By: Murr, Lambert (Senate Sponsor - Middleton) H.B. No. 207
         (In the Senate - Received from the House April 24, 2023;
  April 24, 2023, read first time and referred to Committee on
  Business & Commerce; May 12, 2023, reported adversely, with
  favorable Committee Substitute by the following vote:  Yeas 11,
  Nays 0; May 12, 2023, sent to printer.)
Click here to see the committee vote
 
  COMMITTEE SUBSTITUTE FOR H.B. No. 207 By:  Middleton
 
 
A BILL TO BE ENTITLED
 
AN ACT
 
  relating to the exclusion of certain conveyances from
  classification as sham or pretended sales.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subchapter A, Chapter 41, Property Code, is
  amended by adding Section 41.0022 to read as follows:
         Sec. 41.0022.  CERTAIN CONVEYANCES NOT SHAM OR PRETENDED
  SALES. (a) In this section:
               (1)  "Entity" means a domestic or foreign:
                     (A)  corporation, professional corporation, or
  professional association;
                     (B)  limited liability company or professional
  limited liability company; or
                     (C)  limited partnership.
               (2)  "Parcel" means one or more parcels.
         (b)  The conveyance of a parcel not meeting the definition of
  an urban homestead under Section 41.002(a) or (c) by an individual
  to an entity in which the individual or individual's spouse has a
  direct or indirect ownership interest is not a sham or pretended
  sale, including a pretended sale under Section 50(c), Article XVI,
  Texas Constitution, if:
               (1)  the deed conveying the parcel is recorded at least
  30 days before the entity grants a mortgage, trust deed, or other
  lien on the parcel;
               (2)  the individual does not reside on the parcel at the
  time of the conveyance;
               (3)  the parcel is not contiguous to the parcel on which
  the individual resides;
               (4)  the deed conveying the parcel does not contain a
  condition of defeasance; and
               (5)  the individual recorded contemporaneously with
  the deed an affidavit substantially in the form prescribed by
  Subsection (d).
         (c)  An individual executing a deed under Subsection (b) is
  estopped from claiming that:
               (1)  the conveyance is a sham or pretended sale,
  including a pretended sale under Section 50(c), Article XVI, Texas
  Constitution; or
               (2)  the individual had not abandoned homestead rights,
  if any, in the parcel by executing the deed.
         (d)  At the time of recording a deed under Subsection (b), an
  individual grantor of the deed shall record an affidavit containing
  the following:
               (1)  a title caption stating "Affidavit Regarding
  Conveyance To An Entity";
               (2)  the date of the affidavit;
               (3)  a description of the deed containing:
                     (A)  the title of the deed;
                     (B)  the date of the deed;
                     (C)  the name and address of the individual
  grantor; and
                     (D)  the name and address of the entity grantee;
               (4)  a description of the parcel being conveyed to the
  entity;
               (5)  a description of the parcel upon which the
  individual currently resides;
               (6)  a statement that the parcel being conveyed is not
  contiguous to the parcel upon which the individual currently
  resides;
               (7)  a statement that the parcel upon which the
  individual currently resides is not:
                     (A)  located within the limits of a municipality
  or its extraterritorial jurisdiction or a platted subdivision; or
                     (B)  served by police protection, paid or
  volunteer fire protection, and at least three of the following
  services provided by a municipality or under contract to a
  municipality:
                           (i)  electric;
                           (ii)  natural gas;
                           (iii)  sewer;
                           (iv)  storm sewer; or
                           (v)  water;
               (8)  a statement that:
                     (A)  the individual is unmarried; or
                     (B)  the individual is married, and including the
  name of the individual's spouse;
               (9)  a statement that the individual or individual's
  spouse owns a direct or indirect interest in the entity;
               (10)  a statement that the individual has executed the
  deed conveying the parcel to the entity;
               (11)  a statement that the individual intends to vest
  title in the entity;
               (12)  a statement that there are no written or oral
  agreements regarding a defeasance of the parcel upon the passage of
  time or occurrence or non-occurrence of any event;
               (13)  a statement that the individual acknowledges that
  the individual will be estopped from claiming the conveyance to the
  entity is a sham or pretended sale, including a pretended sale under
  Section 50(c), Article XVI, Texas Constitution;
               (14)  a statement that the individual acknowledges that
  the individual will be estopped from claiming the individual had
  not abandoned homestead rights, if any, in the parcel by executing
  the deed;
               (15)  a statement that the individual understands that
  if the parcel is valued for ad valorem tax purposes as qualified
  open-space land, the entity must reapply in its own name by the
  applicable filing deadline; and
               (16)  a statement that the individual has had an
  opportunity:
                     (A)  to review the affidavit prior to the
  affidavit's execution; and
                     (B)  to consult with an attorney before the
  affidavit's execution, whether or not the opportunity to consult
  with an attorney was exercised.
         (e)  If the individual conveying a parcel under Subsection
  (b) is married, the individual's spouse must join in the execution
  of:
               (1)  the deed; and
               (2)  the affidavit described by Subsection (d).
         (f)  The entity or a lender for value may conclusively rely
  on an affidavit described by Subsection (d).
         (g)  Notwithstanding any other provision of this section, a
  transaction that does not meet the requirements of this section is
  not invalid if the homestead has been abandoned or disclaimed as
  provided by other provisions of law.
         SECTION 2.  This Act takes effect September 1, 2023.
 
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