
27 Pennsylvania Uniform Gifts to Minors Act," and such policy or
28 contract shall be delivered to the person in whose name it is
29 thus registered as custodian.
30 (5) If the subject of the gift is an interest in real
19810S0635B1080 - 22 -
1 property, by executing, in a form suitable for recording, a
2 conveyance of the interest to the donor, another person who
3 has attained the age of 18 years or a trust company, followed
4 in substance by the words "as custodian for (name of minor)
5 under the Pennsylvania Uniform Gifts to Minors Act," and
6 delivering the conveyance to the custodian and, where the
7 donor is the custodian, recording the conveyance.
8 (a.1) Gifts by will or trust.--A person who has attained the
9 age of 18 years may, by will or trust, provide that a gift under
10 the will or trust to a minor shall be paid to a custodian for
11 the minor under this chapter and may name the custodian or may
12 authorize the executor or trustee as the case may be to select
13 and appoint any person or trust company including the executor
14 or trustee as custodian to receive payment of such gift. In such
15 event the executor or trustee shall make distribution by
16 transferring the subject of the gift to the custodian in the
17 form and manner provided in subsection (a). If the testator or
18 settlor directs or authorizes payment to a custodian but fails
19 to designate a custodian or to authorize the executor or trustee
20 to select and appoint a custodian or if the custodian designated
21 by the testator or settlor fails to qualify or ceases to act,
22 the executor or trustee may select and appoint the custodian
23 from among those persons, including the executor or trustee,
24 eligible to become successor custodian for the minor under this
25 chapter. The receipt of the custodian shall constitute a
26 sufficient release or discharge for the custodial property
27 distributed to the custodian.
28 (b) Limitations.--Any gift made in a manner prescribed in
29 [subsection (a) of this section] subsection (a) or (a.1) may be
30 made to only one minor and only one person may be the custodian.
19810S0635B1080 - 23 -
1 (c) Duty of donor.--A donor who makes a gift to a minor in a
2 manner prescribed in subsection (a) [of this section] shall
3 promptly do all things within his power to put the subject of
4 the gift in the possession and control of the custodian, but
5 neither the donor's failure to comply with this subsection nor
6 his designation of an ineligible person as custodian, nor
7 renunciation by the person designated as custodian [affects]
8 shall affect the consummation of the gift.
9 § 5305. Duties and powers of custodian.
10 * * *
11 (e) Investment and retention of property.--The custodian,
12 notwithstanding statutes restricting investments by fiduciaries,
13 shall invest and reinvest the custodial property as would a
14 prudent man of discretion and intelligence who is seeking a
15 reasonable income and the preservation of his capital, except
16 that he may, in his discretion and without liability to the
17 minor or his estate, retain [a security] custodial property
18 given to the minor in a manner prescribed in this chapter [or
19 hold money so given in an account in the financial institution
20 to which it was paid or delivered by the donor].
21 (f) Disposal of property and voting securities.--The
22 custodian may sell, exchange, convert, surrender or otherwise
23 dispose of custodial property, in the manner, at the time or
24 times, for the price or prices, and upon the terms he deems
25 advisable. He may borrow money and mortgage or pledge custodial
26 property as security. He may grant options for the sale or lease
27 of custodial property. He may vote in person, or by general or
28 limited proxy, a security which is custodial property. He may
29 consent, directly or through a committee or other agent, to the
30 reorganization, consolidation, merger, dissolution or
19810S0635B1080 - 24 -
1 liquidation of an issuer, a security which is custodial
2 property, and to the sale, lease, pledge or mortgage of any
3 property by or to such an issuer, and to any other action by
4 such an issuer. He may execute and deliver any and all
5 instruments in writing, which he deems advisable to carry out
6 any of his powers as custodian.
7 (g) Registration, deposit and separation of property.--The
8 custodian shall register each security which is custodial
9 property[,] and in [the] registered form in the name of the
10 custodian followed in substance by the words "as custodian for
11 [...............] (name of minor) under the
12 [(name of minor)]
13 Pennsylvania Uniform Gifts to Minors Act," provided that a
14 corporate custodian may register securities which are custodial
15 property in the name of its nominee. The custodian shall hold
16 all money which is custodial property in an account with a
17 broker or in a bank in the name of the custodian, followed in
18 substance by the words "as custodian for [...............]
19 (name of minor)
20 [(name of minor)]
21 under the Pennsylvania Uniform Gifts to Minors Act."
22 The custodian shall keep all other custodial property separate
23 and distinct from his own property in a manner to identify it
24 clearly as custodial property.
25 * * *
26 § 5308. Resignation, death or removal of custodian; bond;
27 designation of successor custodian.
28 (a) Eligibility and designation of successor.--Only [an
29 adult] a member of the minor's family who has attained the age
30 of 18 years, a guardian of the minor or a trust company is
19810S0635B1080 - 25 -
1 eligible to become successor custodian. A custodian may
2 designate his successor by executing and dating an instrument of
3 designation before a subscribing witness other than the
4 successor; the instrument of designation may but need not
5 contain the resignation of the custodian. If the custodian does
6 not so designate his successor before he dies or becomes legally
7 incapacitated, and the minor has no guardian and has attained
8 the age of 14 years, the minor may designate a successor
9 custodian by executing an instrument of designation before a
10 subscribing witness other than the successor. A successor
11 custodian has all the rights, powers, duties and immunities of a
12 custodian designated in a manner prescribed by this chapter.
13 (b) When designation of successor takes effect.--The
14 designation of a successor custodian as provided in subsection
15 (a) [of this section] takes effect as to each item of the
16 custodial property when the custodian resigns, dies or becomes
17 legally incapacitated and the custodian or his legal
18 representative:
19 (1) causes the item, if it is a security in
20 registered form or a life or endowment insurance policy
21 or annuity contract, to be registered, with the issuing
22 insurance company in the case of a life or endowment
23 insurance policy or annuity contract, in the name of the
24 successor custodian followed, in substance by the words "as
25 custodian for[............] (name of minor) under the
26 [(name of minor)]
27 Pennsylvania Uniform Gifts to Minors Act"; [and]
28 (1.1) if the custodial property is an interest in real
29 property, executes a conveyance of the interest to the
30 successor custodian in the form provided in section
19810S0635B1080 - 26 -
1 5303(a)(5) (relating to manner of making gift); or
2 (2) delivers or causes to be delivered to the successor
3 custodian any other item of the custodial property, together
4 with the instrument of designation of the successor custodian
5 or a true copy thereof and any additional instruments
6 required for the transfer thereof to the successor custodian.
7 * * *
8 (d) Ineligibility, death or incapacity of custodian.--If a
9 person designated as custodian or as successor custodian by the
10 custodian as provided by subsection (a) [of this section] is not
11 eligible, dies or becomes legally incapacitated before the minor
12 attains the age of 21 years and if the minor has a guardian, the
13 guardian of the minor shall be successor custodian. If the minor
14 has no guardian and if no successor custodian who is eligible
15 and has not died or not become legally incapacitated has been
16 designated as provided in subsection (a) [of this section], a
17 donor, his legal representative, the legal representative of the
18 custodian, or [an adult] a member of the minor's family, who has
19 attained the age of 18 years, may petition the court for the
20 designation of a successor custodian.
21 (e) Petition for removal or requiring bond.--A donor, the
22 legal representative of a donor, a successor custodian, [an
23 adult] a member of the minor's family who has attained the age
24 of 18 years, a guardian of the minor or the minor if he has
25 attained the age of 14 years, may petition the court that, for
26 cause shown in the petition, the custodian be removed and a
27 successor custodian be designated, or, in the alternative, that
28 the custodian be required to give bond for the performance of
29 his duties.
30 * * *
19810S0635B1080 - 27 -
1 § 5309. Accounting by custodian.
2 (a) Petition for accounting.--The minor if he has attained
3 the age of 14 years, or the legal representative of the minor,
4 [an adult] a member of the minor's family who has attained the
5 age of 18 years or a donor or his legal representative, may
6 petition the court for an accounting by the custodian or his
7 legal representative.
8 (b) Order for accounting or delivery of property.--The court
9 in a proceeding under this chapter or otherwise may require or
10 permit the custodian or his legal representative to account and
11 if the custodian is removed, shall so require and order,
12 delivery of all custodial property to the successor custodian
13 and the execution of all instruments required for the transfer
14 thereof.
15 Section 9. Sections 5505, 5515, 5521, 5536 and 5537(a) of
16 Title 20 are amended to read:
17 § 5505. Provisions similar to small estates of minors.
18 The provisions concerning small estates of incompetents shall
19 be the same as are set forth in the following provisions of this
20 title relating to minors' estates[, with regard to the
21 following]:
22 [(1) When guardian unnecessary, as in section 5101
23 (relating to when guardian unnecessary).
24 (2) Power of natural guardian, as in section 5102
25 (relating to power of natural guardian).
26 (3) Sequestered deposit, as in section 5103 (relating to
27 sequestered deposit).]
28 Section 5101 (relating to when guardian unnecessary).
29 Section 5102 (relating to power of natural guardian).
30 Section 5103 (relating to sequestered deposit).
19810S0635B1080 - 28 -
1 § 5515. Provisions similar to other estates.
2 The provisions relating to a guardian of an incompetent and
3 his surety shall be the same as are set forth in the following
4 provisions of this title relating to a personal representative
5 or a guardian of a minor and their sureties [with regard to the
6 following]:
7 [(1) Service of process on nonresident guardian, as in
8 section 5114 (relating to service of process on nonresident
9 guardian).
10 (2) Appointment of guardian in conveyance, as in section
11 5115 (relating to appointment of guardian in conveyance).
12 (3) Necessity of bond; form and amount, as in section
13 5121 (relating to necessity, form and amount).
14 (4) When bond not required, as in section 5122 (relating
15 to when bond not required).
16 (5) Requiring or changing amount of bond, as in section
17 5123 (relating to requiring or changing amount of bond).
18 (6) Grounds for removal, as in section 3182 (relating to
19 grounds for removal).
20 (7) Procedure for and effect of removal, as in section
21 3183 (relating to procedure for and effect of removal), for
22 which purpose the incompetent shall be deemed a party in
23 interest).
24 (8) Discharge of guardian and surety, as in section 3184
25 (relating to discharge of personal representative and
26 surety).]
27 Section 3182 (relating to grounds for removal).
28 Section 3183 (relating to procedure for and effect of
29 removal).
30 Section 3184 (relating to discharge of personal
19810S0635B1080 - 29 -
1 representative and surety).
2 Section 5115 (relating to appointment of guardian in
3 conveyance).
4 Section 5121 (relating to necessity, form and amount).
5 Section 5122 (relating to when bond not required).
6 Section 5123 (relating to requiring or changing amount of
7 bond).
8 § 5521. Provisions concerning powers, duties and liabilities.
9 The provisions concerning the powers, duties and liabilities
10 of guardians of incompetents' estates shall be the same as those
11 set forth in the following provisions of this title relating to
12 personal representatives of decedents' estates and guardians of
13 minors' estates [with regard to the following]:
14 [(1) Possession of real and personal property, as in
15 section 5141 (relating to possession of real and personal
16 property).
17 (2) Inventory, as in section 5142 (relating to
18 inventory).
19 (3) Abandonment of property, as in section 5143
20 (relating to abandonment of property).
21 (4) Liability insurance, as in section 3313 (relating to
22 liability insurance).
23 (5) Continuation of business, as in section 3314
24 (relating to continuation of business).
25 (6) Incorporation of business, as in section 3315
26 (relating to incorporation of estate's business).
27 (7) Claims against co-guardian, as in section 3317
28 (relating to claims against co-fiduciary).
29 (8) Proceedings against guardian, as in section 5147
30 (relating to proceedings against guardian).
19810S0635B1080 - 30 -
1 (9) Revival of judgment against guardian, as in section
2 3318 (relating to revival of judgments against personal
3 representative).
4 (10) Liability of guardian on contracts, as in section
5 3331 (relating to liability of personal representative on
6 contracts).
7 (11) Investments, as in section 5145 (relating to
8 investments).
9 (12) Power of attorney and delegation of power over
10 subscription rights and fractional shares, as in section 3319
11 (relating to power of attorney; delegation of power over
12 subscription rights and fractional shares; authorized
13 delegations).
14 (13) Voting stock by proxy, as in section 3320 (relating
15 to voting stock by proxy).
16 (14) Nominee registration; corporate fiduciary as
17 attorney-in-fact, as in section 3321 (relating to nominee
18 registration; corporate fiduciary as attorney-in-fact;
19 deposit of securities in a clearing corporation; book-entry
20 securities).
21 (15) Acceptance of deed in lieu of foreclosure, as in
22 section 3322 (relating to acceptance of deed in lieu of
23 foreclosure).
24 (16) Compromise of controversies, as in section 3323
25 (relating to compromise of controversies).
26 (17) When guardian dies or becomes incompetent, as in
27 section 3324 (relating to death or incompetency of
28 fiduciary).
29 (18) Surviving or remaining guardian, as in section 3327
30 (relating to surviving or remaining personal
19810S0635B1080 - 31 -
1 representatives).
2 (19) Disagreement of guardians, as in section 3328
3 (relating to disagreement of personal representatives).
4 (20) Inherent powers and duties, as in section 3332
5 (relating to inherent powers and duties).
6 (21) Guardian named in conveyance, as in section 5146
7 (relating to guardian named in conveyance).
8 (22) Power to sell personal property, as in section 5151
9 (relating to power to sell personal property).
10 (23) Order of court, as in section 5155 (relating to
11 order of court).
12 (24) Restraint of sale, as in section 3355 (relating to
13 restraint of sale).
14 (25) Purchase by guardian, as in section 3356 (relating
15 to purchase by personal representative).
16 (26) Title of purchaser, as in section 5154 (relating to
17 title of purchaser).
18 (27) Record of proceedings; county where real estate
19 lies, as in section 3359 (relating to record of proceedings;
20 county where real estate lies).
21 (28) Substitution of guardian in pending action or
22 proceedings, as in section 3372 (relating to substitution of
23 personal representative in pending action or proceedings).
24 (29) Death or removal of guardian, as in section 3374
25 (relating to death or removal of fiduciary).
26 (30) Specific performance of contracts, as in section
27 3390 (relating to specific performance of contracts).
28 (31) Contracts, inadequacy of consideration or better
29 offer; brokers' commissions, as in section 3360 (relating to
30 contracts, inadequacy of consideration or better offer;
19810S0635B1080 - 32 -
1 brokers' commissions).]
2 Section 3313 (relating to liability insurance).
3 Section 3314 (relating to continuation of business).
4 Section 3315 (relating to incorporation of estate's
5 business).
6 Section 3317 (relating to claims against co-fiduciary).
7 Section 3318 (relating to revival of judgments against
8 personal representative).
9 Section 3319 (relating to power of attorney; delegation
10 of power over subscription rights and fractional shares;
11 authorized delegations).
12 Section 3320 (relating to voting stock by proxy).
13 Section 3321 (relating to nominee registration; corporate
14 fiduciary as attorney-in-fact; deposit of securities in a
15 clearing corporation; book-entry securities).
16 Section 3322 (relating to acceptance of deed in lieu of
17 foreclosure).
18 Section 3323 (relating to compromise of controversies).
19 Section 3324 (relating to death or incompetency of
20 fiduciary).
21 Section 3327 (relating to surviving or remaining personal
22 representatives).
23 Section 3328 (relating to disagreement of personal
24 representatives).
25 Section 3331 (relating to liability of personal
26 representative on contracts).
27 Section 3332 (relating to inherent powers and duties).
28 Section 3355 (relating to restraint of sale).
29 Section 3356 (relating to purchase by personal
30 representative).
19810S0635B1080 - 33 -
1 Section 3359 (relating to record of proceedings; county
2 where real estate lies).
3 Section 3360 (relating to contracts, inadequacy of
4 consideration or better offer; brokers' commissions).
5 Section 3372 (relating to substitution of personal
6 representative in pending action or proceedings).
7 Section 3374 (relating to death or removal of fiduciary).
8 Section 3390 (relating to specific performance of
9 contracts).
10 Section 5141 (relating to possession of real and personal
11 property).
12 Section 5142 (relating to inventory).
13 Section 5143 (relating to abandonment of property).
14 Section 5145 (relating to investments).
15 Section 5146 (relating to guardian named in conveyance).
16 Section 5147 (relating to proceedings against guardian).
17 Section 5151 (relating to power to sell personal
18 property).
19 Section 5154 (relating to title of purchaser).
20 Section 5155 (relating to order of court).
21 § 5536. Distributions of income and principal during
22 incompetency.
23 (a) In general.--All income received by a guardian of the
24 estate of an incompetent, including (subject to the requirements
25 of Federal law relating thereto) all funds received from the
26 Veterans' Administration, Social Security Administration and
27 other periodic retirement or disability payments under private
28 or governmental plans, in the exercise of a reasonable
29 discretion, may be expended in the care and maintenance of the
30 incompetent, without the necessity of court approval. The court,
19810S0635B1080 - 34 -
1 for cause shown and with only such notice as it considers
2 appropriate in the circumstances, may authorize or direct the
3 payment or application of any or all of the income or principal
4 of the estate of an incompetent for the care, maintenance or
5 education of the incompetent, his spouse, children or those for
6 whom he was making such provision before his incompetency, or
7 for the reasonable funeral expenses of the incompetent's spouse,
8 child or indigent parent. In proper cases, the court may order
9 payment of amounts directly to the incompetent for his
10 maintenance or for incidental expenses and may ratify payments
11 made for these purposes.
12 (b) Estate plan.--The court, upon petition and with notice
13 to all parties in interest, shall have the power to substitute
14 its judgment for that of the incompetent with respect to the
15 estate and affairs of the incompetent for the benefit of the
16 incompetent, his family, members of his household, his friends
17 and charities in which he was interested. This power shall
18 include, but is not limited to, the power to:
19 (1) [make] Make gifts, outright or in trust[;] .
20 (2) [convey or] Convey, release or disclaim his
21 contingent and expectant interests in property, including
22 marital property rights and any right of survivorship
23 incident to joint tenancy or tenancy by the entirety[;].
24 (3) [release] Release or disclaim his powers as trustee,
25 personal representative, custodian for minors, or
26 guardian[;].
27 (4) [exercise or] Exercise, release or disclaim his
28 powers as donee of a power of appointment[;].
29 (5) [enter] Enter into contracts[;].
30 (6) [create] Create for the benefit of the incompetent
19810S0635B1080 - 35 -
1 or others, revocable or irrevocable trusts of his property
2 which may extend beyond his disability or life[;].
3 (7) [exercise] Exercise options of the incompetent to
4 purchase or exchange securities or other property[;].
5 (8) [exercise] Exercise his rights to elect options and
6 change beneficiaries under insurance and annuity policies or
7 surrender the policies for their cash value[;].
8 (9) [exercise] Exercise his right to claim or disclaim
9 an elective share in the estate of his deceased spouse and
10 renounce any interest by testate or intestate succession or
11 by inter vivos transfer[; and].
12 (10) [change] Change the incompetent's residence or
13 domicile.
14 In the exercise of its judgment for that of the incompetent, the
15 court first being satisfied that assets exist which are not
16 required for the maintenance, support and well-being of the
17 incompetent, may adopt a plan of gifts which [result] results in
18 minimizing current or prospective income, estate or inheritance
19 taxes, or which carries out a lifetime giving pattern. The court
20 in exercising its judgment may consider the testamentary and
21 inter vivos intentions of the incompetent insofar as they can be
22 ascertained.
23 § 5537. Reserve for funeral.
24 (a) In general.--The court may authorize the guardian to
25 retain such assets not exceeding [$600] $1,200 in value as are
26 deemed appropriate for the anticipated expense of the
27 incompetent's funeral, including the cost of a burial lot or
28 other resting place, which shall be exempt from all claims
29 including claims of the Commonwealth. The court with notice
30 thereof to the institution or person having custody of the
19810S0635B1080 - 36 -
1 incompetent may also authorize the guardian or another person to
2 set aside such assets in the form of a savings account in a
3 financial institution which account shall not be subject to
4 escheat during the lifetime of the incompetent. Such assets may
5 be disbursed by the guardian or person who set aside such assets
6 or by the financial institution for such funeral expenses
7 without further authorization or accounting. Any part of such
8 assets not so disbursed shall constitute a part of the deceased
9 incompetent's estate. Should the incompetent become competent or
10 should such assets become excessive, the court, upon petition of
11 any party in interest, may make such order as the circumstances
12 shall require.
13 * * *
14 Section 10. Chapter 56 of Title 20 is repealed and a chapter
15 is added to read:
16 CHAPTER 56
17 POWERS OF ATTORNEY
18 Sec.
19 5601. General provision.
20 5602. Form of power of attorney.
21 5603. Implementation of power of attorney.
22 5604. Durable powers of attorney.
23 5605. Power of attorney not revoked until notice.
24 5606. Proof of continuance of durable or other powers of
25 attorney by affidavit.
26 5607. Corporate attorney-in-fact.
27 § 5601. General provision.
28 In addition to all other powers that may be delegated to an
29 attorney-in-fact, any or all of the powers referred to in
30 section 5602(a) (relating to form of power of attorney) may
19810S0635B1080 - 37 -
1 lawfully be granted in writing and, unless the power of attorney
2 expressly directs to the contrary, shall be construed in
3 accordance with the provisions of this chapter.
4 § 5602. Form of power of attorney.
5 (a) Specification of powers.--A principal may, by inclusion
6 of the language quoted in any of the following paragraphs or by
7 inclusion of other language showing a similar intent on the part
8 of the principal, empower his attorney-in-fact to do any or all
9 of the following, each of which is defined in section 5603
10 (relating to implementation of power of attorney):
11 (1) Either:
12 (i) "To make gifts"; or
13 (ii) "To make limited gifts."
14 (2) "To create a trust for my benefit."
15 (3) "To make additions to an existing trust for my
16 benefit."
17 (4) "To claim an elective share of the estate of my
18 deceased spouse."
19 (5) "To disclaim any interest in property."
20 (6) "To renounce fiduciary positions."
21 (7) "To withdraw and receive the income or corpus of a
22 trust."
23 (8) "To authorize my admission to a medical, nursing,
24 residential or similar facility and to enter into agreements
25 for my care."
26 (9) "To authorize medical and surgical procedures."
27 (b) Appointment of attorney-in-fact and successor
28 attorney.--A principal may provide for:
29 (1) The appointment of more than one attorney-in-fact,
30 who shall act jointly, severally or in any other combination
19810S0635B1080 - 38 -
1 that the principal may designate, but if there is no such
2 designation, such attorneys-in-fact shall only act jointly.
3 (2) The appointment of one or more successor attorneys-
4 in-fact who shall serve in the order named in the power of
5 attorney, unless the principal expressly directs to the
6 contrary.
7 (3) The delegation to an original or successor attorney-
8 in-fact of the power to appoint his successor or successors.
9 (c) Filing of power of attorney.--An executed copy of the
10 power of attorney may be filed with the clerk of the orphans'
11 court division of the court of common pleas in the county in
12 which the principal resides, and if it is acknowledged, it may
13 be recorded in the office for the recording of deeds of the
14 county of the principal's residence and of each county in which
15 real property to be affected by an exercise of the power is
16 located. The clerk of the orphans' court division or any office
17 for the recording of deeds with whom the power has been filed,
18 may, upon request, issue certified copies of the power of
19 attorney. Each such certified copy shall have the same validity
20 and the same force and effect as if it were the original, and it
21 may be filed of record in any other office of this Commonwealth
22 (including, without limitation, the clerk of the orphans' court
23 division or the office for the recording of deeds) as if it were
24 the original.
25 § 5603. Implementation of power of attorney.
26 (a) Power to make gifts and power to make limited gifts.--
27 (1) A power "to make gifts" shall mean that the
28 attorney-in-fact may make gifts for and on behalf of the
29 principal to any donees (including the attorney-in-fact) and
30 in such amounts as the attorney-in-fact may decide.
19810S0635B1080 - 39 -
1 (2) A power "to make limited gifts" shall mean that the
2 attorney-in-fact may make only gifts for or on behalf of the
3 principal which are limited as follows:
4 (i) The class of permissible donees shall consist
5 solely of the principal's spouse and issue (including the
6 attorney-in-fact if he is a member of such class), or
7 any of them.
8 (ii) During each calendar year, the gifts made to
9 each donee, pursuant to such power, shall have an
10 aggregate value not in excess of, and shall be made in
11 such manner as to qualify in their entirety for, the
12 principal's annual exclusion from the Federal gift tax
13 permitted under section 2503(b) of the Internal Revenue
14 Code, determined without regard to section 2513(a)
15 thereof (or any successor provision to the code).
16 (iii) The attorney-in-fact shall be answerable <--
17 RESPONSIBLE as equity and justice may require to the <--
18 extent that any gift made pursuant to a power "to make
19 limited gifts" exceeds the limitations imposed by
20 subparagraph (i) or (ii).
21 (3) A power to make gifts, whether or not limited as
22 aforesaid, shall be construed to empower the attorney-in-fact
23 to make gifts to each donee either outright or in trust; in
24 the case of a gift to a minor, such gifts may be made in
25 trust or in accordance with Chapter 53 (relating to
26 Pennsylvania Uniform Gifts to Minors Act) or section 5155
27 (relating to order of court). In the case of a gift made in
28 trust, the attorney-in-fact may execute a deed of trust for
29 such purpose, designating one or more persons (including the
30 attorney-in-fact) as original or successor trustees, or may
19810S0635B1080 - 40 -
1 make additions to an existing trust. In making any gifts, the
2 attorney-in-fact need not treat the donees equally or
3 proportionately and may entirely exclude one or more
4 permissible donees, and the pattern followed on the occasion
5 of any gift or gifts need not be followed on the occasion of
6 any other gift or gifts.
7 (4) An attorney-in-fact and the donee of a gift shall be
8 answerable RESPONSIBLE as equity and justice may require to <--
9 the extent that a gift made by the attorney-in-fact is
10 inconsistent with prudent estate planning or financial
11 management for the principal or with the known or probable
12 intent of the principal with respect to disposition of his
13 estate.
14 (5) No transfer agent, depository or other third party
15 acting in good faith shall have any responsibility to see to
16 the proper discharge by the attorney-in-fact of his duties
17 hereunder.
18 (b) Power to create a trust.--A power "to create a trust for
19 my benefit" shall mean that the attorney-in-fact may execute a
20 deed of trust, designating one or more persons (including the
21 attorney-in-fact) as original or successor trustees and transfer
22 to the trust any or all property owned by the principal as the
23 attorney-in-fact may decide, subject to the following
24 conditions:
25 (1) The income and corpus of such THE trust shall either <--
26 be distributable to the principal or to the guardian of his
27 estate, or be applied for such THE principal's benefit, and <--
28 upon such THE principal's death, any remaining balance of <--
29 corpus and unexpended income of the trust shall be
30 distributed to such THE deceased principal's estate. <--
19810S0635B1080 - 41 -
1 (2) The deed of trust may be amended or revoked at any
2 time and from time to time, in whole or in part, by the
3 principal or the attorney-in-fact, provided that any such
4 amendment by the attorney-in-fact shall not include any
5 provision which could not be included in the original deed.
6 (c) Power to make additions to an existing trust.--A power
7 "to make additions to an existing trust for my benefit" shall
8 mean that the attorney-in-fact, at any time or times, may add
9 any or all of the property owned by the principal to any trust
10 in existence when the power is WAS created, provided that the <--
11 terms of such trust relating to the disposition of the income
12 and corpus during the lifetime of the principal are the same as
13 those set forth in subsection (b). The attorney-in-fact and the
14 trust and its beneficiaries shall be answerable as equity and
15 justice may require to the extent that an addition to a trust is
16 inconsistent with prudent estate planning or financial
17 management for the principal or with the known or probable
18 intent of the principal with respect to disposition of his
19 estate.
20 (d) Power to claim an elective share.--A power "to claim an
21 elective share of the estate of my deceased spouse" shall mean
22 that the attorney-in-fact may elect to take against the will and
23 conveyances of the principal's deceased spouse, disclaim any
24 interest in property which the principal is required to disclaim
25 as a result of such election, retain any property which the
26 principal has the right to elect to retain, file petitions
27 pertaining to the election, including petitions to extend the
28 time for electing and petitions for orders, decrees and
29 judgments in accordance with section 2211(c) and (d) (relating
30 to determination of effect of election; enforcement), and take
19810S0635B1080 - 42 -
1 all other actions which the attorney-in-fact deems appropriate
2 in order to effectuate such THE election: Provided, however, <--
3 That the election shall be made only upon the approval of the
4 court having jurisdiction of such THE principal's estate in <--
5 accordance with section 2206 (relating to right of election
6 personal to surviving spouse) in the case of a principal who has
7 been adjudicated an incompetent, or upon the approval of the
8 court having jurisdiction of the deceased spouse's estate in the
9 case of a principal who has not been adjudicated an incompetent.
10 (e) Power to disclaim any interest in property.--A power "to
11 disclaim any interest in property" shall mean that the attorney-
12 in-fact may release or disclaim any interest in property on
13 behalf of the principal in accordance with Chapter 62 (relating
14 to disclaimers) or section 6103 (relating to release or
15 disclaimer of powers or interests), provided that any disclaimer
16 under Chapter 62 shall be in accordance with the provisions of
17 section 6202 (relating to disclaimers by fiduciaries) in the
18 case of a principal who shall have been adjudicated an
19 incompetent at the time of the execution of the disclaimer.
20 (f) Power to renounce fiduciary position.--
21 (1) A power "to renounce fiduciary positions" shall mean
22 that the attorney-in-fact may:
23 (i) renounce any fiduciary positions POSITION to <--
24 which the principal has been appointed; and
25 (ii) resign any fiduciary positions POSITION in <--
26 which the principal is then serving, and either file an
27 accounting with a court of competent jurisdiction or
28 settle on receipt and release or other informal method as
29 the attorney-in-fact deems advisable.
30 (2) The term "fiduciary" shall be deemed to include,
19810S0635B1080 - 43 -
1 without limitation, AN executor, administrator, trustee, <--
2 guardian, attorney-in-fact, or officer or director of a
3 corporation.
4 (g) Power to withdraw and receive.--A power "to withdraw and
5 receive the income or corpus of a trust" shall mean that the
6 attorney-in-fact may:
7 (1) demand, withdraw and receive the income or corpus of
8 any trust over which the principal has the power to make
9 withdrawals;
10 (2) request and receive the income or corpus of any
11 trust with respect to which the trustee thereof has the
12 discretionary power to make distribution to or on behalf of
13 the principal; and
14 (3) execute a receipt and release or similar document
15 for the property received under paragraphs (1) and (2).
16 (h) Power to authorize admission to medical facility and
17 power to authorize medical procedures.--
18 (1) A power "to authorize my admission to a medical,
19 nursing, residential or similar facility, and to enter into
20 agreements for my care" shall mean that the attorney-in-fact
21 may apply for the admission of the principal to a medical,
22 nursing, residential or other similar facility, execute any
23 consent or admission forms required by such facility which
24 are consistent with this paragraph, and enter into agreements
25 for the care of the principal by such facility or elsewhere
26 during his lifetime or for such lesser period of time as the
27 attorney-in-fact may designate, including the retention of
28 nurses for the principal.
29 (2) A power "to authorize medical and surgical
30 procedures" shall mean that the attorney-in-fact may arrange
19810S0635B1080 - 44 -
1 for and consent to medical, therapeutical and surgical
2 procedures for the principal, including the administration of
3 drugs.
4 § 5604. Durable powers of attorney.
5 (a) Definition.--A durable power of attorney is a power of
6 attorney by which a principal designates another his attorney-
7 in-fact in writing and the writing contains the words "this
8 power of attorney shall not be affected by my subsequent
9 disability or incapacity" or "this power of attorney shall
10 become effective upon my disability or incapacity" or similar
11 words showing the intent of the principal that the authority
12 conferred shall be exercisable notwithstanding the principal's
13 subsequent disability or incapacity.
14 (b) Durable power of attorney not affected by disability.--
15 All acts done by an attorney-in-fact pursuant to a durable power
16 of attorney during any period of disability or incapacity of the
17 principal have the same effect and inure to the benefit of and
18 bind the principal and his successors in interest as if the
19 principal were competent and not disabled.
20 (c) Relation of attorney-in-fact to court-appointed
21 guardian.--
22 (1) If, following execution of a durable power of
23 attorney, the principal is adjudicated an incompetent person
24 and a guardian is appointed for his estate, the attorney-in-
25 fact is accountable to the guardian as well as to the
26 principal. The guardian shall have the same power to revoke
27 or amend the power of attorney that the principal would have
28 had if he were not incompetent.
29 (2) A principal may nominate, by a durable power of
30 attorney, the guardian of his estate or of his person for
19810S0635B1080 - 45 -
1 consideration by the court if incompetency proceedings for
2 the principal's estate or person are thereafter commenced.
3 The court shall make its appointment in accordance with the
4 principal's most recent nomination in a durable power of
5 attorney except for good cause or disqualification.
6 § 5605. Power of attorney not revoked until notice.
7 (a) Death of principal.--The death of a principal who has
8 executed a written power of attorney, durable or otherwise,
9 shall not revoke or terminate the agency as to the attorney-in-
10 fact or other person, who, without actual knowledge of the death
11 of the principal, acts in good faith under the power. Any action
12 so taken, unless otherwise invalid or unenforceable, shall bind
13 successors in interest of the principal.
14 (b) Disability or incapacity of principal.--The disability
15 or incapacity of a principal who has previously executed a
16 written power of attorney which is not a durable power shall not
17 revoke or terminate the agency as to the attorney-in-fact or
18 other person, who, without actual knowledge of the disability or
19 incapacity of the principal, acts in good faith under the power.
20 Any action so taken, unless otherwise invalid or unenforceable,
21 shall bind the principal and his successors in interest.
22 § 5606. Proof of continuance of durable or other powers of
23 attorney by affidavit.
24 As to acts undertaken in good faith reliance thereon, an
25 affidavit executed by the attorney-in-fact under a power of
26 attorney, durable or otherwise, stating that he did not have at
27 the time of exercise of the power actual knowledge of the
28 termination of the power by revocation or of the principal's
29 death, disability or incapacity is conclusive proof of the
30 nonrevocation or nontermination of the power at that time. If
19810S0635B1080 - 46 -
1 the exercise of the power of attorney requires execution and
2 delivery of any instrument which is recordable, the affidavit
3 when authenticated for record is likewise recordable. This
4 section does not affect any provision in a power of attorney for
5 its termination by expiration of time or occurrence of an event
6 other than express revocation or a change in the principal's
7 capacity.
8 § 5607. Corporate attorney-in-fact.
9 A bank and trust company or a trust company incorporated in
10 this Commonwealth, or a National bank with trust powers having
11 its principal office in this Commonwealth, acting as an
12 attorney-in-fact pursuant to a power of attorney, or appointed
13 by another who possesses such a power, shall have the powers,
14 duties and liabilities set forth in section 3321 (relating to
15 nominee registration; corporate fiduciary as attorney-in-fact;
16 deposit of securities in a clearing corporation; book-entry
17 securities).
18 Section 11. Sections 6102(a), 6110 and 6202 of Title 20,
19 section 6102(a) amended July 11, 1980 (P.L.565, No.118), are
20 amended to read:
21 § 6102. Termination of trusts.
22 (a) Failure of original purpose.--The court having
23 jurisdiction of a trust heretofore or hereafter created,
24 regardless of any spendthrift or similar provision therein, in
25 its discretion may terminate such trust in whole or in part, or
26 make an allowance from principal to [a conveyor, his spouse,
27 issue, parents, or any of them, who is an income beneficiary,]
28 one or more beneficiaries provided the court after hearing is
29 satisfied that the original purpose of the conveyor cannot be
30 carried out or is impractical of fulfillment and that the
19810S0635B1080 - 47 -
1 termination, partial termination, or allowance more nearly
2 approximates the intention of the conveyor, and notice is given
3 to all parties in interest or to their duly appointed
4 fiduciaries. [But, distributions of principal under this
5 section, whether by termination, partial termination, or
6 allowance, shall not exceed an aggregate value of $100,000 from
7 all trusts created by the same conveyor.]
8 * * *
9 § 6110. Administration of charitable estates.
10 (a) General rule.--Except as otherwise provided by the
11 conveyor, if the charitable purpose for which an interest shall
12 be conveyed shall be or become indefinite or impossible or
13 impractical of fulfillment, or if it shall not have been carried
14 out for want of a trustee or because of the failure of a trustee
15 to designate such purpose, the court may, on application of the
16 trustee or of any interested person or of the Attorney General
17 [of the Commonwealth], after proof of notice to the Attorney
18 General [of the Commonwealth] when he is not the petitioner,
19 order an administration or distribution of the estate for a
20 charitable purpose in a manner as nearly as possible to fulfill
21 the intention of the conveyor, whether his charitable intent be
22 general or specific.
23 (b) Administrative termination of small charitable trusts.--
24 A trust held solely for charitable purposes with assets not
25 exceeding $10,000, whether heretofore or hereafter created, may
26 be terminated by the trustee at its inception or at any time
27 thereafter with the consent of the Attorney General and all
28 charitable organizations which are designated by name in the
29 conveyance as beneficiaries. Upon such termination the assets,
30 subject to the approval of the Attorney General, shall be
19810S0635B1080 - 48 -
1 delivered to the organizations, if any, designated in the trust
2 instrument or, if none, to organizations selected by the
3 trustee, in either case to be held and applied for such general
4 or specific charitable purposes and on such terms as will, in
5 the trustee's discretion, fulfill as nearly as possible the
6 conveyor's intention.
7 (c) Judicial termination of charitable trusts.--If the
8 separate existence of a trust solely for charitable purposes,
9 whether heretofore or hereafter created, results or will result
10 in administrative expense or other burdens unreasonably out of
11 proportion to the charitable benefits, the court may, upon
12 application of the trustee or any interested person and after
13 notice to the Attorney General, terminate the trust, either at
14 its inception or at any time thereafter, and award the assets
15 outright, free of the trust, to the charitable organizations, if
16 any, designated in the conveyance or, if none, to charitable
17 organizations selected by the court, in either case for such
18 purposes and on such terms as the court may direct to fulfill as
19 nearly as possible the conveyor's intentions other than any
20 intent to continue the trust, if the court is satisfied that the
21 charitable organizations will properly use or administer the
22 assets.
23 § 6202. Disclaimers by fiduciaries or attorneys-in-fact.
24 A disclaimer on behalf of a decedent, a minor or an
25 incompetent may be made by his personal representative, [or] the
26 guardian of his estate [if] or in the case of an incompetent who
27 executed a power of attorney which confers the authority to
28 disclaim upon his attorney-in-fact and which qualifies as a
29 durable power of attorney under section 5604 (relating to
30 durable powers of attorney) by such attorney-in-fact, if, in
19810S0635B1080 - 49 -
1 each case, the court having jurisdiction of the estate
2 authorizes the disclaimer after finding that it is advisable and
3 will not materially prejudice the rights of creditors, heirs or
4 beneficiaries of the decedent, the minor or his creditors, or
5 the incompetent or his creditors, as the case may be.
6 Section 12. Sections 7121, 7133, 7143, 7183, 7185(b) and
7 7186 of Title 20, section 7183 amended July 11, 1980 (P.L.565,
8 No.118), are amended to read:
9 § 7121. Grounds and procedure.
10 The grounds and the procedure for the removal or discharge of
11 a trustee and his surety and the effect of such removal or
12 discharge shall be the same as are set forth in the following
13 provisions of this title relating to the removal and discharge
14 of a personal representative and his surety[, with regard to the
15 following]:
16 [(1) Grounds for removal, as in section 3182 (relating
17 to grounds for removal).
18 (2) Procedure for and effect of removal, as in section
19 3183 (relating to procedure for and effect of removal).
20 (3) Discharge of trustee and surety, as in section 3184
21 (relating to discharge of personal representative and
22 surety).]
23 Section 3182 (relating to grounds for removal).
24 Section 3183 (relating to procedure for and effect of
25 removal).
26 Section 3184 (relating to discharge of personal
27 representative and surety).
28 § 7133. Powers, duties and liabilities identical with
29 personal representatives.
30 The provisions concerning the powers, duties and liabilities
19810S0635B1080 - 50 -
1 of a trustee shall be the same as those set forth in the
2 following provisions of this title for the administration of a
3 decedent's or a minor's estate [with regard to the following]:
4 [(1) Liability insurance, as in section 3313 (relating
5 to liability insurance).
6 (2) Continuation of business, as in section 3314
7 (relating to continuation of business).
8 (3) Incorporation of business, as in section 3315
9 (relating to incorporation of estate's business).
10 (4) Claims against co-trustee, as in section 3317
11 (relating to claims against co-fiduciary).
12 (5) Revival of judgments against trustee, as in section
13 3318 (relating to revival of judgments against personal
14 representative).
15 (6) Power of attorney, as in section 3319 (relating to
16 power of attorney; delegation of power over subscription
17 rights and fractional shares; authorized delegations).
18 (7) Voting stock by proxy, as in section 3320 (relating
19 to voting stock by proxy).
20 (8) Nominee registration, deposit of securities in a
21 clearing corporation and holding of securities in book-entry
22 form, as in section 3321 (relating to nominee registration;
23 corporate fiduciary as attorney-in-fact; deposit of
24 securities in a clearing corporation; book-entry securities).
25 (9) Acceptance of deed in lieu of foreclosure, as in
26 section 3322 (relating to acceptance of deed in lieu of
27 foreclosure).
28 (10) Compromise of controversies, as in section 3323
29 (relating to compromise of controversies).
30 (11) Death or incompetency of trustee, as in section
19810S0635B1080 - 51 -
1 3324 (relating to death or incompetency of fiduciary).
2 (12) Surviving or remaining trustee, as in section 3327
3 (relating to surviving or remaining personal
4 representatives).
5 (13) Disagreement of trustees, as in section 3328
6 (relating to disagreement of personal representatives).
7 (14) Liability of trustee on contracts, as in section
8 3331 (relating to liability of personal representative on
9 contracts).
10 (15) Inherent powers and duties, as in section 3332
11 (relating to inherent powers and duties).
12 (16) Order of court, as in section 3353 (relating to
13 order of court).
14 (17) Power given in the trust instrument, as in section
15 3354 (relating to power given in governing instrument).
16 (18) Restraint of sale, as in section 3355 (relating to
17 restraint of sale).
18 (19) Purchase by trustee, as in section 3356 (relating
19 to purchase by personal representative).
20 (20) Collateral attack, as in section 3358 (relating to
21 collateral attack).
22 (21) Record of proceedings; county where real estate
23 lies, as in section 3359 (relating to record of proceedings;
24 county where real estate lies).
25 (21.1) Contracts, inadequacy of consideration or better
26 offer; brokers' commissions, as in section 3360 (relating to
27 contracts, inadequacy of consideration or better offer;
28 brokers' commissions).
29 (22) Proceedings against trustee, as in section 5147
30 (relating to proceedings against guardian).]
19810S0635B1080 - 52 -
1 Section 3313 (relating to liability insurance).
2 Section 3314 (relating to continuation of business).
3 Section 3315 (relating to incorporation of estate's
4 business).
5 Section 3317 (relating to claims against co-fiduciary).
6 Section 3318 (relating to revival of judgments against
7 personal representative).
8 Section 3319 (relating to power of attorney; delegation
9 of power over subscription rights and fractional shares;
10 authorized delegations).
11 Section 3320 (relating to voting stock by proxy).
12 Section 3321 (relating to nominee registration; corporate
13 fiduciary as attorney-in-fact; deposit of securities in a
14 clearing corporation; book-entry securities).
15 Section 3322 (relating to acceptance of deed in lieu of
16 foreclosure).
17 Section 3323 (relating to compromise of controversies).
18 Section 3324 (relating to death or incompetency of
19 fiduciary).
20 Section 3327 (relating to surviving or remaining personal
21 representatives).
22 Section 3328 (relating to disagreement of personal
23 representatives).
24 Section 3331 (relating to liability of personal
25 representative on contracts).
26 Section 3332 (relating to inherent powers and duties).
27 Section 3353 (relating to order of court).
28 Section 3354 (relating to power given in governing
29 instrument).
30 Section 3355 (relating to restraint of sale).
19810S0635B1080 - 53 -
1 Section 3356 (relating to purchase by personal
2 representative).
3 Section 3358 (relating to collateral attack).
4 Section 3359 (relating to record of proceedings; county
5 where real estate lies).
6 Section 3360 (relating to contracts, inadequacy of
7 consideration or better offer; brokers' commissions).
8 Section 5147 (relating to proceedings against guardian).
9 § 7143. Title of purchaser.
10 If the trustee has given such bond, if any, as shall be
11 required in accordance with this title, any sale, pledge,
12 mortgage, or exchange by a trustee, whether pursuant to a decree
13 or to the exercise of a power conferred by the trust instrument
14 or of a power under this title, shall pass the full title of the
15 trust therein, unless otherwise specified. Persons dealing with
16 the trustee shall have no obligation to see to the proper
17 application of the cash or other assets given in exchange for
18 the property of the trust. Any sale or exchange by a trustee
19 pursuant to a decree under section [7133(16)] 3353 (relating to
20 order of court) shall have the effect of a judicial sale as to
21 the discharge of liens, but the court may decree a sale or
22 exchange freed and discharged from the lien of any mortgage
23 otherwise preserved from discharge by existing law, if the
24 holder of such mortgage shall consent by writing filed in the
25 proceeding. No such sale, mortgage, exchange, or conveyance
26 shall be prejudiced by the subsequent dismissal of the trustee
27 nor shall any such sale, mortgage, exchange, or conveyance by a
28 testamentary trustee be prejudiced by the terms of any will or
29 codicil thereafter probated, if the person dealing with the
30 trustee did so in good faith.
19810S0635B1080 - 54 -
1 § 7183. Notice, audits, reviews, and distribution.
2 The provisions concerning accounts, audits, reviews,
3 distributions and rights of distributees in trust estates shall
4 be the same as those set forth in the following provisions of
5 this title for the administration of a decedent's estate[, with
6 regard to the following]:
7 [(1) Notice to parties in interest, as in section 3503
8 (relating to notice to parties in interest).
9 (2) Representation of parties in interest, as in section
10 3504 (relating to representation of parties in interest).
11 (3) Audits in counties having a separate orphans' court
12 division, as in section 3511 (relating to audits in counties
13 having separate orphans' court division).
14 (4) Audits in counties having no separate orphans' court
15 division, as in section 3512 (relating to audits in counties
16 having no separate orphans' court division).
17 (5) Statement of proposed distribution, as in section
18 3513 (relating to statement of proposed distribution).
19 (6) Confirmation of accounts and approval of proposed
20 distribution, as in section 3514 (relating to confirmation of
21 account and approval of proposed distribution).
22 (7) Rehearing; relief granted, as in section 3521
23 (relating to rehearing; relief granted).
24 (8) Award upon final confirmation of account, as in
25 section 3533 (relating to award upon final confirmation of
26 account).
27 (9) Distribution in kind, as in section 3534 (relating
28 to distribution in kind).
29 (10) Recording and registering decrees awarding real
30 estate, as in section 3536 (relating to recording and
19810S0635B1080 - 55 -
1 registering decrees awarding real estate).
2 (11) Liability for interest, as in section 3544
3 (relating to liability of personal representative for
4 interest).
5 (12) Transcripts of balances due, as in section 3545
6 (relating to transcripts of balances due by personal
7 representative).
8 (13) Record of risk distributions as provided in section
9 3532(c) (relating to at risk of personal representative).
10 (14) Distributions involving persons born out of
11 wedlock, as in section 3538 (relating to distributions
12 involving persons born out of wedlock).
13 (15) Absentee and additional distributees as in section
14 3540 (relating to absentee and additional distributees).]
15 Section 3503 (relating to notice to parties in interest).
16 Section 3504 (relating to representation of parties in
17 interest).
18 Section 3511 (relating to audits in counties having
19 separate orphans' court division).
20 Section 3512 (relating to audits in counties having no
21 separate orphans' court division).
22 Section 3513 (relating to statement of proposed
23 distribution).
24 Section 3514 (relating to confirmation of account and
25 approval of proposed distribution).
26 Section 3521 (relating to rehearing; relief granted).
27 Section 3532(c) (relating to at risk of personal
28 representative).
29 Section 3533 (relating to award upon final confirmation
30 of account).
19810S0635B1080 - 56 -
1 Section 3534 (relating to distribution in kind).
2 Section 3536 (relating to recording and registering
3 decrees awarding real estate).
4 Section 3538 (relating to distributions involving persons
5 born out of wedlock).
6 Section 3539 (relating to information services).
7 Section 3540 (relating to absentee and additional
8 distributees).
9 Section 3544 (relating to liability of personal
10 representative for interest).
11 Section 3545 (relating to transcripts of balances due by
12 personal representative).
13 § 7185. Compensation.
14 * * *
15 (b) Allowed out of principal or income.--[Neither the] The
16 fact that a fiduciary's service has not ended [nor] or the fact
17 that the trust has not ended or the fact that the trust is
18 perpetual shall not be a bar to the fiduciary's receiving
19 compensation for his services out of the principal of the trust.
20 Whenever it shall appear either during the continuance of a
21 trust or at its end, that a fiduciary has rendered services for
22 which he has not been fully compensated, the court having
23 jurisdiction over his accounts, shall allow him such original or
24 additional compensation out of the trust income or the trust
25 principal or both, as may be necessary to compensate him for the
26 services theretofore rendered by him. The provisions of this
27 section shall apply to ordinary and extraordinary services
28 alike.
29 * * *
30 § 7186. Failure to present claim at audit.
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1 (a) General rule.--Any person who at the audit of a
2 trustee's account has a claim which arose out of the
3 administration of trust property, or arises out of the
4 distribution of such property upon any interim or final
5 accounting of the trust, and which is not reported to the court
6 as an admitted claim, and who shall fail to present his claim at
7 the call for audit or confirmation, shall be forever barred,
8 against:
9 (1) any trust property distributed pursuant to such
10 audit or confirmation;
11 (2) any distributee of trust property distributed
12 pursuant to such audit or confirmation; and
13 (3) except as otherwise provided in section [7183(7)]
14 3521 (relating to rehearing; relief granted), any trust
15 property awarded back upon further trust pursuant to such
16 audit or confirmation.
17 (b) Liens and charges unimpaired.--Nothing in this section
18 shall be construed as impairing any lien or charge on real or
19 personal estate of the trust existing at the time of the audit.
20 SECTION 13. THE ACT OF MARCH 14, 1777 (1SM.L.443, CH.737), <--
21 ENTITLED "AN ACT FOR ESTABLISHING IN THE CITY OF PHILADELPHIA,
22 AND IN EACH COUNTY OF THIS STATE, AN OFFICE FOR THE PROBATE AND
23 REGISTERING OF WILLS, AND GRANTING LETTERS OF ADMINISTRATION,
24 AND AN OFFICE FOR THE RECORDING OF DEEDS," IS REPEALED.
25 Section 13 14. This act shall take effect immediately and <--
26 shall apply to the estates of all decedents dying on or after
27 the effective date and, as to the termination of trusts under 20
28 Pa. C.S. § 6110 (relating to administration of charitable
29 estates), it shall apply to all trusts regardless of the date
30 the trust was created and as to 20 Pa.C.S. § 2209 (relating to
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1 surviving spouse as witness), it shall be effective as of June
2 17, 1978 and shall apply to the estates of all decedents dying
3 on or after that date; and, as to powers of attorney, it shall
4 apply to all powers of attorney executed on or after the date of
5 enactment of this act, provided nothing in this act shall be
6 construed to limit the effectiveness of powers of attorney in
7 effect prior to the date of enactment of this act, and provided
8 further that all such powers of attorney which qualified under
9 the provisions of 20 Pa.C.S. § 5601 (relating to when power of
10 attorney not affected by disability) prior to its repeal shall
11 continue to be governed by the provisions of the said section as
12 if no repeal occurred.
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