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A BILL TO BE ENTITLED
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AN ACT
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relating to the filing and release of record of a unilateral |
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memorandum of contract concerning residential property. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 12, Property Code, is amended by adding |
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Section 12.020 to read as follows: |
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Sec. 12.020. FILING AND RELEASE OF UNILATERAL MEMORANDUM OF |
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CONTRACT CONCERNING RESIDENTIAL PROPERTY. (a) In this section: |
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(1) "Residential property" means the real property and |
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existing improvements for a single-family house, duplex, triplex, |
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or quadruplex or a unit in a multiunit structure used for |
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residential purposes in which title to the individual units is |
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transferred to the owners under a condominium system. |
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(2) "Unilateral memorandum of contract" means a |
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written document that is signed only by a person who is not an owner |
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of the real property and asserts that the person has entered into a |
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contract with an owner of real property for the option to purchase |
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an interest in the property or for a right of first refusal or first |
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offer to purchase an interest in the property. The term does not |
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include a deed or a document granting a right of first refusal |
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pursuant to a condominium declaration. |
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(b) A person who files for recording a unilateral memorandum |
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of contract concerning residential property shall: |
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(1) provide to the county clerk the person's mailing |
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address and a certificate of mailing that substantially complies |
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with Subsection (h) for recording with the unilateral memorandum of |
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contract; and |
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(2) not later than the date the person files the |
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memorandum with the county clerk, send a copy of the filed |
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memorandum and a letter notifying the owner of the property of the |
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filing of the memorandum by registered or certified mail, return |
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receipt requested, to: |
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(A) the address of the property; and |
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(B) any mailing address shown for the owner on |
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the filed memorandum, in the real property records for the |
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property, or in the records of the relevant appraisal district with |
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respect to the property. |
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(c) An owner of residential property who receives a letter |
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described by Subsection (b) may file for recording in the real |
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property records of the county in which the property is located: |
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(1) an affidavit that substantially complies with |
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Subsection (i); and |
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(2) a certificate of mailing that substantially |
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complies with Subsection (j). |
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(d) An owner of residential property who files an affidavit |
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under Subsection (c) shall send a copy of the filed affidavit and a |
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letter notifying the person who filed the unilateral memorandum of |
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contract of the filing of the affidavit. The letter and the copy of |
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the affidavit must be sent by registered or certified mail, return |
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receipt requested, to: |
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(1) the address provided to the county clerk by the |
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person who filed the memorandum; and |
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(2) the address of any other person referenced in the |
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memorandum other than the property owner. |
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(e) Subject to Subsection (f) and except as provided by |
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Subsection (g): |
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(1) an affidavit filed under Subsection (c) serves as |
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a release of record of an option or right asserted to exist by the |
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unilateral memorandum of contract referenced in the affidavit; and |
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(2) after the affidavit is recorded: |
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(A) the memorandum and any information derived or |
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that could be derived from the memorandum does not: |
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(i) constitute constructive or actual |
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notice of any contract, option, or right concerning the residential |
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property that is asserted to exist by the memorandum; |
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(ii) create any duty of inquiry in a person |
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with respect to the residential property described in the |
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memorandum; or |
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(iii) affect the validity of a conveyance |
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to a purchaser for value or of a mortgage to a lender for value; |
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(B) a contract, option, or right asserted to |
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exist by the memorandum is not enforceable against a purchaser or |
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lender described by Paragraph (A)(iii), regardless of whether the |
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purchaser or lender knew of the memorandum; and |
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(C) an interest in the residential property may |
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be transferred or encumbered free of all interests asserted in the |
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memorandum. |
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(f) If an owner of residential property has filed an |
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affidavit and certificate of mailing under Subsection (c) and a |
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contradicting affidavit is not filed under Subsection (g): |
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(1) a bona fide purchaser or a mortgagee for value or a |
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successor or assign of a bona fide purchaser or mortgagee for value |
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may rely conclusively on the affidavit filed by the owner under |
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Subsection (c) on and after the 45th day after the date the |
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certificate of mailing was recorded; and |
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(2) the sole remedy available in an action brought to |
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enforce a person's rights asserted under the unilateral memorandum |
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of contract referenced in the affidavit is money damages. |
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(g) An affidavit filed under Subsection (c) does not serve |
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as a release of record of an option or right asserted to exist by a |
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unilateral memorandum of contract filed for recording under this |
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section with respect to a purchaser or mortgagee of the residential |
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property that acquires the purchaser's or mortgagee's interest from |
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the owner if, not later than the 45th day after the date a |
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certificate of mailing was recorded under Subsection (c), the |
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person who filed the memorandum files for recording in the real |
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property records of the county in which the residential property is |
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located a contradicting affidavit asserting that: |
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(1) the affidavit or certificate of mailing filed by |
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the owner under Subsection (c) is untrue; or |
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(2) another reason exists as to why the memorandum |
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serves as a valid notice of record of a contract for an option to |
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purchase an interest in the property or a right of first refusal or |
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first offer to purchase an interest in the property. |
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(h) A certificate of mailing filed under Subsection (b) must |
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be in substantially the following form: |
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CERTIFICATE OF MAILING OF NOTICE OF FILED UNILATERAL MEMORANDUM OF |
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CONTRACT |
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Before me, the undersigned authority, on this day personally |
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appeared __________ ("Affiant(s)") (insert name(s) of Affiant(s)) |
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who, being first duly sworn, upon oath state(s): |
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(1) My name is/Our names are __________ (insert |
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name(s) of Affiant(s)). |
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(2) On the ____ day of __________, 20__, Affiant(s) |
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caused a Unilateral Memorandum of Contract asserting an option to |
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purchase an interest in residential property or a right of first |
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refusal or first offer to purchase an interest in residential |
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property ("Property") to be recorded in __________ (refer to |
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affidavit recording information) ("Memorandum"). |
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(3) On the ____ day of __________, 20__, Affiant(s) |
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sent a copy of the Memorandum and a letter notifying the owner of |
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the residential property referenced in the Memorandum ("Property") |
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of the filing of the Memorandum, by registered or certified mail, |
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return receipt requested, to: |
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(A) the address of the Property; and |
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(B) any mailing address shown for the owner of |
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the Property on the Memorandum, in the real property records for the |
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Property, or in the records of the relevant appraisal district with |
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respect to the Property. |
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(4) Attached to this certificate are: |
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(A) a true and correct copy of the letter |
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described by Subdivision (3) of this certificate; and |
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(B) proof of mailing of the letter as described |
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by Subdivision (3) of this certificate. |
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Signed on the _____ day of __________, 20_____. |
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____________________ |
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____________________ |
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(Signature of Affiant(s)) |
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State of __________ |
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County of __________ |
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SWORN TO AND SUBSCRIBED before me on the _________ day of |
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__________, 20___. |
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My commission expires: |
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______________________ |
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______________________________ |
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Notary Public, State of Texas |
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Notary's printed name: |
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_____________________________ |
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(i) An affidavit filed under Subsection (c) must be in |
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substantially the following form: |
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AFFIDAVIT FOR RELEASE OF UNILATERAL MEMORANDUM OF CONTRACT |
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Before me, the undersigned authority, on this day personally |
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appeared __________ ("Affiant(s)") (insert name(s) of Affiant(s)) |
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who, being first duly sworn, upon oath state(s): |
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(1) My name is/Our names are __________ (insert |
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name(s) of Affiant(s)). I/We own the following described |
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residential property ("Property"): |
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(describe the residential property) |
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(2) This affidavit is made for the purpose of |
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effecting a release of an option to purchase an interest in the |
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Property or a right of first refusal or first offer to purchase an |
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interest in the Property under a contract asserted to exist by that |
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unilateral memorandum of contract recorded in __________ (refer to |
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recording information of unilateral memorandum of contract) |
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("Unilateral Memorandum of Contract"). |
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(3) The factual basis for this affidavit is: |
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(describe the relevant facts) |
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(4) This affidavit serves as a release of any option to |
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purchase an interest in the Property or right of first refusal or |
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first offer to purchase an interest in the Property under the |
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contract asserted to exist by the Unilateral Memorandum of Contract |
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in accordance with Section 12.020, Property Code. |
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Signed on this _____ day of __________, _____. |
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____________________ |
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____________________ |
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(Signature of Affiant(s)) |
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State of __________ |
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County of __________ |
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SWORN TO AND SUBSCRIBED before me on the _________ day of |
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__________, 20___. |
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My commission expires: |
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______________________ |
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_______________________________ |
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Notary Public, State of Texas |
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Notary's printed name: |
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________________________________ |
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(j) A certificate of mailing filed under Subsection (c) must |
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be in substantially the following form: |
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CERTIFICATE OF MAILING OF AFFIDAVIT FOR RELEASE OF UNILATERAL |
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MEMORANDUM OF CONTRACT |
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Before me, the undersigned authority, on this day personally |
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appeared __________ ("Affiant(s)") (insert name(s) of Affiant(s)) |
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who, being first duly sworn, upon oath state(s): |
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(1) My name is/Our names are __________ (insert |
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name(s) of Affiant(s)). |
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(2) On the ____ day of __________, 20__, Affiant(s) |
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caused an Affidavit for Release of UNILATERAL MEMORANDUM OF |
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CONTRACT to be recorded in __________ (refer to affidavit recording |
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information) ("Affidavit"). |
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(3) On the ____ day of __________, 20__, Affiant(s) |
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sent a copy of the Affidavit and a letter notifying the person who |
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filed the Unilateral Memorandum of Contract referenced in the |
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Affidavit ("Memorandum") of the Affiant's/Affiants' claim for the |
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filing and release of the Affidavit, by registered or certified |
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mail, return receipt requested, to: |
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(A) the address of the person who filed the |
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Memorandum, as provided to the county clerk; and |
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(B) the address of any other person referenced in |
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the Memorandum. |
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(4) Attached to this certificate are: |
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(A) a true and correct copy of the letter |
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described by Subdivision (3) of this certificate; and |
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(B) proof of mailing of the letter as described |
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by Subdivision (3) of this certificate. |
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Signed on the _____ day of __________, 20_____. |
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____________________ |
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____________________ |
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(Signature of Affiant(s)) |
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State of __________ |
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County of __________ |
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SWORN TO AND SUBSCRIBED before me on the _________ day of |
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__________, 20___. |
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My commission expires: |
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____________________ |
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_______________________________ |
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Notary Public, State of Texas |
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Notary's printed name: |
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_______________________________ |
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(k) If a unilateral memorandum of contract filed for |
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recording on or after September 1, 2025, does not comply with |
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Subsection (b): |
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(1) the memorandum and any information derived or that |
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could be derived from the memorandum does not: |
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(A) constitute constructive or actual notice of |
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any contract, option, or right concerning the residential property |
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that is asserted to exist by the memorandum; |
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(B) create any duty of inquiry in a person with |
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respect to the residential property described in the memorandum; or |
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(C) affect the validity of a conveyance to a |
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purchaser for value or of a mortgage to a lender for value; |
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(2) a contract, option, or right asserted to exist by |
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the memorandum is not enforceable against a purchaser or lender |
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described by Subdivision (1)(C), regardless of whether the |
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purchaser or lender knew of the memorandum; |
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(3) an interest in the residential property may be |
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transferred or encumbered free of all interests asserted in the |
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memorandum; and |
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(4) the sole remedy available in an action brought to |
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enforce a person's rights asserted under the unilateral memorandum |
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of contract referenced in the affidavit is money damages. |
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SECTION 2. This Act takes effect September 1, 2025. |