CHAPTER 123. ATTORNEY GENERAL PARTICIPATION IN PROCEEDINGS INVOLVING CHARITABLE TRUSTS
PROPERTY CODE
TITLE 9. TRUSTS
SUBTITLE C. MISCELLANEOUS TRUSTS
CHAPTER 123. ATTORNEY GENERAL PARTICIPATION IN PROCEEDINGS
INVOLVING CHARITABLE TRUSTS
Sec. 123.001. DEFINITIONS. In this chapter:
(1) "Charitable entity" means a corporation, trust, community
chest, fund, foundation, or other entity organized for
scientific, educational, philanthropic, or environmental
purposes, social welfare, the arts and humanities, or another
civic or public purpose described by Section 501(c)(3) of the
Internal Revenue Code of 1986 (26 U.S.C. 501(c)(3)).
(2) "Charitable trust" means a charitable entity, a trust the
stated purpose of which is to benefit a charitable entity, or an
inter vivos or testamentary gift to a charitable entity.
(3) "Proceeding involving a charitable trust" means a suit or
other judicial proceeding the object of which is to:
(A) terminate a charitable trust or distribute its assets to
other than charitable donees;
(B) depart from the objects of the charitable trust stated in
the instrument creating the trust, including a proceeding in
which the doctrine of cy-pres is invoked;
(C) construe, nullify, or impair the provisions of a
testamentary or other instrument creating or affecting a
charitable trust;
(D) contest or set aside the probate of an alleged will under
which money, property, or another thing of value is given for
charitable purposes;
(E) allow a charitable trust to contest or set aside the probate
of an alleged will;
(F) determine matters relating to the probate and administration
of an estate involving a charitable trust; or
(G) obtain a declaratory judgment involving a charitable trust.
(4) "Fiduciary or managerial agent" means an individual,
corporation, or other entity acting either as a trustee, a member
of the board of directors, an officer, an executor, or an
administrator for a charitable trust.
Added by Acts 1987, 70th Leg., ch. 147, Sec. 4, eff. Sept. 1,
1987. Amended by Acts 1995, 74th Leg., ch. 172, Sec. 2, eff.
Sept. 1, 1995.
Sec. 123.002. ATTORNEY GENERAL'S PARTICIPATION. For and on
behalf of the interest of the general public of this state in
charitable trusts, the attorney general is a proper party and may
intervene in a proceeding involving a charitable trust. The
attorney general may join and enter into a compromise, settlement
agreement, contract, or judgment relating to a proceeding
involving a charitable trust.
Added by Acts 1987, 70th Leg., ch. 147, Sec. 4, eff. Sept. 1,
1987.
Sec. 123.003. NOTICE. (a) Any party initiating a proceeding
involving a charitable trust shall give notice of the proceeding
to the attorney general by sending to the attorney general, by
registered or certified mail, a true copy of the petition or
other instrument initiating the proceeding involving a charitable
trust within 30 days of the filing of such petition or other
instrument, but no less than 25 days prior to a hearing in such a
proceeding. This subsection does not apply to a proceeding that
is initiated by an application that exclusively seeks the
admission of a will to probate, regardless of whether the
application seeks the appointment of a personal representative,
if the application:
(1) is uncontested; and
(2) is not subject to Section 83, Texas Probate Code.
(b) Notice shall be given to the attorney general of any
pleading which adds new causes of action or additional parties to
a proceeding involving a charitable trust in which the attorney
general has previously waived participation or in which the
attorney general has otherwise failed to intervene. Notice shall
be given by sending to the attorney general by registered or
certified mail a true copy of the pleading within 30 days of the
filing of the pleading, but no less than 25 days prior to a
hearing in the proceeding.
(c) The party or the party's attorney shall execute and file in
the proceeding an affidavit stating the facts of the notice and
shall attach to the affidavit the customary postal receipts
signed by the attorney general or an assistant attorney general.
Added by Acts 1987, 70th Leg., ch. 147, Sec. 4, eff. Sept. 1,
1987. Amended by Acts 1995, 74th Leg., ch. 172, Sec. 3, eff.
Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch.
1017, Sec. 1, eff. September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch.
451, Sec. 15, eff. September 1, 2007.
Sec. 123.004. VOIDABLE JUDGMENT OR AGREEMENT. (a) A judgment
in a proceeding involving a charitable trust is voidable if the
attorney general is not given notice of the proceeding as
required by this chapter. On motion of the attorney general after
the judgment is rendered, the judgment shall be set aside.
(b) A compromise, settlement agreement, contract, or judgment
relating to a proceeding involving a charitable trust is voidable
on motion of the attorney general if the attorney general is not
given notice as required by this chapter unless the attorney
general has:
(1) declined in writing to be a party to the proceeding; or
(2) approved and joined in the compromise, settlement agreement,
contract, or judgment.
Added by Acts 1987, 70th Leg., ch. 147, Sec. 4, eff. Sept. 1,
1987.
Sec. 123.005. BREACH OF FIDUCIARY DUTY: VENUE. Venue in a
proceeding brought by the attorney general alleging breach of a
fiduciary duty by a charitable entity or a fiduciary or
managerial agent of a charitable trust shall be a court of
competent jurisdiction in Travis County or in the county where
the defendant resides or has its principal office. To the extent
of a conflict between this subsection and any provision of the
Texas Probate Code providing for venue of a proceeding brought
with respect to a charitable trust created by a will that has
been admitted to probate, this subsection controls.
Added by Acts 1987, 70th Leg., ch. 147, Sec. 4, eff. Sept. 1,
1987. Amended by Acts 1995, 74th Leg., ch. 172, Sec. 4, eff.
Sept. 1, 1995.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
133, Sec. 1, eff. September 1, 2009.
Acts 2009, 81st Leg., R.S., Ch.
1351, Sec. 12(g), eff. September 1, 2009.
Sec. 123.006. ATTORNEY'S FEES. (a) In a proceeding subject to
Section 123.005, the attorney general, if successful in the
proceeding, is entitled to recover from the charitable entity or
fiduciary or managerial agent of the charitable trust actual
costs incurred in bringing the suit and may recover reasonable
attorney's fees.
(b) In a proceeding in which the attorney general intervenes
under this chapter, other than a proceeding subject to Section
123.005, a court may award the attorney general court costs and
reasonable and necessary attorney's fees as may seem equitable
and just.
Added by Acts 2009, 81st Leg., R.S., Ch.
133, Sec. 2, eff. September 1, 2009.