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2017 SESSION
17101709DBe it enacted by the General Assembly of Virginia:
1. That § 64.2-531 of the Code of Virginia is amended and reenacted as follows:
§ 64.2-531. Nonexoneration; payment of lien if granted by agent.
A. Unless a contrary intent is clearly set out in the will or in a transfer on death deed, (i) real or personal property that is the subject of a specific devise or bequest in the will or (ii) real property subject to a transfer on death deed passes, subject to any mortgage, pledge, security interest, or other lien existing at the date of death of the testator, without the right of exoneration. A general directive in the will to pay debts shall not be evidence of a contrary intent that the mortgage, pledge, security interest, or other lien be exonerated prior to passing to the legatee.
B. If the personal representative of a decedent's estate is aware of any debt to which subsection A applies, the personal representative may give written notice to the creditor that there is no right of exoneration for such debt pursuant to this section. Such notice may be sent to either the creditor's last known address or to the address at which payments to the creditor are to be made. The creditor holding such debt may file a claim for such debt with the commissioner of accounts pursuant to § 64.2-552 on or before the later of one year after the qualification of the personal representative of the decedent's estate or six months after the personal representative gives such written notice to the creditor. Once the personal representative has given notice to the creditor as provided in this section, unless the creditor files a timely claim against the estate as set forth in this subsection, the liability of a personal representative or his surety for such debt shall not exceed the assets of the decedent remaining in the possession of the personal representative and available for application to the debt pursuant to § 64.2-528 at the time the creditor presents a demand for payment of such debt to the personal representative.
In the event that any such claim is timely filed with the commissioner of accounts, the personal representative shall give the specific beneficiary receiving such real or personal property written notice to obtain from the creditor the release of the estate from such claim. The notice to a beneficiary may be made to the personal representative of a deceased beneficiary whose estate is a beneficiary, an attorney-in-fact for a beneficiary, a guardian or conservator of an incapacitated beneficiary, a committee of a convict or insane beneficiary, or the duly qualified guardian of a minor or if none exists, a custodial parent of a minor. If the estate has not been released from such claim after the later of 180 days from such notice or one year from qualification, the personal representative may (i) sell the real or personal property that is the subject of a specific devise or bequest and that is also subject to the claim, (ii) apply the proceeds of sale to the satisfaction of the claim, and (iii) distribute any excess proceeds from such sale of the specific beneficiary of such property. If such real property is subject to a transfer on death deed and is also subject to the claim, the personal representative may proceed as provided in § 64.2-634 to enforce the liability for such claim against such property.
C. Subsection
A shall not apply to any mortgage, pledge, security interest, or other lien
existing at the date of death of the testator against any specifically devised
or bequeathed real or personal property, or any real property subject to a
transfer on death deed, that was granted by an agent acting within the
authority of a durable power of attorney for the testator while the testator
was incapacitated. For the purposes of this section, (i) no adjudication of the
testator's incapacity is necessary, (ii) the acts of an agent within the
authority of a durable power of attorney are rebuttably presumed to be for an
incapacitated testator, and (iii) an incapacitated testator is one who is
impaired by reason of mental illness, intellectual disability, physical illness
or disability, chronic use of drugs, chronic intoxication, or other cause
creating a lack of sufficient understanding or capacity to make or communicate
responsible decisions. This subsection shall not apply (a) if the mortgage,
pledge, security interest, or other lien granted by the agent on the specific
property is thereafter ratified by the testator while he is not incapacitated, or (b) if the durable power
of attorney was limited to one or more specific purposes and was not general in
nature.
C. D. Subsection
A shall not apply to any mortgage, pledge, security interest, or other lien
existing at the date of the death of the testator against any specific devise
or bequest of any real or personal property, or any real property subject to a
transfer on death deed, that was granted by a conservator, guardian, or
committee of the testator. This subsection shall not apply if, after the
mortgage, pledge, security interest, or other lien granted by the conservator,
guardian, or committee, there is an adjudication that the testator's disability
has ceased and the testator survives that adjudication by at least one year.