Texas 2021 - 87th Regular

Texas Senate Bill SB318 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	S.B. No. 318
	1	+	By: Huffman S.B. No. 318
	2	+	(Turner of Tarrant)
2	3
3	4
	5	+	A BILL TO BE ENTITLED
4	6		AN ACT
5	7		relating to the records of certain condominium unit owners'
6	8		associations.
7	9		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	10		SECTION 1. Section 82.114(b), Property Code, is amended to
9	11		read as follows:
10	12		(b) All financial and other records of the association shall
11	13		be reasonably available at its registered office or its principal
12	14		office in this state for examination and production in accordance
13	15		with Section 82.1141 [by a unit owner and the owner's agents. An
14	16		attorney's files and records relating to the association are not
15	17		records of the association and are not subject to inspection by unit
16	18		owners or production in a legal proceeding].
17	19		SECTION 2. Subchapter C, Chapter 82, Property Code, is
18	20		amended by adding Section 82.1141 to read as follows:
19	21		Sec. 82.1141. ACCESS TO ASSOCIATION RECORDS. (a) This
20	22		section applies to all associations governed by this chapter and
21	23		controls over other law not specifically applicable to an
22	24		association.
23	25		(b) Notwithstanding a provision in a dedicatory instrument,
24	26		an association shall make the books and records of the association,
25	27		including financial records, open to and reasonably available for
26	28		examination by a unit owner, or a person designated in a writing
27	29		signed by the unit owner as the unit owner's agent, attorney, or
28	30		certified public accountant, in accordance with this section. A
29	31		unit owner is entitled to obtain from the association copies of
30	32		information contained in the books and records.
31	33		(c) Except as provided by this subsection, an attorney's
32	34		files and records relating to the association, excluding invoices
33	35		requested by a unit owner for attorney's fees and other costs
34	36		relating only to a matter for which the association seeks
35	37		reimbursement of fees and costs from the unit owner, are not records
36	38		of the association and are not subject to inspection by the unit
37	39		owner or production in a legal proceeding. If a document in an
38	40		attorney's files and records relating to the association would be
39	41		responsive to a legally authorized request to inspect or copy
40	42		association documents, the document shall be produced by using the
41	43		copy from the attorney's files and records if the association has
42	44		not maintained a separate copy of the document. This subsection
43	45		does not require production of a document that constitutes attorney
44	46		work product or that is privileged as an attorney-client
45	47		communication.
46	48		(d) A unit owner or the unit owner's authorized
47	49		representative described by Subsection (b) must submit a written
48	50		request for access or information under Subsection (b) by certified
49	51		mail, with sufficient detail describing the association's books and
50	52		records requested, to the mailing address of the association or
51	53		authorized representative as reflected on the most current
52	54		management certificate filed under Section 82.116. The request
53	55		must contain an election either to inspect the books and records
54	56		before obtaining copies or to have the association forward copies
55	57		of the requested books and records and:
56	58		(1) if an inspection is requested, the association, on
57	59		or before the 10th business day after the date the association
58	60		receives the request, shall send written notice of dates during
59	61		normal business hours that the unit owner may inspect the requested
60	62		books and records to the extent those books and records are in the
61	63		possession, custody, or control of the association; or
62	64		(2) if copies of identified books and records are
63	65		requested, the association shall, to the extent those books and
64	66		records are in the possession, custody, or control of the
65	67		association, produce the requested books and records for the
66	68		requesting party on or before the 10th business day after the date
67	69		the association receives the request, except as otherwise provided
68	70		by this section.
69	71		(e) If the association is unable to produce the books or
70	72		records requested under Subsection (d) on or before the 10th
71	73		business day after the date the association receives the request,
72	74		the association must provide to the requestor written notice that:
73	75		(1) informs the requestor that the association is
74	76		unable to produce the information on or before the 10th business day
75	77		after the date the association received the request; and
76	78		(2) states a date by which the information will be sent
77	79		or made available for inspection to the requesting party that is not
78	80		later than the 15th business day after the date notice under this
79	81		subsection is given.
80	82		(f) If an inspection is requested or required, the
81	83		inspection shall take place at a mutually agreed on time during
82	84		normal business hours, and the requesting party shall identify the
83	85		books and records for the association to copy and forward to the
84	86		requesting party.
85	87		(g) An association may produce books and records requested
86	88		under this section in hard copy, electronic, or other format
87	89		reasonably available to the association.
88	90		(h) An association board must adopt a records production and
89	91		copying policy that prescribes the costs the association will
90	92		charge for the compilation, production, and reproduction of
91	93		information requested under this section. The prescribed charges
92	94		may include all reasonable costs of materials, labor, and overhead
93	95		but may not exceed costs that would be applicable for an item under
94	96		1 T.A.C. Section 70.3 for an item produced by the association and
95	97		may not exceed actual costs for an item produced by a third party.
96	98		The policy required by this subsection must be recorded as a
97	99		dedicatory instrument in accordance with Section 202.006. An
98	100		association may not charge a unit owner for the compilation,
99	101		production, or reproduction of information requested under this
100	102		section unless the policy prescribing those costs has been recorded
101	103		as required by this subsection. A unit owner is responsible for
102	104		costs related to the compilation, production, and reproduction of
103	105		the requested information in the amounts prescribed by the policy
104	106		adopted under this subsection. The association may require advance
105	107		payment of the estimated costs of compilation, production, and
106	108		reproduction of the requested information. If the estimated costs
107	109		are lesser or greater than the actual costs, the association shall
108	110		submit a final invoice to the unit owner on or before the 30th
109	111		business day after the date the information is delivered. If the
110	112		final invoice includes additional amounts due from the unit owner,
111	113		the additional amounts, if not reimbursed to the association before
112	114		the 30th business day after the date the invoice is sent to the unit
113	115		owner, may be added to the unit owner's account as an assessment.
114	116		If the estimated costs exceeded the final invoice amount, the unit
115	117		owner is entitled to a refund, and the refund shall be issued to the
116	118		unit owner not later than the 30th business day after the date the
117	119		invoice is sent to the unit owner.
118	120		(i) An association must estimate costs under this section
119	121		using amounts prescribed by the policy adopted under Subsection
120	122		(h).
121	123		(j) Except as provided by Subsection (k) and to the extent
122	124		the information is provided in the meeting minutes, the association
123	125		is not required to release or allow inspection of any books or
124	126		records that identify the dedicatory instrument violation history
125	127		of an individual unit owner of an association, a unit owner's
126	128		personal financial information, including records of payment or
127	129		nonpayment of amounts due the association, a unit owner's contact
128	130		information, a unit owner's address, or information related to an
129	131		employee of the association, including personnel files.
130	132		Information may be released in an aggregate or summary manner that
131	133		would not identify an individual unit owner.
132	134		(k) The books and records described by Subsection (j) shall
133	135		be released or made available for inspection if:
134	136		(1) the express written approval of the unit owner
135	137		whose records are the subject of the request for inspection is
136	138		provided to the association; or
137	139		(2) a court orders the release of the books and records
138	140		or orders that the books and records be made available for
139	141		inspection.
140	142		(l) In addition to retaining records as necessary for
141	143		compliance with Section 82.114, an association composed of eight or
142	144		more units shall adopt and comply with a document retention policy
143	145		that includes, at a minimum, the following requirements:
144	146		(1) certificates of formation, bylaws, dedicatory
145	147		instruments, and all amendments to the certificates of formation,
146	148		bylaws, and dedicatory instruments shall be retained permanently;
147	149		(2) financial books and records shall be retained for
148	150		seven years;
149	151		(3) account records of current unit owners shall be
150	152		retained for five years;
151	153		(4) contracts with a term of one year or more shall be
152	154		retained for four years after the expiration of the contract term;
153	155		(5) minutes of meetings of the unit owners and the
154	156		board shall be retained for seven years; and
155	157		(6) tax returns and audit records shall be retained
156	158		for seven years.
157	159		(m) A member of an association who is denied access to or
158	160		copies of association books or records to which the member is
159	161		entitled under this section may file a petition with the justice of
160	162		the peace of a justice precinct in which all or part of the
161	163		condominium is located requesting relief in accordance with this
162	164		subsection. If the justice of the peace finds that the member is
163	165		entitled to access to or copies of the records, the justice of the
164	166		peace may grant one or more of the following remedies:
165	167		(1) a judgment ordering the association to release or
166	168		allow access to the books or records; or
167	169		(2) a judgment against the association for court costs
168	170		and attorney's fees incurred in connection with seeking a remedy
169	171		under this section.
170	172		(n) If the association prevails in an action under
171	173		Subsection (m), the association is entitled to a judgment for court
172	174		costs and attorney's fees incurred by the association in connection
173	175		with the action.
174	176		(o) On or before the 10th business day before the date a
175	177		person brings an action against an association under this section,
176	178		the person must send written notice to the association of the
177	179		person's intent to bring the action. The notice must:
178	180		(1) be sent certified mail, return receipt requested,
179	181		or delivered by the United States Postal Service with signature
180	182		confirmation service to the mailing address of the association or
181	183		authorized representative as reflected on the most current
182	184		management certificate filed under Section 82.116; and
183	185		(2) describe with sufficient detail the books and
184	186		records being requested.
185	187		(p) For the purposes of this section, "business day" means a
186	188		day other than Saturday, Sunday, or a state or federal holiday.
187	189		SECTION 3. Section 82.1141, Property Code, as added by this
188	190		Act, applies only to a request for association records or
189	191		information made on or after the effective date of this Act.
190	192		SECTION 4. This Act takes effect September 1, 2021.
191		-	______________________________ ______________________________
192		-	President of the Senate Speaker of the House
193		-	I hereby certify that S.B. No. 318 passed the Senate on
194		-	May 5, 2021, by the following vote: Yeas 31, Nays 0.
195		-	______________________________
196		-	Secretary of the Senate
197		-	I hereby certify that S.B. No. 318 passed the House on
198		-	May 26, 2021, by the following vote: Yeas 116, Nays 31, two
199		-	present not voting.
200		-	______________________________
201		-	Chief Clerk of the House
202		-	Approved:
203		-	______________________________
204		-	Date
205		-	______________________________
206		-	Governor