1-1     By:  Ellis, McReynolds (Senate Sponsor - Staples)     H.B. No. 2246
 1-2           (In the Senate - Received from the House May 3, 2001;
 1-3     May 4, 2001, read first time and referred to Committee on Natural
 1-4     Resources; May 10, 2001, reported favorably by the following vote:
 1-5     Yeas 4, Nays 0; May 10, 2001, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to the regulation of the purchase and sale of timber;
 1-9     providing a penalty.
1-11           SECTION 1. Chapter 151, Natural Resources Code, is amended to
1-12     read as follows:
1-15           [Sec. 151.001.  DEFINITIONS. In this subchapter:]
1-16                 [(1)  "Lumber" means lumber attached or bound together
1-17     in some way for floating, but does not include loose lumber.]
1-18                 [(2)  "Shingles" means shingles in bunches or bundles,
1-19     but does not include loose shingles.]
1-20           [Sec. 151.002.  TIMBER TO BE BRANDED. A person engaged in
1-21     floating or rafting timber on the water of a river or creek of this
1-22     state shall have a log brand and shall brand distinctly each log or
1-23     stick which he floats or hauls and puts in the water for sale or
1-24     market.]
1-25           [Sec. 151.003.  RECORDING BRAND. (a)  A person engaged in
1-26     floating or rafting timber on the water of a river or creek of this
1-27     state shall have his log brand recorded by the county clerk in:]
1-28                 [(1)  each county in which he cuts timber; and]
1-29                 [(2)  the county in which he proposes to sell or market
1-30     the timber.]
1-31           [(b)  The brand shall be recorded in a book kept by the
1-32     county clerk for that purpose or on microfilm as permitted in
1-33     Chapter 194, Local Government Code.]
1-34           [(c)  The county clerk shall receive the same fee as is
1-35     allowed by law for recording stock brands.]
1-36           [Sec. 151.004.  FILING WRITTEN REPORT. (a)  A person who
1-37     floats any logs or timber in this state shall make a written report
1-38     under oath on the first day of January, April, July, and October of
1-39     each year, or within 15 days of those dates, showing:]
1-40                 [(1)  the number of logs cut or floated during the next
1-41     preceding three months;]
1-42                 [(2)  the survey or surveys of land from which the logs
1-43     were cut or carried;]
1-44                 [(3)  the number of logs cut from each survey; and]
1-45                 [(4)  a description of the brand placed on the logs.]
1-46           [(b)  The person who floats the logs or timber shall file the
1-47     report required in Subsection (a) of this section with the county
1-48     clerk of the county in which the timber was cut.  The county clerk
1-49     shall record and index the report in a book kept for that purpose
1-50     or on microfilm as permitted in Chapter 194, Local Government Code.]
1-51           [(c)  This section of the code does not apply to pickets,
1-52     posts, rails, or firewood.]
1-53           [Sec. 151.005.  EVIDENCE OF OWNERSHIP. A certificate signed
1-54     by the county clerk, containing a description of a log brand and
1-55     the name of the owner of the brand, with a transfer on the back of
1-56     it, signed and acknowledged by the owner or proved as other
1-57     instruments for record, shall be prima facie evidence that the
1-58     person to whom the transfer is made owns the logs described in the
1-59     certificate.]
1-60           [Sec. 151.006.  PENALTIES. (a)  A person who buys or sells
1-61     any timber or log floating, or that has been floated, in this state
1-62     before it is branded shall be fined not more than $10 for each
1-63     unbranded log or piece of timber purchased, sold, or traced.]
1-64           [(b)  A person shall be fined not more than $200 for each
 2-1     offense if he:]
 2-2                 [(1)  floats any unbranded log or timber for market;]
 2-3                 [(2)  fails to make the reports required under Section
 2-4     151.004 of this code;]
 2-5                 [(3)  brands any log or timber of another without his
 2-6     authority;]
 2-7                 [(4)  defaces a brand on any log or timber except when
 2-8     it is in the act of being sawed or manufactured into lumber or
 2-9     other commodity for use in building; or]
2-10                 [(5)  is not an employee of the owner and without the
2-11     written consent of the owner takes into possession any branded or
2-12     unbranded log or timber cut for floating or sawing, or any sawed
2-13     timber, lumber, or shingle floating in any water of this state or
2-14     deposited on the banks of a river or stream in this state.]
2-15           [Sec. 151.007.  VENUE. The accused may be prosecuted in any
2-16     county in which the timber or lumber was deposited in the water or
2-17     in which it was unlawfully taken into possession or unlawfully
2-18     defaced, sold, purchased, or branded.]
2-20                             OF TREES AND TIMBER
2-21           Sec. 151.001 [151.041].  REQUIRED BILL OF SALE. Before
2-22     purchasing or accepting delivery of any trees, [or] timber, [in the
2-23     form of] logs, [or] pulpwood, or in-woods chips, a seller [person,
2-24     firm, partnership, or corporation] shall provide and a purchaser
2-25     shall require a bill of sale for the trees, [or] timber, logs,
2-26     pulpwood, or in-woods chips executed [and acknowledged] by the
2-27     seller [in the manner required by law for registration].  The bill
2-28     of sale may be a part of, a compilation of information taken from,
2-29     or an addendum to, by way of example, a timber deed, scale ticket,
2-30     weight ticket, cutting contract, harvest agreement, wood purchase
2-31     agreement, or other records of the sale and purchase made at the
2-32     time if all the information required by Section 151.002 is
2-33     included.
2-34           Sec. 151.002 [151.042].  INFORMATION IN BILL OF SALE. (a)
2-35     The bill of sale, which may be filed of record in the appropriate
2-36     real property records, shall at a minimum include:
2-37                 (1)  the name [and address] of the:
2-38                       (A)  owner of the land from which the trees,
2-39     timber, logs, pulpwood, or in-woods chips were or are to be
2-40     obtained;
2-41                       (B)  seller, if the seller is not the owner of
2-42     the land; and
2-43                       (C)  purchaser;
2-44                 (2)  a description of the survey or tract of land from
2-45     which the trees, timber, logs, [or] pulpwood, or in-woods chips
2-46     were or are to be obtained, or information from which the identity
2-47     of that tract of land may be ascertained, but in any event
2-48     including the county name [cut];
2-49                 (3)  a general description of the trees, timber, [the
2-50     number of] logs, [or] pulpwood, or  in-woods chips conveyed in the
2-51     bill of sale; and
2-52                 (4)  representations and a warranty from the seller
2-53     that the seller is the lawful owner of all the trees, timber, [the
2-54     markings, if any, on the] logs, [or] pulpwood, or in-woods chips
2-55     conveyed in the bill of sale and that the trees, timber, logs,
2-56     pulpwood, or in-woods chips are free and clear of all liens,
2-57     security agreements, encumbrances, claims, demands, and charges.
2-58           (b)  The purchaser of trees, timber, logs, pulpwood, or
2-59     in-woods chips conveyed in the bill  of sale may, and is entitled
2-60     to, rely on the information required to be provided by the seller
2-61     to be incorporated into the bill of sale, as well as on the
2-62     representations and warranty of the seller.
2-63           Sec. 151.003 [151.043].  RETENTION OF [EXPENSES IN CONNECTION
2-64     WITH] BILL OF SALE. A person that purchases trees, timber, logs,
2-65     pulpwood, or in-woods chips shall retain the bill of sale for not
2-66     less than two years following the later of the date of execution of
2-67     the bill of sale or the expiration date referenced in the bill of
2-68     sale [Notarial fees, filing fees, and other expenses in connection
2-69     with the bill of sale shall be assumed and paid by the purchaser].
 3-1           Sec. 151.004 [151.044].  NOTICE CONCERNING SALE OR PURCHASE
 3-3     CROSSTIES]. At each designated point of delivery for trees, timber,
 3-4     logs, pulpwood, or in-woods chips, a wood yard, transfer yard, mill
 3-5     site, or storage yard shall post the following written notice in
 3-6     lettering not less than one inch:
 3-8           1.  A seller or purchaser of trees, timber, logs, pulpwood,
 3-9               or in-woods chips who knowingly fails to provide, obtain,
3-10               or retain a bill of sale as provided in Chapter 151,
3-11               Natural Resources Code, is guilty of a misdemeanor and on
3-12               conviction is subject to a fine of not more than $500 for
3-13               each offense.
3-14           2.  A person, firm, partnership, or corporation adjudged
3-15               guilty of theft or fraud in connection with the sale or
3-16               purchase of trees or timber will be punished as provided
3-17               by the Penal Code.
3-18           3.  The Texas Forest Service Timber Theft Hotline is
3-19               1-800-364-3470 [(a)  On  or before  the 10th  day of each
3-20     succeeding month from the date of purchase, a purchaser of staves
3-21     or crossties who does not secure a bill of sale or deed to the
3-22     staves or crossties shall file a verified statement with the county
3-23     clerk of the county in which the land is located from which the
3-24     staves or crossties were cut.]
3-25           [(b)  The verified statement shall include:]
3-26                 [(1)  the name and address of the seller and purchaser;]
3-27                 [(2)  a description of the survey or tract of land from
3-28     which the staves or crossties were cut;]
3-29                 [(3)  the number of staves or crossties; and]
3-30                 [(4)  the markings, if any, on the staves or
3-31     crossties].
3-32           Sec. 151.005 [151.045].  PENALTY. (a)  A seller or purchaser
3-33     who knowingly fails to provide, obtain, or retain [see that] a bill
3-34     of sale [is given in a sale] as required by Sections 151.001,
3-35     151.002, and 151.003 [provided for in this subchapter, or a
3-36     purchaser who does not secure a bill of sale and fails to file the
3-37     statement required by Section 151.044 of this code,] is guilty of a
3-38     misdemeanor and on conviction is subject to a fine of not more than
3-39     $500 for each offense [$100 or confinement for not more than 30
3-40     days in the county jail, or both].
3-41           (b)  A wood yard, transfer yard, mill site, or storage yard
3-42     that knowingly fails to post the notice concerning sale or purchase
3-43     of trees or timber as required by Section 151.004 is guilty of a
3-44     misdemeanor and on conviction is subject to a fine of not more than
3-45     $500 for each offense.
3-46           Sec. 151.006 [151.046].  APPLICABILITY. This [The provisions
3-47     of this] subchapter does [shall] not apply to the sale of:
3-48                 (1)  finished [lumber, cedar staves,] wood products;
3-49                 (2)  logs or pulpwood from a wood yard, transfer yard,
3-50     mill site, or storage yard;
3-51                 (3)  trees from a nursery; or
3-52                 (4)  trees, logs, or pulpwood with a commercial value
3-53     of less than $250[, or posts].
3-54           Sec. 151.007.  PENALTIES CUMULATIVE. A penalty provided by
3-55     this subchapter is in addition to a penalty provided under other
3-56     law.
3-57           Sec. 151.008.  CIVIL LIABILITY. Nothing in this subchapter
3-58     shall be construed to affect the liability under any other statute
3-59     or under common law, provided that failure to comply with the
3-60     provisions of this subchapter shall not, by itself, create civil
3-61     liability.
3-63           Sec. 151.051 [151.101].  DAMAGES FOR UNAUTHORIZED HARVESTING.
3-64     (a)  A person who harvests standing timber with knowledge that the
3-65     harvesting is without the permission of the owner of the standing
3-66     timber and a person who causes another person to harvest standing
3-67     timber without the permission of the owner of the standing timber
3-68     are jointly and severally liable to the owner for damages in an
3-69     amount equal to three times the market price of the timber
 4-1     harvested without permission.
 4-2           (b)  Payment of damages by a person under this section does
 4-3     not preclude a prosecution of the person under Section 151.005
 4-4     [151.045].
 4-5           (c)  This section does not apply to the trimming or clearing
 4-6     of trees in the vicinity of a utility line or right-of-way.
 4-8           Sec. 151.101 [151.151].  DEFINITION. In this subchapter,
 4-9     "timber purchaser" means a person who purchases standing timber for
4-10     harvest.
4-11           Sec. 151.102 [151.152].  MONEY COLLECTED FOR TIMBER AS TRUST
4-12     MONEY. Money a timber purchaser collects for harvested timber is
4-13     trust money.
4-14           Sec. 151.103 [151.153].  TIMBER PURCHASER AS TRUSTEE. A
4-15     timber purchaser and each officer, director, partner, or agent of a
4-16     timber purchaser are trustees of trust money.
4-17           Sec. 151.104 [151.154].  BENEFICIARY OF TRUST. Each seller of
4-18     standing timber is a beneficiary of trust money to the extent of
4-19     the beneficiary's share of the purchase price for the timber.
4-20           Sec. 151.105 [151.155].  OFFENSE. (a)  A trustee commits an
4-21     offense if the trustee, knowingly or with intent to defraud,
4-22     directly or indirectly retains, uses, disperses, or otherwise
4-23     diverts more than $500 of trust money without first fully paying
4-24     all of the beneficiaries the purchase price for the timber.
4-25           (b)  A trustee acts with intent to defraud if the trustee
4-26     retains, uses, disperses, or diverts trust money with the intent to
4-27     deprive a beneficiary of trust money.
4-28           (c)  A trustee is presumed to have acted with intent to
4-29     defraud if the trustee does not pay all of the beneficiaries the
4-30     purchase price for the timber not later than the 45th day after the
4-31     date the trustee collects money for the timber.
4-32           (d)  An offense under this section is a state jail felony.
4-33           Sec. 151.106 [151.156].  DEFENSES TO PROSECUTION. It is an
4-34     affirmative defense to prosecution under this section that:
4-35                 (1)  the trustee paid the beneficiaries all trust money
4-36     to which the beneficiaries were entitled not later than the 15th
4-37     day after the date written notice was given to the trustee at the
4-38     trustee's most recent address known that a criminal complaint has
4-39     been filed against the trustee or that a criminal investigation of
4-40     the trustee is pending; or
4-41                 (2)  two or more persons claim to be beneficiaries of
4-42     the same trust money, and the trustee has deposited the amount of
4-43     the disputed trust money into the registry of the district court of
4-44     the county in which the standing timber was located by action in
4-45     interpleader or other appropriate legal proceeding for the benefit
4-46     of persons the district court determines to be entitled to the
4-47     trust money.
4-48           Sec. 151.107 [151.157].  ELECTION OF OFFENSES. If conduct
4-49     constituting an offense under Section 151.105 [151.155] is an
4-50     offense under another law of this state, the state may elect the
4-51     offense for which it prosecutes the trustee.
4-52           SECTION 2.  This Act takes effect September 1, 2001.
4-53                                  * * * * *