By: West S.B. No. 600
A BILL TO BE ENTITLED
AN ACT
relating to the partition or voluntary sale of real property owned
by certain cotenants; amending the Uniform Partition of Heirs'
Property Act.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 23, Property Code, is amended by adding
Sections 23.0014, 23,0015, 23.0016, 23.0017, 23.0018, 23.0019 and
23.0025 to read as follows:
Sec. 23.0014. DEFINITIONS. In this chapter, "heir
cotenant," "heirs' property," "non-heir cotenant" and "relative"
have the meanings assigned by Section 23A.002.
Sec. 23.0015. REQUIREMENTS OF PETITION. (a) A petition to
partition property must:
(1) meet the requirements in the Texas Rules of Civil
Procedure;
(2) include a statement certifying whether the
property is heirs' property;
(3) include the date that the plaintiff acquired their
interest in the property; and
(4) include the plaintiff's percentage interest in the
property.
(b) If a non-heir cotenant brings a partition action for
heirs' property after December 31, 2025, and the non-heir cotenant
acquired their interest in said property after December 31, 2025,
the petition must also include:
(1) a statement certifying whether the right of first
refusal and notice of sale requirements in Section 5.254 have been
met;
(2) the steps taken to exercise the due diligence
required under Section 5.254; and
(3) the full name of the persons who received the
notice required under Section 5.254.
Sec. 23.0016. CITATION; NOTICE OF HEIR'S BILL OF RIGHTS;
FORM. (a) Citation of an action to partition real property must be
served by personal service or certified mail with return receipt
requested on each of the following persons:
(1) each joint owner of the property who is 16 years of
age or older;
(2) the parent, managing conservator, or guardian of
each joint owner who is younger than 16 years of age;
(3) each person who has paid any part of the property
taxes on the property in any of the five years prior to the filing of
the suit; and
(4) each person residing on the property.
(b) The plaintiff or plaintiff's attorney or agent must
exercise due diligence to identify the name and residence of each
person listed in Subsection (a) and notify the clerk of the court of
the identified names and residences;
(c) The citation is not required to be served on a person
listed in Subsection (a) if:
(1) the person entered a court appearance in the
action;
(2) the person is 16 years of age or older and waived
citation; or
(3) the person is younger than 16 years of age and the
party's parent, managing conservator, guardian, attorney ad litem,
or guardian ad litem waived citation.
(d) If the name or residence of a person listed in
Subsection (a) cannot be ascertained through the exercise of due
diligence, the service of the citation shall be made by publication
in accordance with the Texas Rules of Civil Procedures.
(e) The citation must include a notice of heir's property
rights utilizing the standardized form created by the Office of
Court Administration under Section 72.040, Government Code.
Sec. 23.0017. AFFIDAVIT. (a) A plaintiff who files an
action to partition real property shall file with the court, no
later than 20 days after the service of citation in the action is
completed:
(1) a copy of any citation required by this chapter and
the proof of delivery of service of the citation; and
(2) an affidavit sworn to by the plaintiff or a
certificate signed by the plaintiff's attorney stating:
(A) that the citation was served as required by
this chapter;
(B) the name and address of each person to whom
the citation was served, if the person's name and address are not
shown on the proof of delivery; and
(C) if service of citation is waived.
(b) If the name or location of a person required to be served
the citation under Section 23.0016 has not been ascertained:
(1) the affidavit must confirm that due diligence was
taken to ascertain the person's name and residence and contain a
statement of the actions taken to identify the name and residence of
the person; and
(2) the court shall inquire into the sufficiency of
the diligence taken to identify the person's name and residence and
require any corrective actions needed to comply with this section.
Sec. 23.0018. ATTORNEY AD LITEM. (a) The court shall
appoint an attorney ad litem in a partition action to represent the
interests of any joint owners whose name or location is unknown;
(b) The court shall appoint an attorney ad litem in a
partition action brought by a non-heir cotenant involving heirs'
property to determine if there are any heir cotenants of the
property who have not been identified and to locate any known heir
cotenants who have not been served with the citation. Pursuant to
this subsection:
(1) the attorney ad litem shall conduct a due
diligence investigation to locate known heir cotenants and identify
and locate potential unknown heir cotenants, including, but not
limited to, reviewing deed records, contacting known family
members, and utilizing other reasonable means;
(2) the court shall dismiss the attorney ad litem upon
a finding that the attorney ad litem completed a due diligence
search for the name and location of all heir cotenants; and
(3) The fees for the attorney ad litem appointed under
this subsection shall be paid for by the non-heir cotenant.
Sec. 23.0019. NOTICE OF ACTION BY POSTING; TIME FOR FIRST
HEARING. (a) Not later than 10 days after bringing an action to
partition property, the plaintiff shall post, and maintain while
the action is pending, a conspicuous sign on the property that is
the subject of the action.
(b) The sign must:
(1) be posted in a conspicuous place on the property
that is reasonably accessible and that the public is most likely to
observe and, if the property abuts a public thoroughfare, in a
location that is easily visible from the thoroughfare;
(2) be made of a weatherproof material that is not
likely to disintegrate or decompose;
(3) have dimensions of at least four feet by four feet;
(4) state in conspicuous language that the partition
action has commenced and identify the name and address of the court
and the common designation by which the property is known.
(b) The court may require the plaintiff to publish on the
sign the name of the plaintiff and the known defendants.
(c) The plaintiff must file with the court proof of posting
the sign in compliance with this section not later than the 10th day
after the date of posting.
(d) The court may not hold the first hearing in the action
earlier than the 60th day after the date on which the plaintiff
provides proof the sign is posted as required by this section.
Sec. 23.0025. DETERMINATION OF HEIRS' PROPERTY;
APPLICABILITY; RELATION TO OTHER LAW. In an action to partition
real property, after service of the citation is completed in
compliance with this chapter, the court shall hold a preliminary
hearing to determine whether the property is heirs' property under
Chapter 23A. If the court determines that the property is heirs'
property, the provisions of Chapter 23A apply unless all the
cotenants otherwise agree in a written record.
SECTION 2. Section 23A.002, Property Code, is amended by
adding Subdivisions (4-a) and (5-a) and amending Subdivision (5) to
read as follows:
(4-a) "Heir cotenant" means an individual who:
(A) acquired a tenancy in common interest in real
property from a relative by will, intestacy, or transfer on death
deed; or
(B) acquired a tenancy in common interest in real
property from a relative who previously acquired the interest from
a relative by will, intestacy, or transfer on death deed.
(5) "Heirs' property" means real property held in
tenancy in common that satisfies all of the following requirements
as of the filing of a partition action:
(A) there is no agreement in a record binding all
the cotenants that governs the partition of the property;
(B) one or more of the cotenants acquired title
from a relative, whether living or deceased; and
(C) any of the following applies:
(i) 20 percent or more of the interests are
held by cotenants who are relatives;
(ii) 20 percent or more of the interests are
held by an individual who acquired title from a relative, whether
living or deceased; [or]
(iii) 20 percent or more of the cotenants
are relatives; or
(iv) any heir cotenant resides on the
property.
(5-a) "Non-heir cotenant" means an owner of heirs'
property who is not an heir cotenant.
SECTION 3. The heading of Section 23A.003, Property Code,
is amended to read as follows:
Sec. 23A.003. [APPLICABILITY;] RELATION TO OTHER LAW.
SECTION 4. Section 23A.003(a), Property Code, is repealed.
SECTION 5. Section 23A.004, Property Code, is repealed.
SECTION 6. Chapter 23A, Property Code, is amended by adding
Section 23A.0041 to read as follows:
Sec. 23A.0041. SETTLEMENT CONFERENCE. (a) If the court in
a partition action determines that the property is heirs' property,
a party may file a written request that the court hold a conference
for the parties to engage in settlement discussions with respect to
the parties' interests in the property.
(b) On the filing of a request for a settlement conference
under this section the court shall:
(1) order the parties to participate in a settlement
conference under this section; and
(2) send notice to the parties of the time and place at
which the settlement conference will be held, the purpose of the
settlement conference, and the requirements of this section.
(c) The Office of Court Administration of the Texas Judicial
System shall prescribe a form to be used to provide the notice
required by Subsection (b). Notice provided under Subsection (b)
must be in the form prescribed.
(d) The plaintiff, not later than the 20th day after the
date the court sends notice under Subsection (b)(2), shall post a
copy of that notice on the sign required under Section 23A.0041.
(e) The court:
(1) shall hold a settlement conference under this
section:
(A) not later than the 60th day after the date the
request for the settlement conference is filed; or
(B) on a date agreed to by all parties; and
(2) may adjourn or reconvene the settlement conference
as necessary during the pendency of the partition action.
(f) Each party to the action shall appear at the settlement
conference in person, by videoconference if allowed by the court,
or by counsel. Each party's representative at the settlement
conference must be authorized to dispose of any portion of the case.
If a defendant appears pro se, the court shall advise the defendant
of the nature of the action and the defendant's rights and
responsibilities as a defendant.
(g) If at the time the court first holds a settlement
conference under this section a defendant has not filed an answer to
or motion to dismiss the partition action, the court shall:
(1) advise the defendant of the requirement to answer
the petition and that the ability to contest the partition action
and assert defenses may be lost if an answer is not filed;
(2) explain what is required to answer the petition in
court;
(3) provide information about available resources for
legal assistance; and
(4) set a deadline for any cotenant to request
partition by sale.
(h) The court shall presume that a defendant who appears at
a settlement conference but who did not timely file an answer in the
partition action has a reasonable excuse for the default and shall
allow the defendant to serve and file an answer not later than the
30th day after the date of the defendant's initial appearance at the
settlement conference, without deeming the defendant to have waived
any substantive defenses to the partition action. On service and
filing of the defendant's answer in accordance with this
subsection, the court shall vacate any default judgment that has
issued against the defendant in the action.
(i) Each party to the action shall negotiate in good faith
to reach a mutually agreeable resolution regarding the property,
which may include:
(1) a tenancy in common agreement;
(2) a cotenant buyout and the allocation, mechanics,
and financing for a cotenant buyout under Section 23A.007;
(3) partition in kind as provided under Sections
23A.008 and 23A.009;
(4) an open-market sale as provided under Section
23A.010; or
(5) any other agreement or loss mitigation that is
fair and reasonable in consideration of the factors listed in
Section 23A.009(a).
(j) If the parties do not reach a mutually agreeable
resolution, the court may refer the case to an alternative dispute
resolution procedure under Chapter 154, Civil Practice and Remedies
Code.
(k) The court may hold in abeyance any motion by any party to
a partition action while a settlement conference process under this
section is ongoing, except for a motion concerning:
(1) a determination of the percentage interest, if
any, owned by an alleged cotenant, if the interest is in dispute; or
(2) compliance with this section, including an
application to extend any deadline under this section in the
interest of justice.
SECTION 7. Section 23A.006, Property Code, is amended by
amending Subsections (a) and (b) and adding Subsection (d-1) to
read as follows:
(a) Except as provided by Subsection (b) [ or (c)], if the
court determines that the property that is the subject of a
partition action is heirs' property, the court shall determine the
fair market value of the property by ordering an appraisal under
Subsection (d).
(b) If all cotenants have agreed in writing to the value of
the property or to another method of valuation, the court shall
adopt that value or the value produced by the agreed method of
valuation.
(d-1) An appraiser appointed under Subsection (d) must be
certified as a certified general appraiser under Chapter 1103,
Occupations Code, unless the parties agree otherwise in writing or
the court requires an appraiser with higher or additional
certifications, licensing, or qualifications. Notwithstanding the
foregoing, if the court determines that a certified general
appraiser is unavailable to appraise the property within a
ninety-day time period, the court may appoint an appraiser licensed
as a certified residential appraiser to perform the appraisal
provided that the appraiser's license is adequate for the type of
property being appraised.
SECTION 8. Section 23A.007, Property Code, is amended by
amending Subsection (e) to read as follows:
(e) If the court sends notice to the parties under
Subsection (d)(1) or (2), the court shall set a date, not earlier
than the [60th] 90th day after the date notice was sent, by which an
electing cotenant must pay the cotenant's apportioned price into
the court. After that date:
(1) if all electing cotenants timely pay their
apportioned price into court, the court shall:
(A) issue an order reallocating all the interests
of the cotenants; and
(B) disburse the amounts held by the court to the
persons entitled to them;
(2) if no electing cotenant timely pays its
apportioned price, the court shall resolve the partition action
under Section 23A.008(a) or (b) as if the interests of the cotenants
that requested partition by sale were not purchased; or
(3) if one or more but not all of the electing
cotenants fail to pay their apportioned price on time, the court
shall give notice to the electing cotenants that paid their
apportioned price of the interest remaining and the price for all
that interest.
SECTION 9. Sections 23A.010(d) and (e), Property Code, are
amended to read as follows:
(d) If the broker appointed under Subsection (b) does not
obtain within a reasonable time an offer to purchase the property
for at least the determination of value, the court, after hearing,
may:
(1) approve the highest outstanding offer, if any;
(2) redetermine the value of the property and order
that the property continue to be offered for an additional time; or
(3) appoint a substitute broker under Subsection (b)
and order that the property continue to be offered for sale [be sold
by sealed bids or at an auction].
(e) If a substitute broker appointed under Subsection
(d)(3) does not obtain within a reasonable time a reasonable offer
to purchase the property, the court may order the [orders a] sale of
the property by sealed bids or at an auction. The [, the] court
shall set terms and conditions of the sale. If the court orders an
auction, the auction must be conducted in the manner provided by law
for a sale made under execution.
SECTION 10. Chapter 23A, Property Code, is amended by
adding Section 23A.0115 to read as follows
Sec. 23A.0115. PROHIBITION ON INITIATION OF PARTITION. (a)
No partition action related to an heirs' property may be initiated
by a non-heir cotenant holding less than 50 percent of the interest
in said property for a period of ten years from the date the
non-heir cotenant first acquired a co-ownership interest in said
property.
(b) This section does not apply to an interest in heirs'
property acquired by a non-heir cotenant prior to January 1, 2026.
SECTION 11. Chapter 5, Property Code, is amended by adding
Subchapter H to read as follows:
SUBCHAPTER H. NON-PARTITION SALE OF HEIR COTENANT'S INTEREST IN
HEIRS' PROPERTY
Sec. 5.251. DEFINITIONS. In this subchapter: "heir
cotenant," heirs' property," "non-heir cotenant," and "relative"
have the meanings assigned by Section 23A.002.
Sec. 5.252. APPLICABILITY OF SUBCHAPTER. This subchapter
applies to the sale of an heir cotenant's interest in heirs'
property if:
(1) an heir cotenant is in possession of the property; and
(2) the sale does not result from an action to partition the
property under Chapter 23 or 23A.
Sec. 5.253. RIGHT OF FIRST REFUSAL AND NOTICE OF SALE. (a)
If a cotenant decides to sell all or part of their interest in
heirs' property to a non-heir cotenant who is not a relative of an
heir cotenant, any heir cotenants who reside on the property have a
right of first refusal to purchase the interest in accordance with
this subchapter.
(b) Before selling an interest in heirs' property covered by
this subchapter, the selling cotenant must have a contract with the
third-party purchaser that sets forth the terms of the sale and is
subject to the right of first refusal in this subchapter.
(c) Any heir cotenants who reside on the property are
entitled to buy the interest for the same price in the contract for
a period of 90 days from the date the notice under Section 5.254 is
sent.
(d) If multiple heir cotenants who reside on the property
offer to purchase the interest, priority is given to heir cotenants
who:
(1) have occupied the property as their primary
residence for at least the past five years; and
(2) paid all or part of the ad valorem taxes imposed on
the property for at least three of the five most recent tax years.
(e) If a non-heir cotenant who acquired an interest in
heirs' property after December 31, 2025, brings a partition action
under Chapter 23 and the acquisition was not made in compliance with
the right of first refusal requirements in this section, the heir
cotenants who reside on the property have a right to buy the
non-heir cotenant's interest in the property for the lesser of (1)
the fair market value of the non-heir cotenant's interest in the
property and (2) the price paid by the non-heir cotenant to acquire
the interests in the property.
Sec. 5.254. NOTICE TO HEIR COTENANTS. (a) Within 30 days of
a cotenant entering into a contract for the sale of heirs' property
to a non-heir cotenant, the selling cotenant shall give notice of
the proposed sale to all persons in possession of the property and
all known heir cotenants of the property. The notice shall include
the identity of the proposed purchaser, the sales price of the
proposed transaction, and a copy of the contract.
(b) Notice shall be sent to the heir cotenants' last known
address by certified mail with return receipt requested.
(c) The selling cotenant has a duty to exercise due
diligence to identify the names and locations of all the heir
cotenants and provide the notice required under this subchapter.
SECTION 12. Subchapter C, Chapter 72, Government Code, is
amended by adding Section 72.040 to read as follows:
Sec. 72.040 HEIR'S BILL OF RIGHTS FORM. (a) The Office of
Court Administration of the Texas Judicial System shall promulgate
an heir's bill of rights form required to be included in a citation
for a partition action under Chapter 23, Property Code.
(b) The standardized form developed under Subsection (a)
must:
(1) be written in English that can be easily
understood by the general public and include a Spanish translation;
(2) provide information for accessing free or low-cost
legal assistance;
(3) inform cotenant heirs of their rights and duties
under Chapters 23 and 23A, Property Code, including their buyout
rights and right to request a settlement conference; and
(4) include such other information as the office
determines is appropriate to adequately inform heirs of their
rights and duties under Chapters 23 and 23A, Property Code.
SECTION 13. (a) Chapters 23 and 23A, Property Code, as
amended by this Act, apply only to a partition action commenced on
or after the effective date of this Act. A partition action
commenced before the effective date of this Act is governed by the
law as it existed immediately before the effective date of this Act,
and that law is continued in effect for that purpose.
(b) As soon as practicable after the effective date of this
Act, but not later than December 31, 2025, the Office of Court
Administration of the Texas Judicial System shall create and make
available on the office's Internet Website the forms required by
Section 72.040, Government Code, and Section 23A.0041, Property
Code, as added by this Act.
(c) Subchapter H, Chapter 5, Property Code, as added by this
Act, applies only to the sale of an interest in heirs' property the
closing date of which is on or after January 1, 2026. The sale of an
interest in heirs' property the closing date of which is before
January 1, 2026, is governed by the law as it existed immediately
before the effective date of this Act, and that law is continued in
effect for that purpose.
SECTION 14. This Act takes effect September 1, 2025.