CHAPTER 207. DISCLOSURE OF INFORMATION BY PROPERTY OWNERS' ASSOCIATIONS
PROPERTY CODE
TITLE 11. RESTRICTIVE COVENANTS
CHAPTER 207. DISCLOSURE OF INFORMATION BY PROPERTY OWNERS'
ASSOCIATIONS
Sec. 207.001. DEFINITIONS. In this chapter:
(1) "Restrictions" has the meaning assigned by Section 201.003.
(2) "Dedicatory instrument," "property owners' association," and
"restrictive covenant" have the meanings assigned by Section
202.001.
(3) "Owner" means a person who owns record title to property in
a subdivision or the personal representative of an individual who
owns record title to property in a subdivision.
(4) "Regular assessment" and "special assessment" have the
meanings assigned by Section 204.001.
(5) "Resale certificate" means a written statement issued,
signed, and dated by an officer or authorized agent of a property
owners' association that contains the information specified by
Section 207.003(b).
(6) "Subdivision" means all land that has been divided into two
or more parts and that is or was burdened by restrictions
limiting at least the majority of the land area burdened by
restrictions, excluding streets and public areas, to residential
use only, if the instrument or instruments creating the
restrictions are recorded in the deed or real property records of
a county.
Added by Acts 1999, 76th Leg., ch. 1198, Sec. 1, eff. Sept. 1,
1999.
Sec. 207.002. APPLICABILITY. This chapter applies to a
subdivision with a property owners' association that is entitled
to levy regular or special assessments.
Added by Acts 1999, 76th Leg., ch. 1198, Sec. 1, eff. Sept. 1,
1999.
Sec. 207.003. DELIVERY OF SUBDIVISION INFORMATION TO OWNER. (a)
Not later than the 10th day after the date a written request for
subdivision information is received from an owner, owner's agent,
or title insurance company or its agent acting on behalf of the
owner, the property owners' association shall deliver to the
owner, owner's agent, or title insurance company or its agent:
(1) a current copy of the restrictions applying to the
subdivision;
(2) a current copy of the bylaws and rules of the property
owners' association; and
(3) a resale certificate that complies with Subsection (b).
(b) A resale certificate under Subsection (a) must contain:
(1) a statement of any right of first refusal or other restraint
contained in the restrictions or restrictive covenants that
restricts the owner's right to transfer the owner's property;
(2) the frequency and amount of any regular assessments;
(3) the amount of any special assessment that is due after the
date the resale certificate is prepared;
(4) the total of all amounts due and unpaid to the property
owners' association that are attributable to the owner's
property;
(5) capital expenditures, if any, approved by the property
owners' association for the property owners' association's
current fiscal year;
(6) the amount of reserves, if any, for capital expenditures;
(7) the property owners' association's current operating budget
and balance sheet;
(8) the total of any unsatisfied judgments against the property
owners' association;
(9) the style and cause number of any pending lawsuit in which
the property owners' association is a defendant;
(10) a copy of a certificate of insurance showing the property
owners' association's property and liability insurance relating
to the common areas and common facilities;
(11) a description of any conditions on the owner's property
that the property owners' association board has actual knowledge
are in violation of the restrictions applying to the subdivision
or the bylaws or rules of the property owners' association;
(12) a summary or copy of notices received by the property
owners' association from any governmental authority regarding
health or housing code violations existing on the preparation
date of the certificate relating to the owner's property or any
common areas or common facilities owned or leased by the property
owners' association;
(13) the amount of any administrative transfer fee charged by
the property owners' association for a change of ownership of
property in the subdivision;
(14) the name, mailing address, and telephone number of the
property owners' association's managing agent, if any; and
(15) a statement indicating whether the restrictions allow
foreclosure of a property owners' association's lien on the
owner's property for failure to pay assessments.
(c) A property owners' association may charge a reasonable fee
to assemble, copy, and deliver the information required by this
section and may charge a reasonable fee to prepare and deliver an
update of a resale certificate under Subsection (f).
(d) The property owners' association shall deliver the
information required by Subsection (a) or (f) to the person
specified in the written request. A written request that does
not specify the name and location to which the information is to
be sent is not effective. The property owners' association may
deliver the information required by Subsection (a) and any update
to the resale certificate required by Subsection (f) by mail,
hand delivery, or alternative delivery means specified in the
written request.
(e) Unless required by a dedicatory instrument, neither a
property owners' association or its agent is required to inspect
a property before issuing a resale certificate or an update to a
resale certificate.
(f) Not later than the seventh day after the date a written
request for an update to a resale certificate delivered under
Subsection (a) is received from an owner, owner's agent, or title
insurance company or its agent acting on behalf of the owner, the
property owners' association shall deliver to the owner, owner's
agent, or title insurance company or its agent an updated resale
certificate that contains the following information:
(1) if a right of first refusal or other restraint on sale is
contained in the restrictions, a statement of whether the
property owners' association waives the restraint on sale;
(2) the status of any unpaid special assessments, dues, or other
payments attributable to the owner's property; and
(3) any changes to the information provided in the resale
certificate issued under Subsection (a).
(g) Requests for an updated resale certificate pursuant to
Subsection (f) must be made within 180 days of the date a resale
certificate is issued under Subsection (a). The update request
may be made only by the party requesting the original resale
certificate.
Added by Acts 1999, 76th Leg., ch. 1198, Sec. 1, eff. Sept. 1,
1999.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
147, Sec. 1, eff. September 1, 2009.
Sec. 207.004. OWNER'S REMEDIES FOR FAILURE BY PROPERTY OWNERS'
ASSOCIATION TO TIMELY DELIVER INFORMATION. (a) If a property
owners' association does not timely deliver information in
accordance with Section 207.003, the owner, owner's agent, or
title insurance company or its agent acting on behalf of the
owner may submit a second request for the information.
(b) If a property owners' association fails to deliver the
information required under Section 207.003 before the seventh day
after the second request for the information was mailed by
certified mail, return receipt requested, or hand delivered,
evidenced by receipt, the owner:
(1) may seek one or any combination of the following:
(A) a court order directing the property owners' association to
furnish the required information;
(B) a judgment against the property owners' association for not
more than $500;
(C) a judgment against the property owners' association for
court costs and attorney's fees; or
(D) a judgment authorizing the owner or the owner's assignee to
deduct the amounts awarded under Paragraphs (B) and (C) from any
future regular or special assessments payable to the property
owners' association; and
(2) may provide a buyer under contract to purchase the owner's
property an affidavit that states that the owner, owner's agent,
or title insurance company or its agent acting on behalf of the
owner made, in accordance with this chapter, two written requests
to the property owners' association for the information described
in Section 207.003 and that the association did not timely
provide the information.
(c) If the owner provides a buyer under contract to purchase the
owner's property an affidavit in accordance with Subsection
(b)(2):
(1) the buyer, lender, or title insurance company or its agent
is not liable to the property owners' association for:
(A) any money that is due and unpaid to the property owners'
association on the date the affidavit was prepared; and
(B) any debt to the property owners' association or claim by the
property owners' association that accrued before the date the
affidavit was prepared; and
(2) the property owners' association's lien to secure the
amounts due the property owners' association on the owner's
property on the date the affidavit was prepared shall
automatically terminate.
Added by Acts 1999, 76th Leg., ch. 1198, Sec. 1, eff. Sept. 1,
1999.
Sec. 207.005. EFFECT OF RESALE CERTIFICATE; LIABILITY. (a) A
property owners' association may not deny the validity of any
statement in the resale certificate. The property owners'
association's lien to secure undisclosed amounts due the property
owners' association on the date the resale certificate is
prepared shall automatically terminate as a lien securing the
undisclosed amount. A buyer, buyer's agent, owner, owner's agent,
lender, and title insurance company and its agent are not liable
for any debt or claim existing on the preparation date of the
resale certificate that is not disclosed in the resale
certificate.
(b) A resale certificate does not affect:
(1) the right of a property owners' association to recover debts
or claims that arise or become due after the date the resale
certificate is prepared; or
(2) a lien on a property securing payment of future assessments
held by the property owners' association.
(c) The owner's agent and the title insurance company and its
agent are not liable to a buyer for any delay or failure by the
property owners' association in delivering the information
required by Section 207.003.
(d) Except as provided by Section 207.004, the property owners'
association is not liable to an owner selling property in the
subdivision for delay or failure to deliver the information
required by Section 207.003. An officer or agent of the property
owners' association is not liable for a delay or failure to
furnish a resale certificate.
Added by Acts 1999, 76th Leg., ch. 1198, Sec. 1, eff. Sept. 1,
1999.