Texas Family Code - Section 9.302. Pre-Decree Designation Of Ex-Spouse As Beneficiary In Retirement Benefits And Other Financial Plans

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§ 9.302. PRE-DECREE DESIGNATION OF EX-SPOUSE AS 
BENEFICIARY IN RETIREMENT BENEFITS AND OTHER FINANCIAL PLANS.  (a) 
If a decree of divorce or annulment is rendered after a spouse, 
acting in the capacity of a participant, annuitant, or account 
holder, has designated the other spouse as a beneficiary under an 
individual retirement account, employee stock option plan, stock 
option, or other form of savings, bonus, profit-sharing, or other 
employer plan or financial plan of an employee or a participant in 
force at the time of rendition, the designating provision in the 
plan in favor of the other former spouse is not effective unless:
		(1)  the decree designates the other former spouse as 
the beneficiary;      
		(2)  the designating former spouse redesignates the 
other former spouse as the beneficiary after rendition of the 
decree;  or
		(3)  the other former spouse is designated to receive 
the proceeds or benefits in trust for, on behalf of, or for the 
benefit of a child or dependent of either former spouse.
	(b)  If a designation is not effective under Subsection (a), 
the benefits or proceeds are payable to the named alternative 
beneficiary or, if there is not a named alternative beneficiary, to 
the designating former spouse.
	(c)  A business entity, employer, pension trust, insurer, 
financial institution, or other person obligated to pay retirement 
benefits or proceeds of a financial plan covered by this section who 
pays the benefits or proceeds to the beneficiary under a 
designation of the other former spouse that is not effective under 
Subsection (a) is liable for payment of the benefits or proceeds to 
the person provided by Subsection (b) only if:
		(1)  before payment of the benefits or proceeds to the 
designated beneficiary, the payor receives written notice at the 
home office or principal office of the payor from an interested 
person that the designation of the beneficiary or fiduciary is not 
effective under Subsection (a);  and
		(2)  the payor has not interpleaded the benefits or 
proceeds into the registry of a court of competent jurisdiction in 
accordance with the Texas Rules of Civil Procedure.
	(d)  This section does not affect the right of a former 
spouse to assert an ownership interest in an undivided pension, 
retirement, annuity, or other financial plan described by this 
section as provided by this subchapter.
	(e)  This section does not apply to the disposition of a 
beneficial interest in a retirement benefit or other financial plan 
of a public retirement system as defined by Section 802.001, 
Government Code.

Added by Acts 1997, 75th Leg., ch. 7, § 1, eff. April 17, 1997.            

Last modified: August 10, 2007