Bill Text: TX HB2447 | 2023-2024 | 88th Legislature | Introduced


Bill Title: Relating to private transfer fee obligations.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2023-03-13 - Referred to Business & Industry [HB2447 Detail]

Download: Texas-2023-HB2447-Introduced.html
  88R4470 SHH-F
 
  By: Darby H.B. No. 2447
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to private transfer fee obligations.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 5.201, Property Code, is amended by
  adding Subdivision (3-a) to read as follows:
               (3-a)  "Payee of record" means:
                     (A)  the payee of a private transfer fee under a
  private transfer fee obligation if there is only one payee; or
                     (B)  the payee designated as payee of record by
  multiple payees of a single private transfer fee under a private
  transfer fee obligation, as required by Section 5.203(b).
         SECTION 2.  Section 5.203, Property Code, is amended by
  amending Subsection (e) and adding Subsections (e-1) and (e-2) to
  read as follows:
         (e)  A person who refiles or amends a notice under Subsection
  (d) [(d)(2)] must include:
               (1)  the recording information of the original notice
  and each subsequent notice filed as required by this section; and
               (2)  the legal description of the property subject to
  the private transfer fee obligation.
         (e-1)  The legal description of property included in a notice
  under this section must be sufficient to describe all encumbered
  property. A description by reference to a previously recorded
  document other than a recorded plat does not satisfy this
  subsection.
         (e-2)  If the encumbered property is located in a platted
  subdivision, the legal description of property included in a notice
  under this section must:
               (1)  describe the subdivision and include the
  subdivision's name and recording information; and
               (2)  itemize by lot and block reference each lot that is
  subject to the private transfer fee obligation.
         SECTION 3.  Subchapter G, Chapter 5, Property Code, is
  amended by adding Sections 5.2035, 5.2041, 5.2042, 5.2043, 5.2044,
  and 5.2045 to read as follows:
         Sec. 5.2035.  ADDITIONAL COMPLIANCE REQUIREMENT:
  NOTIFICATION OF SUBDIVISION PROPERTY OWNERS. (a) This section
  applies to encumbered property located in a platted subdivision
  used or developed primarily for use as one to four family
  residences.
         (b)  The payee of record for an encumbered property to which
  this section applies shall:
               (1)  on or before the date a notice required under
  Section 5.203 is filed for record, mail a separate copy of the
  notice to each owner of property in the subdivision by first class
  mail, postage prepaid, at the mailing address shown for the owner in
  the records of the central appraisal district of the county in which
  the encumbered property is located;
               (2)  file for record with the notice the payee's sworn
  affidavit affirming the copies of the notice were mailed in the time
  and manner required by this section; and
               (3)  maintain auditable records showing compliance
  with this section for at least five years and make those records
  available at no charge to any owner of property in the subdivision.
         (c)  For purposes of Section 5.203(f), a payee of record's
  failure to comply with this section constitutes failure to comply
  with Section 5.203.
         Sec. 5.2041.  LIMITATIONS PERIOD FOR PAYEE CLAIM. (a) This
  section applies to a suit:
               (1)  for payment of a private transfer fee payable as a
  result of a transfer of encumbered property;
               (2)  to foreclose a lien securing a private transfer
  fee obligation; or
               (3)  to contest the validity of a recorded termination
  of the instrument creating a private transfer fee obligation.
         (b)  A person must bring a suit to which this section applies
  not later than one year after the date of the sale or conveyance or
  the date the termination was recorded.
         (c)  This section does not affect any other limitation
  applicable to the payment of a private transfer fee, a private
  transfer fee obligation, or the foreclosure of a lien securing a
  private transfer fee or private transfer fee obligation.
         Sec. 5.2042.  REQUEST FOR STATUS OF PRIVATE TRANSFER FEE
  OBLIGATION. (a) An owner of property described in a recorded
  private transfer fee obligation may by mail request that the payee
  of record designated in the most recent recorded notice of private
  transfer fee obligation under Section 5.203 declare whether the
  private transfer fee obligation is or is not currently effective.
         (b)  Not later than the 30th day after the date of the mailing
  of a request under Subsection (a), the payee of record who receives
  the request shall:
               (1)  deliver to the owner making the request a copy of a
  sworn affidavit stating the status of the private transfer fee
  obligation as currently effective or not currently effective and
  made by:
                     (A)  the payee of record, if the payee of record is
  a natural person; or
                     (B)  an individual who is an authorized
  representative of the payee, if the payee is not a natural person;
  and
               (2)  file the affidavit for record in the county where
  the property is located.
         (c)  If a request is made under Subsection (a) and the payee
  of record does not satisfy the requirements of Subsection (b) or the
  affidavit delivered and recorded under Subsection (b) states that
  the private transfer fee obligation is not effective:
               (1)  the private transfer fee obligation is terminated,
  is not effective, and does not encumber any property described in
  the private transfer fee obligation; and
               (2)  a private transfer fee is not due or payable with
  respect to any future transfer of the owner's property or any other
  property described in the private transfer fee obligation.
         (d)  A property owner who makes a request under Subsection
  (a) may record at any time in the county where the property is
  located a sworn affidavit that states the date the request was
  mailed and includes a copy of the request. An affidavit described by
  this subsection:
               (1)  is presumed to be true and correct; and
               (2)  may be conclusively relied on as true and correct
  by any future grantees or lienholders.
         Sec. 5.2043.  ACTION AGAINST PAYEE AUTHORIZED. (a) The
  owner of or any purchaser, lienholder, or other party having an
  interest in or lien on affected property may bring an action under
  this section against any payee of a private transfer fee
  obligation, as shown in the most recent notice of private transfer
  fee obligation recorded under Section 5.203, and any individual who
  signed the relevant affidavit on behalf of the payee, if the payee
  improperly:
               (1)  files a notice of private transfer fee obligation
  under Section 5.203;
               (2)  files an affidavit described by Section 5.2042(b)
  stating that the private transfer fee obligation is currently
  effective; or
               (3)  files any other affidavit or notice asserting the
  private transfer fee obligation is effective with respect to the
  property, the owner, or any purchaser, lienholder, or other
  interested party having an interest in or lien on the property.
         (b)  An owner or a purchaser, lienholder, or other interested
  party who prevails in an action under this section is entitled:
               (1)  to declaratory relief determining that the private
  transfer fee obligation, any right to receive a private transfer
  fee, and any lien securing the private transfer fee obligation is
  invalid and unenforceable with respect to the property; and
               (2)  to recover: 
                     (A)  the party's attorney's fees and court costs;
                     (B)  actual damages; and 
                     (C)  exemplary damages of $10,000 for each
  affected tract, with each subdivided lot constituting a separate
  tract.
         (c)  Each payee and any individual who is determined to have
  signed a false affidavit is jointly and severally liable for an
  award under Subsection (b)(2).
         (d)  An action may be brought under this section in the same
  suit by more than one owner of property described by the private
  transfer fee obligation. Each prevailing owner is separately
  entitled to recover under Subsection (b)(2).
         (e)  An action under this section regarding an affidavit
  recorded under Section 5.2042(b) may be brought by the owner who
  requested the affidavit or any person who acquired title to the
  property after the request was made.
         (f)  In an action brought under this section against the
  payee of record for the most recently filed notice of private
  transfer fee obligation under Section 5.203:
               (1)  service on the payee of record is effective
  service on all payees, without requiring joinder or service on any
  other payee; and
               (2)  a judgment against the payee of record is binding
  on each payee jointly and severally.
         Sec. 5.2044.  DECEPTIVE TRADE PRACTICE. The filing of a
  notice under Section 5.203 with respect to a private transfer fee
  obligation that has terminated or the making or filing of a false
  affidavit under Section 5.2042(b) is a deceptive trade practice
  under Subchapter E, Chapter 17, Business & Commerce Code, and is
  actionable under that subchapter.
         Sec. 5.2045.  TIMING OF TERMINATION. (a) In any action to
  enforce or to determine the validity or enforceability of a private
  transfer fee obligation with respect to a transaction in which a
  deed is executed, a termination of the obligation shall be
  considered effective if:
               (1)  the termination is recorded before the deed is
  recorded; or
               (2)  a grantor or grantee of the deed executes and
  records an affidavit stating that it was the intention of the
  parties to the deed that the deed was not executed, delivered, or
  accepted, and that the property was not sold, conveyed,
  transferred, or assigned, until after the recordation of the
  termination.
         (b)  For purposes of Subsection (a), if a deed is executed in
  a transaction in which a termination of a private transfer fee
  obligation is executed, it is presumed that the termination was
  executed before the conveyance.
         SECTION 4.  (a) Notwithstanding Section 5.2041, Property
  Code, as added by this Act, a person may bring a suit described by
  Subsection (a) of that section before September 1, 2024, in
  connection with a sale or conveyance that occurred or a termination
  of private transfer fee obligation that was recorded before
  September 1, 2023.
         (b)  This section does not affect any other limitation
  applicable to the payment of a private transfer fee, a private
  transfer fee obligation, or the foreclosure of a lien securing a
  private transfer fee or private transfer fee obligation.
         SECTION 5.  This Act takes effect September 1, 2023.
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