By: West S.B. No. 1368
A BILL TO BE ENTITLED
AN ACT
relating to the authority of a co-owner of residential property to
encumber the property.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle B, Title 5, Property Code, is amended by
adding Chapter 64 to read as follows:
CHAPTER 64. AUTHORITY OF CO-OWNER TO ENCUMBER RESIDENTIAL PROPERTY
Sec. 64.001. APPLICATION OF CHAPTER. This chapter applies
only to residential property:
(1) that has residential improvements primarily
designed for not more than four families;
(2) that is not more than 10 acres of land;
(3) that is owned by more than one person; and
(4) for which at least one co-owner has received a
residence homestead exemption under Section 11.13, Tax Code.
Sec. 64.002. CONDITIONS FOR AUTHORITY TO ACT AS AGENT FOR
CO-OWNER. A co-owner of residential property may act in the name of
and on behalf of another co-owner, whether known or unknown, as the
co-owner's statutory agent and attorney-in-fact for the purposes
described by Section 64.004 if:
(1) the co-owner has occupied the property for more
than five years;
(2) the co-owner has a residence homestead exemption
for the property under Section 11.13, Tax Code;
(3) for the five years preceding the date the
documents required by Section 64.003 are filed, the occupying
co-owner has paid all assessed ad valorem taxes without delinquency
and without contribution from the other co-owner; and
(4) the occupying co-owner files the documents
required by Section 64.003.
Sec. 64.003. REQUIRED DOCUMENTATION. The occupying
co-owner may establish the authority to act as an agent and
attorney-in-fact for another co-owner by filing in the office of
the county clerk of the county in which the real property is
located:
(1) an affidavit of the occupying co-owner affirming
the facts described by Sections 64.002(1)-(3);
(2) the affidavits of two additional affiants
personally familiar with the co-owner's occupancy of the real
property corroborating the occupancy during the preceding five
years; and
(3) a certificate of the tax assessor-collector for
the county in which the real property is located affirming that the
co-owner has paid all taxes assessed against the real property for
the preceding five years without delinquency.
Sec. 64.004. SCOPE OF AUTHORITY. (a) The authority of the
occupying co-owner to act as an agent and attorney-in-fact is
limited to the authority to enter into a contract giving rise to a
mechanic's and materialman's lien and to execute a deed of trust for
the purpose of preserving or improving the residential property.
The occupying co-owner is the sole obligor of the debt incurred
under the contract and secured by the deed of trust.
(b) A lien that arises under a contract entered into by an
occupying co-owner under this section is not subject to repudiation
or disaffirmance by another co-owner.
SECTION 2. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2011.