HF 713 (LSB 2737YH (3) 91)

HOUSE FILE 713

BY  THOMSON

A BILL FOR

An Act relating to probate law, including providing notice to named beneficiaries and a process for named beneficiaries to obtain ownership of property held by others.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  NEW SECTION.  633.359  Beneficiary notice —— affidavits —— third-party protection.
   1.  For purposes of this section, “beneficiary designation” means the same as defined in section 633.358, subsection 1.
   2.  If the holder of property that has a beneficiary designation has been notified of the death of the owner of the property, the holder of property shall within ten business days provide notice to each person listed under the beneficiary designation that the person may have a right to the property and provide the person with the contact information of the holder of the property.
   3.  A person listed under the beneficiary designation may present an affidavit to the holder of the property or to any person with information about the property for the purpose of obtaining the property or information regarding the property. The affidavit must state all of the following:
   a.  The decedent’s name and last known address.
   b.  A general description of the property to the extent known.
   c.  The person listed under the beneficiary designation’s name, address, and primary contact information.
   d.  A request that the property be paid or transferred to the person listed under the beneficiary designation or that information about the property be given to the person listed under the beneficiary designation.
   e.  No one other than the person listed under the beneficiary designation has a right to the interest in the property listed in the affidavit.
   f.  The affidavit has been signed by the person listed under the beneficiary designation under penalty of perjury before a notary public as provided in chapter 9B.
   g.  The information in the affidavit is true and correct.
   4.  The holder of the property shall not request any additional personal information from the person listed under the beneficiary designation, including but not limited to any of the following:
   a.  Social security number or driver’s license number.
   b.  Contact information.
   c.  Personal financial information.
   5.  If the requirements of this section are satisfied, all of the following apply:
   a.  The decedent’s property shall be paid, delivered, or transferred to or for the benefit of the person listed under the beneficiary designation if the affidavit has requested the transfer of ownership of the property to the person.
   b.  A transfer agent of a security described in the affidavit shall change registered ownership on the books of the corporation from the decedent to or for the benefit of the person listed under the beneficiary designation if the affidavit has requested the transfer of ownership of the property to the person.
   c.  The information requested in the affidavit shall be delivered to the person.
   6.  The holder of the property and any person who in good faith delivers the property or information requested in reliance on information a person listed under the beneficiary designation provides under this section, who has no knowledge that representations contained in the affidavit are incorrect, shall not be liable to any person for so acting and may assume without inquiry the existence of the facts contained in the affidavit. The time to verify a person listed under the beneficiary designation authority shall not exceed thirty days from the date of delivery of the affidavit. Any right or title acquired from the person listed under the beneficiary designation in consideration of the provision of property or information under this section is not invalid in consequence of misapplication by the person listed under the beneficiary designation. A transaction and a lien created by a transaction entered into by the person listed under the beneficiary designation and anyone acting in reliance on the affidavit under this section is enforceable against the property the person has requested.
   7.  If the holder of the property refuses to provide the requested property or information within thirty days after receiving the affidavit, the person listed under the beneficiary designation may bring an action against the holder of the property to recover the property or receive the information or to compel the delivery of the property. An action brought under this section must be brought within one year after the date of the act or failure to act. If the court finds that the holder of the property acted unreasonably in failing to deliver the property or information as requested in the affidavit, the court may award to the person listed under the beneficiary designation any or all of the following:
   a.  Damages sustained by the person.
   b.  Costs of the action.
   c.  A penalty in an amount determined by the court between five hundred dollars and ten thousand dollars.
   d.  Reasonable attorney fees based on the value of the time reasonably expended by the attorney and not by the amount of the recovery on behalf of the person.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to probate law regarding notice provided to named beneficiaries. The bill provides that if a holder of property that has a beneficiary designation owned by a decedent has been notified of the death of the decedent, the property holder shall within 10 business days notify each person listed under the beneficiary designation that the person may have a right to the property and provide contact information of the holder. For purposes of the bill, beneficiary designation means the provision in an instrument designating a beneficiary, including an annuity or insurance policy, an account with a designation for payment on death, a security registered in beneficiary form, a pension, profit-sharing, retirement, or other employment-related benefit plan, and any other nonprobate transfer at death.
   The bill allows a person listed under the beneficiary designation to present an affidavit to any person for the purpose of obtaining property, or information regarding property, owned by a decedent for which the person is a designated beneficiary. The bill provides the representations and requirements of the affidavit presented. The bill prohibits a person from requesting any additional personal information of a person listed under the beneficiary designation.
   The bill provides that upon completion of the bill’s requirements, the person listed under the beneficiary designation shall receive the decedent’s property as the beneficiary and a transfer agent of a security described in the affidavit shall change registered ownership on the books of the corporation from the decedent to or for the benefit of the successor. The bill provides that a person in good faith that relies upon and has no knowledge that the representations in the affidavit are incorrect shall not be liable to any person for so acting in reliance of the affidavit. The person who received the request has 30 days to verify the affidavit and provide the information or requested property to the person listed under the beneficiary designation. Upon failing to do so, the person listed under the beneficiary designation may bring an action to recover the property, information, or to compel the delivery of the property against the person to whom the person listed under the beneficiary designation presented the affidavit. The bill allows an action to be brought within one year after the date of the act or failure to act. If the person listed under the beneficiary designation prevails in the court action, the court may also award damages sustained, costs of the action, a penalty determined by the court of not less than $500 and not more than $10,000, and reasonable attorney fees.