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A BILL TO BE ENTITLED
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AN ACT
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relating to the disclosure and use of sales price of real property |
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sales; providing a civil penalty. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Title 3, Property Code, is amended by adding |
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Chapter 12A to read as follows: |
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CHAPTER 12A. MANDATORY SALES PRICE DISCLOSURE |
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Sec. 12A.01. MANDATORY SALES PRICE DISCLOSURE. (a) The |
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commissioners court of a county may call an election in the county |
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to permit the voters of the county to determine whether a person |
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must disclose the sales price of the property in the manner provided |
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by this subsection. The election shall be held on the date of the |
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next general election for state and county officers. If a majority |
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of the votes cast at the election favor the establishment of |
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mandatory sales price disclosure, the requirement applies |
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beginning with the tax year following the year in which the election |
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is held. |
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(b) A person shall not file for record or have recorded in |
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the county clerk's office an instrument conveying real property |
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under a contract for sale unless the instrument is attached to a |
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sales price disclosure report as defined by this chapter. |
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SEC. 12A.02 SALES PRICE DISCLOSURE REPORT. (a) A sales |
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price disclosure report filed under this chapter must disclose the |
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sales price of the property of the attached instrument conveying |
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real property under a contract for sale or the exemption under |
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Section 12A.05 that qualifies the purchaser for nondisclosure of |
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sales information. |
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(b) To further explain sales price, a filer may also |
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disclose within the sales price disclosure report: |
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(1) the method used to finance the sales price, such |
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as: cash sale, cash and third-party financing, cash and seller |
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financing, or other; |
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(2) whether the sale involved property other than real |
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property and the type of property, whether tangible or intangible, |
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involved in the sale and, if so, the portion of the sales price |
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allocated between real property, business personal property and |
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intangibles; |
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(3) whether the sale involved property located in more |
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than one county and, if so, the portion of the sales price or other |
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consideration allocated to the portion of the property located in |
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each county; |
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(4) whether the sale was part of a combined sale of |
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real property investments and, if so, the portion of the combined |
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sales price allocated to the property subject to Section 12A.01; |
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(5) whether the sale involved a 1031 tax exchange, |
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under the United States Internal Revenue Code; |
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(6) whether the sale is the sale of an entire business |
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or business unit; and |
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(7) a description of any unusual or extraordinary |
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terms of the sale or transfer that affected the amount of the sales |
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price; |
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(c) A sales price disclosure report must be signed by the |
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purchaser of the real property described in the report. |
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(d) The comptroller shall adopt and make available |
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electronically a form that shall be used to file the information |
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required in the sales price disclosure report. |
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(e) A sales price disclosure report must be prepared by the |
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purchaser of the property described in the report or by another |
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person on behalf of the purchaser. |
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(f) A person who prepares a sales price disclosure report on |
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behalf of a purchaser of the property described in the report is not |
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liable to any person for preparing the report or for any |
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unintentional error or omission in the report. |
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Sec. 12A.03. COUNTY CLERK RESPONSIBILITY. (a) The county |
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clerk shall not under any circumstance reject an instrument |
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presented for recording solely because the instrument fails to |
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comply with this Chapter. |
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(b) The county clerk shall not be held criminally or civilly |
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liable for recording or disclosing a sales price disclosure report |
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or information in a sales price disclosure report. |
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Sec. 12A.04. ACTION TO COMPEL COMPLIANCE. (a) The chief |
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appraiser upon discovery of a recorded instrument conveying real |
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property under a contract for sale lacking an attached sales price |
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disclosure report or a sales price disclosure report containing |
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errors or omissions and recorded after September 1, 2007 and within |
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his jurisdiction shall give written notice to the purchaser: (1) |
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identifying errors or omissions, (2) instructing the purchaser how |
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to file a sales price disclosure report, (3) informing the |
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purchaser of penalties for failure to properly file a sales price |
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disclosure report within 30 days of the mailed notice, and (4) |
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include a sales price disclosure report. |
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(b) Thirty days after the date the chief appraiser gives |
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written notice to the purchaser, the purchaser of any property for |
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which an instrument is recorded in violation of this Chapter shall |
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be liable to the state for a civil penalty for each violation in an |
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amount equal to five percent of the sales price of the property. |
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(c) The attorney general or the county or district attorney |
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for the county in which the property is located may bring suit to |
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recover a penalty under this Chapter. |
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Sec. 12A.05. EXEMPTIONS. (a) A filer may use the sales price |
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disclosure report to claim an exemption from listing the sales |
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price of real property on the sales price disclosure form, and omit |
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the sales price from the sales price disclosure form, if: |
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(1) the sale is made pursuant to a court order; |
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(2) the sale is made to or from a trustee in |
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bankruptcy; |
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(3) the sale is made pursuant to a power of sale under |
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a deed of trust or other encumbrance secured by the property; |
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(4) the sale is made by a deed in lieu of foreclosure; |
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(5) the sale is made by one co-owner to one or more |
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other co-owners; |
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(6) the sale is made to a spouse or to a person or |
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persons in the first degree of lineal consanguinity of one or more |
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of the sellers or grantors; |
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(7) the sale is made to or from a governmental entity; |
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(8) the sale is made pursuant to the power of eminent |
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domain; |
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(9) the sale is made to a utility company and the real |
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property is an easement, license, or right-of-way; |
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(10) it represents a transfer of title pursuant to a |
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merger or combination of corporation, partnerships, limited |
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liability companies or other entities under common control; |
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(11) it represents a transfer among entities under |
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common control (i) as a contribution to, or a dividend or |
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distribution of, capital for no consideration or nominal |
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consideration, or (ii) in sole consideration for canceling or |
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surrendering an interest in a corporation, partnership, limited |
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liability company or other entity; |
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(12) the real property is a severed mineral interest; |
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or |
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(13) the real property is a timeshare interest in real |
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property. |
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Sec. 12A.06. USE OF SALES DATA. (a) The sales data disclosed |
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under this Chapter shall not be used as the sole basis by the chief |
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appraiser to increase the market value of the real property |
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described in the sales price disclosure report. |
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Sec. 12A.07. AUTHORITY TO BRING SUIT. (a) A person may sue |
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an appraisal district or appraisal review board to compel the |
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appraisal district or appraisal review board to comply with the |
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provisions of Section 12A.06 if the failure to comply causes or will |
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cause substantial economic harm to or denial of a statutory or |
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constitutional right of that person. A person bringing an action |
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under this subsection must pay $500 into the registry of the court. |
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The court shall distribute that amount to the prevailing party on |
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entry of final judgment in the action. |
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(b) If the party bringing an action under this section |
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prevails on the merits, the court shall enter an order compelling |
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the appraisal district or appraisal review board to comply with the |
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applicable law and ordering that the prevailing party recover its |
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costs. |
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(c) This section applies only to Section 12A.06. |
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(d) As a prerequisite to filing a suit under this section, a |
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person shall give certified written notice to the defendant at |
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least 60 days before filing the suit advising in reasonable detail |
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of the person's specific complaint. |
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SECTION 2. This Act takes effect January 1, 2008. |