Current StatusView additional legislative information at the LPITS web site.Bill Number: 1194 Ratification Number: 779 Act Number 659 Introducing Body: Senate Subject: Definition of "presently exercisable general power of appointment"
(A659, R779, S1194)
AN ACT TO AMEND SECTION 62-1-108, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO ACTS BY A HOLDER OF A GENERAL POWER OF APPOINTMENT, SO AS TO DEFINE THE TERM "PRESENTLY EXERCISABLE GENERAL POWER OF APPOINTMENT"; TO AMEND SECTION 62-1-302, AS AMENDED, RELATING TO THE SUBJECT MATTER OF JURISDICTION OF THE PROBATE COURTS, SO AS TO REVISE CERTAIN ASPECTS OF THIS JURISDICTION; TO AMEND SECTION 62-1-306, RELATING TO JURY TRIALS IN THE PROBATE COURT, SO AS TO FURTHER PROVIDE FOR THE SITUATIONS WHEN JURY TRIALS MAY BE DEMANDED AND THE MANNER IN WHICH THESE TRIALS MAY BE WAIVED; TO AMEND SECTION 62-5-102, RELATING TO JURISDICTION OF PERSONS UNDER DISABILITY AND THEIR PROPERTY, SO AS TO CLARIFY THAT THE PROBATE COURT HAS JURISDICTION OF CERTAIN PROTECTIVE PROCEEDINGS AND GUARDIANSHIP PROCEEDINGS; TO AMEND SECTION 62-5-402, RELATING TO PROTECTIVE PROCEEDINGS, SO AS TO FURTHER PROVIDE FOR THE JURISDICTION OF THE PROBATE COURT AND OTHER COURTS WITH REGARD TO CERTAIN CLAIMS AND ISSUES IN THESE PROCEEDINGS; TO AMEND SECTION 62-5-411, RELATING TO BONDS IN PROTECTIVE PROCEEDINGS, SO AS TO FURTHER PROVIDE FOR THESE BONDING REQUIREMENTS; TO AMEND SECTION 62-5-424, RELATING TO POWERS OF A CONSERVATOR, SO AS TO REVISE HIS AUTHORITY TO PAY, CONTEST, OR SETTLE CERTAIN CLAIMS; TO AMEND THE 1976 CODE BY ADDING SECTION 62-5-433 SO AS TO PROVIDE FOR THE JURISDICTION OF SPECIFIED COURTS IN REGARD TO CERTAIN CLAIMS IN FAVOR OF OR AGAINST A MINOR OR INCAPACITATED PERSON, AND TO PROVIDE THE PROCEDURES TO BE FOLLOWED IN SETTLING THESE CLAIMS; TO AMEND THE 1976 CODE BY ADDING SECTION 62-7-211 SO AS TO ALLOW THE COURT TO CONSOLIDATE OR DIVIDE TRUSTS UNDER CERTAIN CONDITIONS; TO AMEND SECTION 62-7-302, RELATING TO A TRUSTEE'S STANDARD OF CARE, SO AS TO FURTHER PROVIDE FOR THIS STANDARD OF CARE; TO AMEND SECTION 62-7-418, RELATING TO CHARGES WHICH MUST BE MADE AGAINST PRINCIPAL, SO AS TO FURTHER PROVIDE FOR THESE CHARGES; TO AMEND THE 1976 CODE BY ADDING SECTION 15-72-10 SO AS TO CONFORM THE JURISDICTION OF THE CIRCUIT COURT TO THE PROVISIONS OF SECTION 62-5-433; TO AMEND THE 1976 CODE BY ADDING SECTION 62-3-1202A SO AS TO PERMIT CERTAIN ESTATES UNDER TEN THOUSAND DOLLARS NOT TO BE ADMINISTERED; TO AMEND SECTION 62-2-503, AS AMENDED, RELATING TO ATTESTATION AND SELF-PROVING OF A WILL, SO AS TO FURTHER PROVIDE FOR THIS ATTESTATION AND SELF-PROVING; TO AMEND SECTION 62-3-406, AS AMENDED, RELATING TO TESTIMONY OF ATTESTING WITNESSES TO A WILL IN CONTESTED CASES, SO AS TO FURTHER PROVIDE FOR THE PRESUMPTIONS OF COMPLIANCE WITH SIGNATURE REQUIREMENTS FOR EXECUTION IF THE WILL IS SELF-PROVED; TO AMEND SECTION 62-3-603, AS AMENDED, RELATING TO BONDS OF PERSONAL REPRESENTATIVES, SO AS TO FURTHER PROVIDE FOR WHEN THESE BONDS MAY BE WAIVED AND ARE REQUIRED; TO AMEND SECTION 14-23-650, AS AMENDED, RELATING TO A DESCRIPTION OF LANDS DEVISED, SO AS TO DELETE A REFERENCE TO WHERE THESE DESCRIPTIONS MUST BE ENTERED; TO AMEND SECTION 62-3-806, AS AMENDED, RELATING TO ALLOWANCE OF CLAIMS, SO AS TO PROVIDE THAT IT IS THE RESPONSIBILITY OF THE PERSONAL REPRESENTATIVE TO NOTIFY THE CLAIMANT IF A CLAIM IS DISALLOWED; TO AMEND SECTION 62-5-103, RELATING TO THE MANNER IN WHICH A PERSON UNDER A DUTY TO PAY OR DELIVER MONEY OR PERSONAL PROPERTY UNDER TEN THOUSAND DOLLARS TO A MINOR MUST PERFORM THIS DUTY, SO AS TO MAKE THESE PROVISIONS ALSO APPLICABLE TO INCAPACITATED PERSONS; TO AMEND THE 1976 CODE BY ADDING SECTION 62-5-434 SO AS TO PROVIDE THAT THE SETTLEMENT OF ANY CLAIM INVOLVING A MINOR COMPLETED BETWEEN JULY 1, 1987, AND SEPTEMBER 24, 1987, IS PRESUMED FACIALLY VALID WHETHER EFFECTUATED WITH OR WITHOUT COURT APPROVAL; TO MAKE LEGISLATIVE FINDINGS REGARDING THE PROCEDURES TO BE FOLLOWED FOR THE SETTLEMENT OF CLAIMS OF MINORS; TO AMEND SECTIONS 33-14-200, 33-14-210, 33-14-220, AND 33-14-230, RELATING TO ADMINISTRATIVE DISSOLUTION OF CORPORATIONS UNDER THE SOUTH CAROLINA BUSINESS CORPORATION ACT OF 1988, SO AS TO FURTHER PROVIDE FOR THIS ADMINISTRATIVE DISSOLUTION; TO AMEND SECTIONS 33-15-300, 33-15-310, AND 33-15-320, RELATING TO REVOCATION OF A FOREIGN CORPORATION'S CERTIFICATE OF AUTHORITY TO TRANSACT BUSINESS, SO AS TO FURTHER PROVIDE FOR THIS REVOCATION; TO AMEND SECTION 33-1-280, AS AMENDED, RELATING TO THE SECRETARY OF STATE FURNISHING CERTIFICATES OF EXISTENCE FOR CORPORATIONS, SO AS TO REVISE THE CONTENTS OF THE CERTIFICATE OF EXISTENCE AS IT RELATES TO A CORPORATION'S DISSOLUTION OR REVOCATION OF AUTHORITY TO DO BUSINESS; TO AMEND SECTION 12-7-1675, RELATING TO ADMINISTRATIVE DISSOLUTION OF A DOMESTIC CORPORATION OR REVOCATION OF THE CERTIFICATE OF AUTHORITY OF A FOREIGN CORPORATION TO TRANSACT BUSINESS FOR FAILURE TO FILE CERTAIN TAX RETURNS, SO AS TO FURTHER PROVIDE FOR THIS DISSOLUTION OR REVOCATION; AND TO REPEAL CHAPTER 29 OF TITLE 33 RELATING TO FEES AND TAXES PAYABLE BY CORPORATIONS.
Be it enacted by the General Assembly of the State of South Carolina:
Definition of "presently exercisable general power of appointment"
SECTION 1. Section 62-1-108 of the 1976 Code is amended to read:
"Section 62-1-108. For the purpose of granting consent or approval with regard to the acts or accounts of a personal representative or trustee, including relief from liability or penalty for failure to post bond, or to perform other duties, and for purposes of consenting to modification or termination of a trust or to deviation from its terms, the sole holder or all co-holders of a presently exercisable general power of appointment, including one in the form of a power of amendment or revocation, are deemed to act for beneficiaries to the extent their interests (as objects, takers in default, or otherwise) are subject to the power. The term 'presently exercisable general power of appointment' includes a testamentary general power of appointment having no conditions precedent to its exercise other than the death of the holder, the validity of the holder's last will and testament, and the inclusion of a provision in the will sufficient to exercise this power."
Jurisdiction revised
SECTION 2. Section 62-1-302(a)(2) of the 1976 Code, as last amended by Act 171 of 1987, is further amended to read:
"(2) protection of minors and incapacitated persons, including the mortgage and sale of personal and real property owned by minors or incapacitated persons, except that jurisdiction for approval of settlements of claims in favor of or against minors or incapacitated persons is governed by Section 62-5-433."
Jurisdiction revised
SECTION 3. Section 62-1-302(c) of the 1976 Code, as last amended by Act 171 of 1987, is further amended to read:
"(c) Notwithstanding the exclusive jurisdiction of the probate court over the foregoing matters, any action or proceeding filed in the probate court and relating to the following subject matters, on motion of any party, or by the court on its own motion, must
be removed, not later than ten days following the date on which all responsive pleadings must be filed, to the circuit court and in such cases the circuit court shall proceed upon the matter de novo:
(1) formal proceedings for the probate of wills and for the appointment of personal representatives named in wills;
(2) construction of wills;
(3) actions to try title;
(4) trusts; and
(5) actions in which a party has a right to trial by jury and which involve an amount in controversy of at least five thousand dollars in value."
Revision of jury trial provisions
SECTION 4. Section 62-1-306(a) of the 1976 Code is amended to read:
"(a) If duly demanded, a party is entitled to trial by jury in any proceeding involving an issue of fact in an action for the recovery of money only or of specific real or personal property, unless waived as provided in the rules of civil procedure for the courts of this State. The right to trial by jury exists in, but is not limited to, formal proceedings in favor of the probate of a will or contesting the probate of a will."
Jurisdiction provisions clarified
SECTION 5. Section 62-5-102(a) of the 1976 Code is amended to read:
"(a) The probate court has jurisdiction over protective proceedings and guardianship proceedings."
Jurisdiction revised
SECTION 6. Section 62-5-402 of the 1976 Code is amended to read:
"Section 62-5-402. After the service of notice in a proceeding seeking the appointment of a conservator or other protective order and until termination of the proceeding, the probate court in which the petition is filed has:
(1) exclusive jurisdiction to determine the need for a conservator or other protective order until the proceedings are terminated;
(2) exclusive jurisdiction to determine how the estate of the protected person which is subject to the laws of this State must be managed, expended, or distributed to or for the use of the protected person or any of his dependents; and
(3) concurrent jurisdiction to determine the validity of claims for or against the person or estate of the protected person except as limited by Section 62-5-433."
Bonding requirements revised
SECTION 7. Section 62-5-411 of the 1976 Code is amended to read:
"Section 62-5-411. The court shall, unless for good cause stated, require a conservator to furnish a bond conditioned upon faithful discharge of all duties of the trust according to law and will approve all sureties. If bond is required, the person qualifying shall file a statement under oath with the court indicating his best estimate of the value of the personal estate of the protected person and of the income expected from the personal estate during the next year, and he shall execute and file a bond with the court, or give other suitable security, in an amount not less than the estimate. The court shall determine that the bond is duly executed by a corporate surety, or one or more individual sureties whose performance is secured by pledge of personal property, mortgage on real property, or other adequate security. The court may permit the amount of the bond to be reduced by the value of assets of the estate deposited with a domestic financial institution, as defined in Section 62-6-101, in a manner that prevents their unauthorized disposition. On petition of the conservator or another interested person, the court may increase or reduce the amount of the bond, release sureties, dispense with security or securities, or permit the substitution of another bond with the same or different sureties."
Conservation powers revised
SECTION 8. Section 62-5-424(c)(12) of the 1976 Code is amended to read:
"(12) pay or contest any claim except as limited by Section 62-5-433; to settle a claim by or against the estate of the protected person by compromise, arbitration, or otherwise except as limited by Section 62-5-433; and to release, in whole or in part, any claim belonging to the estate to the extent that the claim is uncollectible;".
Jurisdiction and procedures for claims for and against minors and incapacitated persons
SECTION 9. The 1976 Code is amended by adding:
"Section 62-5-433. (A)(1) For purposes of this section and for any claim exceeding ten thousand dollars in favor of or against any minor or incapacitated person, 'court' means the circuit court of the county in which the minor or incapacitated person resides. For purposes of this section and for any claim not exceeding ten thousand dollars in favor of or against any minor or incapacitated person, 'court' means either the circuit court or the probate court of the county in which the minor or incapacitated person resides.
(2) 'Claim' means the net or actual amount accruing to or paid by the minor or incapacitated person as a result of the settlement.
(3) 'Petitioner' means either a conservator appointed by the probate court for the minor or incapacitated person or the guardian or guardian ad litem of the minor or incapacitated person if a conservator has not been appointed.
(B) The settlement of any claim over two thousand, five hundred dollars in favor of or against any minor incapacitated person for the payment of money or the possession of personal property must be effected on his behalf in the following manner:
(1) The petitioner shall file with the court a verified petition setting forth all of the pertinent facts concerning the claim, payment, attorney's fees, and expenses, if any, and the reasons why, in the opinion of the petitioner, the proposed settlement should be approved. For all claims that exceed ten thousand dollars, the verified petition must include a statement by the petitioner that, in his opinion, the proposed settlement is in the best interests of the minor or incapacitated person.
(2) If, upon consideration of the petition and after hearing the testimony as it may require concerning the matter, the court concludes that the proposed settlement is proper and in the best interests of the minor or incapacitated person, the court shall issue its order approving the settlement and authorizing the petitioner to consummate it and, if the settlement requires the payment of money or the delivery of property for the benefit of the minor or incapacitated person, to receive the money or property and execute a proper receipt and release or covenant not to sue therefor, which is binding upon the minor or incapacitated person.
(3) The order authorizing the settlement must require that payment or delivery of the money or property be made through the conservator. If a conservator has not been appointed, the petitioner shall, upon receiving the money or property, pay and deliver it to the court pending the appointment and qualification of a duly appointed conservator. If a party subject to the court order fails or refuses to pay the money or deliver the property as required by the order, he is liable and punishable as for contempt of court, but failure or refusal does not affect the validity or conclusiveness of the settlement.
(C) The settlement of any claim that does not exceed two thousand, five hundred dollars in favor of or against a minor or incapacitated person for the payment of money or the possession of personal property may be effected in any of the following manners:
(1) If a conservator has been appointed, he may settle the claim as provided in Section 62-5-424, or he may petition the court for approval as provided in subsection (B) above. If the settlement requires the payment of money or the delivery of property for the benefit of the minor or incapacitated person, the conservator shall receive the money or property and execute a proper receipt and release or covenant not to sue therefor, which is binding upon the minor or incapacitated person. The payment or delivery of money or personal property to a minor or incapacitated person must be made in accordance with Section 62-5-103.
(2) If a conservator has not been appointed, the guardian must petition the court for approval of the settlement as provided in
subsection (B) above. The payment or delivery of money or personal property to a minor or incapacitated person must be made in accordance with Section 62-5-103.
(D) The settlement of any claim that does not exceed one thousand dollars in favor of or against any minor or incapacitated person for the payment of money or the possession of personal property may be effected by the parent or guardian of the minor or incapacitated person without court approval of the settlement and without the appointment of a conservator. If the settlement requires the payment of money or the delivery of property for the benefit of the minor or incapacitated person, the parent or guardian shall receive the money or property and execute a proper receipt and release or covenant not to sue therefor, which is binding upon the minor or incapacitated person. The payment or delivery of money or personal property to a minor or incapacitated person must be made in accordance with Section 62-5-103."
Consolidation or division of trusts
SECTION 10. The 1976 Code is amended by adding:
"Section 62-7-211. Upon petition by a trustee, beneficiary, or any interested party for good cause shown, the court, after a hearing on notice to all interested parties, in that manner as the court may direct, may divide a trust into two or more single trusts or consolidate two or more trusts into a single trust, upon those terms and conditions as it considers appropriate, provided the consolidation or division satisfies the court that:
(1) consolidation or division is not inconsistent with the intent of the trustor with regard to any trust to be consolidated or divided;
(2) consolidation or division would facilitate administration of the trusts; and
(3) consolidation or division would be in the best interests of all beneficiaries and not materially impair their respective interests.
This section applies to all trusts whenever created, whether inter vivos or testamentary, created by the same or different instruments, by the same or different persons and regardless of where created or administered.
This section does not limit the right of a trustee acting in accordance with the applicable provisions of the governing instrument to divide or consolidate trusts."
Trustee's standard of care revised
SECTION 11. Section 62-7-302(a) of the 1976 Code is amended to read:
"(a) Except as otherwise provided by the terms or limitations set forth in any will, agreement, court order, or other instrument creating or defining the fiduciary's duties and powers (the term 'legal investment' or 'authorized investment' or words of similar import, as used in any such instrument being taken, however, to mean any investment which is permitted by the terms of this section), in acquiring, investing, reinvesting, exchanging, retaining, selling, and managing property for the benefit of another, a fiduciary shall exercise the judgment and care under the circumstances then prevailing, which men of prudence, discretion, and intelligence exercise in the management of their own affairs, not in regard to speculation but in regard to the permanent disposition of their funds, considering the probable income as well as the probable safety of their capital. Within the limitations of the foregoing standard, a fiduciary is authorized to: (1) acquire and retain every kind of property and every kind of investment, specifically including, but not by way of limitation, bonds, debentures, and other corporate obligations, and stocks, preferred or common, and securities of any open-end or closed-end management-type investment company or investment trust registered under the Federal Investment Company Act of 1940, as amended; (2) retain property properly acquired, without limitation as to time and without regard to its suitability for original purchase; (3) retain the property received by such fiduciary on the creation of the estate, guardianship, or trust (including, in the case of a corporate fiduciary, stock, or other securities of its own issue) without regard to its suitability for original purchase; (4) retain the securities into which corporate securities owned by the fiduciary may be converted or which may be derived therefrom as a result of merger, consolidation, stock dividends, splits, liquidations, and similar procedures (and may exercise by purchase or otherwise any rights, warrants, or conversion features attaching to any such securities); and (5) purchase or otherwise acquire and retain any security underwritten by a syndicate, even if the fiduciary or its affiliate (defined as any entity which owns or is owned by, in whole or in part, the fiduciary or is owned by the same entity that owns the fiduciary) participates or has participated as a member of the syndicate, provided the fiduciary does not purchase the security from itself, its affiliate, or from another member of the underwriting syndicate or its affiliate pursuant to an implied or express reciprocal agreement between the fiduciary or its affiliate, and such other member or its affiliate, to purchase all or part of each other's underwriting participation commitment within the syndicate."
Charges against principal provisions revised
SECTION 12. Section 62-7-418(2) of the 1976 Code is amended to read:
"(2) charges not provided for in Section 62-7-417(a) including the cost of investing and reinvesting principal, the payments on principal of an indebtedness (including a mortgage amortized by periodic payments of principal), expenses for preparation of property for rental or sale, and, unless the court directs otherwise, expenses incurred in maintaining or defending any action to protect or construe the trust or the property or assure the title of any trust property;".
Jurisdiction conformed
SECTION 13. Title 15 of the 1976 Code is amended by adding:
"Section 15-72-10. Subject to the provisions of Section 62-5-433 the circuit court has:
(1) exclusive jurisdiction to approve the settlement of any claim that exceeds ten thousand dollars in favor of or against any minor or incapacitated person; and
(2) concurrent jurisdiction with the probate court to approve the settlement of any claim not exceeding ten thousand dollars in favor of or against any minor or incapacitated person."
Administration of certain estates not required
SECTION 14. The 1976 Code is amended by adding:
"Section 62-3-1202A. When any person in this State dies leaving an estate with a value, less liens and encumbrances, not exceeding ten thousand dollars and exempt property, reasonable funeral expenses, and reasonable and necessary medical and hospital expenses of the last illness of the decedent, the probate judge may receive such estate and pay these creditors as may present their duly attested claims in the priority set forth in Section 62-3-805 and the residue, if any, to the distributee or distributees of the estate without the requirement of an administration."
Attestation and self-proving provisions revised
SECTION 15. Section 62-2-503 of the 1976 Code, as amended by Act 171 of 1987, is further amended to read:
"Section 62-2-503. (a) Any will may be simultaneously executed, attested, and made self-proved. The self-proof shall be effective upon the acknowledgment by the testator and the affidavit of at least one witness, each made before an officer authorized to administer oaths under the laws of the state where execution occurs and evidenced by the officer's certificate, under official seal, in the following form or in a similar form showing the same intent:
I, ________________ , the testator, sign my name to this instrument this _____ day of _______ , 19__ , and being first duly sworn, do hereby declare to the undersigned authority that I sign and execute this instrument as my last will and that I sign it willingly (or willingly direct another to sign for me), that I execute it as my free and voluntary act for the purposes therein expressed, and that I am eighteen years of age or older, of sound mind, and under no constraint or undue influence.
_________________________________
(Testator)
We, _______________ and ____________________ , the witnesses, sign our names to this instrument, and at least one of us, being first duly sworn, does hereby declare, generally and to the undersigned authority, that the testator signs and executes this instrument as his last will and that he signs it willingly (or willingly directs another to sign for him), and that each of us, in the presence and hearing of the testator, hereby signs this will as witness to the testator's signing, and that to the best of our knowledge the testator is eighteen years of age or older, of sound mind, and under no constraint or undue influence.
________________________________________
Witness
________________________________________
Witness
The State of ______________________
County of ______________________
Subscribed, sworn to, and acknowledged before me by_______________ , the testator, and subscribed and sworn to before me by ____________ , witness, this___________ day of____.
(Seal)__________________
(Signed)_______________________
(Official capacity of officer)
(b) An attested will may at any time subsequent to its execution be made self-proved by the acknowledgment thereof by the testator and the affidavit of at least one witness, each made before an officer authorized to administer oaths under the laws of the state where the acknowledgment occurs and evidenced by the officer's certificate, under the official seal, attached, or annexed to the will in the following form or in a similar form showing the same intent:
The State of__________________
County of ______________________
We,__________________ and_____________________ , the testator and at least one of the witnesses, respectively, whose names are signed to the attached or foregoing instrument, being first duly sworn, do hereby declare to the undersigned authority that the testator signed and executed the instrument as his last will and that he had signed willingly (or willingly directed another to sign for him), and that he executed it as his free and voluntary act for the purposes therein expressed, and that each of the witnesses, in the presence and hearing of the testator, signed the will as witness and to the best of his knowledge the testator was at that time eighteen years of age or older, of sound mind, and under no constraint or undue influence.
___________________________________________________
Testator
____________________________________________________
Witness
Subscribed, sworn to, and acknowledged before me by _________, the testator, and subscribed and sworn to before me by ____________ , witness, this__________ day of ____________.
____________________
(Seal)
____________________
(Signed)
___________________________
(Official capacity of officer)
(c) A witness to any will who is also an officer authorized to administer oaths under the laws of this State may notarize the signature of the other witness of the will in the manner provided by this section."
Presumptions in self-proved wills
SECTION 16. Section 62-3-406(b) of the 1976 Code is amended to read:
"(b) If the will is self-proved, compliance with signature requirements for execution and other requirements of execution are presumed subject to rebuttal, without the testimony of any witness upon filing the will and the acknowledgment and affidavits annexed or attached thereto, unless there is proof of fraud or forgery affecting the acknowledgment or affidavit."
Bond requirements of personal representatives revised
SECTION 17. Section 62-3-603 of the 1976 Code is amended to read:
"Section 62-3-603. No bond is required of a personal representative who is named in a will and the will expressly waives the bond. Bond will be required in the following cases: (1) upon the appointment of a special administrator; (2) upon the appointment of a personal representative of an intestate estate unless that personal representative is a banking corporation or trust company qualified under Section 34-15-10; (3) upon appointment of a nonresident personal representative unless bond is expressly excused in the will; (4) when a personal representative is appointed to administer an estate under a will which does not expressly waive the requirement of bond; or (5)
when bond is required under Section 62-3-605. No bond is required of any banking corporation or trust company qualified under Section 34-15-10 when it is appointed to act as a personal representative except under item (4) above."
Description of lands reference deleted
SECTION 18. Section 14-23-650 of the 1976 Code is amended to read:
"Section 14-23-650. Description of lands devised; fees. Whenever a will omits to set forth a description of the lands thereby devised, the person offering such will for probate is required to furnish to the judge of probate of every county where the decedent owned real estate a sufficient description of such lands. The judge of probate, in addition to his charges for probate of wills allowed by law, is entitled to charge one dollar for each index of devises of real estate made by him, to be paid by the executor or party probating the will."
Notification of claim disallowance required
SECTION 19. Section 62-3-806 of the 1976 Code is amended to read:
"Section 62-3-806. (a) As to claims presented in the manner described in Section 62-3-804 within the time limit prescribed in Section 62-3-803, the personal representative may mail a notice to any claimant stating that the claim has been disallowed. If, after allowing or disallowing a claim, the personal representative changes his decision concerning the claim, he shall notify the claimant. The personal representative may not change a disallowance of a claim after the time for the claimant to file a petition for allowance or to commence a proceeding on the claim has run and the claim has been barred. Every claim which is disallowed in whole or in part by the personal representative is barred so far as not allowed unless the claimant files a petition for allowance in the court or commences a proceeding against the personal representative not later than thirty days after the mailing of the notice of disallowance or partial allowance if the notice warns the claimant of the impending bar. It is the responsibility of the personal representative to notify the claimant if a claim is disallowed."
Provisions made applicable to incapacitated persons
SECTION 20. Section 62-5-103 of the 1976 Code is amended to read:
"Section 62-5-103. Any person under a duty to pay or deliver money or personal property to a minor or incapacitated person may perform this duty in amounts not exceeding ten thousand dollars per annum, by paying or delivering the money or property to: (1) the minor or incapacitated person if he is married; (2) any person having the care and custody of the minor or incapacitated person with whom the minor or incapacitated person resides; (3) a guardian of the minor or incapacitated person; or (4) a financial institution incident to a deposit in a federally insured savings account in the sole name of the minor or incapacitated person and giving notice of the deposit to the minor or incapacitated person. This section does not apply if the person making payment or delivery has actual knowledge that a conservator has been appointed or proceedings for appointment of a conservator of the estate of the minor or incapacitated person are pending. The persons, other than the minor or incapacitated person or any financial institution under (4) above, receiving money or property for a minor or incapacitated person, are obligated to apply the money to the support and education of the minor or incapacitated person, but may not pay themselves except by way of reimbursement for out-of-pocket expenses for goods and services necessary for the minor's or incapacitated person's support. Any excess sums must be preserved for future support of the minor or incapacitated person, and any balance not so used and any property received for the minor or incapacitated person must be turned over to the minor when he attains majority or to the incapacitated person when he is no longer incapacitated. Persons who pay or deliver in accordance with provisions of this section are not responsible for the proper application thereof."
Settlement of certain minor claims presumed valid
SECTION 21. (A) Provisions of the South Carolina Probate Code which became effective July 1, 1987, superceded the minor settlement provisions of former Sections 15-71-10 through 15-71-30 of the 1976 Code which had required court approval of the settlement. On September 24, 1987, the South Carolina Supreme Court issued an administrative order reinstituting a court approval procedure for the settlement of minor claims. It is the intent of the General Assembly that the settlement of any claim involving a minor completed between July 1, 1987, and September 24, 1987, is presumed facially valid, and the General Assembly has therefore determined to enact the provisions of Section 62-5-434 herein. Neither the court which may have approved a settlement nor a person who completed the settlement of a minor's claim but did not seek court approval during this time period is liable for their good faith exercise of discretion in approving or completing the settlement.
(B) The 1976 Code is amended by adding:
"Section 62-5-434. The settlement of any claim involving a minor completed between July 1, 1987, and September 24, 1987, is presumed facially valid whether effectuated with or without court approval."
Contents of certificate of existence revised
SECTION 22. (A) Section 33-1-280 of the 1976 Code, as amended by an act of 1988 bearing ratification number 490, is further amended to read:
"Section 33-1-280. Certificate of existence.
(a) Anyone may apply to the Secretary of State to furnish a certificate of existence for a domestic corporation or a certificate of authorization for a foreign corporation.
(b) A certificate of existence or authorization sets forth:
(1) the domestic corporation's corporate name or the foreign corporation's corporate name used in this State;
(2) that (i) the domestic corporation is duly incorporated under the law of this State, the date of its incorporation, and the period of its duration if less than perpetual; or (ii) the foreign corporation is authorized to transact business in this State;
(3) that all fees, taxes, and penalties owed to the Secretary of State have been paid;
(4) that the Secretary of State has not mailed notice to the corporation pursuant to either Section 33-14-210 or 33-15-310 that the corporation is subject to being dissolved or its authority revoked;
(5) that articles of dissolution have not been filed; and
(6) other facts of record in the office of the Secretary of State that may be requested by the applicant.
(c) Subject to any qualification stated in the certificate, a certificate of existence or authorization issued by the Secretary of State may be relied upon as conclusive evidence that the domestic or foreign corporation is in existence or is authorized to transact business in this State."
(B) The South Carolina Reporters' Comments to Section 33-1-280 of the 1976 Code, as these comments are contained in an act of 1988 bearing ratification number 490, are amended to read:
"SOUTH CAROLINA REPORTERS' COMMENTS
Although the 1981 South Carolina Business Corporation Act did not explicitly provide for the Secretary of State to issue a certificate of existence or authorization, it has been current policy for the Secretary to issue a certificate of good standing.
1. Warning -- Tax certificate must also be obtained
The granting of the certificate of existence gives very limited protection. It only assures that the corporation has not been dissolved and that the Secretary of State has not brought an action to administratively dissolve the company. It does not warn the lawyer that the company may be dissolved the very next day because it has failed to file a tax return. Nor does it disclose that other grounds may then exist which give the Secretary of State the right to begin dissolution proceedings.
If the Tax Commission has notified a corporation that it has failed to file a required tax return and the corporation does not
file within sixty days of this notice, the Tax Commission will then so advise the Secretary of State and he will immediately dissolve the company (see Sections 33-14-210(c) and 33-15-310(c)). However, the Secretary of State will have no knowledge of this delinquency notice while it is pending and will issue a certificate of existence (good standing) even though the company is in the process of being dissolved for failure to file a tax return. Most administrative dissolutions will occur in this manner.
The only way that the lawyer can be certain that the company is not about to be dissolved for failure to file a tax return is to obtain a separate certificate of compliance from the Tax Commission. In most situations it will be necessary to obtain this certificate.
There may be other existing grounds for the Secretary of State to administratively dissolve the company. They, likewise, will not be disclosed by the certificate.
2. Differences from Model Act
Section 1.28(b)(3) of the 1987 Model Act Official Text requires the Secretary of State to provide information on unpaid taxes, fees, and penalties only if such information is available in the Secretary's records. Since the Secretary of State does not routinely have access to current tax information, subsection (b)(3) has been revised. The South Carolina version specifies that the Secretary of State will only certify the payment of any taxes and fees owed to him.
Subsection (b)(4) differs from the Model Act Official Text in two respects. First, since the annual report is filed with the Tax Commission (see Sections 33-16-220 and 12-19-20), the Secretary of State will not certify whether the annual report has been filed. Lawyers and others desiring to know whether the corporation has filed its annual report will have to obtain this information from the Tax Commission. Second, subsection (b)(4) has been amended to require the Secretary of State to certify that he has not mailed notice to the corporation that it is subject to being dissolved. This does not assure that the Tax Commission has not mailed such a notice.
3. Certificate does not negate the possibility that other actions are pending to dissolve the company.
The Attorney General has authority pursuant to Section 12-37-2270 to bring an action to vacate the corporation's charter for failure to pay property taxes or for other stated causes. Technically, the charter may be automatically 'forfeited or annulled' without the actual court action if property taxes have not been paid. The Attorney General also has the power to bring an action to dissolve a corporation for obtaining articles by fraud or abusing its authority (see Section 33-14-300). A shareholder has the continuing right to bring an action to dissolve the company (see Section 33-14-300(2)). The certificate of existence will not negate the possibility of any of these events or any others not within the jurisdiction of the Secretary of State. However, if an action has been brought under any of these sections, the corporation (or its officers or directors) will receive notice of the proceeding.
4. Other changes to prior law
Section 33-1-280 additionally provides for disclosure:
(1) that no articles of dissolution have been filed (subsection (b)(5)); and
(2) of other facts of record in the Secretary of State's office requested by the applicant (subsection (b)(6)).
It is clear also that any person, regardless of his relationship with the corporation, has the right to obtain a certificate of existence (subsection (a))."
Administrative dissolution provisions revised
SECTION 23. (A) Section 33-14-200 of the 1976 Code, as amended by an act of 1988 bearing ratification number 490, is further amended to read:
"Section 33-14-200. Grounds for administrative dissolution.
(a) The Secretary of State shall commence a proceeding under Section 33-14-210(a) to dissolve a corporation administratively if: (1) the corporation does not pay when they are due any franchise taxes, taxes payable under Chapter 7 of Title 12, or penalties imposed by law;
(2) the corporation does not deliver its annual report to the Tax Commission when it is due;
(3) the corporation is without a registered agent or registered office in this State;
(4) the corporation does not notify the Secretary of State that its registered agent or registered office has been changed, that its registered agent has resigned, or that its registered office has been discontinued; or
(5) the corporation's period of duration stated in its articles of incorporation expires.
(b) The Secretary of State shall dissolve a corporation under Section 33-14-210(c) if he is notified by the Tax Commission that the corporation has failed to file a required tax return within sixty days of the notice required by Section 12-7-1675."
(B) The South Carolina Reporters' Comments to Section 33-14-200 of the 1976 Code, as these comments are contained in an act of 1988 bearing ratification number 490, are amended to read:
"SOUTH CAROLINA REPORTERS' COMMENTS
Section 14.20 of the Model Act has been adopted with several technical changes. First, this provision reflects that the annual report required by Section 33-16-220 is to be filed with the Tax Commission, not the Secretary of State. Second, the failure to file a tax return within sixty days after the Tax Commission has notified the corporation of its delinquency is added as a ground for dissolution by the Secretary of State. He dissolves the corporation upon notification by the Tax Commission. Third, the sixty-day grace period contained in the Model Act section is not included here. However, new Section 12-7-1675 requires the Tax Commission to give sixty-day notice of failure to file a return before requesting the Secretary of State to administratively dissolve a delinquent corporation, and under Section 33-14-210(b) the corporation has sixty days to correct any other failure after notification by the Secretary of State. It was decided that one such sixty-day period was sufficient.
This section also adds failure to file income tax returns to the Model Act grounds for administrative dissolution. Finally, it adds expiration of the period of duration stated in the corporation's articles to the grounds for administrative dissolution; the special procedures of former Section 33-21-40 for dissolution (and reinstatement) of a corporation whose period of duration has expired are not continued."
Administrative dissolution provisions revised
SECTION 24. (A) Section 33-14-210 of the 1976 Code, as amended by an act of 1988 bearing ratification number 490, is further amended to read:
"Section 33-14-210. Procedure for and effect of administrative dissolution.
(a) If the Secretary of State determines that grounds exist under Section 33-14-200(a) for dissolving a corporation, he shall mail written notice of his determination to the corporation.
(b) If the corporation does not correct each ground for dissolution or demonstrate to the reasonable satisfaction of the Secretary of State that each ground determined by the Secretary of State does not exist within sixty days after the notice required by subsection (a) was mailed, the Secretary of State shall dissolve the corporation administratively by signing a certificate of dissolution that recites the grounds for dissolution and its effective date. The Secretary of State shall file the original of the certificate and send a copy to the corporation by registered or certified mail addressed to its registered agent at its registered office or to the office of the secretary of the corporation at its principal office.
(c) If the Secretary of State is notified by the Tax Commission that the corporation has failed to file a required tax return within sixty days of the notice required by Section 12-7-1675, the Secretary of State shall dissolve the corporation administratively by signing a certificate of dissolution that recites the grounds for dissolution and its effective date. The Secretary of State shall file the original of the certificate and send a copy to the corporation by registered or certified mail addressed to its registered agent at its registered office or to the office of the secretary of the corporation at its principal office.
(d) A corporation dissolved administratively continues its corporate existence but may not carry on any business except that necessary to wind up and liquidate its business and affairs under Section 33-14-105 and notify claimants under Sections 33-14-106 and 33-14-107.
(e) The administrative dissolution of a corporation does not terminate the authority of its registered agent."
(B) The South Carolina Reporters' Comments to Section 33-14-210 of the 1976 Code, as these comments are contained in an act of 1988 bearing ratification number 490, are amended to read:
"SOUTH CAROLINA REPORTERS' COMMENTS
Section 14.21 of the 1984 Model Act has been adopted with several changes. The Model Act requires that the notices specified by this section be served upon the corporation, either by service upon its registered agent or, if the corporation has no registered agent or he cannot be served, by certified (or registered) mail, return receipt requested, addressed to the corporation's secretary at its principal office. The new provision requires that the first notice be mailed to the corporation. This should be done in accordance with Section 33-1-410(d). The new provision further requires that the notice of dissolution be sent by certified (or registered) mail to the registered agent or the corporation's secretary; a return receipt need not be requested by the Secretary of State at the time of mailing. Thus, the method of notification has been simplified, while still assuring actual notice to the corporation. Requiring a return receipt would merely add to the cost and recordkeeping burdens of the Secretary of State's office without any benefit, since the United States Postal Service keeps records of delivery of all registered and certified mail and this information can be obtained later if the fact or date of delivery is at issue.
A new subsection (c) has been added to provide for administrative dissolution by the Secretary of State if a corporation fails to file a tax return within sixty days after notification of delinquency by the Tax Commission. Since the Tax Commission is responsible for the collection of taxes and keeps track of the filing of returns, it should give the initial notice that dissolution is imminent if the corporation does not file its overdue return with the Commission. Under subsection (c) the Secretary of State dissolves the corporation without giving another sixty-day advance notice.
This provision follows the Model Act in reducing the period for the corporation to respond to the Secretary of State's notice of determination that grounds for administrative dissolution exist from ninety to sixty days, but otherwise the procedure is similar to that under the 1981 South Carolina Business Corporation Act."
Administrative dissolution provisions revised
SECTION 25. (A) Section 33-14-220 of the 1976 Code, as amended by an act of 1988 bearing ratification number 490, is further amended to read:
"Section 33-14-220. Reinstatement following administrative dissolution.
(a) A corporation dissolved administratively under Section 33-14-210 may apply to the Secretary of State for reinstatement within two years after the effective date of dissolution. The application must:
(1) recite the name of the corporation and the effective date of its administrative dissolution;
(2) state that the grounds for dissolution either did not exist or have been eliminated;
(3) state that the corporation's name satisfies the requirements of Section 33-4-101; and
(4) contain a certificate from the South Carolina Tax Commission reciting that all taxes owed by the corporation have been paid.
(b) If the Secretary of State determines that the application contains the information required by subsection (a) and that the information is correct, he shall cancel the certificate of dissolution and prepare a certificate of reinstatement that recites his determination and the effective date of reinstatement, file the original of the certificate, and send a copy to the corporation.
(c) When the reinstatement is effective, it relates back to and takes effect as of the effective date of the administrative dissolution and the corporation resumes carrying on its business as if the administrative dissolution had never occurred."
(B) The South Carolina Reporters' Comments to Section 33-14-220 of the 1976 Code, as these comments are contained in an act of 1988 bearing ratification number 490, are amended to read:
"SOUTH CAROLINA REPORTERS' COMMENTS
Section 14.22 of the 1984 Model Act has been adopted with one change. The Model Act requires that the Secretary of State serve the notice of reinstatement upon the corporation. It was decided that formal service is purposeless, so this provision merely requires that the Secretary of State send the notice of reinstatement to the corporation.
This provision follows the Model Act in reducing the period for reinstatement from five years to two years, and it deletes the requirement of the 1981 South Carolina Business Corporation Act that all outstanding judgments against the corporation be paid before reinstatement. Otherwise, the procedure is similar to that under prior South Carolina law."
Administrative dissolution provisions revised
SECTION 26. (A) Section 33-14-230 of the 1976 Code, as amended by an act of 1988 bearing ratification number 490, is further amended to read:
"Section 33-14-230. Appeal from denial of reinstatement.
(a) If the Secretary of State denies a corporation's application for reinstatement following administrative dissolution, he shall send a written notice that explains the reasons for denial to the corporation by registered or certified mail addressed to its registered agent at its registered office or to the office of the secretary of the corporation at its principal office.
(b) The corporation may appeal the denial of reinstatement to the circuit court for Richland County within thirty days after the notice of denial was received. The corporation appeals by petitioning the court to set aside the dissolution and attaching to the petition copies of the Secretary of State's certificate of dissolution, the corporation's application for reinstatement, and the Secretary of State's notice of denial.
(c) The court may summarily order the Secretary of State to reinstate the dissolved corporation or may take other action the court considers appropriate.
(d) The court's final decision may be appealed as in other civil proceedings."
(B) The South Carolina Reporters' Comments to Section 33-14-230 of the 1976 Code, as these
comments are contained in an act of 1988 bearing ratification number 490, are amended to read:
"SOUTH CAROLINA REPORTERS' COMMENTS
Section 14.23 of the 1984 Model Act has been adopted with only a few technical changes. The Model Act requires that the notice of denial be served upon the corporation, either by service upon its registered agent or, if the corporation has no registered agent or he cannot be served, by certified (or registered) mail, return receipt requested, addressed to the corporation's secretary at its principal office. The new provision requires that the notice be sent by certified (or registered) mail to the registered agent or the corporation's secretary but does not require that a return receipt be requested at the time of mailing. Thus, the method of notification is simplified, while still assuring actual notice to the corporation. A conforming change has been made to subsection (b) to start the thirty-day period for appeal from receipt, rather than service, of the notice. This is when the notice would be effective under the general provisions of Section 33-1-410(e). If a dispute arises about the date or fact of receipt, the Secretary of State can obtain from the United States Postal Service a record of delivery of the notice since the notice has to be sent registered or certified mail.
There was no similar provision in the 1981 South Carolina Business Corporation Act."
Provisions relating to revocation of foreign corporation's certificate of authority revised
SECTION 27. (A) Section 33-15-300 of the 1976 Code, as amended by an act of 1988 bearing ratification number 490, is further amended to read:
"Section 33-15-300. Grounds for revocation.
(a) The Secretary of State shall commence a proceeding under Section 33-15-310 to revoke the certificate of authority of a foreign corporation authorized to transact business in this State if:
(1) the foreign corporation does not deliver its annual report to the Tax Commission when due;
(2) the foreign corporation does not pay, when they are due, any franchise taxes or penalties imposed by this act or other law;
(3) the foreign corporation is without a registered agent or registered office in this State;
(4) the foreign corporation does not inform the Secretary of State under Section 33-15-108 or 33-15-109 that its registered agent or registered office has changed, that its registered agent has resigned, or that its registered office has been discontinued;
(5) an incorporator, director, officer, or agent of the foreign corporation signed a document he knew was false in any material respect with intent that the document be delivered to the Secretary of State for filing;
(6) the Secretary of State receives a duly authenticated certificate from the secretary of state or other official having custody of corporate records in the state or country under whose law the foreign corporation is incorporated stating that it has been dissolved or disappeared as the result of a merger.
(b) The Secretary of State shall proceed under Section 33-15-310(c) to revoke the certificate of authority of a foreign corporation authorized to transact business in this State if he is notified by the Tax Commission that the corporation has failed to file a required tax return within sixty days of the notice required by Section 12-7-1675."
(B) The South Carolina Reporters' Comments to Section 33-15-300 of the 1976 Code, as these comments are contained in an act of 1988 bearing ratification number 490, are amended to read:
"SOUTH CAROLINA REPORTERS' COMMENTS
The grounds whereby the Secretary of State can revoke the foreign corporation's qualification are almost identical to those in Sections 33-23-100 and 33-23-110 of the 1981 South Carolina Business Corporation Act. There are only two differences.
The prior law allowed cancelation if the company failed to make any required filing. Now cancelation is specified only for failure to file the annual report. Second, under the prior law (Section 33-23-100 of the 1981 South Carolina Business Corporation Act), if the company went out of business, it or its trustee was required to file notice of its dissolution with South Carolina. If the company failed to make this filing, then the Secretary of State of South Carolina could move to cancel the qualification. Under item (6) of this section, there is no expressed duty for the corporation to notify South Carolina. However, the Secretary of State will likely know when a company goes out of business since it will no longer be sending annual reports. Thus, the Secretary can cancel the qualification because of either the failure to file or lack of existing charter.
The Attorney General in 1965 Op. S.C. Att'y Gen. 13 (#1780) held that the Secretary of State could not cancel a foreign corporation's qualification for its failure to pay the then annual license fee. The annual license fee was collected by the Tax Commissioner, and the Secretary of State could only cancel for failure to pay those fees he collected. A different result will exist under this statute since the Secretary of State has the power to terminate a foreign corporation's qualification for failure to pay any franchise taxes prescribed by the law of South Carolina. It is irrelevant who collects the tax.
This provision adds to those contained in Model Act Section 15.30, the failure to file an income tax return or corporate license tax return within sixty days after the Tax Commission has notified the corporation of its delinquency under Section 12-7-675. The Secretary of State revokes the certificate of authority of the foreign corporation upon notification by the Tax Commission.
In South Carolina the annual report is filed with the Tax Commission rather than with the Secretary of State (as is the procedure in most states). See Sections 33-16-220 and 12-19-20. Subsection (a)(1) has been appropriately worded to specify that the foreign corporation is in default if the annual report is not filed with the Tax Commission.
Sections 15.30 and 15.40 of the 1984 Model Act Official Text generally give a delinquent foreign corporation two sixty-day grace periods before the Secretary of State can revoke its authority. For example, if the company does not file its annual report within sixty days after it is due, the Secretary of State is only then (after the sixty-day grace period) empowered to send a notice of the failure to file. If the foreign corporation does not do anything about this, then, after the expiration of a second sixty-day period, the Secretary of State can revoke the foreign corporation's authority to do business. In keeping with prior law, and in accordance with the procedure to dissolve administratively a domestic corporation, the Model Act language has been amended to empower the Secretary of State to send a sixty-day final notice as soon as the company fails to file its annual report. If the company fails to cure its problem within sixty days of the deficiency notice, the Secretary of State then can revoke the authority without any further delay.
Although the language of the new section varies from the prior law, except as noted, the content of the provisions remains the same."
Provisions relating to revocation of foreign corporation's certificate of authority revised.
SECTION 28. (A) Section 33-15-310 of the 1976 Code, as amended by an act of 1988 bearing ratification number 490, is further amended to read:
"Section 33-15-310. Procedure for and effect of revocation.
(a) If the Secretary of State determines that grounds exist under Section 33-15-300(a) for revocation of a certificate of authority, he shall mail written notice of his determination to the foreign corporation.
(b) If the foreign corporation does not correct each ground for revocation or demonstrate to the reasonable satisfaction of the Secretary of State that each ground determined by the Secretary of State does not exist within sixty days after the notice required by subsection (a) was mailed, the Secretary of State shall revoke the foreign corporation's certificate of authority by signing a certificate of revocation that recites the grounds for revocation and its effective date. The Secretary of State shall file the original of the certificate and send a copy to the foreign corporation by registered or certified mail addressed to its registered agent at its registered office or to the office of the secretary of the corporation at its principal office.
(c) If the Secretary of State is notified by the Tax Commission that the foreign corporation has failed to file a required tax return within sixty days of the notice required by Section 12-7-1675, the Secretary of State shall revoke the foreign corporation's certificate of authority by signing a certificate of revocation that recites the grounds for revocation and its effective date. The Secretary of State shall file the original of the certificate and send a copy to the foreign corporation by registered or certified mail addressed to its registered agent at its registered office or to the office of the secretary of the corporation at its principal office.
(d) The authority of a foreign corporation to transact business in this State ceases on the date shown on the certificate revoking its certificate of authority.
(e) The Secretary of State's revocation of a foreign corporation's certificate of authority appoints the Secretary of State as the foreign corporation's agent for service of process in any proceeding based on a cause of action which arose during the time the foreign corporation was authorized to transact business in this State. Service of process on the Secretary of State under this subsection is service on the foreign corporation. Upon receipt of process, the Secretary of State shall mail a copy of the process to the secretary of the foreign corporation at its principal office shown in its most recent annual report or in any subsequent communication received from the corporation stating the current mailing address of its principal office or, if none is on file, in its application for a certificate of authority.
(f) Revocation of a foreign corporation's certificate of authority does not terminate the authority of the registered agent of the corporation."
(B) The South Carolina Reporters' Comments to Section 33-15-310 of the 1976 Code, as these
comments are contained in an act of 1988 bearing ratification number 490, are amended to read:
"SOUTH CAROLINA REPORTERS' COMMENTS
This section establishes more precision in the method to be used in revoking a foreign company's qualification than the 1981 South Carolina Business Corporation Act. It grants the corporation sixty days to cure its default. Prior South Carolina practice was to allow ninety days. This provision provides for mailing of the notices to the foreign corporation, rather than service upon it as required by Section 15.31 of the 1984 Model Act. See the South Carolina Reporters' Comments to Section 33-14-210. If the ground for revocation is the failure to file an income tax return or license tax return, the initial notice is given by the Tax Commission rather than the Secretary of State. If the return is not filed within the sixty-day period following the notice, the Tax Commission notifies the Secretary of State, who then revokes the certificate of authority.
As was previously specified in Section 33-23-100 of the 1981 South Carolina Business Corporation Act, if the qualification is revoked, service of process is proper on the Secretary of State. See State v. Ford Motor Co. 208 S.C. 379, 38 S.E.2d 242 (1946), upholding the propriety of serving the Secretary of State in situations where a corporation was exempt from qualifying but was conducting interstate business in South Carolina. Subsection (f) also allows service of process to be made on the company's agent, if the company or agent has not revoked this appointment. See also, Section 33-15-110, which permits service also to be made on the company's secretary. Except as mentioned above, the provisions of this section are comparable to Section 33-23-110(b) and (c) of the 1981 South Carolina Business Corporation Act."
Provisions relating to revocation of foreign corporation's certificate of authority revised
SECTION 29. (A) Section 33-15-320 of the 1976 Code, as amended by an act of 1988 bearing ratification number 490, is further amended to read:
"Section 33-15-320. Appeal from revocation.
(a) A foreign corporation may appeal the Secretary of State's revocation of its certificate of authority to the Richland County Circuit Court within thirty days after the certificate of revocation was received. The foreign corporation appeals by petitioning the court to set aside the revocation and attaching to the petition copies of its certificate of authority and the Secretary of State's certificate of revocation.
(b) The court may summarily order the Secretary of State to reinstate the certificate of authority or may take any other action the court considers appropriate.
(c) The court's final decision may be appealed as in other civil proceedings."
(B) The South Carolina Reporters' Comments to Section 33-15-320 of the 1976 Code, as these comments are contained in an act of 1988 bearing ratification number 490, are amended to read:
"SOUTH CAROLINA REPORTERS' COMMENTS
This section has no counterpart in the 1981 South Carolina Business Corporation Act. Because of convenience, the Circuit Court of Richland County is designated to hear any appeal. As noted in the South Carolina Reporters' Comments to Section 33-1-260, the provisions of the Administrative Procedures Act (as guaranteed by Article I, Section 22, of the Constitution of South Carolina, 1895) specify the appropriate procedures for reviewing the Secretary of State's revocation of a foreign corporation's certificate of authority. See specifically Section 1-23-380 of the 1976 Code.
A change has been made to subsection (a) to conform it to the procedure for mailing the notice of revocation under Section 33-15-310(b) and (c). The thirty-day period for appeal starts to run upon receipt, rather than service, of the notice. This is when the notice would be effective under the general provisions of Section 33-1-410(e). If a dispute arises about the date or fact of receipt, the Secretary of State can obtain from the United States Postal Service a record of delivery of the notice since the notice has to be sent registered or certified mail."
Dissolution and revocation provisions for failure to file certain tax returns revised
SECTION 30. (A) Section 12-7-1675 of the 1976 Code, as amended by an act of 1988 bearing ratification number 490, is further amended to read:
"Section 12-7-1675. Notwithstanding the provisions of Sections 12-7-1650 and 12-7-1670, the Commission shall notify any domestic or foreign corporation of its failure to comply with the provisions of Chapters 7 and 19 of this title requiring the filing of returns. If the taxpayer fails to file the required return within sixty days of the notice, the Commission may provide the Secretary of State the name of the taxpayer failing to file a return and the Secretary of State shall administratively dissolve the corporation if it is a domestic corporation and shall revoke its certificate of authority if it is a foreign corporation authorized to transact business in this State. The Commission may not make an assessment or issue any warrant against a taxpayer which it refers to the Secretary of State for administrative dissolution."
(B) The South Carolina Reporters' Comments to Section 12-7-1675 of the 1976 Code, as these comments are contained in an act of 1988 bearing ratification number 490, are amended to read:
"SOUTH CAROLINA REPORTERS' COMMENTS
This new section makes technical changes to the Tax Commission procedures to coordinate them with Sections 33-14-200 and 33-14-210 providing for administrative dissolution for failure to file franchise or income tax returns when they are due and with Sections 33-15-300 and 33-15-310 providing for revocation of a foreign corporation's certificate of authority to transact business in this State for failure to timely file such returns. See the South Carolina Reporters' Comments to those sections."
Repeal
SECTION 31. Chapter 29, Title 33 of the 1976 Code is repealed.
Effective date for certain provisions
SECTION 32. The amendments to Sections 33-1-280, 33-14-200, 33-14-210, 33-14-220, 33-14-230, 33-15-300, 33-15-310, 33-15-320, and 12-7-1675 of the 1976 Code, and the repeal of Chapter 29 of Title 33 of the 1976 Code, as contained in this act, take effect January 1, 1989.
Time effective
SECTION 33. This act takes effect upon approval by the Governor.