By Brimer H.B. No. 1052
76R3660 PAM-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to creating a real estate broker's lien on commercial real
1-3 estate.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subtitle B, Title 5, Property Code, is amended by
1-6 adding Chapter 62 to read as follows:
1-7 CHAPTER 62. BROKER'S LIEN ON COMMERCIAL REAL ESTATE
1-8 SUBCHAPTER A. GENERAL PROVISIONS
1-9 Sec. 62.001. SHORT TITLE. This chapter may be cited as the
1-10 Broker's Lien on Commercial Real Estate Act.
1-11 Sec. 62.002. APPLICABILITY. This chapter applies only to
1-12 real estate that is commercial real estate on the date the notice
1-13 of lien is filed under this chapter.
1-14 Sec. 62.003. DEFINITIONS. In this chapter:
1-15 (1) "Broker" means a person who:
1-16 (A) is licensed as a real estate broker under
1-17 The Real Estate License Act (Article 6573a, Vernon's Texas Civil
1-18 Statutes) and is not acting as a residential rental locator as
1-19 defined by Section 24, The Real Estate License Act (Article 6573a,
1-20 Vernon's Texas Civil Statutes); or
1-21 (B) is licensed or certified as a real estate
1-22 appraiser under the Texas Appraiser Licensing and Certification Act
1-23 (Article 6573a.2, Vernon's Texas Civil Statutes).
1-24 (2) "Commercial real estate" means all real estate
2-1 except:
2-2 (A) real estate improved with one to four
2-3 residential units;
2-4 (B) a single-family residential unit, including
2-5 a condominium, townhouse, or home in a subdivision, if the unit is
2-6 sold, leased, or otherwise conveyed on a unit-by-unit basis and
2-7 regardless of whether the unit is part of a larger building or
2-8 located on real estate containing more than four residential units;
2-9 (C) real estate that is a person's homestead; or
2-10 (D) real estate that is not improved with a
2-11 structure and is:
2-12 (i) zoned for single-family residential
2-13 use; or
2-14 (ii) restricted for single-family use
2-15 under restrictive covenants that remain in effect for at least 20
2-16 years after the date the restrictions are recorded in the real
2-17 property records of the county in which the real estate is located.
2-18 (3) "Commission" includes a fee or other valuable
2-19 consideration.
2-20 (4) "Commission agreement" means a written instrument
2-21 that:
2-22 (A) entitles a broker to a commission;
2-23 (B) is signed by the person obligated to pay the
2-24 commission or that person's authorized agent;
2-25 (C) references the commission amount or
2-26 describes the formula used to determine the commission amount; and
2-27 (D) contains a description legally sufficient
3-1 for identification of the real estate that is the subject of the
3-2 agreement if the person obligated to pay the commission is a seller
3-3 or lessor.
3-4 (5) "Deferred commission" means a commission that is
3-5 earned and is not yet payable.
3-6 (6) "Real estate" has the meaning assigned by Section
3-7 2, The Real Estate License Act (Article 6573a, Vernon's Texas Civil
3-8 Statutes).
3-9 Sec. 62.004. EARNED COMMISSION AND PAYABLE COMMISSION. (a)
3-10 If the broker enters into a commission agreement with a seller or
3-11 lessor of the commercial real estate, a commission is earned at the
3-12 time the broker presents to the seller or lessor a ready, willing,
3-13 and able buyer or tenant to purchase or lease all or part of the
3-14 commercial real estate on the seller's or lessor's terms.
3-15 (b) If the broker enters into a commission agreement with a
3-16 prospective buyer or tenant of commercial real estate, a commission
3-17 is earned at the time the broker presents to the prospective buyer
3-18 or tenant a property suitable for purchase or lease on the buyer's
3-19 or tenant's terms.
3-20 (c) A commission is payable at the time provided by the
3-21 commission agreement.
3-22 (Sections 62.005-62.020 reserved for expansion)
3-23 SUBCHAPTER B. BROKER'S LIEN
3-24 Sec. 62.021. PERSON ENTITLED TO LIEN. (a) A broker has a
3-25 lien on commercial real estate in the amount specified by the
3-26 commission agreement if:
3-27 (1) the broker has earned a commission under a
4-1 commission agreement signed by the seller or lessor of the
4-2 commercial real estate or the seller's or lessor's authorized
4-3 agent; and
4-4 (2) a notice of lien is recorded and indexed as
4-5 provided by Section 62.024.
4-6 (b) A broker has a lien on the interest in commercial real
4-7 estate that a prospective buyer purchases in the amount specified
4-8 by the commission agreement if:
4-9 (1) the broker has earned a commission under a
4-10 commission agreement signed by the prospective buyer of the
4-11 commercial real estate or the prospective buyer's authorized agent;
4-12 and
4-13 (2) a notice of lien is recorded and indexed as
4-14 provided by Section 62.024.
4-15 (c) A broker has a lien on the leasehold interest in
4-16 commercial real estate of a prospective tenant in the amount
4-17 specified by the commission agreement if:
4-18 (1) the broker has earned a commission under a
4-19 commission agreement signed by the prospective tenant of the
4-20 commercial real estate or the prospective tenant's authorized
4-21 agent; and
4-22 (2) a notice of lien is recorded and indexed as
4-23 provided by Section 62.024.
4-24 (d) A lien described by this section is available only to
4-25 the broker named in the commission agreement. The lien is not
4-26 available to an employee or independent contractor of the broker.
4-27 (e) The broker's right to claim a lien based on the
5-1 commission agreement must be disclosed in the commission agreement.
5-2 Sec. 62.022. WAIVER OR RELEASE AND DISCHARGE OF LIEN. (a)
5-3 The waiver of a broker's entitlement to a lien under this chapter,
5-4 or the release of a lien given for the purpose of releasing a
5-5 broker's lien before the commission is satisfied or forgiven, is
5-6 void.
5-7 (b) A lien under this chapter is discharged by:
5-8 (1) paying the commission to the broker named in the
5-9 commission agreement; or
5-10 (2) establishing an escrow account described by
5-11 Subchapter F.
5-12 Sec. 62.023. AFFIDAVIT IDENTIFYING BROKER. If requested by
5-13 the buyer, the buyer's authorized agent, or the escrow agent for
5-14 the commercial real estate transaction, the seller of commercial
5-15 real estate may and the broker representing the seller shall
5-16 provide to the requesting party before the closing of the
5-17 transaction a written affidavit identifying each broker with whom
5-18 the seller or the seller's authorized agent has signed a commission
5-19 agreement.
5-20 Sec. 62.024. FILING OF NOTICE OF LIEN. (a) A broker
5-21 claiming a lien under this chapter may not file a notice of lien
5-22 unless the commission on which the lien is based is earned.
5-23 (b) A broker claiming a lien under this chapter must file a
5-24 notice of lien as provided by Subchapter C with the county clerk of
5-25 the county in which the commercial real estate is located.
5-26 (c) The county clerk shall record the notice of lien in
5-27 records kept for that purpose and shall index and cross-index the
6-1 notice of lien in the names of the broker, each person obligated to
6-2 pay the commission under the commission agreement, and each owner
6-3 of the interest in the commercial real estate on which the lien is
6-4 claimed.
6-5 Sec. 62.025. CONTENTS OF NOTICE OF LIEN. The notice of lien
6-6 must be signed by the broker or by a person authorized to sign on
6-7 behalf of the broker and must contain the following:
6-8 (1) a sworn statement of the nature and amount of the
6-9 claim, including:
6-10 (A) the commission amount or the formula used to
6-11 determine the commission; and
6-12 (B) the type of commission at issue, including a
6-13 deferred commission;
6-14 (2) the name of the broker and the real estate license
6-15 number of the broker;
6-16 (3) the name as reflected in the broker's records of
6-17 any person who the broker believes is obligated to pay the
6-18 commission under the commission agreement;
6-19 (4) the name as reflected in the broker's records of
6-20 any person the broker believes to be an owner of the interest in
6-21 the real estate on which the lien is claimed;
6-22 (5) a description legally sufficient for
6-23 identification of the interest in the commercial real estate sought
6-24 to be charged with the lien; and
6-25 (6) a copy of the commission agreement.
6-26 Sec. 62.026. NOTICE OF FILING. (a) In this section,
6-27 "business day" means a day other than a Saturday, Sunday, or
7-1 holiday recognized by this state.
7-2 (b) Not later than one business day after the date the
7-3 broker files a notice of lien, the broker shall mail a copy of the
7-4 notice of lien by certified mail, return receipt requested, or
7-5 registered mail to:
7-6 (1) the owner of record of the interest in the
7-7 commercial real estate on which the lien is claimed or the owner's
7-8 authorized agent; and
7-9 (2) the prospective buyer or tenant and any escrow
7-10 agent named in a contract for the sale or lease of the interest in
7-11 the commercial real estate on which the lien is claimed if:
7-12 (A) a binding written contract for the sale or
7-13 lease of the interest in the commercial real estate is in effect
7-14 between the owner and the prospective buyer or tenant in a
7-15 transaction that is the basis for the commission; and
7-16 (B) the binding written contract was executed by
7-17 the owner and the prospective buyer or tenant before the date the
7-18 notice of lien is filed.
7-19 (c) Service of the notice under Subsection (b) is complete
7-20 when the notice is deposited in the United States mail, postage
7-21 prepaid, and addressed to the persons entitled to receive the
7-22 notice under this section.
7-23 (d) If the broker has actual knowledge of the identity of
7-24 the escrow agent named in the contract for the sale or lease of the
7-25 interest in the commercial real estate on which the broker claims a
7-26 lien or of the escrow agent otherwise closing the sale or lease of
7-27 the interest in the commercial real estate, the broker, before the
8-1 first business day before the date that the sale or lease is
8-2 closed, shall deliver a file-stamped copy or transmit a facsimile
8-3 of a file-stamped copy of the notice of lien to each escrow agent
8-4 at the agent's closing office for use during the closing of the
8-5 sale or lease.
8-6 (e) If the escrow agent receives the notice of lien, the
8-7 escrow agent and other parties to the sale or lease may not close
8-8 the transaction unless the lien is released or the funds are held
8-9 in escrow as provided by Subchapter F.
8-10 (f) If the broker fails to comply with this section, the
8-11 notice of lien is void.
8-12 Sec. 62.027. INCEPTION OF BROKER'S LIEN. (a) A broker's
8-13 lien attaches to the interest in the commercial real estate owned
8-14 by the person obligated to pay the commission on the date the
8-15 notice of lien is recorded as provided by this chapter. The lien
8-16 does not relate back to the date of the commission agreement.
8-17 (b) A notice of lien for amounts earned by the broker under
8-18 an installment contract or under a commission agreement for a
8-19 deferred commission is enforceable only to the extent that the
8-20 installment or commission has become payable.
8-21 Sec. 62.028. PRIORITY. (a) A recorded lien, mortgage, or
8-22 other encumbrance on commercial real estate, including a recorded
8-23 lien securing revolving credit and future advances for a loan,
8-24 recorded before the date a broker's lien is recorded has priority
8-25 over the broker's lien.
8-26 (b) A broker's lien on the interest in commercial real
8-27 estate of a person obligated to pay a commission is not valid or
9-1 enforceable against a grantee, buyer, lessee, or transferee of the
9-2 interest of the person obligated to pay the commission if the deed,
9-3 lease, or instrument transferring the interest is recorded before
9-4 the broker's lien is recorded.
9-5 (c) A purchase-money mortgage lien executed by the buyer of
9-6 the interest in the commercial real estate has priority over a
9-7 broker's lien claimed against the prospective buyer for the
9-8 commission owed by that buyer.
9-9 (d) A mechanic's lien that is recorded after a broker's lien
9-10 and that relates back to a date before the date the broker's lien
9-11 is recorded has priority over the broker's lien.
9-12 Sec. 62.029. SUBORDINATION. (a) If the person obligated to
9-13 pay the commission sells that person's interest in the commercial
9-14 real estate, the broker's lien is subordinate to a recorded
9-15 purchase-money first lien authorized by the buyer if the buyer:
9-16 (1) executes and files with the county clerk of the
9-17 county in which the broker's lien is filed a memorandum that
9-18 evidences the buyer's ratification of the broker's lien and the
9-19 buyer's assumption of the obligation to pay the broker the
9-20 commission as provided by the commission agreement that is the
9-21 basis for the lien; and
9-22 (2) sends the broker, by certified mail, return
9-23 receipt requested, or registered mail, a copy of the recorded
9-24 memorandum required by this subsection.
9-25 (b) If the person obligated to pay the commission refinances
9-26 a recorded first lien secured by that person's interest in the
9-27 commercial real estate, the broker's lien is subordinate to the
10-1 recorded refinanced first lien, regardless of the amount of the
10-2 first lien after refinancing, if the person obligated to pay the
10-3 commission:
10-4 (1) executes and files with the county clerk of the
10-5 county in which the broker's lien is filed a memorandum that
10-6 evidences the person's ratification of the broker's lien and the
10-7 person's obligation to pay the broker the commission as provided by
10-8 the commission agreement that is the basis for the lien; and
10-9 (2) sends the broker, by certified mail, return
10-10 receipt requested, or registered mail, a copy of the recorded
10-11 memorandum required by this subsection.
10-12 (c) If the person obligated to pay the commission obtains an
10-13 extension of credit secured by that person's interest in the
10-14 commercial real estate, the broker's lien is subordinate to the
10-15 lien securing the extension of credit if, according to the lien
10-16 documents, the extension of credit is made only for the purpose of:
10-17 (1) repairing or renovating the commercial real
10-18 estate; or
10-19 (2) completing construction or providing additional
10-20 improvements on the commercial real estate.
10-21 (d) If the person obligated to pay the commission furnishes
10-22 a subordination agreement as provided by this section to be
10-23 executed by the broker, the broker must:
10-24 (1) execute and acknowledge the subordination
10-25 agreement before a notary public; and
10-26 (2) return the subordination agreement to the person
10-27 not later than the seventh day after the date the broker receives
11-1 the subordination agreement and other documents the broker
11-2 reasonably requests in order to determine that the subordination
11-3 agreement complies with this section.
11-4 Sec. 62.030. MIXED-USE REAL ESTATE. If real estate is zoned
11-5 or restricted for more than one use, the broker's lien attaches
11-6 only to the portions of the real estate zoned or restricted for
11-7 commercial use.
11-8 Sec. 62.031. CHANGE IN USE OF REAL ESTATE. (a) Except as
11-9 provided by Subsection (b), any change in the use of the real
11-10 estate does not affect a broker's lien if the notice of the lien
11-11 was filed when the real estate was commercial real estate.
11-12 (b) The broker's lien is extinguished if:
11-13 (1) not later than the 180th day after the date on
11-14 which the broker's commission is payable, the commercial real
11-15 estate on which a broker claims a lien is zoned for single-family
11-16 use or restricted for single-family use under recorded restrictive
11-17 covenants that remain in effect for at least 20 years after the
11-18 date the restrictions are recorded in the real property records of
11-19 the county in which the real estate is located; and
11-20 (2) the zoning ordinances or restrictive covenants for
11-21 single-family use are in effect until at least the second
11-22 anniversary of the date the commission is payable.
11-23 (Sections 62.032-62.040 reserved for expansion)
11-24 SUBCHAPTER C. TIME FOR FILING NOTICE OF LIEN
11-25 Sec. 62.041. TIME TO FILE. (a) If a broker has earned a
11-26 commission under a commission agreement signed by a seller or the
11-27 seller's authorized agent, a broker must record a notice of lien:
12-1 (1) after the commission is earned; and
12-2 (2) before the conveyance of the interest in the
12-3 commercial real estate on which the broker is claiming a lien.
12-4 (b) If a broker has earned a commission under a commission
12-5 agreement signed by a prospective buyer or a prospective buyer's
12-6 authorized agent, the broker must record a notice of lien:
12-7 (1) after the buyer acquires legal title to the
12-8 interest in the commercial real estate on which the broker is
12-9 claiming a lien; and
12-10 (2) before the buyer conveys the buyer's interest in
12-11 the commercial real estate on which the broker is claiming a lien.
12-12 (c) If the lien is based on a lease transaction, the broker
12-13 must record a notice of lien after the commission is earned and
12-14 before the earlier of:
12-15 (1) the 91st day after the date the event for which
12-16 the commission becomes payable occurs; or
12-17 (2) the date the person obligated to pay the
12-18 commission records a conveyance of that person's interest in the
12-19 commercial real estate after executing the lease agreement relating
12-20 to the lease transaction for which the lien is claimed.
12-21 (d) If a notice of lien is not filed within the time
12-22 required by this section, the lien is void.
12-23 (Sections 62.042-62.060 reserved for expansion)
12-24 SUBCHAPTER D. ENFORCEMENT OF LIEN
12-25 Sec. 62.061. SUIT TO FORECLOSE LIEN. (a) A broker may not
12-26 bring a suit to foreclose a lien under this chapter unless the lien
12-27 is earned and payable. A broker may bring a suit to foreclose a
13-1 lien in any district court for the county in which the commercial
13-2 real estate is located by filing a sworn complaint stating that the
13-3 notice of lien has been recorded.
13-4 (b) A complaint in a suit filed under this section must
13-5 contain:
13-6 (1) a brief description of the commission agreement
13-7 that is the basis for the lien, including:
13-8 (A) a description of the disclosure of the
13-9 broker's right to the lien contained in the commission agreement;
13-10 (B) the date on which the commission agreement
13-11 was executed;
13-12 (C) the event for which a commission is
13-13 considered to be earned; and
13-14 (D) the event for which a commission is
13-15 considered to be payable;
13-16 (2) a description of the services performed by the
13-17 broker;
13-18 (3) the amount of the payable commission that is
13-19 unpaid;
13-20 (4) a description of the commercial real estate to
13-21 which the lien attaches; and
13-22 (5) other facts necessary for a full understanding of
13-23 the rights of the parties.
13-24 (c) The broker must include as a defendant in a suit brought
13-25 under this subchapter each person the broker believes to have an
13-26 interest in the commercial real estate that is subordinate to or
13-27 encumbered by the broker's lien.
14-1 (d) If the broker and a person against whom the broker
14-2 claims a commission use alternative dispute resolution procedures
14-3 to resolve a dispute concerning entitlement to the broker's
14-4 commission, the broker's lien remains valid, and any suit to
14-5 foreclose the lien is stayed until the alternative dispute
14-6 resolution process is completed.
14-7 Sec. 62.062. STATUTE OF LIMITATIONS. (a) Except as provided
14-8 by this section, a broker claiming a lien under this chapter must
14-9 bring a suit to foreclose the lien on or before the second
14-10 anniversary of the date the notice of lien is recorded.
14-11 (b) A broker claiming a lien to collect a deferred
14-12 commission must bring a suit to foreclose the lien on or before the
14-13 earlier of:
14-14 (1) the second anniversary of the date on which the
14-15 commission is payable; or
14-16 (2) the 10th anniversary of the date the lien is
14-17 recorded or the 10th anniversary of the date the broker records a
14-18 subsequent notice of the lien as a renewal of the broker's
14-19 entitlement to the lien, whichever date is later.
14-20 (c) A renewal of a notice of lien must state that it is a
14-21 renewal of the broker's lien and must be recorded after the ninth
14-22 anniversary after the date the original notice of lien or last
14-23 renewal notice is recorded and on or before the 10th anniversary of
14-24 the date the original notice of lien or last renewal notice is
14-25 recorded.
14-26 (d) A broker claiming a lien for a commission that is
14-27 payable must bring a suit to foreclose the lien not later than the
15-1 30th day after the date the broker receives a written demand to
15-2 bring a suit to foreclose the lien from the owner of the interest
15-3 in the commercial real estate on which the lien is claimed.
15-4 (e) If a suit to foreclose the lien is not brought within
15-5 the time required by this section, the lien is void.
15-6 Sec. 62.063. ASSESSMENT OF COSTS, FEES, AND INTEREST. The
15-7 prevailing party in a suit brought under this subchapter is
15-8 entitled to court costs, reasonable attorney's fees, and
15-9 prejudgment interest.
15-10 (Sections 62.064-62.080 reserved for expansion)
15-11 SUBCHAPTER E. RELEASE OF LIEN
15-12 Sec. 62.081. RELEASE OF LIEN. (a) When a debt that is the
15-13 basis for a lien under this chapter is satisfied, the broker shall,
15-14 not later than the fifth day after the date the broker receives a
15-15 written request from the owner of the interest in the commercial
15-16 real estate on which the lien is claimed, furnish to the owner a
15-17 release of indebtedness and any lien claimed.
15-18 (b) When a condition occurs that would preclude the broker
15-19 from receiving compensation under the terms of the commission
15-20 agreement that is the basis for the lien, the broker shall, not
15-21 later than the 10th day after the date the broker receives a
15-22 written request from the owner of the interest in the commercial
15-23 real estate on which the lien is claimed, furnish to the owner a
15-24 release of indebtedness and any lien claimed.
15-25 (c) A release of lien must be in a form that permits the
15-26 instrument to be filed of record.
15-27 (Sections 62.082-62.100 reserved for expansion)
16-1 SUBCHAPTER F. ESCROW OF DISPUTED AMOUNTS
16-2 Sec. 62.101. ESCROW ACCOUNT. If a claim for a lien under a
16-3 recorded notice of lien is not paid or assumed at the closing of a
16-4 sale, lease, or mortgage of the commercial real estate subject to
16-5 the lien and would prevent the closing of the transaction or
16-6 conveyance, any person named in the notice of lien as obligated to
16-7 pay the commission shall, before closing:
16-8 (1) establish an escrow account from the proceeds of
16-9 the transaction or conveyance in an amount sufficient to satisfy
16-10 the lien and related costs in an amount not less than 15 percent of
16-11 the amount of the lien for any interpleader action brought by the
16-12 person maintaining the escrow account; or
16-13 (2) file a bond to indemnify against the lien as
16-14 provided by Subchapter G.
16-15 Sec. 62.102. NAMED ESCROW AGENT. If an escrow agent is
16-16 named in the contract on which the transaction or conveyance is
16-17 based, the escrow account shall be established with the named
16-18 escrow agent.
16-19 Sec. 62.103. COSTS OF INTERPLEADER. Related costs for any
16-20 interpleader action may be deducted from the escrow account by the
16-21 person maintaining the escrow account.
16-22 Sec. 62.104. REFUSAL TO ESTABLISH AN ESCROW ACCOUNT. A
16-23 party may not refuse to close a transaction because of the
16-24 requirement to establish an escrow account as provided by this
16-25 section if:
16-26 (1) the broker provides a copy of the notice of lien
16-27 that complies with Section 62.026;
17-1 (2) sufficient proceeds exist in the proposed
17-2 transaction for the payment of the commission and costs of the
17-3 interpleader; and
17-4 (3) the broker executes and delivers a full release
17-5 of the broker's lien in a recordable form.
17-6 Sec. 62.105. TERM OF ESCROW ACCOUNT. The amount held in
17-7 escrow shall be held in escrow until:
17-8 (1) the rights of the parties claiming the amount in
17-9 escrow are determined by a written agreement of the parties, a
17-10 court order, or an alternative dispute resolution process agreed to
17-11 by the parties;
17-12 (2) the broker's lien is no longer enforceable; or
17-13 (3) the funds are interpled into a district court for
17-14 the county in which the commercial real estate is located.
17-15 Sec. 62.106. EXTINGUISHMENT OF LIEN UPON ESCROW. When the
17-16 escrow account is established under this section, the broker's lien
17-17 against the commercial real estate is extinguished and becomes a
17-18 lien on the proceeds in the escrow account.
17-19 (Sections 62.107-62.120 reserved for expansion)
17-20 SUBCHAPTER G. BOND TO INDEMNIFY AGAINST LIEN
17-21 Sec. 62.121. BOND. (a) If a lien is fixed or is attempted
17-22 to be fixed by a recorded instrument under this chapter, any
17-23 person may file a bond to indemnify against the lien.
17-24 (b) The bond shall be filed with the county clerk of the
17-25 county in which the commercial real estate subject to the lien is
17-26 located.
17-27 Sec. 62.122. BOND REQUIREMENTS. The bond must:
18-1 (1) describe the commercial real estate on which the
18-2 lien is claimed;
18-3 (2) refer to the lien claimed in a manner sufficient
18-4 to identify it;
18-5 (3) be in an amount that is double the amount of the
18-6 lien referred to in the bond as of the date of execution of the
18-7 bond by the surety, unless the total amount claimed in the lien
18-8 exceeds $40,000, in which case the bond must be in an amount that
18-9 is 1-1/2 times the amount of the lien;
18-10 (4) be payable to the party claiming the lien;
18-11 (5) be executed by:
18-12 (A) the party filing the bond as principal; and
18-13 (B) a corporate surety licensed by this state to
18-14 execute the bond as surety;
18-15 (6) be conditioned substantially that the principal
18-16 and sureties will pay the named obligees or their assignees the
18-17 amount that the named obligees would have been entitled to recover
18-18 if their claim had been proved to be valid and enforceable liens on
18-19 the commercial real estate; and
18-20 (7) identify the last known mailing address of the
18-21 person claiming the lien.
18-22 Sec. 62.123. NOTICE OF BOND. (a) After the bond is filed,
18-23 the county clerk shall issue notice of the bond to all named
18-24 obligees.
18-25 (b) A copy of the bond must be attached to the notice.
18-26 (c) The notice must be served on each obligee by mailing a
18-27 copy of the notice and the bond to the obligee by certified mail,
19-1 return receipt requested, addressed to the claimant at the address
19-2 stated in the bond for the obligee.
19-3 Sec. 62.124. RECORDING OF BOND AND NOTICE. (a) The county
19-4 clerk shall record the bond, the notice, and a certificate of
19-5 mailing in the real property records.
19-6 (b) In acquiring an interest in or insuring title to the
19-7 commercial real estate, a buyer, insurer of title, or lender may
19-8 rely on and is absolutely protected by the record of the bond and
19-9 the notice to the same extent as if the lien claimant had filed a
19-10 release of lien in the real property records.
19-11 Sec. 62.125. ACTION ON BOND. (a) A party making or holding
19-12 a lien claim may not sue on the bond later than the second
19-13 anniversary of the date on which the underlying lien claim becomes
19-14 payable.
19-15 (b) The bond is not exhausted by one action against it.
19-16 Each named obligee or assignee of an obligee may maintain a
19-17 separate suit on the bond in any district court for the county in
19-18 which the commercial real estate is located.
19-19 SECTION 2. This Act takes effect September 1, 1999. The
19-20 change in law made by this Act applies only to an agreement to
19-21 compensate a licensed real estate broker that is entered into on or
19-22 after the effective date of this Act.
19-23 SECTION 3. The importance of this legislation and the
19-24 crowded condition of the calendars in both houses create an
19-25 emergency and an imperative public necessity that the
19-26 constitutional rule requiring bills to be read on three several
19-27 days in each house be suspended, and this rule is hereby suspended.