The text as introduced · 836 words
89R16197 EAS-D
By: Wilson
H.B. No. 5137
A BILL TO BE ENTITLED
AN ACT
relating to a beneficiary designation that transfers a motor
vehicle to one or more beneficiaries at the owner's death.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 115.002(a) and (b), Estates Code, are
amended to read as follows:
(a) An owner of a motor vehicle may transfer the owner's
interest in the motor vehicle to one or more beneficiaries [ a sole
beneficiary ] effective on the owner's death by designating each [ a ]
beneficiary as provided by Section 501.0315, Transportation Code.
(b) A beneficiary designation is:
(1) subject to Section 115.003(b), revocable and may
be changed at any time without the consent of the designated
beneficiaries [ beneficiary ] as provided by Section 501.0315,
Transportation Code;
(2) a nontestamentary instrument; and
(3) effective without:
(A) notice or delivery to or acceptance by the
designated beneficiaries [ beneficiary ] during the owner's life; or
(B) consideration.
SECTION 2. Section 115.004, Estates Code, is amended to
read as follows:
Sec. 115.004. EFFECT OF BENEFICIARY DESIGNATION DURING
OWNER'S LIFE. During a motor vehicle owner's life, a beneficiary
designation does not:
(1) affect an interest or right of the owner or owners
making the designation, including the right to transfer or encumber
the motor vehicle that is the subject of the designation;
(2) create a legal or equitable interest in favor of a
[ the ] designated beneficiary in the motor vehicle that is the
subject of the designation, even if the beneficiary has actual or
constructive notice of the designation;
(3) affect an interest or right of a secured or
unsecured creditor or future creditor of the owner or owners making
the designation, even if the creditor has actual or constructive
notice of the designation; or
(4) affect an owner's or any [ the ] designated
beneficiary's eligibility for any form of public assistance,
subject to applicable federal law.
SECTION 3. Section 115.005, Estates Code, is amended to
read as follows:
Sec. 115.005. EFFECT OF BENEFICIARY DESIGNATION AT OWNER'S
OR LAST SURVIVING OWNER'S DEATH. (a) On the death of the owner of a
motor vehicle that is the subject of a beneficiary designation, the
following rules apply to an interest in the motor vehicle:
(1) if any [ the ] designated beneficiary survives the
owner making the designation by 120 hours, the interest in the motor
vehicle is transferred to each surviving [ the ] designated
beneficiary; and
(2) if each [ the ] designated beneficiary fails to
survive the owner making the designation by 120 hours, the share of
each [ the ] designated beneficiary lapses, notwithstanding Section
111.052, and is subject to and passes in accordance with Subchapter
D, Chapter 255, as if each [ the ] beneficiary designation were a
devise made in a will.
(b) If an owner is a joint owner with right of survivorship
who is survived by one or more other joint owners, the motor vehicle
that is the subject of a [ the ] beneficiary designation belongs to
the surviving joint owner or owners. If an owner is a joint owner
with right of survivorship who is the last surviving joint owner,
the beneficiary designation is effective.
(c) A designated beneficiary takes the motor vehicle
subject to all encumbrances, assignments, contracts, liens, and
other interests to which the vehicle is subject at the owner's or
last surviving owner's death, as applicable. The transfer to one or
more [ the ] designated beneficiaries [ beneficiary ] does not affect
the ability of a lienholder to pursue an existing means of debt
collection permitted under the laws of this state.
SECTION 4. Sections 501.0315(a), (b), and (c),
Transportation Code, are amended to read as follows:
(a) The owner of a motor vehicle may designate one or more
beneficiaries [ a sole beneficiary ] to whom the owner's interest in
the vehicle transfers on the owner's death as provided by Chapter
115, Estates Code, by submitting an application for title under
Section 501.023 with the designation. To be effective, the
designation must state that the transfer of an interest in the
vehicle to one or more [ the ] designated beneficiaries [ beneficiary ]
is to occur at the transferor's death.
(b) The legal name of each [ a ] beneficiary designated under
this section must be included on the title.
(c) The department shall transfer title of a motor vehicle
to the beneficiary or beneficiaries, as applicable, [ a beneficiary ]
designated under this section for the vehicle if the sole
beneficiary submits or all beneficiaries jointly submit, as
applicable :
(1) an application for title under Section 501.023 not
later than the 180th day after the date of the owner's death or, if
the vehicle is owned by joint owners, the last surviving owner's
death, as applicable; and
(2) satisfactory proof of the death of the owner or
owners, as applicable.
SECTION 5. This Act takes effect September 1, 2025.
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