82R13010 PMO-F

By: Deshotel H.B. No. 1429

Substitute the following for H.B. No. 1429:

By: Orr C.S.H.B. No. 1429

A BILL TO BE ENTITLED

AN ACT

relating to rights and remedies of certain residential tenants and landlords; providing civil penalties.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Effective January 1, 2012, Section 24.005, Property Code, is amended by amending Subsection (b) and adding Subsections (b-1), (b-2), (b-3), and (b-4) to read as follows:

(b) If the occupant is a tenant at will or by sufferance, the landlord must give the tenant at least three days' written notice to vacate before the landlord files a forcible detainer suit unless the parties have contracted for a shorter or longer notice period in a written lease or agreement.

(b-1) If the occupant is a bona fide residential tenant at will or by sufferance, a purchaser who purchases at a judicial or nonjudicial foreclosure sale the building that the tenant occupies must give the tenant at least 90 days' written notice to vacate.

(b-2) For purposes of this section, a residential tenant is bona fide only if the tenant:

(1) occupies the premises on the date of the foreclosure sale; and

(2) is not the mortgagor of the purchaser at the foreclosure sale or the child, spouse, or parent of the mortgagor. [If a building is purchased at a tax foreclosure sale or a trustee's foreclosure sale under a lien superior to the tenant's lease and the tenant timely pays rent and is not otherwise in default under the tenant's lease after foreclosure, the purchaser must give a residential tenant of the building at least 30 days' written notice to vacate if the purchaser chooses not to continue the lease. The tenant is considered to timely pay the rent under this subsection if, during the month of the foreclosure sale, the tenant pays the rent for that month to the landlord before receiving any notice that a foreclosure sale is scheduled during the month or pays the rent for that month to the foreclosing lienholder or the purchaser at foreclosure not later than the fifth day after the date of receipt of a written notice of the name and address of the purchaser that requests payment.]

(b-3) Before a foreclosure sale, a foreclosing lienholder may give [written notice] to a tenant at will or by sufferance or under a written lease or oral rental agreement written notice stating that a foreclosure notice has been given to the landlord or owner of the property and specifying the date of the foreclosure.

(b-4) This subsection and Subsections (b-1), (b-2), and (b-3) expire December 31, 2014.

SECTION 2. Effective January 1, 2015, Section 24.005, Property Code, is amended by adding Subsections (b-1), (b-2), and (b-3) to read as follows:

(b-1) If a building is purchased at a tax foreclosure sale or a trustee's foreclosure sale under a lien superior to the tenant's lease and the tenant timely pays rent and is not otherwise in default under the tenant's lease after foreclosure, the purchaser must give a residential tenant of the building at least 30 days' written notice to vacate if the purchaser chooses not to continue the lease.

(b-2) The tenant is considered to timely pay the rent under Subsection (b-1) if, during the month of the foreclosure sale, the tenant pays the rent for that month to the landlord before receiving any notice that a foreclosure sale is scheduled during the month or pays the rent for that month to the foreclosing lienholder or the purchaser at foreclosure not later than the fifth day after the date of receipt of a written notice of the name and address of the purchaser that requests payment.

(b-3) Before a foreclosure sale, a foreclosing lienholder may give written notice to a tenant stating that a foreclosure notice has been given to the landlord or owner of the property and specifying the date of the foreclosure.

SECTION 3. Subchapter A, Chapter 92, Property Code, is amended by adding Sections 92.025 and 92.026 to read as follows:

Sec. 92.025. EFFECT OF FORECLOSURE ON TENANCY. (a) The purchaser of a premises at a judicial or nonjudicial foreclosure sale may require a bona fide tenant of the premises to vacate only after the purchaser provides to the tenant at least 90 days' written notice to vacate.

(b) A bona fide tenant of a premises purchased at a judicial or nonjudicial foreclosure sale may occupy the premises until the later of:

(1) the date provided by the notice to vacate under Subsection (a); or

(2)(A) the end of the remaining lease term; or

(B) if the purchaser intends to occupy the premises as a primary residence, the date provided by the notice to vacate under Subsection (a).

(c) For purposes of Subsection (b), a tenant may occupy the premises as described by Subsection (b) only if the tenant:

(1) owes no delinquent or unpaid rent or other sums owed to the landlord on the date of the foreclosure sale; and

(2) is a party to a lease agreement that is effective on the date of the foreclosure sale.

(d) For purposes of this section, a tenant is bona fide only if:

(1) the lease was the result of an arms-length transaction;

(2) the lease requires receipt of rent that is not substantially less than fair market rent for the premises; and

(3) the tenant is not the mortgagor of the purchaser at the foreclosure sale or the child, spouse, or parent of the mortgagor.

(e) This section expires December 31, 2014.

Sec. 92.026. LANDLORD'S DUTY TO PROVIDE COPY OF LEASE. (a) Not later than the third business day after the date the lease is signed by each party to the lease, a landlord shall provide at least one copy of the lease to at least one tenant who is a party to the lease.

(b) If more than one tenant is a party to the lease, not later than the third business day after the date a landlord receives a written request for a copy of a lease from a tenant who has not received a copy of the lease under Subsection (a), the landlord shall provide one copy of the lease to the requesting tenant.

(c) If a landlord fails to comply with Subsection (a) or (b), a tenant, after giving written notice to the landlord of the failure to comply with Subsection (a) or (b), may bring an action to recover actual damages resulting from the failure to provide a copy of the lease, court costs, and reasonable attorney's fees.

SECTION 4. Section 92.331(a), Property Code, is amended to read as follows:

(a) A landlord may not retaliate against a tenant by taking an action described by Subsection (b) because the tenant:

(1) in good faith exercises or attempts to exercise against a landlord a right or remedy granted to the tenant by lease, municipal ordinance, or federal or state statute;

(2) gives a landlord a notice to repair or exercise a remedy under this chapter; [or]

(3) complains to a governmental entity responsible for enforcing building or housing codes, a public utility, or a civic or nonprofit agency, and the tenant:

(A) claims a building or housing code violation or utility problem; and

(B) believes in good faith that the complaint is valid and that the violation or problem occurred; or

(4) establishes, attempts to establish, or participates in a tenant organization.

SECTION 5. (a) The changes in law made by Section 24.005, Property Code, as amended by this Act, effective January 1, 2012, apply only to the purchase of leased property at a foreclosure sale on or after January 1, 2012. The purchase of leased property at a foreclosure sale before January 1, 2012, is governed by the law as it existed immediately before January 1, 2012, and that law is continued in effect for that purpose.

(b) The changes in law made by Section 24.005, Property Code, as amended by this Act, effective January 1, 2015, apply only to the purchase of leased property at a foreclosure sale on or after January 1, 2015. The purchase of leased property at a foreclosure sale before January 1, 2015, is governed by the law as it existed immediately before January 1, 2015, and that law is continued in effect for that purpose.

(c) The changes in law made by Section 92.025, Property Code, as added by this Act, apply only to the purchase of leased property at a foreclosure sale on or after the effective date of this Act. The purchase of leased property at a foreclosure sale before the effective date of this Act is governed by the law as it existed immediately before the effective date of this Act, and that law is continued in effect for that purpose.

(d) The changes in law made by Section 92.026, Property Code, as added by this Act, apply only to a lease the effective date of which is on or after the effective date of this Act. A lease the effective date of which is before the effective date of this Act is governed by the law as it existed immediately before the effective date of this Act, and that law is continued in effect for that purpose.

SECTION 6. This Act takes effect January 1, 2012.