MN HF2233

Adopts the Uniform Special Deposits Act, codified in Minnesota Statutes chapter 47 (sections 47.90 to 47.985), establishing a legal framework for special deposit accounts held by banks for specified purposes with designated beneficiaries

Defines a "special deposit" as a bank deposit under an account agreement for the benefit of at least two beneficiaries, for a permissible purpose (such as escrow funds, security deposits, settlement of payment system obligations, or holding collateral), and subject to a contingency

Protects special deposits from creditor process (garnishment, attachment, liens) against the bank, except when the bank becomes obligated to pay a beneficiary and specific procedural requirements are met

Limits bank liability to only proximate damages caused by noncompliance with account agreements, excludes fiduciary duties, and prohibits banks from exercising set-off rights against special deposits except in limited circumstances

Applies to account agreements executed on or after August 1, 2025, or to existing deposits if all parties agree to convert them to special deposits under the new law