1-1 By: Brimer (Senate Sponsor - Brown) H.B. No. 1081
1-2 (In the Senate - Received from the House April 1, 1993;
1-3 April 5, 1993, read first time and referred to Committee on State
1-4 Affairs; May 5, 1993, reported favorably, as amended, by the
1-5 following vote: Yeas 7, Nays 0; May 5, 1993, sent to printer.)
1-6 COMMITTEE VOTE
1-7 Yea Nay PNV Absent
1-8 Harris of Dallas x
1-9 Rosson x
1-10 Carriker x
1-11 Henderson x
1-12 Leedom x
1-13 Lucio x
1-14 Luna x
1-15 Nelson x
1-16 Patterson x
1-17 Shelley x
1-18 Sibley x
1-19 West x
1-20 Whitmire x
1-21 COMMITTEE AMENDMENT NO. 1 By: Sibley
1-22 Amend H.B. 1081, Section 1 as follows:
1-23 (1) Strike lines 37 through 49 in Subsection (b), page 4;
1-24 (2) Strike Subsection (f) on page 5, and insert Subsection
1-25 (f) to read:
1-26 (f) The notice shall be delivered by the seller to the
1-27 purchaser on or before the effective date of an executory contract
1-28 binding the purchaser to purchase the property. If a contract is
1-29 entered without the seller providing the notice required by this
1-30 section, the purchaser may terminate the contract for any reason
1-31 within seven days after receiving the notice.
1-32 (3) Strike Subsection (g) on page 5.
1-33 COMMITTEE AMENDMENT NO. 2 By: Rosson
1-34 Amend H.B. No. 1081 as follows:
1-35 Amend SECTION 1 by striking lines 24 and 25 on page 4.
1-36 COMMITTEE AMENDMENT NO. 3 By: Carriker
1-37 Amend C.S.H.B. No. 1081 as follows:
1-38 Amend SECTION 1 by striking lines 11 and 12 on page 3 and
1-39 substituting the following:
1-40 2. Are there any defects or malfunctions in any of the
1-41 following?
1-42 Amend SECTION 1 by striking line 28 on page 3 and substituting the
1-43 following:
1-44 3. Write Yes (Y) if you are aware, write No (N) if you are
1-45 not aware.
1-46 Amend SECTION 1, by striking lines 2 and 3 on page 4 and
1-47 substituting the following:
1-48 4. Is any item, equipment, or system in or on the property
1-49 in need of repair? _____ Yes
1-50 Amend SECTION 1 by striking line 9 on page 4 and substituting the
1-51 following:
1-52 5. Do any of the following exist on or affect the property?
1-53 Amend SECTION 1 by adding a new subdivision (11) under subsection
1-54 5.008(e) after line 23 on page 5:
1-55 (11) transfers of real property where the value of any
1-56 dwelling does not exceed five percent (5%) of the value of the
1-57 property.
1-58 A BILL TO BE ENTITLED
1-59 AN ACT
1-60 relating to a seller's duty to disclose the condition of real
1-61 property to a purchaser.
1-62 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-63 SECTION 1. Subchapter A, Chapter 5, Property Code, is
1-64 amended by adding Section 5.008 to read as follows:
1-65 Sec. 5.008. SELLER'S DISCLOSURE OF PROPERTY CONDITION.
1-66 (a) A seller of residential real property comprising not more than
1-67 one dwelling unit located in this state shall give to the purchaser
1-68 of the property a written notice as prescribed by this section or a
2-1 written notice substantially similar to the notice prescribed by
2-2 this section which contains, at a minimum, all of the items in the
2-3 notice prescribed by this section.
2-4 (b) The notice must be executed and must, at a minimum, read
2-5 substantially similar to the following:
2-6 SELLER'S DISCLOSURE NOTICE
2-7 CONCERNING THE PROPERTY AT
2-8 (Street Address and City)
2-9 THIS NOTICE IS A DISCLOSURE OF SELLER'S KNOWLEDGE OF
2-10 THE CONDITION OF THE PROPERTY AS OF THE DATE SIGNED BY
2-11 SELLER AND IS NOT A SUBSTITUTE FOR ANY INSPECTIONS OR
2-12 WARRANTIES THE PURCHASER MAY WISH TO OBTAIN. IT IS NOT
2-13 A WARRANTY OF ANY KIND BY SELLER OR SELLER'S AGENTS.
2-14 Seller _____ is _____ is not occupying the Property.
2-15 If unoccupied, how long since Seller has occupied the Property?
2-16 ______________________
2-17 1. The Property has the items checked below:
2-18 Write Yes (Y), No (N), or Unknown (U).
2-19 ____ Range ____ Oven ____ Microwave
2-20 ____ Dishwasher ____ Trash Compactor ____ Disposal
2-21 ____ Washer/Dryer ____ Window Screens ____ Rain Gutters
2-22 Hookups
2-23 ____ Security System ____ Fire Detection ____ Intercom
2-24 Equipment System
2-25 ____ TV Antenna ____ Cable TV Wiring ____ Satellite
2-26 Dish
2-27 ____ Ceiling Fan(s) ____ Attic Fan(s) ____ Exhaust
2-28 Fan(s)
2-29 ____ Central A/C ____ Central Heating ____ Wall/Window Air
2-30 Conditioning
2-31 ____ Plumbing System ____ Septic System ____ Public Sewer
2-32 System
2-33 ____ Patio/Decking ____ Outdoor Grill ____ Fences
2-34 ____ Pool ____ Sauna ____ Spa ___ Hot Tub
2-35 ____ Pool Equipment ____ Pool Heater ____ Automatic Lawn
2-36 Sprinkler
2-37 System
2-38 ____ Fireplace(s) & Chimney ____ Fireplace(s) &
2-39 (Woodburning) Chimney (Mock)
2-40 ____ Gas Lines (Nat./LP) ____ Gas Fixtures
2-41 Garage: ___ Attached ____ Not Attached ____ Carport
2-42 Garage Door Opener(s): ____ Electronic ____ Control(s)
2-43 Water Heater: ____ Gas ____ Electric
2-44 Water Supply: ___ City ____ Well ____ MUD ____ Co-op
2-45 Roof Type: _____________________ Age: _______________(approx)
2-46 Are you (Seller) aware of any of the above items that are not in
2-47 working condition, that have known defects, or that are in need of
2-48 repair? _____ Yes _____ No _____ Unknown.
2-49 If yes, then describe. (Attach additional sheets if necessary):
2-50 ___________________________________________________________________
2-51 ___________________________________________________________________
2-52 ___________________________________________________________________
2-53 ___________________________________________________________________
2-54 2. Are you (Seller) aware of any known defects/malfunctions in any
2-55 of the following?
2-56 Write Yes (Y), No (N), or Unknown (U).
2-57 ____ Interior Walls ____ Ceilings ____ Floors
2-58 ____ Exterior Walls ____ Doors ____ Windows
2-59 ____ Roof ____ Foundation/ ____ Basement
2-60 Slab(s)
2-61 ____ Walls/Fences ____ Driveways ____ Sidewalks
2-62 ____ Plumbing/Sewers/ ____ Electrical ____ Lighting
2-63 Septics Systems Fixtures
2-64 ____ Other Structural Components (Describe): _____________________
2-65 ___________________________________________________________________
2-66 ___________________________________________________________________
2-67 If the answer to any of the above is yes, explain. (Attach
2-68 additional sheets if necessary): _________________________________
2-69 ___________________________________________________________________
2-70 ___________________________________________________________________
3-1 3. Are you (Seller) aware of any of the following conditions?
3-2 Write Yes (Y), No (N), or Unknown (U).
3-3 ____ Active Termites ____ Previous Structural
3-4 (includes wood-destroying or Roof Repair
3-5 insects)
3-6 ____ Termite or Wood Rot Damage ____ Hazardous or Toxic
3-7 Needing Repair Waste
3-8 ____ Previous Termite Damage ____ Asbestos Components
3-9 ____ Previous Termite Treatment ____ Urea formaldehyde
3-10 Insulation
3-11 ____ Previous Flooding ____ Radon Gas
3-12 ____ Improper Drainage ____ Lead Based Paint
3-13 ____ Water Penetration ____ Aluminum Wiring
3-14 ____ Located in 100-Year ____ Previous Fires
3-15 Floodplain
3-16 ____ Present Flood Insurance ____ Unplatted Easements
3-17 Coverage
3-18 ____ Landfill, Settling, Soil ____ Subsurface
3-19 Movement, Fault Lines Structure or Pits
3-20 If the answer to any of the above is yes, explain. (Attach
3-21 additional sheets if necessary): _________________________________
3-22 ___________________________________________________________________
3-23 ___________________________________________________________________
3-24 ___________________________________________________________________
3-25 4. Are you (Seller) aware of any item, equipment, or system in
3-26 or on the property that is in need of repair? _________ Yes
3-27 ________ No _________ Unknown. If yes, explain (attach additional
3-28 sheets if necessary). ____________________________________________
3-29 ___________________________________________________________________
3-30 ___________________________________________________________________
3-31 ___________________________________________________________________
3-32 5. Are you (Seller) aware of any of the following?
3-33 Write Yes (Y), No (N), or Unknown (U).
3-34 ____ Room additions, structural modifications, or other
3-35 alterations or repairs made without necessary permits or not
3-36 in compliance with building codes in effect at that time.
3-37 ____ Homeowners' Association or maintenance fees or assessments.
3-38 ____ Any "common area" (facilities such as pools, tennis courts,
3-39 walkways, or other areas) co-owned in undivided interest with
3-40 others.
3-41 ____ Any notices of violations of deed restrictions or
3-42 governmental ordinances affecting the condition or use of the
3-43 Property.
3-44 ____ Any lawsuits directly or indirectly affecting the Property.
3-45 ____ Any condition on the Property which materially affects the
3-46 physical health or safety of an individual.
3-47 ____ Any murder, sexual assault (rape), or other serious assault
3-48 that occurred on the Property in the last twelve (12) months.
3-49 If the answer to any of the above is yes, explain. (Attach
3-50 additional sheets if necessary): _________________________
3-51 ___________________________________________________________________
3-52 ___________________________________________________________________
3-53 ___________________________________________________________________
3-54 ___________________________ _____________________________
3-55 Date Signature of Seller
3-56 The undersigned purchaser hereby acknowledges receipt of the
3-57 foregoing notice.
3-58 ___________________________ _____________________________
3-59 Date Signature of Purchaser
3-60 NOTICE: Section 5.008 of the Texas Property Code provides that
3-61 this notice shall be delivered to the purchaser before the
3-62 effective date of a contract binding the purchaser to purchase the
3-63 property. In the event a contract is entered into without this
3-64 notice being provided, the purchaser may terminate the contract
3-65 prior to closing. If the notice is furnished to the purchaser at
3-66 or prior to closing and the purchaser does not elect to terminate
3-67 the contract within 48 hours after receipt of this notice or if the
3-68 purchaser elects to close within 48 hours after receipt of this
3-69 notice, the purchaser will waive all rights to terminate the
3-70 contract for failing to timely receive this notice. In any event,
4-1 a purchaser is not entitled to rescind the purchase of the property
4-2 after closing for failing to receive this notice.
4-3 (c) A seller or seller's agent shall have no duty to make a
4-4 disclosure or release information related to whether a death by
4-5 natural causes, suicide, or accident unrelated to the condition of
4-6 the property occurred on the property or whether a previous
4-7 occupant had, may have had, has, or may have AIDS, HIV related
4-8 illnesses, or HIV infection.
4-9 (d) The notice shall be completed to the best of seller's
4-10 belief and knowledge as of the date the notice is completed and
4-11 signed by the seller. If the information required by the notice is
4-12 unknown to the seller, the seller shall indicate that fact on the
4-13 notice, and by that act is in compliance with this section.
4-14 (e) This section does not apply to a transfer:
4-15 (1) pursuant to a court order or foreclosure sale;
4-16 (2) by a trustee in bankruptcy;
4-17 (3) to a mortgage by a mortgagor or successor in
4-18 interest, or to a beneficiary of a deed of trust by a trustor or
4-19 successor in interest;
4-20 (4) by a mortgagee or a beneficiary under a deed of
4-21 trust who has acquired the real property at a sale conducted
4-22 pursuant to a power of sale under a deed of trust or a sale
4-23 pursuant to a court ordered foreclosure or has acquired the real
4-24 property by a deed in lieu of foreclosure;
4-25 (5) by a fiduciary in the course of the administration
4-26 of a decedent's estate, guardianship, conservatorship, or trust;
4-27 (6) from one co-owner to one or more other co-owners;
4-28 (7) made to a spouse or to a person or persons in the
4-29 lineal line of consanguinity of one or more of the transferors;
4-30 (8) between spouses resulting from a decree of
4-31 dissolution of marriage or a decree of legal separation or from a
4-32 property settlement agreement incidental to such a decree;
4-33 (9) to or from any governmental entity; or
4-34 (10) transfers of new residences of not less than one
4-35 or more than four dwelling units which have not previously been
4-36 occupied for residential purposes.
4-37 (f) The notice shall be delivered by the seller to the
4-38 purchaser on or before the effective date of an executory contract
4-39 binding the purchaser to purchase the property. If a contract of
4-40 purchase and sale is entered into without the seller providing the
4-41 notice required by this section, the purchaser is entitled to
4-42 terminate the contract prior to the closing of the contract. If,
4-43 however, the seller furnishes the notice required by this section
4-44 at or before closing the purchase and sale contract and the
4-45 purchaser does not elect to terminate the contract within 48 hours
4-46 after receipt of the notice or if the purchaser elects to close the
4-47 purchase and sale contract within 48 hours after receipt of the
4-48 notice, the purchaser waives all rights to terminate the contract
4-49 for failing to timely receive the notice required by this section.
4-50 Notwithstanding any other provision of this subchapter, a purchaser
4-51 is not entitled to rescind the sale or purchase of a property after
4-52 closing the purchase and sale contract for failing to receive or
4-53 failing to timely receive the notice required by this section.
4-54 (g) A seller who provides the information required by this
4-55 section is not liable for any error, inaccuracy, or omission unless
4-56 the seller knew of same and such misinformation was intended to
4-57 induce the purchaser into a transaction into which the purchaser
4-58 would not have entered had the information been correct. An agent
4-59 for the seller shall not be liable for any error, inaccuracy, or
4-60 omission of any information provided by the seller under this
4-61 section unless the agent had personal knowledge of the error,
4-62 inaccuracy, or omission and such misinformation was intended to
4-63 induce the purchaser into a transaction into which the purchaser
4-64 would not have entered had the information been correct.
4-65 SECTION 2. This Act takes effect January 1, 1994.
4-66 SECTION 3. The importance of this legislation and the
4-67 crowded condition of the calendars in both houses create an
4-68 emergency and an imperative public necessity that the
4-69 constitutional rule requiring bills to be read on three several
4-70 days in each house be suspended, and this rule is hereby suspended.
5-1 * * * * *
5-2 Austin,
5-3 Texas
5-4 May 5, 1993
5-5 Hon. Bob Bullock
5-6 President of the Senate
5-7 Sir:
5-8 We, your Committee on State Affairs to which was referred H.B. No.
5-9 1081, have had the same under consideration, and I am instructed to
5-10 report it back to the Senate with the recommendation that it do
5-11 pass, as amended, and be printed.
5-12 Harris of
5-13 Dallas, Chairman
5-14 * * * * *
5-15 WITNESSES
5-16 FOR AGAINST ON
5-17 FOR AGAINST ON
5-18 ___________________________________________________________________
5-19 ___________________________________________________________________
5-20 Name: Mark J Hanna x
5-21 Representing: Texas Realty Committee
5-22 City: Austin
5-23 -------------------------------------------------------------------
5-24 Name: Ronald Walker x
5-25 Representing: Texas Assn of Realtors
5-26 City: Austin
5-27 -------------------------------------------------------------------
5-28 Name: Parker McCullough x
5-29 Representing: Texas Assn of Realtors
5-30 City: Austin
5-31 -------------------------------------------------------------------
5-32 Name: Don Harvey x
5-33 Representing: Don Harvey Realtors
5-34 City: Midland
5-35 -------------------------------------------------------------------
5-36 Name: Ralph L Hull x
5-37 Representing: Indep Brokers of America Inc
5-38 City: Irving
5-39 -------------------------------------------------------------------
5-40 Name: David Bragg x
5-41 Representing: Self
5-42 City: Austin
5-43 -------------------------------------------------------------------
5-44 Name: Joe Longley x
5-45 Representing: Texas Trial Lawyers Assn
5-46 City: Austin
5-47 -------------------------------------------------------------------
5-48 Name: Mike Curry x
5-49 Representing: Texas Trial Lawyers Assn
5-50 City: Austin
5-51 -------------------------------------------------------------------
5-52 Name: Russell Blair x
5-53 Representing: Garland Board of Realtors
5-54 City: Garland
5-55 -------------------------------------------------------------------
5-56 Name: Reggie James x
5-57 Representing: Consumers Union
5-58 City: Austin
5-59 -------------------------------------------------------------------
5-60 Name: Gerald Uretsky x
5-61 Representing: Self
5-62 City: San Antonio
5-63 -------------------------------------------------------------------