Texas Senate Bill SB1368

Texas 2011 - 82nd Regular

• Out of Senate Committee: 4/14/11
• Introduced: 3/9/11
• Voted on by Senate: 4/20/11
• Refer: 3/22/11
• Out of House Committee: 5/16/11
• Report Pass: 4/14/11
• Voted on by House: 5/23/11
• Engrossed: 4/20/11
• Governor Action: 6/17/11
• Refer: 4/29/11
• Report Pass: 5/11/11
• Enrolled: 5/23/11
• Passed: 6/17/11

Caption

Relating to the authority of a co-owner of residential property to encumber the property.

Impact

The introduction of SB1368 addresses a significant gap in the current real estate law regarding co-owned properties. By enabling one co-owner, who qualifies under certain conditions, to act as an agent for all owners in financial dealings related to the property, it prevents potential disputes among co-owners and enhances the ability to secure loans needed for property improvements. The bill stipulates specific criteria for the occupying co-owner, including having resided in the property for over five years and having maintained consistent tax payments for that duration, thereby promoting responsible property management.

Summary

SB1368 aims to clarify the authority of a co-owner of residential property to encumber said property, specifically in situations where the property is owned by multiple individuals. This bill introduces a new Chapter 64 to the Texas Property Code, regulating the conditions under which an occupying co-owner can act on behalf of other co-owners. Under the bill, an occupying co-owner is allowed to enter into contracts that create mechanic's and materialman's liens, focusing on necessary repairs or improvements to the residential property, thereby enhancing the property's value and habitability.

Contention

Notably, while the bill strengthens the rights of occupying co-owners, it also raises concerns regarding the rights of non-occupying co-owners. Critics may fear that this could lead to unilateral decisions by the occupying co-owner that do not necessarily reflect the interests of the other co-owners. The provision that any mechanisms for debt incurred will not be repudiated by another co-owner could potentially escalate conflicts unless all parties involved are made adequately aware before actions are taken. Consequently, the bill has implications for how co-ownership is structured and operated moving forward.