Texas 2009 - 81st Regular

Texas House Bill HB406 Compare Versions

The same version is selected twice. Please select two different versions to compare.

Version 1 (Old)

Version 2 (New)

Old	New	Differences
1	1	H.B. No. 406
2	2
3	3
4	4	AN ACT
5	5	relating to the disposition of excess proceeds of a tax sale of real
6	6	property or foreclosure of a tax lien on real property.
7	7	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	8	SECTION 1. Subchapter A, Chapter 34, Tax Code, is amended by
9	9	adding Section 34.021 to read as follows:
10	10	Sec. 34.021. DISTRIBUTION OF EXCESS PROCEEDS IN OTHER TAX
11	11	FORECLOSURE PROCEEDINGS. A person conducting a sale for the
12	12	foreclosure of a tax lien under Rule 736 of the Texas Rules of Civil
13	13	Procedure shall, within 10 days of the sale, pay any excess proceeds
14	14	after payment of all amounts due all participants in the sale to the
15	15	clerk of the court that issued the order authorizing the sale. The
16	16	excess proceeds from such a sale shall be handled according to
17	17	Sections 34.03 and 34.04 of this code.
18	18	SECTION 2. Section 34.04, Tax Code, is amended by amending
19	19	Subsections (c), (e), (f), (g), (h), and (i) and adding Subsections
20	20	(c-1) and (j) to read as follows:
21	21	(c) At the hearing the court shall order that the proceeds
22	22	be paid according to the following priorities to each party that
23	23	establishes its claim to the proceeds:
24	24	(1) to the tax sale purchaser if the tax sale has been
25	25	adjudged to be void and the purchaser has prevailed in an action
26	26	against the taxing units under Section 34.07(d) by final judgment;
27	27	(2) to a taxing unit for any taxes, penalties, or
28	28	interest that have become due or delinquent on the subject property
29	29	subsequent to the date of the judgment or that were omitted from the
30	30	judgment by accident or mistake;
31	31	(3) to any other lienholder, consensual or otherwise,
32	32	for the amount due under a lien, in accordance with the priorities
33	33	established by applicable law;
34	34	(4) to a taxing unit for any unpaid taxes, penalties,
35	35	interest, or other amounts adjudged due under the judgment that
36	36	were not satisfied from the proceeds from the tax sale; and
37	37	(5) to each former owner of the property, as the
38	38	interest of each may appear, provided that the former owner:
39	39	(A) was a defendant in the judgment;
40	40	(B) is related within the third degree by
41	41	consanguinity or affinity to a former owner that was a defendant in
42	42	the judgment; or
43	43	(C) acquired by will or intestate succession the
44	44	interest in the property of a former owner that was a defendant in
45	45	the judgment.
46	46	(c-1) Except as provided by Subsections (c)(5)(B) and (C), a
47	47	former owner of the property that acquired an interest in the
48	48	property after the date of the judgment may not establish a claim to
49	49	the proceeds. For purposes of this subsection, a former owner of
50	50	the property is considered to have acquired an interest in the
51	51	property after the date of the judgment if the deed by which the
52	52	former owner acquired the interest was recorded in the real
53	53	property records of the county in which the property is located
54	54	after the date of the judgment.
55	55	(e) An [an] order under this section directing that all or
56	56	part of the excess proceeds be paid to a party is appealable.
57	57	(f) A person may not take an assignment or other transfer of
58	58	an owner's claim to excess proceeds unless:
59	59	(1) the assignment or transfer is taken on or after the
60	60	36th day after the date the excess proceeds are deposited in the
61	61	registry of the court;
62	62	(2) the assignment or transfer is in writing and
63	63	signed by the assignor or transferor; [and]
64	64	(3) the assignment or transfer is not the result of an
65	65	in-person or telephone solicitation;
66	66	(4) the assignee or transferee pays the assignor or
67	67	transferor on the date of the assignment or transfer an amount equal
68	68	to at least 80 percent of the amount of the assignor's or
69	69	transferor's claim to the excess proceeds; and
70	70	(5) the assignment or transfer document contains a
71	71	sworn statement by the assignor or transferor affirming:
72	72	(A) that the assignment or transfer was given
73	73	voluntarily;
74	74	(B) the date on which the assignment or transfer
75	75	was made and that the date was not earlier than the 36th day after
76	76	the date the excess proceeds were deposited in the registry of the
77	77	court;
78	78	(C) that the assignor or transferor has received
79	79	the notice from the clerk required by Section 34.03;
80	80	(D) the nature and specific amount of
81	81	consideration given for the assignment or transfer;
82	82	(E) the circumstances under which the excess
83	83	proceeds are in the registry of the court;
84	84	(F) the amount of the claim to excess proceeds in
85	85	the registry of the court;
86	86	(G) that the assignor or transferor has made no
87	87	other assignments or transfers of the assignor's or transferor's
88	88	claim to the excess proceeds; [and]
89	89	(H) that the assignor or transferor knows that
90	90	the assignor or transferor may retain counsel; and
91	91	(I) that the consideration was paid in full on
92	92	the date of the assignment or transfer and that the consideration
93	93	paid was an amount equal to at least 80 percent of the amount of the
94	94	assignor's or transferor's claim to the excess proceeds.
95	95	(g) An assignee or transferee who obtains excess proceeds
96	96	without complying with Subsection (f) is liable to the assignor or
97	97	transferor for the amount of excess proceeds obtained plus
98	98	attorney's fees and expenses. An assignee or transferee who
99	99	attempts to obtain excess proceeds without complying with
100	100	Subsection (f) is liable to the assignor or transferor for
101	101	attorney's fees and expenses.
102	102	(h) An assignee or transferee who files a petition setting
103	103	forth a claim to excess proceeds must attach a copy of the
104	104	assignment or transfer document and produce the original of the
105	105	assignment or transfer document in court at the hearing on the
106	106	petition. If the original assignment or transfer document is lost,
107	107	the assignee or transferee must obtain the presence of the assignor
108	108	or transferor to testify at the hearing. In addition, the assignee
109	109	or transferee must produce at the hearing the original of any
110	110	evidence verifying the payment of the consideration given for the
111	111	assignment or transfer. If the original of any evidence of the
112	112	payment is lost or if the payment was in cash, the assignee or
113	113	transferee must obtain the presence of the assignor or transferor
114	114	to testify at the hearing.
115	115	(i) A fee charged by an attorney to obtain excess proceeds
116	116	for an owner may not be greater than 25 percent of the amount
117	117	obtained or $1,000, whichever is less. A person who is not an
118	118	attorney may not charge a fee to obtain excess proceeds for an
119	119	owner.
120	120	(j) The amount of the excess proceeds the court may order be
121	121	paid to an assignee or transferee may not exceed 125 percent of the
122	122	amount the assignee or transferee paid the assignor or transferor
123	123	on the date of the assignment or transfer.
124	124	SECTION 3. The change in law made by this Act applies to the
125	125	disposition of excess proceeds of a tax sale paid to the clerk of
126	126	the court that issued the warrant or order of sale regardless of the
127	127	date on which the warrant or order of sale was issued, the tax sale
128	128	was conducted, or the proceeds were paid to the clerk.
129	129	SECTION 4. This Act takes effect September 1, 2009.
130	130	______________________________ ______________________________
131	131	President of the Senate Speaker of the House
132	132	I certify that H.B. No. 406 was passed by the House on April
133	133	24, 2009, by the following vote: Yeas 136, Nays 0, 1 present, not
134	134	voting.
135	135	______________________________
136	136	Chief Clerk of the House
137	137	I certify that H.B. No. 406 was passed by the Senate on May
138	138	14, 2009, by the following vote: Yeas 30, Nays 1.
139	139	______________________________
140	140	Secretary of the Senate
141	141	APPROVED: _____________________
142	142	Date
143	143	_____________________
144	144	Governor