Bill Text: MI HB5368 | 2013-2014 | 97th Legislature | Introduced

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Bill Title: Probate; other; definitions relating to the fiduciary access to digital assets act; enact. Amends secs. 1103, 1104, 1106 & 1107 of 1998 PA 386 (MCL 700.1103 et seq.). TIE BAR WITH: HB 5366'14, HB 5367'14, HB 5369'14, HB 5370'14

Spectrum: Moderate Partisan Bill (Republican 6-1)

Status: (Introduced - Dead) 2014-10-02 - Referred To Second Reading [HB5368 Detail]

Download: Michigan-2013-HB5368-Introduced.html

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HOUSE BILL No. 5368

 

February 26, 2014, Introduced by Reps. Cotter, Leonard, LaFontaine, Geiss, Lauwers, Kowall and Jenkins and referred to the Committee on Judiciary.

 

     A bill to amend 1998 PA 386, entitled

 

"Estates and protected individuals code,"

 

by amending sections 1103, 1104, 1106, and 1107 (MCL 700.1103,

 

700.1104, 700.1106, and 700.1107), section 1103 as amended by 2013

 

PA 157 and sections 1104, 1106, and 1107 as amended by 2009 PA 46.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 1103. As used in this act:

 

     (a) "Agent" includes, but is not limited to, an attorney-in-

 

fact under a durable or nondurable power of attorney and an

 

individual authorized to make decisions as a patient advocate

 

concerning another's health care.

 

     (b) "Application" means a written request to the probate

 

register for an order of informal probate or informal appointment

 

under part 3 of article III.

 

     (c) "Attorney" means, if appointed to represent a child under

 

the provisions referenced in section 5213, an attorney as that term

 

is defined and serving as the child's legal advocate in the manner

 

defined and described in section 13a of chapter XIIA of the probate

 

code of 1939, 1939 PA 288, MCL 712A.13a.

 

     (d) "Beneficiary" includes, but is not limited to, the

 

following:

 

     (i) In relation to a trust, a person that is a trust

 

beneficiary as defined in section 7103.

 

     (ii) In relation to a charitable trust, a person that is

 

entitled to enforce the trust.

 

     (iii) In relation to a beneficiary of a beneficiary designation,

 

a person that is a beneficiary of an insurance or annuity policy,

 

of an account with POD designation, of a security registered in

 

beneficiary form (TOD), of a pension, profit-sharing, retirement,

 

or similar benefit plan, or of another nonprobate transfer at

 

death.

 

     (iv) In relation to a beneficiary designated in a governing

 

instrument, a person that is a grantee of a deed, devisee, trust

 

beneficiary, beneficiary of a beneficiary designation, donee,

 

appointee, taker in default of a power of appointment, or person in

 

whose favor a power of attorney or power held in an individual,

 

fiduciary, or representative capacity is exercised.

 

     (e) "Beneficiary designation" means the naming in a governing

 

instrument of a beneficiary of an insurance or annuity policy, of

 

an account with POD designation, of a security registered in

 

beneficiary form (TOD), of a pension, profit-sharing, retirement,

 

or similar benefit plan, or of another nonprobate transfer at

 

death.

 

     (f) "Child" includes, but is not limited to, an individual

 

entitled to take as a child under this act by intestate succession

 

from the parent whose relationship is involved. Child does not

 

include an individual who is only a stepchild, a foster child, or a

 

grandchild or more remote descendant.

 

     (g) "Claim" includes, but is not limited to, in respect to a

 

decedent's or protected individual's estate, a liability of the

 

decedent or protected individual, whether arising in contract,

 

tort, or otherwise, and a liability of the estate that arises at or

 

after the decedent's death or after a conservator's appointment,

 

including funeral and burial expenses and costs and expenses of

 

administration. Claim does not include an estate or inheritance

 

tax, or a demand or dispute regarding a decedent's or protected

 

individual's title to specific property alleged to be included in

 

the estate.

 

     (h) "Conservator" means a person appointed by a court to

 

manage a protected individual's estate.

 

     (i) "Cost-of-living adjustment factor" means a fraction, the

 

numerator of which is the United States consumer price index for

 

the prior calendar year and the denominator of which is the United

 

States consumer price index for 1997. As used in this subdivision,

 

"United States consumer price index" means the annual average of

 

the United States consumer price index for all urban consumers as

 

defined and reported by the United States department of labor,

 

bureau of labor statistics, or its successor agency, and as

 

certified by the state treasurer.

 

     (j) "Court" means the probate court or, when applicable, the

 

family division of circuit court.

 

     (k) "Descendant" means, in relation to an individual, all of

 

his or her descendants of all generations, with the relationship of

 

parent and child at each generation being determined by the

 

definitions of child and parent contained in this act.

 

     (l) "Devise" means, when used as a noun, a testamentary

 

disposition of real or personal property and, when used as a verb,

 

to dispose of real or personal property by will.

 

     (m) "Devisee" means a person designated in a will to receive a

 

devise. For the purposes of article II, for a devise to a trustee

 

of an existing trust or to a trustee under a will, the trustee is a

 

devisee and a beneficiary is not.

 

     (n) "Digital account" means an electronic system for creating,

 

generating, sending, receiving, storing, displaying, or processing

 

electronic information that provides access to a digital asset or a

 

digital service.

 

     (o) "Digital account holder" means a decedent, protected

 

individual, principal of a durable power of attorney, or settlor

 

who has a terms-of-service agreement with a digital custodian.

 

     (p) "Digital asset" means electronic information created,

 

generated, sent, communicated, received, or stored by electronic

 

means on a digital service or digital device. Digital account

 

includes a username, word, character, code, or contract right under

 

a terms-of-service agreement.

 

     (q) "Digital custodian" means a person that electronically

 

stores digital property of a digital account holder or otherwise

 

has control over digital property of the digital account holder.

 

     (r) "Digital device" means an electronic device that can

 

receive, store, process, or send digital information.

 

     (s) "Digital property" means the ownership and management of

 

and rights related to a digital account and digital asset.

 

     (t) "Digital service" means the delivery of digital

 

information, such as data or content, and transactional services,

 

such as online forms and benefits applications, across a variety of

 

platforms, devices, and delivery mechanisms, such as websites,

 

mobile applications, and social media.

 

     (u) (n) "Disability" means cause for a protective order as

 

described in section 5401.

 

     (v) (o) "Distributee" means a person that receives a

 

decedent's property from the decedent's personal representative or

 

trust property from the trustee other than as a creditor or

 

purchaser. A trustee of a trust created by will is a distributee

 

only to the extent that distributed property or an increment of the

 

distributed property remains in the trustee's hands. A beneficiary

 

of a trust created by will to whom the trustee distributes property

 

received from a personal representative is a distributee of the

 

personal representative. For the purposes of this subdivision,

 

"trustee of a trust created by will" includes a trustee to whom

 

property is transferred by will to the extent of the devised

 

property.

 

     (w) (p) "Do-not-resuscitate order" means that term as defined

 

in section 2 of the Michigan do-not-resuscitate procedure act, 1996

 

PA 193, MCL 333.1052.

 

     Sec. 1104. As used in this act:

 

     (a) "Electronic" means relating to technology having

 

electronic, digital, magnetic, wireless, optical, electromagnetic,

 

or similar capabilities.

 

     (b) "Electronic information" includes data, text, images,

 

sounds, codes, computer programs, software, and databases.

 

     (c) "Electronic record" means electronic information that is

 

inscribed on a tangible medium or that is stored in an electronic

 

or other medium and is retrievable in a perceivable form.

 

     (d) (a) "Environmental law" means a federal, state, or local

 

law, rule, regulation, or ordinance that relates to the protection

 

of the environment or human health.

 

     (e) (b) "Estate" includes the property of the decedent, trust,

 

or other person whose affairs are subject to this act as the

 

property is originally constituted and as it exists throughout

 

administration. Estate also includes the rights described in

 

sections 3805, 3922, and 7606 to collect from others amounts

 

necessary to pay claims, allowances, and taxes.

 

     (f) (c) "Exempt property" means property of a decedent's

 

estate that is described in section 2404.

 

     (g) (d) "Family allowance" means the allowance prescribed in

 

section 2403.

 

     (h) (e) "Fiduciary" includes, but is not limited to, a

 

personal representative, guardian, conservator, trustee, plenary

 

guardian, partial guardian, and successor fiduciary.

 

     (i) (f) "Financial institution" means an organization

 

authorized to do business under state or federal laws relating to a

 

financial institution and includes, but is not limited to, a bank,

 

trust company, savings bank, building and loan association, savings

 

and loan company or association, credit union, insurance company,

 

and entity that offers mutual fund, securities brokerage, money

 

market, or retail investment accounts.

 

     (j) (g) "Foreign personal representative" means a personal

 

representative appointed by another jurisdiction.

 

     (k) (h) "Formal proceedings" means proceedings conducted

 

before a judge with notice to interested persons.

 

     (l) (i) "Funeral establishment" means that term as defined in

 

section 1801 of the occupational code, 1980 PA 299, MCL 339.1801,

 

and the owners, employees, and agents of the funeral establishment.

 

     (m) (j) "General personal representative" means a personal

 

representative other than a special personal representative.

 

     (n) (k) "Governing instrument" means a deed; will; trust;

 

insurance or annuity policy; account with POD designation; security

 

registered in beneficiary form (TOD); pension, profit-sharing,

 

retirement, or similar benefit plan; instrument creating or

 

exercising a power of appointment or a power of attorney; or

 

dispositive, appointive, or nominative instrument of any similar

 

type.

 

     (o) (l) "Guardian" means a person who has qualified as a

 

guardian of a minor or a legally incapacitated individual under a

 

parental or spousal nomination or a court appointment and includes

 

a limited guardian as described in sections 5205, 5206, and 5306.

 

Guardian does not include a guardian ad litem.

 

     (p) (m) "Hazardous substance" means a substance defined as

 

hazardous or toxic or otherwise regulated by an environmental law.

 

     (q) (n) "Heir" means, except as controlled by section 2720, a

 

person, including the surviving spouse or the state, that is

 

entitled under the statutes of intestate succession to a decedent's

 

property.

 

     (r) (o) "Homestead allowance" means the allowance prescribed

 

in section 2402.

 

     Sec. 1106. As used in this act:

 

     (a) "Mental health professional" means an individual who is

 

trained and experienced in the area of mental illness or

 

developmental disabilities and who is 1 of the following:

 

     (i) A physician who is licensed to practice medicine or

 

osteopathic medicine and surgery in this state under article 15 of

 

the public health code, 1978 PA 368, MCL 333.16101 to 333.18838.

 

     (ii) A psychologist licensed to practice in this state under

 

article 15 of the public health code, 1978 PA 368, MCL 333.16101 to

 

333.18838.

 

     (iii) A registered professional nurse licensed to practice in

 

this state under article 15 of the public health code, 1978 PA 368,

 

MCL 333.16101 to 333.18838.

 

     (iv) A licensed master's social worker licensed under article

 

15 of the public health code, 1978 PA 368, MCL 333.16101 to

 

333.18838.

 

     (v) A physician's assistant licensed to practice in this state

 

under article 15 of the public health code, 1978 PA 368, MCL

 

333.16101 to 333.18838.

 

     (vi) A licensed professional counselor licensed under part 181

 

of the public health code, 1978 PA 368, MCL 333.18101 to 333.18117.

 

     (b) "Michigan prudent investor rule" means the fiduciary

 

investment and management rule prescribed by part 5 of this

 

article.

 

     (c) "Minor" means an individual who is less than 18 years of

 

age.

 

     (d) "Minor ward" means a minor for whom a guardian is

 

appointed solely because of minority.

 

     (e) "Money" means legal tender or a note, draft, certificate

 

of deposit, stock, bond, check, or credit card.

 

     (f) "Mortgage" means a conveyance, agreement, or arrangement

 

in which property is encumbered or used as security.

 

     (g) "Nonresident decedent" means a decedent who was domiciled

 

in another jurisdiction at the time of his or her death.

 

     (h) "Organization" means a corporation, business trust,

 

estate, trust, partnership, limited liability company, association,

 

or joint venture; governmental subdivision, agency, or

 

instrumentality; public corporation; or another legal or commercial

 

entity.

 

     (i) "Parent" includes, but is not limited to, an individual

 

entitled to take, or who would be entitled to take, as a parent

 

under this act by intestate succession from a child who dies

 

without a will and whose relationship is in question. Parent does

 

not include an individual who is only a stepparent, foster parent,

 

or grandparent.

 

     (j) "Partial guardian" means that term as defined in section

 

600 of the mental health code, 1974 PA 258, MCL 330.1600.

 

     (k) "Patient advocate" means an individual designated to

 

exercise powers concerning another individual's care, custody, and

 

medical or mental health treatment or authorized to make an

 

anatomical gift on behalf of another individual, or both, as

 

provided in section 5506.

 

     (l) "Patient advocate designation" means the written document

 

executed and with the effect as described in sections 5506 to 5515.

 

     (m) "Payor" means a trustee, insurer, business entity,

 

employer, government, governmental subdivision or agency, or other

 

person authorized or obligated by law or a governing instrument to

 

make payments.

 

     (n) "Person" means an individual or an organization.

 

     (o) "Personal representative" includes, but is not limited to,

 

an executor, administrator, successor personal representative, and

 

special personal representative, and any other person, other than a

 

trustee of a trust subject to article VII, who performs

 

substantially the same function under the law governing that

 

person's status.

 

     (p) "Petition" means a written request to the court for an

 

order after notice.

 

     (q) "Plenary guardian" means that term as defined in section

 

600 of the mental health code, 1974 PA 258, MCL 330.1600.

 

     (r) "Proceeding" includes an application and a petition, and

 

may be an action at law or a suit in equity. A proceeding may be

 

denominated a civil action under court rules.

 

     (s) "Professional conservator" means a person that provides

 

conservatorship services for a fee. Professional conservator does

 

not include a person who is an individual who is related to all but

 

2 of the protected individuals for whom he or she is appointed as

 

conservator.

 

     (t) "Professional guardian" means a person that provides

 

guardianship services for a fee. Professional guardian does not

 

include a person who is an individual who is related to all but 2

 

of the wards for whom he or she is appointed as guardian.

 

     (u) "Property" means anything that may be the subject of

 

ownership, and includes both real and personal property or an

 

interest in real or personal property. Property includes digital

 

property.

 

     (v) "Protected individual" means a minor or other individual

 

for whom a conservator has been appointed or other protective order

 

has been made as provided in part 4 of article V.

 

     (w) "Protective proceeding" means a proceeding under the

 

provisions of part 4 of article V.

 

     Sec. 1107. As used in this act:

 

     (a) "Register" or "probate register" means the official of the

 

court designated to perform the functions of register as provided

 

in section 1304.

 

     (b) "Revised judicature act of 1961" means the revised

 

judicature act of 1961, 1961 PA 236, MCL 600.101 to 600.9947.

 

     (c) "Security" includes, but is not limited to, a note, stock,

 

treasury stock, bond, debenture, evidence of indebtedness,

 

certificate of interest or participation in an oil, gas, or mining

 

title or lease or in payments out of production under such a title

 

or lease, collateral trust certificate, transferable share, voting

 

trust certificate, or interest in a regulated investment company or

 

other entity generally referred to as a mutual fund or, in general,

 

an interest or instrument commonly known as a security, or a

 

certificate of interest or participation for, a temporary or

 

interim certificate, receipt, or certificate of deposit for, or any

 

warrant or right to subscribe to or purchase any of the items

 

listed in this subdivision.

 

     (d) "Settlement" means, in reference to a decedent's estate,

 

the full process of administration, distribution, and closing.

 

     (e) "Special personal representative" means a personal

 

representative as described by sections 3614 to 3618.

 

     (f) "State" means a state of the United States, the District

 

of Columbia, the Commonwealth of Puerto Rico, or a territory or

 

insular possession subject to the jurisdiction of the United

 

States.

 

     (g) "Successor" means a person, other than a creditor, who is

 

entitled to property of a decedent under the decedent's will or

 

this act.

 

     (h) "Successor personal representative" means a personal

 

representative, other than a special personal representative, who

 

is appointed to succeed a previously appointed personal

 

representative.

 

     (i) "Supervised administration" means the proceedings

 

described in part 5 of article III.

 

     (j) "Survive" means that an individual neither predeceases an

 

event, including the death of another individual, nor is considered

 

to predecease an event under section 2104 or 2702.

 

     (k) "Terms-of-service agreement" means a contract that

 

controls the relationship between a digital account holder and a

 

digital custodian. Terms-of-service agreement includes a terms-of-

 

use agreement.

 

     (l) (k) "Terms of a trust" or "terms of the trust" means the

 

manifestation of the settlor's intent regarding a trust's

 

provisions as expressed in the trust instrument or as may be

 

established by other evidence that would be admissible in a

 

judicial proceeding.

 

     (m) (l) "Testacy proceeding" means a proceeding to establish a

 

will or determine intestacy.

 

     (n) (m) "Testator" includes an individual of either gender.

 

     (o) (n) "Trust" includes, but is not limited to, an express

 

trust, private or charitable, with additions to the trust, wherever

 

and however created. Trust includes, but is not limited to, a trust

 

created or determined by judgment or decree under which the trust

 

is to be administered in the manner of an express trust. Trust does

 

not include a constructive trust or a resulting trust,

 

conservatorship, personal representative, custodial arrangement

 

under the Michigan uniform transfers to minors act, 1998 PA 433,

 

MCL 554.521 to 554.552, business trust providing for a certificate

 

to be issued to a beneficiary, common trust fund, voting trust,

 

security arrangement, liquidation trust, or trust for the primary

 

purpose of paying debts, dividends, interest, salaries, wages,

 

profits, pensions, or employee benefits of any kind, or another

 

arrangement under which a person is a nominee or escrowee for

 

another.

 

     (p) (o) "Trustee" includes an original, additional, or

 

successor trustee, whether or not appointed or confirmed by the

 

court.

 

     Enacting section 1. This amendatory act does not take effect

 

unless all of the following bills of the 97th Legislature are

 

enacted into law:

 

     (a) Senate Bill No.____ or House Bill No. 5367 (request no.

 

04550'13).

 

     (b) Senate Bill No.____ or House Bill No. 5366 (request no.

 

04551'13).

 

     (c) Senate Bill No.____ or House Bill No. 5369 (request no.

 

04552'13).

 

     (d) Senate Bill No.____ or House Bill No. 5370 (request no.

 

04553'13).