| 1 | 1 | | By: Gutierrez H.B. No. 1335 |
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| 2 | 2 | | |
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| 3 | 3 | | |
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| 4 | 4 | | A BILL TO BE ENTITLED |
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| 5 | 5 | | AN ACT |
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| 6 | 6 | | relating to the collection of attorney fees in property owners' |
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| 7 | 7 | | association foreclosures. |
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| 8 | 8 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 9 | 9 | | SECTION 1. Section 209.008, Property Code, is amended to |
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| 10 | 10 | | read as follows: |
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| 11 | 11 | | Sec. 209.008. ATTORNEY'S FEES. (a) A property owners' |
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| 12 | 12 | | association may collect reimbursement of reasonable attorney's |
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| 13 | 13 | | fees and other reasonable costs incurred by the association |
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| 14 | 14 | | relating to collecting amounts, including damages, due the |
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| 15 | 15 | | association for enforcing restrictions or the bylaws or rules of |
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| 16 | 16 | | the association only if the owner is provided a written notice that |
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| 17 | 17 | | attorney's fees and costs will be charged to the owner if the |
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| 18 | 18 | | delinquency or violation continues after a date certain. |
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| 19 | 19 | | (b) An owner is not liable for attorney's fees incurred by |
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| 20 | 20 | | the association relating to a matter described by the notice under |
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| 21 | 21 | | Section 209.006 if the attorney's fees are incurred before the |
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| 22 | 22 | | conclusion of the hearing under Section 209.007 or, if the owner |
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| 23 | 23 | | does not request a hearing under that section, before the date by |
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| 24 | 24 | | which the owner must request a hearing. The owner's presence is not |
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| 25 | 25 | | required to hold a hearing under Section 209.007. |
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| 26 | 26 | | (c) All attorney's fees, costs, and other amounts collected |
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| 27 | 27 | | from an owner shall be deposited into an account maintained at a |
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| 28 | 28 | | financial institution in the name of the association or its |
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| 29 | 29 | | managing agent. Only members of the association's board or its |
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| 30 | 30 | | managing agent or employees of its managing agent may be |
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| 31 | 31 | | signatories on the account. |
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| 32 | 32 | | (d) On written request from the owner, the association shall |
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| 33 | 33 | | provide copies of invoices for attorney's fees and other costs |
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| 34 | 34 | | relating only to the matter for which the association seeks |
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| 35 | 35 | | reimbursement of fees and costs. |
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| 36 | 36 | | (e) The notice provisions of Subsection (a) do not apply to |
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| 37 | 37 | | a counterclaim of an association in a lawsuit brought against the |
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| 38 | 38 | | association by a property owner. |
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| 39 | 39 | | (f) If the dedicatory instrument or restrictions of an |
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| 40 | 40 | | association allow for [nonjudicial] foreclosure, the amount of |
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| 41 | 41 | | attorney's fees that a property owners' association may [include] |
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| 42 | 42 | | seek in a [nonjudicial] foreclosure sale proceeding brought for an |
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| 43 | 43 | | indebtedness covered by a property owners' association's assessment |
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| 44 | 44 | | lien is limited to the greater of: |
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| 45 | 45 | | (1) ten percent [one third] of the amount of all |
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| 46 | 46 | | [actual costs and] assessments owed [excluding attorney's fees, |
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| 47 | 47 | | plus interest and court costs,] if those amounts are permitted to be |
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| 48 | 48 | | included by law including the statute of limitations [or by the |
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| 49 | 49 | | restrictive covenants governing the property]; or |
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| 50 | 50 | | (2) [$2,500] $500. |
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| 51 | 51 | | g) Subsection (f) does not prevent a property owners' |
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| 52 | 52 | | association from recovering or collecting attorney's fees in excess |
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| 53 | 53 | | of the amounts prescribed by Subsection (f) by other means provided |
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| 54 | 54 | | by law. |
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| 55 | 55 | | (g) A property owners' association may not seek any |
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| 56 | 56 | | additional attorney's fees in a foreclosure proceeding except as |
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| 57 | 57 | | provided by (f) unless: |
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| 58 | 58 | | (i) an owner files a separate, original proceeding in |
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| 59 | 59 | | a court of competent jurisdiction that contests the property |
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| 60 | 60 | | owners' association right to foreclose; and |
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| 61 | 61 | | (ii) such fees are reasonable and necessary, and |
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| 62 | 62 | | equitable and just, to defend such a proceeding. |
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| 63 | 63 | | SECTION 3 |
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| 64 | 64 | | . The Act takes effect September 1, 2015. |
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