HBA-DMD S.B. 167 76(R)    BILL ANALYSIS


Office of House Bill AnalysisS.B. 167
By: Carona
Business & Industry
4/12/1999
Engrossed



BACKGROUND AND PURPOSE 

Currently, a person selling real property is not required to deliver notice
to purchasers regarding the possible annexation of the property. A person
buying real estate that is located outside a city's limits may not be aware
that the property lies within the city's extraterritorial jurisdiction and
may be subject to future annexation.  

S.B. 167 requires a person who sells an interest in real property in this
state to give to the purchaser of the property a written notice. This bill
requires the seller to deliver the notice to the purchaser before the
executory contract binds the purchaser to purchase the property. This bill
authorizes the notice to be given separately, as part of the contract
during negotiations, or as part of any other notice the seller delivers to
the purchaser. This bill also provides that if the notice is delivered, the
seller has no duty to provide additional information regarding the possible
annexation of the property by a municipality. It also authorizes the
purchaser, if an executory contract is entered into without the seller
providing the notice, to terminate the contract for any reason within a
specified time period. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subchapter A, Chapter 5, Property Code, by adding
Section 5.011, as follows: 

Sec. 5.011. SELLER'S DISCLOSURE REGARDING POTENTIAL ANNEXATION. (a)
Requires a person who sells an interest in real property to give written
notice to the person purchasing the property. Specifies the language for
the written notice.  

(b) Requires the seller to deliver the written notice to the purchaser
before the executory contract legally binds the purchaser to purchase the
property. Authorizes the notice to be given separately, as part of the
contract during negotiations, or as part of any other notice the seller
delivers to the purchaser. 

(c) Specifies the transfers to which this section does not apply.

(d) Provides that if the notice is delivered as provided by this section,
the seller has no duty to provide additional information regarding the
possible annexation of the property by a municipality. 

(e) Authorizes the purchaser, if an executory contract is entered into
without the seller providing the notice required by this section, to
terminate the contract for any reason within a specified time period. 

SECTION 2.Effective date: January 1, 2000.
  Makes application of this Act prospective.

SECTION 3.Emergency clause.