                                 CODE OF VIRGINIA

NONEXONERATION; PAYMENT OF LIEN IF GRANTED BY AGENT (§ 64.2-531)

A. For the purposes of this section, &#8220;revocable,&#8221;
&#8220;settlor,&#8221; &#8220;trustee,&#8221; and &#8220;trust instrument&#8221;
mean the same as those terms are defined in &#xA7; 64.2-701.

B. Unless a contrary intent is clearly set out in the will, the trust
instrument, or a transfer on death deed, (i) real or personal property that is
the subject of a specific devise or bequest in the will or the trust instrument
that was revocable immediately before the settlor&#8217;s death or (ii) real
property subject to a transfer on death deed passes, subject to any mortgage,
pledge, security interest, or other lien existing at the date of death of the
testator or settlor, without the right of exoneration. A general directive in
the will or trust instrument to pay debts shall not be evidence of a contrary
intent that the mortgage, pledge, security interest, or other lien be exonerated
prior to passing to the legatee.

C. The personal representative may give written notice to the creditor holding
any debt to which subsection B applies that there is no right of exoneration for
such debt pursuant to this section. Such notice shall include a copy of this
section. Any such notice shall be sent by certified mail (i) to the address the
creditor last provided to the debtor as the address to which notices to the
creditor are to be sent; (ii) if the personal representative cannot reasonably
determine the address to which notices to the creditor are to be sent, to the
address the creditor last provided to the debtor as the address at which
payments to the creditor are to be made; or (iii) if the personal representative
cannot reasonably determine either the address to which notices to the creditor
are to be sent or at which payments to the creditor are to be made, to (a) the
address of the creditor&#8217;s registered agent on file with the Virginia State
Corporation Commission or (b) if there is no such registered agent on file, to
the creditor&#8217;s last known address. The creditor holding such debt may file
a claim for such debt with the commissioner of accounts pursuant to &#xA7;
64.2-552 on or before the later of one year after the qualification of the
personal representative of the decedent&#8217;s estate or six months after the
personal representative gives such written notice to the creditor. Once the
personal representative has given notice to the creditor as provided in this
section, unless the creditor files a timely claim against the estate as set
forth in this subsection, the liability of a personal representative or his
surety for such debt shall not exceed the assets of the decedent remaining in
the possession of the personal representative and available for application to
the debt pursuant to &#xA7; 64.2-528 at the time the creditor presents a demand
for payment of such debt to the personal representative. Nothing in this section
shall affect either the liability of the estate for such debt to the extent of
the decedent&#8217;s assets remaining at the time a claim is filed or the
liability of the beneficiaries that receive the decedent&#8217;s assets to the
extent of such receipt.
			In the event that any such claim is timely filed with the commissioner of
accounts, the personal representative shall give the specific beneficiary
receiving such real or personal property written notice, within 90 days after
such claim is filed, to obtain from the creditor the release of the estate from
such claim. The notice to a beneficiary may be made to the personal
representative of a deceased beneficiary whose estate is a beneficiary, an
attorney-in-fact for a beneficiary, a guardian or conservator of an
incapacitated beneficiary, a committee of a convict or insane beneficiary, or
the duly qualified guardian of a minor or, if none exists, a custodial parent of
a minor. If the estate has not been released from such claim after the later of
180 days from such notice or one year from qualification, the personal
representative may (1) sell the real or personal property that is the subject of
a specific devise or bequest and that is also subject to the claim, (2) apply
the proceeds of sale to the satisfaction of the claim, and (3) distribute any
excess proceeds from such sale of the specific beneficiary of such property. If
the proceeds of such sale are insufficient to satisfy the debt in full, the
deficiency shall remain a debt of the estate to be satisfied from the other
assets of the estate in accordance with applicable law. If such real property is
subject to a transfer on death deed and is also subject to the claim, the
personal representative may proceed as provided in &#xA7; 64.2-634 to enforce
the liability for such claim against such property.

D. Subsection B shall not apply to any mortgage, pledge, security interest, or
other lien existing at the date of death of the testator or settlor against any
specifically devised or bequeathed real or personal property, or any real
property subject to a transfer on death deed, that was granted by an agent
acting within the authority of a durable power of attorney for the testator or
settlor while the testator or settlor was incapacitated. For the purposes of
this section, (i) no adjudication of the testator&#8217;s or settlor&#8217;s
incapacity is necessary, (ii) the acts of an agent within the authority of a
durable power of attorney are rebuttably presumed to be for an incapacitated
testator or settlor, and (iii) an incapacitated testator or settlor is one who
is impaired by reason of mental illness, intellectual disability, physical
illness or disability, chronic use of drugs, chronic intoxication, or other
cause creating a lack of sufficient understanding or capacity to make or
communicate responsible decisions. This subsection shall not apply (a) if the
mortgage, pledge, security interest, or other lien granted by the agent on the
specific property is thereafter ratified by the testator or settlor while he is
not incapacitated or (b) if the durable power of attorney was limited to one or
more specific purposes and was not general in nature.

E. Subsection B shall not apply to any mortgage, pledge, security interest, or
other lien existing at the date of the death of the testator or settlor against
any specific devise or bequest of any real or personal property, or any real
property subject to a transfer on death deed, that was granted by a conservator,
guardian, or committee of the testator or settlor. This subsection shall not
apply if, after the mortgage, pledge, security interest, or other lien granted
by the conservator, guardian, or committee, there is an adjudication that the
testator&#8217;s or settlor&#8217;s disability has ceased and the testator or
settlor survives that adjudication by at least one year.

F. Nothing in this section shall affect the priority of a secured debt with
respect to the collateral securing such debt.

HISTORY: 2007, c. 341, § 64.1-157.1; 2012, cc. 476, 507, 614; 2013, c. 390;
2017, cc. 34, 139; 2024, c. 576.