Subcommittee clarifies probate status of cooperative patronage capital accounts

House Bill 3,914 would amend the South Carolina Probate Code to include patronage capital accounts held by members of electric or telephone cooperatives in the statutory definition of an “account.”

Under the bill, patronage capital accounts — which represent a cooperative member’s share of surplus earnings allocated based on payments for services or capital contributions — would be explicitly treated as financial accounts for probate purposes. The change would clarify whether those funds pass directly to surviving co-owners if the account includes survivorship or pass into the decedent’s estate under existing probate or non-probate transfer rules.

A committee member explained the change as a practical fix after consulting with a Richland County probate judge and cited a constituent example: Representative Bailey’s mother reportedly left a single check for $67 that, without clarification, could require opening a probate estate. “This doesn’t happen a lot, but in his situation, his mother passed away. The only thing she had that was a check from, an entity for $67 he would have had to open a probate estate, go through the whole process for $67,” the member said.

The bill would take effect July 1, 2025, if enacted. The subcommittee took a roll-call vote and returned a favorable report on House Bill 3,914 by a vote of 5 to 0.

The measure aims to reduce administrative burdens in probate for small cooperative distributions and to provide clear rules for transfer on death where survivorship language is present in cooperative accounts.