Second Regular Session Seventieth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 16-0327.01 Richard Sweetman x4333SENATE BILL 16-108 SENATE SPONSORSHIP Carroll, HOUSE SPONSORSHIP Singer, Senate Committees House Committees State, Veterans, & Military Affairs A BILL FOR AN ACT Concerning making certain public administrators employees of the state judicial system, and, in connection therewith, prohibiting such public administrators from collecting additional compensation for the performance of their duties. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) The bill requires the state court administrator to hire and employ a staff of full-time public administrators, to be assigned as necessary to each court. Such a public administrator is an employee of the state of Colorado and shall not charge a fee or collect additional compensation for the performance of his or her duties as a public administrator. Additionally, each district or probate court in each judicial district may appoint a private attorney to act as a public administrator in a particular case if such an appointment is the preference of the parties. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. Legislative declaration. (1) The general assembly hereby declares that making public administrators employees of the state judicial system serves the best interests of the people of the state by: (a) Reducing conflicts of interest; (b) Increasing options; (c) Reducing the costs associated with probate matters; (d) Eliminating financial motives for public administrators; and (e) Expanding access to public administrators. SECTION 2. In Colorado Revised Statutes, add 13-3-116 as follows: 13-3-116. Public administrators - assignment to judicial districts - oath. (1) On and after the effective date of this section, the state court administrator shall hire and employ a staff of full-time public administrators, as described in section 15-12-619, C.R.S., to be assigned as necessary to each judicial district and to the probate court of the city and county of Denver. (2) Each public administrator must be a qualified elector twenty-one years of age or older and a resident of the judicial district in which the public administrator is assigned to act as a public administrator. Unless authorized by the appointing court, the public administrator must remain a resident of the judicial district while he or she holds the office of public administrator. (3) A public administrator hired by the state court administrator pursuant to subsection (1) of this section is an employee of the state of Colorado and shall not charge a fee or collect additional compensation for the performance of his or her duties as a public administrator. (4) Before performing any duties as a public administrator, each public administrator shall take and subscribe an oath before a district or probate judge of the judicial district to which the public administrator is assigned, or by which the public administrator is appointed pursuant to section 15-12-619 (1), C.R.S., in the following form: I, ___________, in accepting the position of public administrator in and for the ________ judicial district of the state of Colorado, do solemnly swear (or affirm) that I will support the constitution of the United States and of the state of Colorado, and that I will faithfully perform the duties of the office of public administrator as required by law. I recognize that as a public administrator, I assume certain fiduciary duties to the persons and estates whose affairs I administer. I attest that I do not have any personal or financial interests that conflict with the duties and powers that are incumbent upon the office of public administrator, and I solemnly swear to avoid any such conflict of interest in each case that requires my administration. (5) The state court administrator may assign a public administrator to more than one judicial district or probate court. SECTION 3. In Colorado Revised Statutes, 15-12-619, amend (1), (4), and (5); and repeal (2), (6), and (7) as follows: 15-12-619. Public administrator - appointment - bond. (1) The In addition to requesting the assignment of sufficient public administrators from the state court administrator's office pursuant to section 13-3-116, C.R.S., each district or probate court in each judicial district may appoint a person who shall be known as the private attorney to act as a public administrator in a particular case if such an appointment is the preference of the parties. The appointee shall be a qualified elector over twenty-one years of age and shall be a resident of or maintain a principal place of business in the judicial district in which the appointee is to act as public administrator. Unless authorized by the appointing court, the appointee shall remain a resident of or maintain a principal place of business in the judicial district in which the appointee has been appointed during the period in which the appointee holds the office of public administrator. The A person appointed as the a public administrator shall serve serves at the pleasure of the appointing court until discharged by the court or until such person's resignation is accepted by the appointing court. Any person appointed as a public administrator shall not be pursuant to this section is not considered an employee of either the state of Colorado or of the judicial district or the city or the county in which such person has been appointed public administrator because of his or her appointment as public administrator. Before performing any duties as a public administrator, the appointee shall take and subscribe the oath described in section 13-3-116 (4), C.R.S. (2) Before taking office, a public administrator shall take and subscribe an oath, before a district or probate judge of the appointing judicial district, in the following form: I, ___________, in accepting the position of the public administrator in and for the ________ judicial district of the state of Colorado, do solemnly swear (or affirm) that I will support the constitution of the United States and of the state of Colorado, and that I will faithfully perform the duties of the office of public administrator as required by law. (4) Every Each private attorney who is appointed to act as a public administrator pursuant to subsection (1) of this section shall procure and maintain a general bond in the sum of twenty-five thousand dollars covering the public administrator's performance and the performance of the public administrator's employees to the people of the state of Colorado. Such bond shall must be conditioned on the faithful discharge of the duties of the office of the public administrator and shall must be filed in the office of the secretary of state. If the Colorado attorney general finds reasonable grounds to believe that a private attorney appointed to act as a public administrator has improperly administered a public administrator's an estate, the attorney general may sue upon such bond in the name of the people of the state of Colorado to compensate any party harmed by any neglect or wrongful act by a the public administrator or the public administrator's employees. In addition to the above general bond described in this subsection (4), a public administrator may also be required to give such bonds as are required of other fiduciaries. (5) The A public administrator is authorized to may act as provided in this section and section sections 15-12-620, 15-12-621, and 15-12-622 and 15-12-623 and as directed by the appointing court. A public administrator may also be appointed as a fiduciary in other cases in any judicial district in the state of Colorado or elsewhere as needed. (6) Subject to the approval and confirmation by the district or probate court in each judicial district, the public administrator may also appoint one or more deputy public administrators. Deputy public administrators shall be qualified electors over the age of twenty-one. Any deputy public administrator shall serve at the pleasure of the appointing court and the public administrator in that judicial district until such time as the deputy public administrator is discharged by the court or the public administrator or until the deputy public administrator resigns. No resignation of a deputy public administrator shall be effective until it is filed with and approved by the appointing court. The deputy public administrator shall act as directed by the public administrator in the deputy public administrator's judicial district. (7) Any acting public administrator or deputy public administrator who was appointed prior to July 1, 1991, shall be exempt from the appointment criteria required by this section. SECTION 4. In Colorado Revised Statutes, 15-12-620, amend (3) as follows: 15-12-620. Public administrator - responsibility for protecting decedent's estate - duty of persons holding property. (3) If a public administrator is a private attorney appointed by a court to act as a public administrator pursuant to section 15-12-619 (1), reasonable administration fees and costs including reasonable attorney fees incurred in efforts to protect the decedent's property shall must be paid to the public administrator at the time such property is released by the public administrator. Upon the presentation or mailing of an itemized statement of fees and costs to the person assuming responsibility for the case, the public administrator shall be entitled to may deduct such fees and costs from any cash assets of the decedent's estate that are in the public administrator's possession. Any fee dispute regarding a public administrator's fees and costs shall must be resolved by petition to the district or probate court that has jurisdiction over the estate. SECTION 5. In Colorado Revised Statutes, 15-12-621, amend (6) and (9) as follows: 15-12-621. Public administrator - decedents' estates - areas of responsibility. (6) Small estates, as defined in section 15-12-1201 may be administered by the A public administrator may administer a small estate, as described in section 15-12-1203, using an affidavit as provided in section 15-12-1201, with the same effect as provided in section 15-12-1202. The claims period shall end ends one year from the date of the decedent's death. At the end of the claims period, the public administrator shall summarily make distribution of distribute estate assets by distribution to allowed claimants pursuant to the priorities set forth in section 15-12-805. The public administrator shall distribute the remainder of the estate's funds, if any, shall be distributed to the decedent's heirs or devisees as determined under the Colorado Probate Code. In determining who is entitled to an estate's funds, a public administrator may rely on affidavits by persons who set forth facts to establish their claims, heirship, or the validity of a testamentary document. The public administrator shall not be is not liable for any improper distributions made in reasonable reliance on information contained in such affidavits. All estates administered by a public administrator pursuant to the small estate procedure shall must be closed by the filing of a public administrator's statement of account with the appointing district or probate court. The statement of account shall must set forth all receipts and disbursements made during the administration of the estate, including, if the public administrator is a private attorney appointed by a court to act as a public administrator pursuant to section 15-12-619 (1), C.R.S., the public administrator's fees and costs, and the fees and costs of the public administrator's staff and investigators. Upon filing of the public administrator's statement of account, the court shall discharge the public administrator shall be discharged and released release the public administrator from all further responsibility and all liability with regards to the estate. (9) A public administrator may act as a special administrator in a decedent's estate when a creditor or claimant requests such an appointment for the purpose of having the public administrator represent the estate in an action to be brought by the creditor or claimant against the estate. A public administrator requested to act as a special administrator in such cases need act only if the creditor or claimant makes advance arrangements, satisfactory to the public administrator, to pay to the office of the state court administrator or, if the public administrator is a private attorney appointed by a court to act as a public administrator pursuant to section 15-12-619 (1), C.R.S., to the public administrator, all reasonable fees and costs likely to be incurred by the public administrator in the public administrator's performance as special administrator regardless of the outcome of the creditor's or claimant's claim or litigation against the estate. SECTION 6. In Colorado Revised Statutes, 15-12-622, amend (1) and (2) as follows: 15-12-622. Public administrator - acting as conservator or trustee. (1) When appointed by a court of appropriate jurisdiction, the A public administrator may act as a conservator, temporary conservator, special conservator, trustee, or other fiduciary of any estate that has assets requiring protection. A public administrator may also be appointed by a court, in its discretion, to manage the financial affairs of a protected person, as defined in section 15-14-102 (11), or a ward, as defined in section 15-14-102 (15). Each county department of human or social services may refer any resident of that county, or any nonresident located in that county, to that county's public administrator for appropriate protective proceedings if such the department determines that such person the resident or nonresident meets the standards required for court protective action. (2) Any case referred to the a public administrator pursuant to this section by a county department of human or social services shall must be presented to the court of appropriate jurisdiction by a petition which shall state that states to the court that the county department of human or social services has requested a public administrator has been requested by the county department of social services to act as a conservator or other fiduciary for the person in need of protection, that the public administrator is the nominee of that department, and that the public administrator is not acting as an attorney for that department. The public administrator may prepare and file such a petition if requested to do so by the county department of human or social services. The fact that a public administrator has been requested by a county department of social services to act as a conservator or other fiduciary shall not be construed by the court as granting any priority for his appointment, and the court shall make that determination solely upon the best interests of the person in need of protection. If the public administrator is not appointed as conservator or other fiduciary and the court determines that another individual should act as the conservator or fiduciary, the court may award reasonable fees and costs to the public administrator if the court determines that the efforts of the public administrator were beneficial to the estate or contributed to the protection of the protected person's assets. In cases where the court awards fees and costs to the public administrator, to the extent that such funds are available, such fees shall be paid from the protected person's estate. In cases in which the public administrator is not compensated from the protected person's estate, the court may approve the payment of such fees from state funds designated for the payment of court-appointed counsel or fiduciaries. The court may determine the amount of fees to be paid from such state funds as it deems to be just. SECTION 7. In Colorado Revised Statutes, amend 15-12-623 as follows: 15-12-623. Public administrator - administration - reports - fees. (1) In the any case of involving a private attorney who has been appointed by a court to act as a public administrator pursuant to section 15-12-619 (1), C.R.S., the following court docket fees shall be charged: (a) Public administrator statements of account in small estates, as "small estates" is defined in section 15-12-1201, having gross assets: Fee Tax Total (I) Less than $500.00 fee waived (II) $500.00 or more, but less than $2,000.00 $ 9.00 1.00 10.00 (III) $2,000.00 or more $ 89.00 1.00 90.00 (b) The docket fee charged in all other decedent, trust, or conservatorship estates filed by a private attorney who has been appointed by a court to act as a public administrator shall be the same fee as those charged to the general public filing a similar type of action. (2) On or before March 1 of each year, each private attorney who has been appointed by a court to act as a public administrator pursuant to section 15-12-619 (1), C.R.S., shall file with the appointing court such reports concerning the administration of public administrator cases during the previous calendar year as the appointing court shall direct. (3) The office of the A private attorney who has been appointed by a court to act as a public administrator shall only pursuant to section 15-12-619 (1), C.R.S., may charge only fees and costs that are reasonable and proper for similar services in the community. The A private attorney who has been appointed by a court to act as a public administrator shall maintain detailed time records for all charged services. The A private attorney who has been appointed by a court to act as a public administrator shall attempt to minimize fees while providing quality fiduciary, administrative, and legal services to all assigned estates. The A private attorney who has been appointed by a court to act as a public administrator may charge the estates under his or her administration for the services of attorneys, paralegals, bookkeepers, certified public accountants, investigators, tax counsel, or any other professional or nonprofessional who provides necessary services which further the cost-effective administration of the estates. A private attorney who has been appointed by a court to act as a public administrator and who is a member of a law firm may use the legal services of that firm to assist the public administrator in his or her duties as the public administrator or as a fiduciary. All fees of the a private attorney who has been appointed by a court to act as a public administrator or of the such a public administrator's agents and employees are subject to review by the court having jurisdiction over the estate in which the fees were incurred. The payment of public administrators' administrative fees and costs shall have has priority over all other claims and exempt property or family allowances. In cases in which the a private attorney is appointed by a court to act as a public administrator is appointed to administer an estate, and a more suitable person is subsequently located and such person is then appointed to continue the administration of the estate, the private attorney who initially acted as public administrator shall be is entitled to receive the prompt payment of his fees and costs for the period of his or her administration of the estate. (4) Cash assets collected by the a public administrator in small decedent estates may be combined into a single public administrator's trust account which shall be held in a federally insured bank or savings and loan association located in this state. The total amount of the funds in a single public administrator's trust account shall may not exceed the federal deposit insurance limits for such accounts. When an additional account is required, such account shall must be opened in a different Colorado bank or savings and loan association which that has the required federal deposit insurance protection. Regardless of whether the public administrator is an attorney, all estate funds under the control of a public administrator shall be are governed by the rules set forth by the Colorado supreme court in the code of professional responsibility, DR 9-102, dealing with trust accounts, unless otherwise modified by this section. Any public administrator's trust account may be utilized as the temporary depository for any public administrator funds. When letters are issued in an estate, the funds belonging to such an estate shall must be promptly transferred to an account or accounts in the individual estate's name. SECTION 8. Act subject to petition - effective date. This act takes effect at 12:01 a.m. on the day following the expiration of the ninety-day period after final adjournment of the general assembly (August 10, 2016, if adjournment sine die is on May 11, 2016); except that, if a referendum petition is filed pursuant to section 1 (3) of article V of the state constitution against this act or an item, section, or part of this act within such period, then the act, item, section, or part will not take effect unless approved by the people at the general election to be held in November 2016 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor.