SB-0461, As Passed Senate, November 2, 2011
SENATE BILL NO. 461
A bill to amend 1998 PA 386, entitled
"Estates and protected individuals code,"
by amending sections 2802, 2803, 2804, 5314, 5315, 5316, 5410,
5422, and 5423 (MCL 700.2802, 700.2803, 700.2804, 700.5314,
700.5315, 700.5316, 700.5410, 700.5422, and 700.5423), section 5314
as amended by 2000 PA 469, section 5316 as amended by 2000 PA 54,
and section 5423 as amended by 2005 PA 204, and by adding section
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2802. As used in this section and sections 2803 and 2804:
(a) "Abuse, neglect, or exploitation" means any of the
(i) An intentional act, the commission of which is a felony,
prohibited under chapter XXA of the Michigan penal code, 1931 PA
328, MCL 750.145m to 750.145r.
(ii) A violation of section 174a of the Michigan penal code,
1931 PA 328, MCL 750.174a.
(iii) A criminal act that is an offense involving domestic
violence as that term is defined in section 27b of chapter VIII of
the code of criminal procedure, 1927 PA 175, MCL 768.27b.
(iv) An act that constitutes child abuse under section 136b of
the Michigan penal code, 1931 PA 328, MCL 750.136b.
(v) A criminal act that constitutes abuse, neglect, or
exploitation as those terms are defined in section 11 of the social
welfare act, 1939 PA 280, MCL 400.11.
"Disposition or appointment of property" includes, but
is not limited to, a transfer of an item of property or another
benefit to a beneficiary designated in a governing instrument.
(c) "Felon" means the individual who was convicted of
committing the abuse, neglect, or exploitation.
"Governing instrument" means a governing instrument
executed by the decedent.
"Revocable" means, with respect to a disposition,
appointment, provision, or nomination, one under which the
decedent, at the time of or immediately before death, was alone
empowered, by law or under the governing instrument, to cancel the
designation in favor of the killer or felon, whether or not the
decedent was then empowered to designate himself or herself in
place of his or her killer or felon and whether or not the decedent
then had the capacity to exercise the power.
Sec. 2803. (1) An individual who feloniously and intentionally
kills or who is convicted of committing abuse, neglect, or
exploitation with respect to the decedent forfeits all benefits
under this article with respect to the decedent's estate, including
an intestate share, an elective share, an omitted spouse's or
child's share, a homestead allowance, a family allowance, and
exempt property. If the decedent died intestate, the decedent's
intestate estate passes as if the killer or felon disclaimed his or
her intestate share.
(2) The felonious and intentional killing or the conviction of
the felon for the abuse, neglect, or exploitation of the decedent
does all of the following:
(a) Revokes all of the following that are revocable:
(i) Disposition or appointment of property made by the decedent
to the killer or felon in a governing instrument.
(ii) Provision in a governing instrument conferring a general
or nongeneral power of appointment on the killer or felon.
(iii) Nomination of the killer or felon in a governing
instrument, nominating or appointing the killer or felon to serve
in a fiduciary or representative capacity, including a personal
representative, executor, trustee, or agent.
(b) Severs the interests of the decedent and killer or felon
in property held by them at the time of the killing, abuse,
neglect, or exploitation as joint tenants with the right of
survivorship, transforming the interests of the decedent and killer
or felon into tenancies in common.
(3) A severance under subsection (2)(b) does not affect a
third party interest in property acquired for value and in good
faith reliance on an apparent title by survivorship in the killer
or felon unless a writing declaring the severance has been noted,
registered, filed, or recorded in records appropriate to the kind
and location of the property that are relied upon, in the ordinary
course of transactions involving that type of property, as evidence
(4) A provision of a governing instrument is given effect as
if the killer or felon disclaimed all provisions revoked by this
section or, in the case of a revoked nomination in a fiduciary or
representative capacity, as if the killer or felon predeceased the
(5) A killer's or felon's wrongful acquisition of property or
interest not covered by this section shall be treated in accordance
with the principle that a killer or felon cannot profit from his or
(6) After all right to appeal has been exhausted, a judgment
of conviction establishing criminal accountability for the
felonious and intentional killing or the abuse, neglect, or
exploitation of the decedent conclusively establishes the convicted
individual as the decedent's killer or as a felon, as applicable,
purposes of this section.
respect to a claim of
felonious and intentional killing, in the absence of a conviction,
the court, upon the petition of an interested person, shall
determine whether, under the preponderance of evidence standard,
the individual would be found criminally accountable for the
felonious and intentional killing of the decedent. If the court
determines that, under that standard, the individual would be found
criminally accountable for the felonious and intentional killing of
the decedent, the determination conclusively establishes that
individual as the decedent's killer for purposes of this section.
(7) This section does not apply if the forfeiture, revocation,
or severance would occur because of abuse, neglect, or exploitation
and the decedent executed a governing instrument after the date of
the conviction expressing a specific intent to allow the felon to
inherit or otherwise receive the estate or property of the
Sec. 2804. (1) Except as otherwise provided in this section, a
payor or other third party is not liable for having made a payment
or transferred an item of property or another benefit to a
beneficiary designated in a governing instrument affected by an
intentional and felonious killing or by abuse, neglect, or
exploitation, or for having taken another action in reliance on the
validity of the governing instrument, upon request and satisfactory
proof of the decedent's death. A payor or other third party is
for a payment made or other action taken
3 10 or
business days after the payor or other third party actually
receives written notice of a claimed forfeiture or revocation under
section 2803. A payor or other third party is not obligated to
determine whether the decedent was the victim of felonious killing
or abuse, neglect, or exploitation or to seek evidence relating to
such a killing or abuse, neglect, or exploitation even if the
circumstances of the decedent's death are suspicious as to the
beneficiary's participation in such a killing or if there is
evidence that would raise suspicions that the decedent was the
victim of abuse, neglect, or exploitation by the beneficiary. A
recipient who incorrectly receives a payment, transfer of property,
or other benefit is liable for the payment or transfer received,
whether or not written notice of the claim is given.
(2) Written notice of a claimed forfeiture or revocation under
subsection (1) must be mailed to the payor's or other third party's
main office or home by registered or certified mail, return receipt
requested, or served upon the payor or other third party in the
same manner as a summons in a civil action. Notice to a sales
representative of a payor or other third party does not constitute
notice to the payor or other third party.
(3) The written notice under subsection (1) must include all
of the following information:
The decedent's name,
the age, and date of birth, and 1 of
(i) The last 4 digits of the decedent's social security number.
(ii) The decedent's last known address.
The name of the person asserting an
(c) The nature of the payment, item of property, or other
(d) A statement that a claim of forfeiture or revocation is
being made under section 2803.
(e) If the claim is based on a conviction for abuse, neglect,
or exploitation, a copy of the judgment of conviction.
(4) Notice in a form or service in a manner other than that
described in this section does not impose liability on a payor or
other third party for an action taken in accordance with a
Upon receipt of written notice of a
or revocation under this section, a payor or other third party may
pay an amount owed to the county treasurer of the county of the
court having jurisdiction of the probate proceedings relating to
the decedent's estate or, if no proceedings have been commenced, to
the county treasurer of the county of the decedent's residence.
With a payment under this section, the payor or other third party
shall file a copy of the written notice received by the payor or
other third party. A payment made to the county treasurer
discharges the payor or other third party from a claim for the
value of an amount paid to the county treasurer.
The county treasurer shall not
charge a filing fee for
a payment to the county treasurer under this section. The county
treasurer shall hold the money in accordance with section 3917 and,
upon the court's determination under section 2803, shall disburse
the money in accordance with the determination.
The provision for payment to the
under this section does not preclude a payor or other third party
from taking another action authorized by law or the governing
Sec. 5306a. (1) An individual for whom a guardian is appointed
under section 5306 has all of the following rights:
(a) To object to the appointment of a successor guardian by
will or other writing, as provided in section 5301.
(b) To have the guardianship proceeding commenced and
conducted in the place where the individual resides or is present
or, if the individual is admitted to an institution by a court, in
the county in which the court is located, as provided in section
(c) To petition on his or her own behalf for the appointment
of a guardian, as provided in section 5303.
(d) To have legal counsel of his or her own choice represent
him or her on the petition to appoint a guardian, as provided in
sections 5303, 5304, and 5305.
(e) If he or she is not represented by legal counsel, to the
appointment of a guardian ad litem to represent the individual on
the petition to appoint a guardian, as provided in section 5303.
(f) To an independent evaluation of his or her capacity by a
physician or mental health professional, at public expense if he or
she is indigent, as provided in section 5304.
(g) To be present at the hearing on the petition to appoint a
guardian and to have all practical steps taken to ensure this,
including, if necessary, moving the hearing site, as provided by
(h) To see or hear all the evidence presented in the hearing
on the petition to appoint a guardian, as provided in section 5304.
(i) To present evidence and cross-examine witnesses in the
hearing on the petition to appoint a guardian, as provided in
(j) To a trial by jury on the petition to appoint a guardian,
as provided in section 5304.
(k) To a closed hearing on the petition to appoint a guardian,
as provided in section 5304.
(l) If a guardian ad litem is appointed, to be personally
visited by the guardian ad litem, as provided in section 5305.
(m) If a guardian ad litem is appointed, to an explanation by
the guardian ad litem of the nature, purpose, and legal effects of
a guardian's appointment, as provided in section 5305.
(n) If a guardian ad litem is appointed, to an explanation by
the guardian ad litem of the individual's rights in the hearing
procedure, as provided in section 5305.
(o) If a guardian ad litem is appointed, to be informed by the
guardian ad litem of the right to contest the petition, to request
limits on the guardian's powers, to object to a particular person
being appointed guardian, to be present at the hearing, to be
represented by legal counsel, and to have legal counsel appointed
if the individual is unable to afford legal counsel, as provided in
(p) To be informed of the name of each person known to be
seeking appointment as guardian, including, if a guardian ad litem
is appointed, to be informed of the names by the guardian ad litem
as provided in section 5305.
(q) To require that proof of incapacity and the need for a
guardian be proven by clear and convincing evidence, as provided in
(r) To the limitation of the powers and period of time of a
guardianship to only the amount and time that is necessary, as
provided in section 5306.
(s) To a guardianship designed to encourage the development of
maximum self-reliance and independence as provided in section 5306.
(t) To prevent the grant of powers to a guardian if those
powers are already held by a valid patient advocate, as provided in
(u) To periodic review of the guardianship by the court,
including the right to a hearing and the appointment of an attorney
if issues arise upon the review of the guardianship, as provided in
(v) To, at any time, seek modification or termination of the
guardianship by informal letter to the judge, as provided in
(w) To a hearing within 28 days of requesting a review,
modification, or termination of the guardianship, as provided in
(x) To the same rights on a petition for modification or
termination of the guardianship with respect to the appointment of
a visitor as apply to a petition for appointment of a guardian, as
provided in section 5310.
(y) To personal notice of a petition for appointment or
removal of a guardian, as provided in section 5311.
(z) To written notice of the nature, purpose, and legal
effects of the appointment of a guardian, as provided in section
(aa) To choose the person who will serve as guardian, if the
chosen person is suitable and willing to serve, as provided in
(bb) To consult with the guardian about major decisions
affecting the individual, if meaningful conversation is possible,
as provided in section 5314.
(cc) To quarterly visits by the guardian, as provided in
(dd) To have the guardian notify the court within 14 days of a
change in the individual's residence, as provided in section 5314.
(ee) To have the guardian secure services to restore the
individual to the best possible state of mental and physical well-
being so that the individual can return to self-management at the
earliest possible time, as provided in section 5314.
(ff) To have the guardian take reasonable care of the
individual's clothing, furniture, vehicles, and other personal
effects, as provided in section 5314.
(gg) To partially self-manage his or her property to encourage
self-reliance and independence, as provided in section 5316.
(2) A guardian ad litem shall inform the ward in writing of
his or her rights enumerated in this section. The state court
administrative office and the office of services to the aging
created in section 5 of the older Michiganians act, 1981 PA 180,
MCL 400.585, shall promulgate a form to be used to give the written
notice under this section, which shall include space for the court
to include information on how to contact the court or other
relevant personnel with respect to the rights enumerated in this
Sec. 5314. Whenever meaningful communication is possible, a
legally incapacitated individual's guardian shall consult with the
legally incapacitated individual before making a major decision
the legally incapacitated individual.
Except as limited
To the extent a guardian of a legally incapacitated individual is
powers by the court under section 5306,
a legally incapacitated
individual's the guardian is responsible for the
ward's care, custody, and control, but is not liable to third
persons by reason of that responsibility for the ward's acts. In
particular and without qualifying the previous sentences, a
has all of the following powers and duties,
except as modified
to the extent granted by court order:
To the extent that it is consistent with the terms of an order
by a court of competent jurisdiction relating to the ward's detention
or commitment, the guardian is entitled to The custody of
person of the
guardian's ward and may the power to establish
ward's place of residence within or without this state.
The guardian shall visit the ward within 3 months after
guardian's appointment and not less than once within 3 months after
previous visit. The guardian
must shall notify the court
within 14 days of a change in the ward's place of residence.
If entitled to custody of the ward, the
guardian must duty
to make provision for the ward's care, comfort, and maintenance
and, when appropriate, arrange for the ward's training and
education. The guardian shall secure services to restore the ward
to the best possible state of mental and physical well-being so
that the ward can return to self-management at the earliest
possible time. Without regard to custodial rights of the ward's
must shall take reasonable care of the ward's
clothing, furniture, vehicles, and other personal effects and
commence a protective proceeding if the ward's other property needs
protection. If a guardian commences a protective proceeding because
the guardian believes that it is in the ward's best interest to
sell or otherwise dispose of the ward's real property or interest
in real property, the court may appoint the guardian as special
conservator and authorize the special conservator to proceed under
section 5423(3). A guardian shall not otherwise sell the ward's
real property or interest in real property.
A guardian may The power
to give the consent or approval
that is necessary to enable the ward to receive medical or other
professional care, counsel, treatment, or service.
If a conservator for the ward's estate is not appointed,
may the power to do any of the following:
(i) Institute a proceeding to compel a person under a duty to
support the ward or to pay money for the ward's welfare to perform
(ii) Receive money and tangible property deliverable to the
ward and apply the money and property for the ward's support, care,
and education. The guardian shall not use money from the ward's
estate for room and board that the guardian or the guardian's
spouse, parent, or child have furnished the ward unless a charge
for the service is approved by court order made upon notice to at
least 1 of the ward's next of kin, if notice is possible. The
guardian shall exercise care to conserve any excess for the ward's
guardian shall duty to
report the condition of the
ward and the ward's estate that is subject to the guardian's
possession or control, as required by the court, but not less often
than annually. The guardian shall also serve the report required
under this subdivision on the ward and interested persons as
specified in the Michigan court rules. A report under this
must shall contain all of the following:
(i) The ward's current mental, physical, and social condition.
(ii) Improvement or deterioration in the ward's mental,
physical, and social condition that occurred during the past year.
(iii) The ward's present living arrangement and changes in his
or her living arrangement that occurred during the past year.
(iv) Whether the guardian recommends a more suitable living
arrangement for the ward.
(v) Medical treatment received by the ward.
(vi) Services received by the ward.
(vii) A list of the guardian's visits with, and activities on
behalf of, the ward.
(viii) A recommendation as to the need for continued
If a conservator is appointed, the
guardian shall duty to
pay to the conservator, for management as provided in this act, the
amount of the ward's estate received by the guardian in excess of
the amount the guardian expends for the ward's current support,
care, and education. The guardian shall account to the conservator
for the amount expended.
A To the extent
granted by the court under
section 5306, the guardian of an individual for whom a conservator
also is appointed controls the ward's custody and care and is
entitled to receive reasonable amounts for those services and for
room and board furnished to the ward as agreed upon between the
guardian and the conservator if the amounts agreed upon are
reasonable under the circumstances. The guardian may request the
conservator to expend the ward's estate by payment to a third
person or institution for the ward's care and maintenance.
(2) If a ward dies while under guardianship and a conservator
has not been appointed for the ward's estate and if the guardian
has possession of money of the deceased ward, upon petition of the
guardian and with or without notice, the court may hear a claim for
burial expenses or any other claim as the court considers
advisable. Upon hearing the claim, the court may enter an order
allowing or disallowing the claim or a part of the claim and may
provide in the order of allowance that the claim or a part of it be
paid immediately if the payment can be made without injury or
serious inconvenience to the ward's estate.
To encourage self-reliance and independence in
Except to the extent the court grants the guardian or conservator
of a legally incapacitated individual the power to control the
the court may authorize
to function may handle his
or her money or property
without the consent or supervision of the individual's guardian or
handling part of his or her money or property,
authorizing the individual to maintain maintaining an
account with a financial institution. To the extent the individual
authorized has the power to function autonomously, a person may
deal with the individual as though the individual is mentally
Sec. 5410. (1) The court may require a conservator to furnish
a bond. If the court determines that the value of cash and property
that is readily convertible into cash in the estate and in the
conservator's control exceeds the limit for administering a
decedent's estate under section 3982, adjusted in the manner
provided under section 1210 for the year in which the conservator
is appointed, the court shall require the conservator to furnish a
bond, unless 1 or more of the following apply:
(a) The estate contains no property readily convertible to
cash and the cash is in a restricted account with a financial
(b) The conservator has been granted trust powers under
section 4401 of the banking code of 1999, 1999 PA 276, MCL
(c) The court determines that requiring a bond would impose a
financial hardship on the estate.
(d) The court states on the record the reasons why a bond is
(2) A bond furnished under this section shall be conditioned
upon faithful discharge of all duties of the conservator's trust
according to law, with sureties as the court specifies. Unless
otherwise directed, the bond shall be in the amount of the
aggregate capital value of the estate property in the conservator's
control plus 1 year's estimated income minus the value of
securities deposited under arrangements requiring a court order for
their removal and the value of land that the fiduciary, by express
limitation of power, lacks power to sell or convey without court
authorization. Instead of sureties on a bond, the court may accept
other security for the performance of the bond, including a pledge
of securities or a mortgage of land.
Sec. 5422. (1) A person who in good faith either assists or
deals with a conservator for value in a transaction, other than
requiring a transaction that
requires a court order as
provided in section 5407 or 5423(3), is protected as if the
properly exercised the power.
The Except as provided in
subsection (3), the fact that a person knowingly deals with a
conservator does not alone require the person to inquire into the
existence of a power or the propriety of its exercise, but a
restriction on a conservator's powers that is endorsed on letters
as provided in section 5427 is effective as to third persons. A
person is not bound to see to the proper application of estate
property paid or delivered to a conservator.
(2) The protection expressed in this section extends to a
procedural irregularity or jurisdictional defect that occurs in a
proceeding leading to the issuance of letters and is not a
substitution for protection provided by a comparable provision of
the law relating to a commercial transaction or to simplifying a
transfer of securities by a fiduciary.
(3) A conservator shall record an order allowing the sale,
disposal, mortgage, or pledge of or placement of a lien on real
property under section 5423 in the records of the register of deeds
for the county in which the real estate is located. Unless the
order has been recorded or a person to whom an interest in the real
estate is transferred has been given a copy of the order, the
person is not entitled to presume that the conservator has the
power to sell or otherwise dispose of the real property, or to
mortgage, pledge, or cause a lien to be placed on the protected
individual's real property, as applicable.
Sec. 5423. (1) Subject to a limitation imposed under section
5427, a conservator has all of the powers conferred in this section
and the additional powers conferred by law on trustees in this
state. In addition, a conservator of the estate of an unmarried
minor, as to whom no one has parental rights, has the powers,
responsibilities, and duties of a guardian described in section
5215 until the individual is no longer a minor or marries. The
parental rights conferred on a conservator by this section do not
preclude a guardian's appointment as provided in part 2.
(2) Acting reasonably in an effort to accomplish the purpose
of the appointment and without court authorization or confirmation,
a conservator may do any of the following:
(a) Collect, hold, or retain estate property, including land
in another state, until the conservator determines that disposition
of the property should be made. Property may be retained even
though it includes property in which the conservator is personally
(b) Receive an addition to the estate.
(c) Continue or participate in the operation of a business or
(d) Acquire an undivided interest in estate property in which
the conservator, in a fiduciary capacity, holds an undivided
(e) Invest or reinvest estate property. If the conservator
exercises the power conferred by this subdivision, the conservator
must invest or reinvest the property in accordance with the
Michigan prudent investor rule.
(f) Deposit estate money in a state or federally insured
financial institution including one operated by the conservator.
(g) Except as provided in subsection (3), acquire or dispose
of estate property, including land in another state, for cash or on
credit, at public or private sale, or manage, develop, improve,
exchange, partition, change the character of, or abandon estate
(h) Make an ordinary or extraordinary repair or alteration in
a building or other structure, demolish an improvement, or raze an
existing or erect a new party wall or building.
(i) Subdivide, develop, or dedicate land to public use; make
or obtain the vacation of a plat or adjust a boundary; adjust a
difference in valuation on exchange or partition by giving or
receiving consideration; or dedicate an easement to public use
(j) Enter for any purpose into a lease as lessor or lessee
with or without option to purchase or renew for a term within or
extending beyond the term of the conservatorship.
(k) Enter into a lease or arrangement for exploration and
removal of a mineral or other natural resource or enter into a
pooling or unitization agreement.
(l) Grant an option involving disposition of estate property or
take an option for the acquisition of property.
(m) Vote a security, in person or by general or limited proxy.
(n) Pay a call, assessment, or other amount chargeable or
accruing against or on account of a security.
(o) Sell or exercise stock subscription or conversion rights.
(p) Consent, directly or through a committee or other agent,
to the reorganization, consolidation, merger, dissolution, or
liquidation of a corporation or other business enterprise.
(q) Hold a security in the name of a nominee or in other form
without disclosure of the conservatorship so that title to the
security may pass by delivery. However, the conservator is liable
for an act of the nominee in connection with the stock so held.
(r) Insure the estate property against damage or loss or the
conservator against liability with respect to third persons.
(s) Borrow money to be repaid from estate property or
(t) Advance money for the protection of the estate or the
protected individual, and for all expense, loss, or liability
sustained in the estate's administration or because of the holding
or ownership of estate property. The conservator has a lien on the
estate as against the protected individual for such an advance.
(u) Pay or contest a claim; settle a claim by or against the
estate or the protected individual by compromise, arbitration, or
otherwise; and release, in whole or in part, a claim belonging to
the estate to the extent that the claim is uncollectible.
(v) Pay a tax, assessment, conservator's compensation, or
other expense incurred in the estate's collection, care,
administration, and protection.
(w) Allocate an item of income or expense to either estate
income or principal, as provided by law, including creation of a
reserve out of income for depreciation, obsolescence, or
or for depletion in
a mineral or timber property.
(x) Pay money distributable to a protected individual or the
protected individual's dependent by paying the money to the
distributee or by paying the money for the use of the distributee
to the distributee's guardian, or if none, to a relative or other
person having custody of the distributee.
(y) Employ a person, including an auditor, investment advisor,
or agent, even though the person is associated with the
conservator, to advise or assist in the performance of an
administrative duty; act upon the person's recommendation without
independent investigation; and, instead of acting personally,
employ an agent to perform an act of administration, whether or not
(z) Employ an attorney to perform necessary legal services or
to advise or assist the conservator in the performance of the
conservator's administrative duties, even if the attorney is
associated with the conservator, and act without independent
investigation upon the attorney's recommendation. An attorney
employed under this subdivision shall receive reasonable
compensation for his or her employment.
(aa) Prosecute or defend an action, claim, or proceeding in
any jurisdiction for the protection of estate property and of the
conservator in the performance of a fiduciary duty.
(bb) Execute and deliver an instrument that will accomplish or
facilitate the exercise of a power vested in the conservator.
(cc) Respond to an environmental concern or hazard affecting
property as provided in section 5424.
(3) A conservator shall not sell or otherwise dispose of the
protected individual's principal dwelling, real property, or
interest in real property or mortgage, pledge, or cause a lien to
be placed on any such property without approval of the court. The
shall only approve the sale,
or other disposal, mortgage, or
pledge of or lien against the principal dwelling, real property, or
interest in real property if, after a hearing with notice to
interested persons as specified in the Michigan court rules, the
considers evidence of the value of the
real property or interest
in real property and otherwise
determines that the sale,
other disposal, mortgage, pledge, or lien is in the protected
individual's best interest.
Enacting section 1. This amendatory act takes effect April 1,