New Texas Bill Would Provide Release Relief To Trustees Who Deliver Adequate Accountings Without A Timely Objection By The Beneficiary

A new bill has been submitted that would “provide a trustee relief for transactions described in an accounting where a beneficiary fails to timely object to the accounting and there is no fraud, intentional misrepresentation, or material omission.” 

The bill provides: 

Sec. 113.153. BENEFICIARY’S APPROVAL OF ACCOUNTING. (a) This section does not apply to a trust that is under judicial supervision. (b) If a beneficiary does not object to a trustee’s accounting before the 180th day after the date a copy of the accounting has been delivered to the last known address of the beneficiary: (1) the beneficiary is considered to have approved the accounting; and (2) absent fraud, intentional misrepresentation, or material omission, the trustee is released from liability relating to all matters in the accounting.

If this bill were passed, it would take effect on September 1, 2021 and would apply to accountings delivered on or after the effective date. 

If this new bill is passed, there would likely be constitutional challenges addressing constitutional limitations to the statute as well as public policy arguments. 

However, the new bill is similar to a provision in the Uniform Trust Code, which has already been upheld as constitutional. 

It will be interesting to see the path and effect of this proposed bill. 

See David Fowler Johnson, New Texas Bill Would Provide Release Relief To Trustees Who Deliver Adequate Accountings Without A Timely Objection By The Beneficiary, Winstead: Texas Fiduciary Litigator, March 15, 2021. 

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.