PROPERTY CODE
TITLE 11. RESTRICTIVE COVENANTS
CHAPTER 209. TEXAS RESIDENTIAL PROPERTY OWNERS PROTECTION ACT
Sec. 209.001. SHORT TITLE. This chapter may be cited as the Texas Residential Property Owners Protection Act.
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.002. DEFINITIONS. In this chapter:
(1) "Assessment" means a regular assessment, special assessment, or other amount a property owner is required to pay a property owners' association under the dedicatory instrument or by law.
(2) "Board" means the governing body of a property owners' association.
(3) "Declaration" means an instrument filed in the real property records of a county that includes restrictive covenants governing a residential subdivision.
(4) "Dedicatory instrument" means each governing instrument covering the establishment, maintenance, and operation of a residential subdivision. The term includes restrictions or similar instruments subjecting property to restrictive covenants, bylaws, or similar instruments governing the administration or operation of a property owners' association, to properly adopted rules and regulations of the property owners' association, and to all lawful amendments to the covenants, bylaws, rules, or regulations.
(4-a) "Development period" means a period stated in a declaration during which a declarant reserves:
(A) a right to facilitate the development, construction, and marketing of the subdivision; and
(B) a right to direct the size, shape, and composition of the subdivision.
(5) "Lot" means any designated parcel of land located in a residential subdivision, including any improvements on the designated parcel.
(6) "Owner" means a person who holds record title to property in a residential subdivision and includes the personal representative of a person who holds record title to property in a residential subdivision.
(7) "Property owners' association" or "association" means an incorporated or unincorporated association that:
(A) is designated as the representative of the owners of property in a residential subdivision;
(B) has a membership primarily consisting of the owners of the property covered by the dedicatory instrument for the residential subdivision; and
(C) manages or regulates the residential subdivision for the benefit of the owners of property in the residential subdivision.
(8) "Regular assessment" means an assessment, a charge, a fee, or dues that each owner of property within a residential subdivision is required to pay to the property owners' association on a regular basis and that is designated for use by the property owners' association for the benefit of the residential subdivision as provided by the restrictions.
(9) "Residential subdivision" or "subdivision" means a subdivision, planned unit development, townhouse regime, or similar planned development in which all land has been divided into two or more parts and is subject to restrictions that:
(A) limit a majority of the land subject to the dedicatory instruments, excluding streets, common areas, and public areas, to residential use for single-family homes, townhomes, or duplexes only;
(B) are recorded in the real property records of the county in which the residential subdivision is located; and
(C) require membership in a property owners' association that has authority to impose regular or special assessments on the property in the subdivision.
(10) "Restrictions" means one or more restrictive covenants contained or incorporated by reference in a properly recorded map, plat, replat, declaration, or other instrument filed in the real property records or map or plat records. The term includes any amendment or extension of the restrictions.
(11) "Restrictive covenant" means any covenant, condition, or restriction contained in a dedicatory instrument, whether mandatory, prohibitive, permissive, or administrative.
(12) "Special assessment" means an assessment, a charge, a fee, or dues, other than a regular assessment, that each owner of property located in a residential subdivision is required to pay to the property owners' association, according to procedures required by the dedicatory instruments, for:
(A) defraying, in whole or in part, the cost, whether incurred before or after the assessment, of any construction or reconstruction, unexpected repair, or replacement of a capital improvement in common areas owned by the property owners' association, including the necessary fixtures and personal property related to the common areas;
(B) maintenance and improvement of common areas owned by the property owners' association; or
(C) other purposes of the property owners' association as stated in its articles of incorporation or the dedicatory instrument for the residential subdivision.
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 863 (H.B. 503), Sec. 1, eff. September 1, 2013.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.003. APPLICABILITY OF CHAPTER. (a) This chapter applies only to a residential subdivision that is subject to restrictions or provisions in a declaration that authorize the property owners' association to collect regular or special assessments on all or a majority of the property in the subdivision.
(b) Except as otherwise provided by this chapter, this chapter applies only to a property owners' association that requires mandatory membership in the association for all or a majority of the owners of residential property within the subdivision subject to the association's dedicatory instruments.
(c) This chapter applies to a residential property owners' association regardless of whether the entity is designated as a "homeowners' association," "community association," or similar designation in the restrictions or dedicatory instrument.
(d) This chapter does not apply to a condominium development governed by Chapter 82.
(e) The following provisions of this chapter do not apply to a property owners' association that is a mixed-use master association that existed before January 1, 1974, and that does not have the authority under a dedicatory instrument or other governing document to impose fines:
(1) Section 209.005(c);
(2) Section 209.0056;
(3) Section 209.0057;
(4) Section 209.0058;
(5) Section 209.00592; and
(6) Section 209.0062.
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 1367 (H.B. 3674), Sec. 7, eff. September 1, 2007.
Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 1, eff. January 1, 2012.
Acts 2011, 82nd Leg., R.S., Ch. 1142 (H.B. 1821), Sec. 6, eff. January 1, 2012.
Acts 2011, 82nd Leg., R.S., Ch. 1217 (S.B. 472), Sec. 1, eff. September 1, 2011.
Acts 2011, 82nd Leg., R.S., Ch. 1282 (H.B. 1228), Sec. 1, eff. January 1, 2012.
Acts 2013, 83rd Leg., R.S., Ch. 161 (S.B. 1093), Sec. 17.002(a), eff. September 1, 2013.
Acts 2013, 83rd Leg., R.S., Ch. 161 (S.B. 1093), Sec. 17.002(b), eff. September 1, 2013.
Sec. 209.004. MANAGEMENT CERTIFICATES. (a) A property owners' association shall record in each county in which any portion of the residential subdivision is located a management certificate, signed and acknowledged by an officer or the managing agent of the association, stating:
(1) the name of the subdivision;
(2) the name of the association;
(3) the recording data for the subdivision;
(4) the recording data for the declaration;
(5) the name and mailing address of the association;
(6) the name and mailing address of the person managing the association or the association's designated representative; and
(7) other information the association considers appropriate.
(a-1) The county clerk of each county in which a management certificate is filed as required by this section shall record the management certificate in the real property records of the county and index the document as a "Property Owners' Association Management Certificate."
(b) The property owners' association shall record an amended management certificate not later than the 30th day after the date the association has notice of a change in any information in the recorded certificate required by Subsection (a).
(c) Except as provided under Subsections (d) and (e), the property owners' association and its officers, directors, employees, and agents are not subject to liability to any person for a delay in recording or failure to record a management certificate, unless the delay or failure is wilful or caused by gross negligence.
(d) If a property owners' association fails to record a management certificate or an amended management certificate under this section, the purchaser, lender, or title insurance company or its agent in a transaction involving property in the property owners' association is not liable to the property owners' association for:
(1) any amount due to the association on the date of a transfer to a bona fide purchaser; and
(2) any debt to or claim of the association that accrued before the date of a transfer to a bona fide purchaser.
(e) A lien of a property owners' association that fails to file a management certificate or an amended management certificate under this section to secure an amount due on the effective date of a transfer to a bona fide purchaser is enforceable only for an amount incurred after the effective date of sale.
(f) For purposes of this section, "bona fide purchaser" means:
(1) a person who pays valuable consideration without notice of outstanding rights of others and acts in good faith; or
(2) a third-party lender who acquires a security interest in the property under a deed of trust.
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 148 (S.B. 1919), Sec. 1, eff. September 1, 2009.
Acts 2013, 83rd Leg., R.S., Ch. 1108 (H.B. 3800), Sec. 1, eff. September 1, 2013.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.0041. ADOPTION OR AMENDMENT OF CERTAIN DEDICATORY INSTRUMENTS. (a) In this section, "development period" means a period stated in a declaration during which a declarant reserves:
(1) a right to facilitate the development, construction, and marketing of the subdivision; and
(2) a right to direct the size, shape, and composition of the subdivision.
(b) This section applies to a residential subdivision in which property owners are subject to mandatory membership in a property owners' association.
(c) This section does not apply to a property owners' association that is subject to Chapter 552, Government Code, by application of Section 552.0036, Government Code.
(d) This section does not apply to the amendment of a declaration during a development period.
(e) This section applies to a dedicatory instrument regardless of the date on which the dedicatory instrument was created.
(f) This section supersedes any contrary requirement in a dedicatory instrument.
(g) To the extent of any conflict with another provision of this title, this section prevails.
(h) Except as provided by this subsection, a declaration may be amended only by a vote of 67 percent of the total votes allocated to property owners in the property owners' association, in addition to any governmental approval required by law. If the declaration contains a lower percentage, the percentage in the declaration controls.
(i) A bylaw may not be amended to conflict with the declaration.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1217 (S.B. 472), Sec. 2, eff. September 1, 2011.
Sec. 209.005. ASSOCIATION RECORDS. (a) Except as provided by Subsection (b), this section applies to all property owners' associations and controls over other law not specifically applicable to a property owners' association.
(b) This section does not apply to a property owners' association that is subject to Chapter 552, Government Code, by application of Section 552.0036, Government Code.
(c) Notwithstanding a provision in a dedicatory instrument, a property owners' association shall make the books and records of the association, including financial records, open to and reasonably available for examination by an owner, or a person designated in a writing signed by the owner as the owner's agent, attorney, or certified public accountant, in accordance with this section. An owner is entitled to obtain from the association copies of information contained in the books and records.
(d) Except as provided by this subsection, an attorney's files and records relating to the property owners' association, excluding invoices requested by an owner under Section 209.008(d), are not records of the association and are not subject to inspection by the owner or production in a legal proceeding. If a document in an attorney's files and records relating to the association would be responsive to a legally authorized request to inspect or copy association documents, the document shall be produced by using the copy from the attorney's files and records if the association has not maintained a separate copy of the document. This subsection does not require production of a document that constitutes attorney work product or that is privileged as an attorney-client communication.
(e) An owner or the owner's authorized representative described by Subsection (c) must submit a written request for access or information under Subsection (c) by certified mail, with sufficient detail describing the property owners' association's books and records requested, to the mailing address of the association or authorized representative as reflected on the most current management certificate filed under Section 209.004. The request must contain an election either to inspect the books and records before obtaining copies or to have the property owners' association forward copies of the requested books and records and:
(1) if an inspection is requested, the association, on or before the 10th business day after the date the association receives the request, shall send written notice of dates during normal business hours that the owner may inspect the requested books and records to the extent those books and records are in the possession, custody, or control of the association; or
(2) if copies of identified books and records are requested, the association shall, to the extent those books and records are in the possession, custody, or control of the association, produce the requested books and records for the requesting party on or before the 10th business day after the date the association receives the request, except as otherwise provided by this section.
(f) If the property owners' association is unable to produce the books or records requested under Subsection (e) on or before the 10th business day after the date the association receives the request, the association must provide to the requestor written notice that:
(1) informs the requestor that the association is unable to produce the information on or before the 10th business day after the date the association received the request; and
(2) states a date by which the information will be sent or made available for inspection to the requesting party that is not later than the 15th business day after the date notice under this subsection is given.
(g) If an inspection is requested or required, the inspection shall take place at a mutually agreed on time during normal business hours, and the requesting party shall identify the books and records for the property owners' association to copy and forward to the requesting party.
(h) A property owners' association may produce books and records requested under this section in hard copy, electronic, or other format reasonably available to the association.
(i) A property owners' association board must adopt a records production and copying policy that prescribes the costs the association will charge for the compilation, production, and reproduction of information requested under this section. The prescribed charges may include all reasonable costs of materials, labor, and overhead but may not exceed costs that would be applicable for an item under 1 T.A.C. Section 70.3. The policy required by this subsection must be recorded as a dedicatory instrument in accordance with Section 202.006. An association may not charge an owner for the compilation, production, or reproduction of information requested under this section unless the policy prescribing those costs has been recorded as required by this subsection. An owner is responsible for costs related to the compilation, production, and reproduction of the requested information in the amounts prescribed by the policy adopted under this subsection. The association may require advance payment of the estimated costs of compilation, production, and reproduction of the requested information. If the estimated costs are lesser or greater than the actual costs, the association shall submit a final invoice to the owner on or before the 30th business day after the date the information is delivered. If the final invoice includes additional amounts due from the owner, the additional amounts, if not reimbursed to the association before the 30th business day after the date the invoice is sent to the owner, may be added to the owner's account as an assessment. If the estimated costs exceeded the final invoice amount, the owner is entitled to a refund, and the refund shall be issued to the owner not later than the 30th business day after the date the invoice is sent to the owner.
(j) A property owners' association must estimate costs under this section using amounts prescribed by the policy adopted under Subsection (i).
(k) Except as provided by Subsection (l) and to the extent the information is provided in the meeting minutes, the property owners' association is not required to release or allow inspection of any books or records that identify the dedicatory instrument violation history of an individual owner of an association, an owner's personal financial information, including records of payment or nonpayment of amounts due the association, an owner's contact information, other than the owner's address, or information related to an employee of the association, including personnel files. Information may be released in an aggregate or summary manner that would not identify an individual property owner.
(l) The books and records described by Subsection (k) shall be released or made available for inspection if:
(1) the express written approval of the owner whose records are the subject of the request for inspection is provided to the property owners' association; or
(2) a court orders the release of the books and records or orders that the books and records be made available for inspection.
(m) A property owners' association composed of more than 14 lots shall adopt and comply with a document retention policy that includes, at a minimum, the following requirements:
(1) certificates of formation, bylaws, restrictive covenants, and all amendments to the certificates of formation, bylaws, and covenants shall be retained permanently;
(2) financial books and records shall be retained for seven years;
(3) account records of current owners shall be retained for five years;
(4) contracts with a term of one year or more shall be retained for four years after the expiration of the contract term;
(5) minutes of meetings of the owners and the board shall be retained for seven years; and
(6) tax returns and audit records shall be retained for seven years.
(n) A member of a property owners' association who is denied access to or copies of association books or records to which the member is entitled under this section may file a petition with the justice of the peace of a justice precinct in which all or part of the property that is governed by the association is located requesting relief in accordance with this subsection. If the justice of the peace finds that the member is entitled to access to or copies of the records, the justice of the peace may grant one or more of the following remedies:
(1) a judgment ordering the property owners' association to release or allow access to the books or records;
(2) a judgment against the property owners' association for court costs and attorney's fees incurred in connection with seeking a remedy under this section; or
(3) a judgment authorizing the owner or the owner's assignee to deduct the amounts awarded under Subdivision (2) from any future regular or special assessments payable to the property owners' association.
(o) If the property owners' association prevails in an action under Subsection (n), the association is entitled to a judgment for court costs and attorney's fees incurred by the association in connection with the action.
(p) On or before the 10th business day before the date a person brings an action against a property owners' association under this section, the person must send written notice to the association of the person's intent to bring the action. The notice must:
(1) be sent certified mail, return receipt requested, or delivered by the United States Postal Service with signature confirmation service to the mailing address of the association or authorized representative as reflected on the most current management certificate filed under Section 209.004; and
(2) describe with sufficient detail the books and records being requested.
(q) For the purposes of this section, "business day" means a day other than Saturday, Sunday, or a state or federal holiday.
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 1367 (H.B. 3674), Sec. 6, eff. September 1, 2007.
Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 2, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.0051. OPEN BOARD MEETINGS. (a) This section does not apply to a property owners' association that is subject to Chapter 551, Government Code, by application of Section 551.0015, Government Code.
(b) In this section:
(1) "Board meeting":
(A) means a deliberation between a quorum of the voting board of the property owners' association, or between a quorum of the voting board and another person, during which property owners' association business is considered and the board takes formal action; and
(B) does not include the gathering of a quorum of the board at a social function unrelated to the business of the association or the attendance by a quorum of the board at a regional, state, or national convention, ceremonial event, or press conference, if formal action is not taken and any discussion of association business is incidental to the social function, convention, ceremonial event, or press conference.
(2) "Development period" means a period stated in a declaration during which a declarant reserves:
(A) a right to facilitate the development, construction, and marketing of the subdivision; and
(B) a right to direct the size, shape, and composition of the subdivision.
(c) Regular and special board meetings must be open to owners, subject to the right of the board to adjourn a board meeting and reconvene in closed executive session to consider actions involving personnel, pending or threatened litigation, contract negotiations, enforcement actions, confidential communications with the property owners' association's attorney, matters involving the invasion of privacy of individual owners, or matters that are to remain confidential by request of the affected parties and agreement of the board. Following an executive session, any decision made in the executive session must be summarized orally and placed in the minutes, in general terms, without breaching the privacy of individual owners, violating any privilege, or disclosing information that was to remain confidential at the request of the affected parties. The oral summary must include a general explanation of expenditures approved in executive session.
(c-1) Except for a meeting held by electronic or telephonic means under Subsection (h), a board meeting must be held in a county in which all or part of the property in the subdivision is located or in a county adjacent to that county.
(d) The board shall keep a record of each regular or special board meeting in the form of written minutes of the meeting. The board shall make meeting records, including approved minutes, available to a member for inspection and copying on the member's written request to the property owners' association's managing agent at the address appearing on the most recently filed management certificate or, if there is not a managing agent, to the board.
(e) Members shall be given notice of the date, hour, place, and general subject of a regular or special board meeting, including a general description of any matter to be brought up for deliberation in executive session. The notice shall be:
(1) mailed to each property owner not later than the 10th day or earlier than the 60th day before the date of the meeting; or
(2) provided at least 72 hours before the start of the meeting by:
(A) posting the notice in a conspicuous manner reasonably designed to provide notice to property owners' association members:
(i) in a place located on the association's common property or, with the property owner's consent, on other conspicuously located privately owned property within the subdivision; or
(ii) on any Internet website maintained by the association or other Internet media; and
(B) sending the notice by e-mail to each owner who has registered an e-mail address with the association.
(f) It is an owner's duty to keep an updated e-mail address registered with the property owners' association under Subsection (e)(2)(B).
(g) If the board recesses a regular or special board meeting to continue the following regular business day, the board is not required to post notice of the continued meeting if the recess is taken in good faith and not to circumvent this section. If a regular or special board meeting is continued to the following regular business day, and on that following day the board continues the meeting to another day, the board shall give notice of the continuation in at least one manner prescribed by Subsection (e)(2)(A) within two hours after adjourning the meeting being continued.
(h) A board may meet by any method of communication, including electronic and telephonic, without prior notice to owners under Subsection (e), if each director may hear and be heard by every other director, or the board may take action by unanimous written consent to consider routine and administrative matters or a reasonably unforeseen emergency or urgent necessity that requires immediate board action. Any action taken without notice to owners under Subsection (e) must be summarized orally, including an explanation of any known actual or estimated expenditures approved at the meeting, and documented in the minutes of the next regular or special board meeting. The board may not, without prior notice to owners under Subsection (e), consider or vote on:
(1) fines;
(2) damage assessments;
(3) initiation of foreclosure actions;
(4) initiation of enforcement actions, excluding temporary restraining orders or violations involving a threat to health or safety;
(5) increases in assessments;
(6) levying of special assessments;
(7) appeals from a denial of architectural control approval; or
(8) a suspension of a right of a particular owner before the owner has an opportunity to attend a board meeting to present the owner's position, including any defense, on the issue.
(i) This section applies to a meeting of a property owners' association board during the development period only if the meeting is conducted for the purpose of:
(1) adopting or amending the governing documents, including declarations, bylaws, rules, and regulations of the association;
(2) increasing the amount of regular assessments of the association or adopting or increasing a special assessment;
(3) electing non-developer board members of the association or establishing a process by which those members are elected; or
(4) changing the voting rights of members of the association.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 3, eff. January 1, 2012.
Sec. 209.0052. ASSOCIATION CONTRACTS. (a) This section does not apply to a contract entered into by an association during the development period.
(b) An association may enter into an enforceable contract with a current association board member, a person related to a current association board member within the third degree by consanguinity or affinity, as determined under Chapter 573, Government Code, a company in which a current association board member has a financial interest in at least 51 percent of profits, or a company in which a person related to a current association board member within the third degree by consanguinity or affinity, as determined under Chapter 573, Government Code, has a financial interest in at least 51 percent of profits only if the following conditions are satisfied:
(1) the board member, relative, or company bids on the proposed contract and the association has received at least two other bids for the contract from persons not associated with the board member, relative, or company, if reasonably available in the community;
(2) the board member:
(A) is not given access to the other bids;
(B) does not participate in any board discussion regarding the contract; and
(C) does not vote on the award of the contract;
(3) the material facts regarding the relationship or interest with respect to the proposed contract are disclosed to or known by the association board and the board, in good faith and with ordinary care, authorizes the contract by an affirmative vote of the majority of the board members who do not have an interest governed by this subsection; and
(4) the association board certifies that the other requirements of this subsection have been satisfied by a resolution approved by an affirmative vote of the majority of the board members who do not have an interest governed by this subsection.
Added by Acts 2013, 83rd Leg., R.S., Ch. 863 (H.B. 503), Sec. 2, eff. September 1, 2013.
Sec. 209.0055. VOTING. (a) This section applies only to a property owners' association that:
(1) provides maintenance, preservation, and architectural control of residential and commercial property within a defined geographic area in a county with a population of 2.8 million or more or in a county adjacent to a county with a population of 2.8 million or more; and
(2) is a corporation that:
(A) is governed by a board of trustees who may employ a general manager to execute the association's bylaws and administer the business of the corporation;
(B) does not require membership in the corporation by the owners of the property within the defined area; and
(C) was incorporated before January 1, 2006.
(b) A property owners' association described by Subsection (a) may not bar a property owner from voting in an association election solely based on the fact that:
(1) there is a pending enforcement action against the property owner; or
(2) the property owner owes the association any delinquent assessments, fees, or fines.
Added by Acts 2007, 80th Leg., R.S., Ch. 1367 (H.B. 3674), Sec. 8, eff. September 1, 2007.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.0056. NOTICE OF ELECTION OR ASSOCIATION VOTE. (a) Not later than the 10th day or earlier than the 60th day before the date of an election or vote, a property owners' association shall give written notice of the election or vote to:
(1) each owner of property in the property owners' association, for purposes of an association-wide election or vote; or
(2) each owner of property in the property owners' association entitled under the dedicatory instruments to vote in a particular representative election, for purposes of a vote that involves election of representatives of the association who are vested under the dedicatory instruments of the property owners' association with the authority to elect or appoint board members of the property owners' association.
(b) This section supersedes any contrary requirement in a dedicatory instrument.
(c) This section does not apply to a property owners' association that is subject to Chapter 552, Government Code, by application of Section 552.0036, Government Code.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 3, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.0057. RECOUNT OF VOTES. (a) This section does not apply to a property owners' association that is subject to Chapter 552, Government Code, by application of Section 552.0036, Government Code.
(b) Any owner may, not later than the 15th day after the date of the meeting at which the election was held, require a recount of the votes. A demand for a recount must be submitted in writing either:
(1) by certified mail, return receipt requested, or by delivery by the United States Postal Service with signature confirmation service to the property owners' association's mailing address as reflected on the latest management certificate filed under Section 209.004; or
(2) in person to the property owners' association's managing agent as reflected on the latest management certificate filed under Section 209.004 or to the address to which absentee and proxy ballots are mailed.
(c) The property owners' association shall, at the expense of the owner requesting the recount, retain for the purpose of performing the recount, the services of a person qualified to tabulate votes under this subsection. The association shall enter into a contract for the services of a person who:
(1) is not a member of the association or related to a member of the association board within the third degree by consanguinity or affinity, as determined under Chapter 573, Government Code; and
(2) is:
(A) a current or former:
(i) county judge;
(ii) county elections administrator;
(iii) justice of the peace; or
(iv) county voter registrar; or
(B) a person agreed on by the association and the persons requesting the recount.
(d) Any recount under Subsection (b) must be performed on or before the 30th day after the date of receipt of a request and payment for a recount in accordance with Subsections (b) and (c). If the recount changes the results of the election, the property owners' association shall reimburse the requesting owner for the cost of the recount. The property owners' association shall provide the results of the recount to each owner who requested the recount. Any action taken by the board in the period between the initial election vote tally and the completion of the recount is not affected by any recount.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 3, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 864 and S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.0058. BALLOTS. (a) Any vote cast in an election or vote by a member of a property owners' association must be in writing and signed by the member.
(b) Electronic votes cast under Section 209.00592 constitute written and signed ballots.
(c) In an association-wide election, written and signed ballots are not required for uncontested races.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 3, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.0059. RIGHT TO VOTE. (a) A provision in a dedicatory instrument that would disqualify a property owner from voting in a property owners' association election of board members or on any matter concerning the rights or responsibilities of the owner is void.
(b) This section does not apply to a property owners' association that is subject to Chapter 552, Government Code, by application of Section 552.0036, Government Code.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 3, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168 and H.B. 1072, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.00591. BOARD MEMBERSHIP. (a) Except as provided by this section, a provision in a dedicatory instrument that restricts a property owner's right to run for a position on the board of the property owners' association is void.
(b) If a board is presented with written, documented evidence from a database or other record maintained by a governmental law enforcement authority that a board member has been convicted of a felony or crime involving moral turpitude, the board member is immediately ineligible to serve on the board of the property owners' association, automatically considered removed from the board, and prohibited from future service on the board.
(c) The declaration may provide for a period of declarant control of the association during which a declarant, or persons designated by the declarant, may appoint and remove board members and the officers of the association, other than board members or officers elected by members of the property owners' association. Regardless of the period of declarant control provided by the declaration, on or before the 120th day after the date 75 percent of the lots that may be created and made subject to the declaration are conveyed to owners other than a declarant, at least one-third of the board members must be elected by owners other than the declarant. If the declaration does not include the number of lots that may be created and made subject to the declaration, at least one-third of the board members must be elected by owners other than the declarant not later than the 10th anniversary of the date the declaration was recorded.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 3, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 862 and S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.00592. VOTING; QUORUM. (a) The voting rights of an owner may be cast or given:
(1) in person or by proxy at a meeting of the property owners' association;
(2) by absentee ballot in accordance with this section;
(3) by electronic ballot in accordance with this section; or
(4) by any method of representative or delegated voting provided by a dedicatory instrument.
(b) An absentee or electronic ballot:
(1) may be counted as an owner present and voting for the purpose of establishing a quorum only for items appearing on the ballot;
(2) may not be counted, even if properly delivered, if the owner attends any meeting to vote in person, so that any vote cast at a meeting by a property owner supersedes any vote submitted by absentee or electronic ballot previously submitted for that proposal; and
(3) may not be counted on the final vote of a proposal if the motion was amended at the meeting to be different from the exact language on the absentee or electronic ballot.
(c) A solicitation for votes by absentee ballot must include:
(1) an absentee ballot that contains each proposed action and provides an opportunity to vote for or against each proposed action;
(2) instructions for delivery of the completed absentee ballot, including the delivery location; and
(3) the following language: "By casting your vote via absentee ballot you will forgo the opportunity to consider and vote on any action from the floor on these proposals, if a meeting is held. This means that if there are amendments to these proposals your votes will not be counted on the final vote on these measures. If you desire to retain this ability, please attend any meeting in person. You may submit an absentee ballot and later choose to attend any meeting in person, in which case any in-person vote will prevail."
(d) For the purposes of this section, "electronic ballot" means a ballot:
(1) given by:
(A) e-mail;
(B) facsimile; or
(C) posting on an Internet website;
(2) for which the identity of the property owner submitting the ballot can be confirmed; and
(3) for which the property owner may receive a receipt of the electronic transmission and receipt of the owner's ballot.
(e) If an electronic ballot is posted on an Internet website, a notice of the posting shall be sent to each owner that contains instructions on obtaining access to the posting on the website.
(f) This section supersedes any contrary provision in a dedicatory instrument.
(g) This section does not apply to a property owners' association that is subject to Chapter 552, Government Code, by application of Section 552.0036, Government Code.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 3, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.00593. ELECTION OF BOARD MEMBERS. (a) Notwithstanding any provision in a dedicatory instrument, any board member whose term has expired must be elected by owners who are members of the property owners' association. A board member may be appointed by the board to fill a vacancy on the board. A board member appointed to fill a vacant position shall serve for the remainder of the unexpired term of the position.
(b) The board of a property owners' association may amend the bylaws of the property owners' association to provide for elections to be held as required by Subsection (a).
(c) The appointment of a board member in violation of this section is void.
(d) This section does not apply to the appointment of a board member during a development period. In this subsection, "development period" means a period stated in a declaration during which a declarant reserves:
(1) a right to facilitate the development, construction, and marketing of the subdivision; and
(2) a right to direct the size, shape, and composition of the subdivision.
(e) This section does not apply to a representative board whose members or delegates are elected or appointed by representatives of a property owners' association who are elected by owner members of a property owners' association.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 3, eff. January 1, 2012.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 1062 (H.B. 3176), Sec. 1, eff. June 14, 2013.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.00594. TABULATION OF AND ACCESS TO BALLOTS. (a) Notwithstanding any other provision of this chapter or any other law, a person who is a candidate in a property owners' association election or who is otherwise the subject of an association vote, or a person related to that person within the third degree by consanguinity or affinity, as determined under Chapter 573, Government Code, may not tabulate or otherwise be given access to the ballots cast in that election or vote except as provided by this section.
(b) A person other than a person described by Subsection (a) may tabulate votes in an association election or vote but may not disclose to any other person how an individual voted.
(c) Notwithstanding any other provision of this chapter or any other law, a person other than a person who tabulates votes under Subsection (b), including a person described by Subsection (a), may be given access to the ballots cast in the election or vote only as part of a recount process authorized by law.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1217 (S.B. 472), Sec. 3, eff. September 1, 2011.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.006. NOTICE REQUIRED BEFORE ENFORCEMENT ACTION. (a) Before a property owners' association may suspend an owner's right to use a common area, file a suit against an owner other than a suit to collect a regular or special assessment or foreclose under an association's lien, charge an owner for property damage, or levy a fine for a violation of the restrictions or bylaws or rules of the association, the association or its agent must give written notice to the owner by certified mail, return receipt requested.
(b) The notice must:
(1) describe the violation or property damage that is the basis for the suspension action, charge, or fine and state any amount due the association from the owner; and
(2) inform the owner that the owner:
(A) is entitled to a reasonable period to cure the violation and avoid the fine or suspension unless the owner was given notice and a reasonable opportunity to cure a similar violation within the preceding six months;
(B) may request a hearing under Section 209.007 on or before the 30th day after the date the owner receives the notice; and
(C) may have special rights or relief related to the enforcement action under federal law, including the Servicemembers Civil Relief Act (50 U.S.C. app. Section 501 et seq.), if the owner is serving on active military duty.
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 252 (H.B. 1127), Sec. 3, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.0062. ALTERNATIVE PAYMENT SCHEDULE FOR CERTAIN ASSESSMENTS. (a) A property owners' association composed of more than 14 lots shall adopt reasonable guidelines to establish an alternative payment schedule by which an owner may make partial payments to the property owners' association for delinquent regular or special assessments or any other amount owed to the association without accruing additional monetary penalties. For purposes of this section, monetary penalties do not include reasonable costs associated with administering the payment plan or interest.
(b) The minimum term for a payment plan offered by a property owners' association is three months.
(c) A property owners' association may not allow a payment plan for any amount that extends more than 18 months from the date of the owner's request for a payment plan. The association is not required to enter into a payment plan with an owner who failed to honor the terms of a previous payment plan during the two years following the owner's default under the previous payment plan.
(d) A property owners' association shall file the association's guidelines under this section in the real property records of each county in which the subdivision is located.
(e) A property owners' association's failure to file as required by this section the association's guidelines in the real property records of each county in which the subdivision is located does not prohibit a property owner from receiving an alternative payment schedule by which the owner may make partial payments to the property owners' association for delinquent regular or special assessments or any other amount owed to the association without accruing additional monetary penalties, as defined by Subsection (a).
Added by Acts 2011, 82nd Leg., R.S., Ch. 1282 (H.B. 1228), Sec. 2, eff. January 1, 2012.
Sec. 209.0063. PRIORITY OF PAYMENTS. (a) Except as provided by Subsection (b), a payment received by a property owners' association from the owner shall be applied to the owner's debt in the following order of priority:
(1) any delinquent assessment;
(2) any current assessment;
(3) any attorney's fees or third party collection costs incurred by the association associated solely with assessments or any other charge that could provide the basis for foreclosure;
(4) any attorney's fees incurred by the association that are not subject to Subdivision (3);
(5) any fines assessed by the association; and
(6) any other amount owed to the association.
(b) If, at the time the property owners' association receives a payment from a property owner, the owner is in default under a payment plan entered into with the association:
(1) the association is not required to apply the payment in the order of priority specified by Subsection (a); and
(2) in applying the payment, a fine assessed by the association may not be given priority over any other amount owed to the association.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1282 (H.B. 1228), Sec. 2, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.0064. THIRD PARTY COLLECTIONS. (a) In this section, "collection agent" means a debt collector, as defined by Section 803 of the federal Fair Debt Collection Practices Act (15 U.S.C. Section 1692a).
(b) A property owners' association may not hold an owner liable for fees of a collection agent retained by the property owners' association unless the association first provides written notice to the owner by certified mail, return receipt requested, that:
(1) specifies each delinquent amount and the total amount of the payment required to make the account current;
(2) describes the options the owner has to avoid having the account turned over to a collection agent, including information regarding availability of a payment plan through the association; and
(3) provides a period of at least 30 days for the owner to cure the delinquency before further collection action is taken.
(c) An owner is not liable for fees of a collection agent retained by the property owners' association if:
(1) the obligation for payment by the association to the association's collection agent for fees or costs associated with a collection action is in any way dependent or contingent on amounts recovered; or
(2) the payment agreement between the association and the association's collection agent does not require payment by the association of all fees to a collection agent for the action undertaken by the collection agent.
(d) The agreement between the property owners' association and the association's collection agent may not prohibit the owner from contacting the association board or the association's managing agent regarding the owner's delinquency.
(e) A property owners' association may not sell or otherwise transfer any interest in the association's accounts receivables for a purpose other than as collateral for a loan.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1282 (H.B. 1228), Sec. 2, eff. January 1, 2012.
Sec. 209.007. HEARING BEFORE BOARD; ALTERNATIVE DISPUTE RESOLUTION. (a) If the owner is entitled to an opportunity to cure the violation, the owner has the right to submit a written request for a hearing to discuss and verify facts and resolve the matter in issue before a committee appointed by the board of the property owners' association or before the board if the board does not appoint a committee.
(b) If a hearing is to be held before a committee, the notice prescribed by Section 209.006 must state that the owner has the right to appeal the committee's decision to the board by written notice to the board.
(c) The association shall hold a hearing under this section not later than the 30th day after the date the board receives the owner's request for a hearing and shall notify the owner of the date, time, and place of the hearing not later than the 10th day before the date of the hearing. The board or the owner may request a postponement, and, if requested, a postponement shall be granted for a period of not more than 10 days. Additional postponements may be granted by agreement of the parties. The owner or the association may make an audio recording of the meeting.
(d) The notice and hearing provisions of Section 209.006 and this section do not apply if the association files a suit seeking a temporary restraining order or temporary injunctive relief or files a suit that includes foreclosure as a cause of action. If a suit is filed relating to a matter to which those sections apply, a party to the suit may file a motion to compel mediation. The notice and hearing provisions of Section 209.006 and this section do not apply to a temporary suspension of a person's right to use common areas if the temporary suspension is the result of a violation that occurred in a common area and involved a significant and immediate risk of harm to others in the subdivision. The temporary suspension is effective until the board makes a final determination on the suspension action after following the procedures prescribed by this section.
(e) An owner or property owners' association may use alternative dispute resolution services.
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
Sec. 209.008. ATTORNEY'S FEES. (a) A property owners' association may collect reimbursement of reasonable attorney's fees and other reasonable costs incurred by the association relating to collecting amounts, including damages, due the association for enforcing restrictions or the bylaws or rules of the association only if the owner is provided a written notice that attorney's fees and costs will be charged to the owner if the delinquency or violation continues after a date certain.
(b) An owner is not liable for attorney's fees incurred by the association relating to a matter described by the notice under Section 209.006 if the attorney's fees are incurred before the conclusion of the hearing under Section 209.007 or, if the owner does not request a hearing under that section, before the date by which the owner must request a hearing. The owner's presence is not required to hold a hearing under Section 209.007.
(c) All attorney's fees, costs, and other amounts collected from an owner shall be deposited into an account maintained at a financial institution in the name of the association or its managing agent. Only members of the association's board or its managing agent or employees of its managing agent may be signatories on the account.
(d) On written request from the owner, the association shall provide copies of invoices for attorney's fees and other costs relating only to the matter for which the association seeks reimbursement of fees and costs.
(e) The notice provisions of Subsection (a) do not apply to a counterclaim of an association in a lawsuit brought against the association by a property owner.
(f) If the dedicatory instrument or restrictions of an association allow for nonjudicial foreclosure, the amount of attorney's fees that a property owners' association may include in a nonjudicial foreclosure sale for an indebtedness covered by a property owners' association's assessment lien is limited to the greater of:
(1) one-third of the amount of all actual costs and assessments, excluding attorney's fees, plus interest and court costs, if those amounts are permitted to be included by law or by the restrictive covenants governing the property; or
(2) $2,500.
(g) Subsection (f) does not prevent a property owners' association from recovering or collecting attorney's fees in excess of the amounts prescribed by Subsection (f) by other means provided by law.
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.009. FORECLOSURE SALE PROHIBITED IN CERTAIN CIRCUMSTANCES. A property owners' association may not foreclose a property owners' association's assessment lien if the debt securing the lien consists solely of:
(1) fines assessed by the association;
(2) attorney's fees incurred by the association solely associated with fines assessed by the association; or
(3) amounts added to the owner's account as an assessment under Section 209.005(i).
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 4, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.0091. PREREQUISITES TO FORECLOSURE: NOTICE AND OPPORTUNITY TO CURE FOR CERTAIN OTHER LIENHOLDERS. (a) A property owners' association may not foreclose a property owners' association assessment lien on real property by giving notice of sale under Section 51.002 or commencing a judicial foreclosure action unless the association has:
(1) provided written notice of the total amount of the delinquency giving rise to the foreclosure to any other holder of a lien of record on the property whose lien is inferior or subordinate to the association's lien and is evidenced by a deed of trust; and
(2) provided the recipient of the notice an opportunity to cure the delinquency before the 61st day after the date the recipient receives the notice.
(b) Notice under this section must be sent by certified mail, return receipt requested, to the address for the lienholder shown in the deed records relating to the property that is subject to the property owners' association assessment lien.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1282 (H.B. 1228), Sec. 2, eff. January 1, 2012.
This section was amended by the 84th Legislature. Pending publication of the current statutes, see S.B. 1168, 84th Legislature, Regular Session, for amendments affecting this section.
Sec. 209.0092. JUDICIAL FORECLOSURE REQUIRED. (a) Except as provided by Subsection (c) and subject to Section 209.009, a property owners' association may not foreclose a property owners' association assessment lien unless the association first obtains a court order in an application for expedited foreclosure under the rules adopted by the supreme court under Subsection (b). A property owners' association may use the procedure described by this subsection to foreclose any lien described by the association's dedicatory instruments.
(b) The supreme court, as an exercise of the court's authority under Section 74.024, Government Code, shall adopt rules establishing expedited foreclosure proceedings for use by a property owners' association in foreclosing an assessment lien of the association. The rules adopted under this subsection must be substantially similar to the rules adopted by the supreme court under Section 50(r), Article XVI, Texas Constitution.
(c) Expedited foreclosure is not required under this section if the owner of the property that is subject to foreclosure agrees in writing at the time the foreclosure is sought to waive expedited foreclosure under this section. A waiver under this subsection may not be required as a condition of the transfer of title to real property.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1282 (H.B. 1228), Sec. 2, eff. September 1, 2011.
Sec. 209.0093. REMOVAL OR ADOPTION OF FORECLOSURE AUTHORITY. A provision granting a right to foreclose a lien on real property for unpaid amounts due to a property owners' association may be removed from a dedicatory instrument or adopted in a dedicatory instrument by a vote of at least 67 percent of the total votes allocated to property owners in the property owners' association. Owners holding at least 10 percent of all voting interests in the property owners' association may petition the association and require a special meeting to be called for the purposes of taking a vote for the purposes of this section.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1282 (H.B. 1228), Sec. 2, eff. January 1, 2012.
Sec. 209.0094. ASSESSMENT LIEN FILING. A lien, lien affidavit, or other instrument evidencing the nonpayment of assessments or other charges owed to a property owners' association and filed in the official public records of a county is a legal instrument affecting title to real property.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1282 (H.B. 1228), Sec. 2, eff. January 1, 2012.
Sec. 209.010. NOTICE AFTER FORECLOSURE SALE. (a) A property owners' association that conducts a foreclosure sale of an owner's lot must send to the lot owner and to each lienholder of record, not later than the 30th day after the date of the foreclosure sale, a written notice stating the date and time the sale occurred and informing the lot owner and each lienholder of record of the right of the lot owner and lienholder to redeem the property under Section 209.011.
(b) The notice must be sent by certified mail, return receipt requested, to:
(1) the lot owner's last known mailing address, as reflected in the records of the property owners' association;
(2) the address of each holder of a lien on the property subject to foreclosure evidenced by the most recent deed of trust filed of record in the real property records of the county in which the property is located; and
(3) the address of each transferee or assignee of a deed of trust described by Subdivision (2) who has provided notice to a property owners' association of such assignment or transfer. Notice provided by a transferee or assignee to a property owners' association shall be in writing, shall contain the mailing address of the transferee or assignee, and shall be mailed by certified mail, return receipt requested, or United States mail with signature confirmation to the property owners' association according to the mailing address of the property owners' association pursuant to the most recent management certificate filed of record pursuant to Section 209.004.
(b-1) If a recorded instrument does not include an address for the lienholder, the association does not have a duty to notify the lienholder as provided by this section.
(b-2) For purposes of this section, the lot owner is deemed to have given approval for the association to notify the lienholder.
(c) Not later than the 30th day after the date the association sends the notice required by Subsection (a), the association must record an affidavit in the real property records of the county in which the lot is located, stating the date on which the notice was sent and containing a legal description of the lot. Any person is entitled to rely conclusively on the information contained in the recorded affidavit.
(d) The notice requirements of this section also apply to the sale of an owner's lot by a sheriff or constable conducted as provided by a judgment obtained by the property owners' association.
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1176 (H.B. 3479), Sec. 2, eff. September 1, 2009.
Sec. 209.011. RIGHT OF REDEMPTION AFTER FORECLOSURE. (a) A property owners' association or other person who purchases occupied property at a sale foreclosing a property owners' association's assessment lien must commence and prosecute a forcible entry and detainer action under Chapter 24 to recover possession of the property.
(b) The owner of property in a residential subdivision or a lienholder of record may redeem the property from any purchaser at a sale foreclosing a property owners' association's assessment lien not later than the 180th day after the date the association mails written notice of the sale to the owner and the lienholder under Section 209.010. A lienholder of record may not redeem the property as provided herein before 90 days after the date the association mails written notice of the sale to the lot owner and the lienholder under Section 209.010, and only if the lot owner has not previously redeemed.
(c) A person who purchases property at a sale foreclosing a property owners' association's assessment lien may not transfer ownership of the property to a person other than a redeeming lot owner during the redemption period.
(d) To redeem property purchased by the property owners' association at the foreclosure sale, the lot owner or lienholder must pay to the association:
(1) all amounts due the association at the time of the foreclosure sale;
(2) interest from the date of the foreclosure sale to the date of redemption on all amounts owed the association at the rate stated in the dedicatory instruments for delinquent assessments or, if no rate is stated, at an annual interest rate of 10 percent;
(3) costs incurred by the association in foreclosing the lien and conveying the property to the lot owner, including reasonable attorney's fees;
(4) any assessment levied against the property by the association after the date of the foreclosure sale;
(5) any reasonable cost incurred by the association, including mortgage payments and costs of repair, maintenance, and leasing of the property; and
(6) the purchase price paid by the association at the foreclosure sale less any amounts due the association under Subdivision (1) that were satisfied out of foreclosure sale proceeds.
(e) To redeem property purchased at the foreclosure sale by a person other than the property owners' association, the lot owner or lienholder:
(1) must pay to the association:
(A) all amounts due the association at the time of the foreclosure sale less the foreclosure sales price received by the association from the purchaser;
(B) interest from the date of the foreclosure sale through the date of redemption on all amounts owed the association at the rate stated in the dedicatory instruments for delinquent assessments or, if no rate is stated, at an annual interest rate of 10 percent;
(C) costs incurred by the association in foreclosing the lien and conveying the property to the redeeming lot owner, including reasonable attorney's fees;
(D) any unpaid assessments levied against the property by the association after the date of the foreclosure sale; and
(E) taxable costs incurred in a proceeding brought under Subsection (a); and
(2) must pay to the person who purchased the property at the foreclosure sale:
(A) any assessments levied against the property by the association after the date of the foreclosure sale and paid by the purchaser;
(B) the purchase price paid by the purchaser at the foreclosure sale;
(C) the amount of the deed recording fee;
(D) the amount paid by the purchaser as ad valorem taxes, penalties, and interest on the property after the date of the foreclosure sale; and
(E) taxable costs incurred in a proceeding brought under Subsection (a).
(f) If a lot owner or lienholder redeems the property under this section, the purchaser of the property at foreclosure shall immediately execute and deliver to the redeeming party a deed transferring the property to the lot owner. If a purchaser fails to comply with this section, the lot owner or lienholder may file an action against the purchaser and may recover reasonable attorney's fees from the purchaser if the lot owner or the lienholder is the prevailing party in the action.
(g) If, before the expiration of the redemption period, the redeeming lot owner or lienholder fails to record the deed from the foreclosing purchaser or fails to record an affidavit stating that the lot owner or lienholder has redeemed the property, the lot owner's or lienholder's right of redemption as against a bona fide purchaser or lender for value expires after the redemption period.
(h) The purchaser of the property at the foreclosure sale or a person to whom the person who purchased the property at the foreclosure sale transferred the property may presume conclusively that the lot owner or a lienholder did not redeem the property unless the lot owner or a lienholder files in the real property records of the county in which the property is located:
(1) a deed from the purchaser of the property at the foreclosure sale; or
(2) an affidavit that:
(A) states that the property has been redeemed;
(B) contains a legal description of the property; and
(C) includes the name and mailing address of the person who redeemed the property.
(i) If the property owners' association purchases the property at foreclosure, all rent and other income collected by the association from the date of the foreclosure sale to the date of redemption shall be credited toward the amount owed the association under Subsection (d), and if there are excess proceeds, they shall be refunded to the lot owner. If a person other than the association purchases the property at foreclosure, all rent and other income collected by the purchaser from the date of the foreclosure sale to the date of redemption shall be credited toward the amount owed the purchaser under Subsection (e), and if there are excess proceeds, those proceeds shall be refunded to the lot owner.
(j) If a person other than the property owners' association is the purchaser at the foreclosure sale, before executing a deed transferring the property to the lot owner, the purchaser shall obtain an affidavit from the association or its authorized agent stating that all amounts owed the association under Subsection (e) have been paid. The association shall provide the purchaser with the affidavit not later than the 10th day after the date the association receives all amounts owed to the association under Subsection (e). Failure of a purchaser to comply with this subsection does not affect the validity of a redemption.
(k) Property that is redeemed remains subject to all liens and encumbrances on the property before foreclosure. Any lease entered into by the purchaser of property at a sale foreclosing an assessment lien of a property owners' association is subject to the right of redemption provided by this section and the lot owner's right to reoccupy the property immediately after redemption.
(l) If a lot owner makes partial payment of amounts due the association at any time before the redemption period expires but fails to pay all amounts necessary to redeem the property before the redemption period expires, the association shall refund any partial payments to the lot owner by mailing payment to the owner's last known address as shown in the association's records not later than the 30th day after the expiration date of the redemption period.
(m) If a lot owner or lienholder sends by certified mail, return receipt requested, a written request to redeem the property on or before the last day of the redemption period, the lot owner's or lienholder's right of redemption is extended until the 10th day after the date the association and any third party foreclosure purchaser provides written notice to the redeeming party of the amounts that must be paid to redeem the property.
(n) After the redemption period and any extended redemption period provided by Subsection (m) expires without a redemption of the property, the association or third party foreclosure purchaser shall record an affidavit in the real property records of the county in which the property is located stating that the lot owner or a lienholder did not redeem the property during the redemption period or any extended redemption period.
(o) The association or the person who purchased the property at the foreclosure sale may file an affidavit in the real property records of the county in which the property is located that states the date the citation was served in a suit under Subsection (a) and contains a legal description of the property. Any person may rely conclusively on the information contained in the affidavit.
(p) The rights of a lot owner and a lienholder under this section also apply if the sale of the lot owner's property is conducted by a constable or sheriff as provided by a judgment obtained by the property owners' association.
Added by Acts 2001, 77th Leg., ch. 926, Sec. 1, eff. Jan. 1, 2002.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1176 (H.B. 3479), Sec. 3, eff. September 1, 2009.
Sec. 209.012. RESTRICTIVE COVENANTS GRANTING EASEMENTS TO CERTAIN PROPERTY OWNERS' ASSOCIATIONS. (a) A property owners' association may not amend a dedicatory instrument to grant the property owners' association an easement through or over an owner's lot without the consent of the owner.
(b) This section does not prohibit a property owners' association from adopting or enforcing a restriction in a dedicatory instrument that allows the property owners' association to access an owner's lot to remedy a violation of the dedicatory instrument.
Added by Acts 2007, 80th Leg., R.S., Ch. 887 (H.B. 2402), Sec. 1, eff. September 1, 2007.
Sec. 209.013. AUTHORITY OF ASSOCIATION TO AMEND DEDICATORY INSTRUMENT. (a) A dedicatory instrument created by a developer of a residential subdivision or by a property owners' association in which the developer has a majority of the voting rights or that the developer otherwise controls under the terms of the dedicatory instrument may not be amended during the period between the time the developer loses the majority of the voting rights or other form of control of the property owners' association and the time a new board of directors of the association assumes office following the loss of the majority of the voting rights or other form of control.
(b) A provision in a dedicatory instrument that violates this section is void and unenforceable.
Added by Acts 2007, 80th Leg., R.S., Ch. 887 (H.B. 2402), Sec. 2(a), eff. September 1, 2007.
Sec. 209.014. MANDATORY ELECTION REQUIRED AFTER FAILURE TO CALL REGULAR MEETING. (a) Notwithstanding any provision in a dedicatory instrument, a board of a property owners' association shall call an annual meeting of the members of the association.
(b) If a board of a property owners' association does not call an annual meeting of the association members, an owner may demand that a meeting of the association members be called not later than the 30th day after the date of the owner's demand. The owner's demand must be made in writing and sent by certified mail, return receipt requested, to the registered agent of the property owners' association and to the association at the address for the association according to the most recently filed management certificate. A copy of the notice must be sent to each property owner who is a member of the association.
(c) If the board does not call a meeting of the members of the property owners' association on or before the 30th day after the date of a demand under Subsection (b), three or more owners may form an election committee. The election committee shall file written notice of the committee's formation with the county clerk of each county in which the subdivision is located.
(d) A notice filed by an election committee must contain:
(1) a statement that an election committee has been formed to call a meeting of owners who are members of the property owners' association for the sole purpose of electing board members;
(2) the name and residential address of each committee member; and
(3) the name of the subdivision over which the property owners' association has jurisdiction under a dedicatory instrument.
(e) Each committee member must sign and acknowledge the notice before a notary or other official authorized to take acknowledgments.
(f) The county clerk shall enter on the notice the date the notice is filed and record the notice in the county's real property records.
(g) Only one committee in a subdivision may operate under this section at one time. If more than one committee in a subdivision files a notice, the first committee that files a notice, after having complied with all other requirements of this section, is the committee with the power to act under this section. A committee that does not hold or conduct a successful election within four months after the date the notice is filed with the county clerk is dissolved by operation of law. An election held or conducted by a dissolved committee is ineffective for any purpose under this section.
(h) The election committee may call meetings of the owners who are members of the property owners' association for the sole purpose of electing board members. Notice, quorum, and voting provisions contained in the bylaws of the property owners' association apply to any meeting called by the election committee.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1026 (H.B. 2761), Sec. 5, eff. January 1, 2012.
Sec. 209.015. REGULATION OF LAND USE: RESIDENTIAL PURPOSE. (a) In this section:
(1) "Adjacent lot" means:
(A) a lot that is contiguous to another lot that fronts on the same street;
(B) with respect to a corner lot, a lot that is contiguous to the corner lot by either a side property line or a back property line; or
(C) if permitted by the dedicatory instrument, any lot that is contiguous to another lot at the back property line.
(2) "Residential purpose" with respect to the use of a lot:
(A) means the location on the lot of any building, structure, or other improvement customarily appurtenant to a residence, as opposed to use for a business or commercial purpose; and
(B) includes the location on the lot of a garage, sidewalk, driveway, parking area, children's swing or playscape, fence, septic system, swimming pool, utility line, or water well and, if otherwise specifically permitted by the dedicatory instrument, the parking or storage of a recreational vehicle.
(b) Except as provided by this section, a property owners' association may not adopt or enforce a provision in a dedicatory instrument that prohibits or restricts the owner of a lot on which a residence is located from using for residential purposes an adjacent lot owned by the property owner.
(c) An owner must obtain the approval of the property owners' association or, if applicable, an architectural committee established by the association or the association's dedicatory instruments, based on criteria prescribed by the dedicatory instruments specific to the use of a lot for residential purposes, including reasonable restrictions regarding size, location, shielding, and aesthetics of the residential purpose, before the owner begins the construction, placement, or erection of a building, structure, or other improvement for the residential purpose on an adjacent lot.
(d) An owner who elects to use an adjacent lot for residential purposes under this section shall, on the sale or transfer of the lot containing the residence:
(1) include the adjacent lot in the sales agreement and transfer the lot to the new owner under the same dedicatory conditions; or
(2) restore the adjacent lot to the original condition before the addition of the improvements allowed under this section to the extent that the lot would again be suitable for the construction of a separate residence as originally platted and provided for in the conveyance to the owner.
(e) An owner may sell the adjacent lot separately only for the purpose of the construction of a new residence that complies with existing requirements in the dedicatory instrument unless the lot has been restored as described by Subsection (d)(2).
(f) A provision in a dedicatory instrument that violates this section is void.
Added by Acts 2013, 83rd Leg., R.S., Ch. 219 (H.B. 35), Sec. 1, eff. June 14, 2013.
