Texas 2015 - 84th Regular

Texas Senate Bill SB738 Compare Versions

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1	1	84R2880 PMO-F
2	2	By: Hinojosa S.B. No. 738
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the transfer or termination of certain timeshare
8	8	interests.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 221.003(b), Property Code, is amended to
11	11	read as follows:
12	12	(b) Timeshare properties located outside this state are
13	13	subject only to Subchapters C through H and J.
14	14	SECTION 2. Chapter 221, Property Code, is amended by adding
15	15	Subchapter J to read as follows:
16	16	SUBCHAPTER J. SERVICE AGREEMENTS TO TRANSFER OR TERMINATE A
17	17	TIMESHARE INTEREST
18	18	Sec. 221.101. TRANSFER OR TERMINATION OF TIMESHARE
19	19	INTEREST. In this subchapter:
20	20	(1) "Termination" with respect to a timeshare
21	21	interest:
22	22	(A) means:
23	23	(i) the release of contractual obligations
24	24	relating to a timeshare interest by the developer, association, or
25	25	managing entity; or
26	26	(ii) the invalidation of a timeshare
27	27	interest by a judgment or court order; and
28	28	(B) does not include the cancellation of a
29	29	purchase contract governed by Subchapter E.
30	30	(2) "Transfer" with respect to a timeshare interest
31	31	means the conveyance of all or substantially all of a timeshare
32	32	interest.
33	33	Sec. 221.102. APPLICABILITY. (a) This subchapter applies
34	34	to a timeshare interest if the timeshare interest has been acquired
35	35	only for the purchaser's personal, family, or household use and:
36	36	(1) the timeshare interest is owned by a resident of
37	37	this state;
38	38	(2) the timeshare property is located in this state;
39	39	or
40	40	(3) the timeshare interest acquired is in a multisite
41	41	timeshare plan required to be registered under Subchapter C.
42	42	(b) Except as provided by Subsection (c), this subchapter
43	43	applies to a person who:
44	44	(1) is acting in the ordinary course of business; and
45	45	(2) directly or indirectly, regardless of whether
46	46	acting in person, by mail, by telephone, or by any mode of Internet
47	47	or electronic communication, offers or advertises an offer to
48	48	engage in, for consideration, the following activities:
49	49	(A) obtaining or attempting to obtain on behalf
50	50	of a timeshare interest owner:
51	51	(i) a release of the owner's timeshare
52	52	interest from any person, including the developer, association, or
53	53	managing entity; or
54	54	(ii) a judgment or court order invalidating
55	55	the owner's timeshare interest;
56	56	(B) selling, renting, listing, or advertising a
57	57	timeshare interest on behalf of a timeshare interest owner;
58	58	(C) purchasing a timeshare interest from a
59	59	timeshare interest owner; or
60	60	(D) assisting in the transfer of an owner's
61	61	timeshare interest.
62	62	(c) This subchapter does not apply to:
63	63	(1) a license holder under Chapter 1101, Occupations
64	64	Code, acting as a broker, agent, or salesperson under that person's
65	65	license in connection with the transfer or termination of a
66	66	timeshare interest;
67	67	(2) a developer, association, or managing entity for a
68	68	timeshare interest to be transferred or terminated; or
69	69	(3) an attorney, title agent, title company, or escrow
70	70	company that:
71	71	(A) provides only closing, settlement, or other
72	72	specific transaction services in connection with the transfer or
73	73	termination of a timeshare interest; and
74	74	(B) does not otherwise engage in activities
75	75	described by Subsection (b).
76	76	Sec. 221.103. GENERAL DISCLOSURES REQUIRED. A person
77	77	subject to this subchapter who enters into an agreement with a
78	78	timeshare interest owner to facilitate the transfer or termination
79	79	of a timeshare interest shall provide to the timeshare interest
80	80	owner the following written disclosures, as applicable:
81	81	(1) the name, telephone number, and physical address
82	82	of the person providing services under the agreement and any
83	83	affiliate, agent, or third-party representative of that person;
84	84	(2) a description, legally sufficient for
85	85	identification, of the timeshare interest to be transferred or
86	86	terminated;
87	87	(3) a description of the method of transfer or
88	88	termination or a copy of the instrument that will be used for
89	89	transferring or terminating the timeshare interest;
90	90	(4) a description of any interest the timeshare
91	91	interest owner retains after the transfer;
92	92	(5) a description of the scope of a power of attorney
93	93	or other delegation of authority, if any, that the timeshare
94	94	interest owner is required to give to complete the transfer of the
95	95	timeshare interest;
96	96	(6) an itemized statement of any amounts the timeshare
97	97	owner is required to pay as consideration or reimbursement for
98	98	services provided in connection with the agreement;
99	99	(7) the name of each recipient of amounts described by
100	100	Subdivision (6);
101	101	(8) the estimated date for completing all services
102	102	sufficient to transfer or terminate the timeshare interest; and
103	103	(9) a statement that, on completion of the transfer or
104	104	termination of the timeshare interest, the person will give written
105	105	notice of the transfer or termination to:
106	106	(A) the developer, association, or managing
107	107	entity, as applicable; and
108	108	(B) if applicable, the exchange company for the
109	109	timeshare interest.
110	110	Sec. 221.104. DISCLOSURE OF AUTHORIZED USE OF TIMESHARE
111	111	INTEREST. (a) A person subject to this subchapter who enters into
112	112	an agreement with a timeshare interest owner to facilitate the
113	113	transfer or termination of a timeshare interest shall disclose in
114	114	writing to the timeshare interest owner the name of any person,
115	115	other than the timeshare interest owner, who may occupy, rent,
116	116	exchange, or otherwise use the timeshare interest during the term
117	117	of the agreement.
118	118	(b) If a person is authorized to occupy, rent, exchange, or
119	119	otherwise use the timeshare interest during the term of the
120	120	agreement, the agreement must state the name of each person
121	121	receiving consideration for the occupation, rent, exchange, or use
122	122	of the timeshare interest.
123	123	Sec. 221.105. DISCLOSURES RELATING TO PAYMENT OF FEES FOR
124	124	TRANSFER SERVICES. A person subject to this subchapter who enters
125	125	into an agreement with a timeshare interest owner to facilitate the
126	126	transfer of the timeshare interest must disclose in writing to the
127	127	timeshare interest owner that the timeshare interest owner is not
128	128	required to pay any consideration or reimbursement under the
129	129	agreement until the timeshare interest owner receives:
130	130	(1) a written acknowledgement from the developer, the
131	131	association, or the managing entity that the person facilitating
132	132	the transfer under the agreement complied with all applicable
133	133	policies, if any, governing the transfer of the timeshare interest;
134	134	and
135	135	(2) a copy of the instrument transferring the
136	136	timeshare interest, recorded, if required by applicable law, in the
137	137	real property records of the county in which the timeshare property
138	138	is located.
139	139	Sec. 221.106. REQUIRED NOTICE FOR TRANSFER SERVICES. A
140	140	person subject to this subchapter who enters into an agreement with
141	141	a timeshare interest owner to facilitate the transfer of the
142	142	timeshare interest must provide to the timeshare interest owner a
143	143	statement printed in 14-point boldface type or 14-point uppercase
144	144	typewritten letters that reads substantially similar to the
145	145	following:
146	146	I (name of the person facilitating the transfer) WILL ACT IN
147	147	GOOD FAITH AND IN A COMMERCIALLY REASONABLE MANNER TO COMPLETE THE
148	148	TRANSFER OF OWNERSHIP OF YOUR TIMESHARE INTEREST NOT LATER THAN THE
149	149	180TH DAY AFTER THE DATE OF THIS AGREEMENT.
150	150	YOUR OBLIGATION TO PAY ALL COSTS AND FEES ASSOCIATED WITH
151	151	YOUR TIMESHARE INTEREST, INCLUDING ANY REGULAR OR SPECIAL
152	152	ASSESSMENTS OR REAL OR PERSONAL PROPERTY TAXES, DOES NOT CEASE BY
153	153	VIRTUE OF THE EXECUTION OF THIS AGREEMENT.
154	154	IF THE TRANSFER OF YOUR TIMESHARE INTEREST IS NOT COMPLETED
155	155	BEFORE THE 180TH DAY AFTER THE DATE OF THIS AGREEMENT, YOU WILL
156	156	CONTINUE TO BE RESPONSIBLE FOR THE PAYMENT OF ALL COSTS AND FEES
157	157	ASSOCIATED WITH YOUR TIMESHARE INTEREST, INCLUDING ANY REGULAR OR
158	158	SPECIAL ASSESSMENTS OR REAL OR PERSONAL PROPERTY TAXES.
159	159	Sec. 221.107. REQUIRED NOTICE FOR TERMINATION SERVICES. A
160	160	person subject to this subchapter who enters into an agreement with
161	161	a timeshare interest owner to facilitate the termination of the
162	162	timeshare interest must provide to the timeshare interest owner a
163	163	statement printed in 14-point boldface type or 14-point uppercase
164	164	typewritten letters that reads substantially similar to the
165	165	following:
166	166	I (name of the person facilitating the termination of the
167	167	timeshare interest) WILL ACT IN GOOD FAITH AND IN A COMMERCIALLY
168	168	REASONABLE MANNER TO COMPLETE THE TERMINATION OF YOUR TIMESHARE
169	169	INTEREST NOT LATER THAN THE 180TH DAY AFTER THE DATE OF THIS
170	170	AGREEMENT BY OBTAINING:
171	171	(1) A VALID AND ENFORCEABLE RELEASE FROM THE
172	172	DEVELOPER, ASSOCIATION, OR MANAGING ENTITY; OR
173	173	(2) A JUDGMENT OR COURT ORDER INVALIDATING THE
174	174	PURCHASE OR OWNERSHIP OF YOUR TIMESHARE INTEREST.
175	175	YOUR OBLIGATION TO PAY ALL COSTS AND FEES ASSOCIATED WITH
176	176	YOUR TIMESHARE INTEREST, INCLUDING ANY REGULAR OR SPECIAL
177	177	ASSESSMENTS OR REAL OR PERSONAL PROPERTY TAXES, DOES NOT CEASE BY
178	178	VIRTUE OF THE EXECUTION OF THIS AGREEMENT.
179	179	I CANNOT GUARANTEE THAT I WILL SUCCESSFULLY COMPLETE THE
180	180	TERMINATION OF YOUR TIMESHARE INTEREST. IF I FAIL TO COMPLETE THE
181	181	TERMINATION OF YOUR TIMESHARE INTEREST, YOU WILL CONTINUE TO BE
182	182	RESPONSIBLE FOR THE PAYMENT OF ALL COSTS AND FEES ASSOCIATED WITH
183	183	YOUR TIMESHARE INTEREST, INCLUDING ANY REGULAR OR SPECIAL
184	184	ASSESSMENTS OR REAL OR PERSONAL PROPERTY TAXES.
185	185	Sec. 221.108. RELIANCE. In making disclosures required by
186	186	this subchapter, a person facilitating the transfer or termination
187	187	of a timeshare interest may rely on written information provided by
188	188	the timeshare interest owner, the developer, the association, or
189	189	the managing entity.
190	190	Sec. 221.109. DUTY OF GOOD FAITH REGARDING TRANSFER OR
191	191	TERMINATION SERVICES. A person facilitating the transfer or
192	192	termination of a timeshare interest must act in good faith to
193	193	accomplish the transfer or termination not later than the 180th day
194	194	after the date the person enters into an agreement with the
195	195	timeshare interest owner.
196	196	Sec. 221.110. DECEPTIVE TRADE PRACTICES. A person subject
197	197	to this subchapter commits a false, misleading, or deceptive act or
198	198	practice within the meaning of Sections 17.46(a) and (b), Business &
199	199	Commerce Code, by engaging in any of the following acts:
200	200	(1) failing to disclose information as required by
201	201	this subchapter;
202	202	(2) making false or misleading statements concerning:
203	203	(A) the existence of an offer related to the
204	204	purchase or rent of a timeshare interest;
205	205	(B) the likelihood of the completion or the time
206	206	necessary to complete any sale, rental, transfer, or termination of
207	207	a timeshare interest;
208	208	(C) the value of a timeshare interest;
209	209	(D) the current or future costs, including
210	210	assessments, maintenance fees, or taxes, of owning a timeshare
211	211	interest;
212	212	(E) the method by which or source from which a
213	213	timeshare interest owner's name, address, telephone number, or
214	214	other contact information was obtained;
215	215	(F) the identity of the person providing services
216	216	to facilitate the transfer or termination of a timeshare interest
217	217	or any affiliate, agent, or third-party representative of that
218	218	person;
219	219	(G) the terms and conditions under which services
220	220	to facilitate a transfer or termination of a timeshare interest are
221	221	offered;
222	222	(H) the willingness of a developer, association,
223	223	or managing entity to:
224	224	(i) agree to the transfer or termination of
225	225	a timeshare interest; or
226	226	(ii) execute instruments necessary to
227	227	transfer or terminate the timeshare interest; or
228	228	(I) the manner in which consideration or
229	229	reimbursements paid by a timeshare interest owner will be used or
230	230	applied; or
231	231	(3) encouraging or inducing a timeshare interest owner
232	232	to stop paying the developer, the association, or the managing
233	233	entity in violation of a contract with the developer, the
234	234	association, or the managing entity before the completion of a
235	235	transfer or termination.
236	236	Sec. 221.111. SUPERVISORY DUTIES. (a) The person who
237	237	enters into an agreement to facilitate the transfer or termination
238	238	of a timeshare interest shall supervise, manage, and control all
239	239	aspects of the services provided under the agreement.
240	240	(b) Any violation of this subchapter that occurs during the
241	241	provision of services is considered a violation by the person who
242	242	enters into the agreement and any affiliate, agent, or third-party
243	243	representative of that person.
244	244	(c) Section 221.035 does not apply to a person providing
245	245	services under this subchapter.
246	246	SECTION 3. (a) The disclosure and notice requirements
247	247	provided by Subchapter J, Chapter 221, Property Code, as added by
248	248	this Act, apply only to an agreement to facilitate the transfer or
249	249	termination of a timeshare interest entered into on or after the
250	250	effective date of this Act. An agreement to facilitate the transfer
251	251	or termination of a timeshare interest entered into before the
252	252	effective date of this Act is governed by the law as it existed
253	253	immediately before the effective date of this Act, and that law is
254	254	continued in effect for that purpose.
255	255	(b) Section 221.110, Property Code, as added by this Act,
256	256	applies only to conduct that occurs on or after the effective date
257	257	of this Act. Conduct that occurs before the effective date of this
258	258	Act is governed by the law as it existed when the conduct occurred,
259	259	and the former law is continued in effect for that purpose.
260	260	SECTION 4. This Act takes effect September 1, 2015.