PROPERTY CODE
CHAPTER 82. UNIFORM CONDOMINIUM ACT
SUBCHAPTER A. GENERAL PROVISIONS
§ 82.001. SHORT TITLE. This chapter may be cited as the
Uniform Condominium Act.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.002. APPLICABILITY. (a) This chapter applies to
all commercial, industrial, residential, and other types of
condominiums in this state for which the declaration is recorded on
or after January 1, 1994. A condominium for which the declaration
was recorded before January 1, 1994, may be governed exclusively
under this chapter if either:
(1) the owners of units vote to amend the declaration,
in accordance with the amendment process authorized by the
declaration, to have this chapter apply and that amendment is filed
for record in the condominium records in each county in which the
condominium is located; or
(2) a declaration or amendment of declaration was
recorded before January 1, 1994, and the declaration or amendment
states that this chapter will apply in its entirety on January 1,
1994.
(b) An amendment to a declaration under Subsection (a)(1)
that implements a vote of the unit owners to be governed by this
chapter may not affect the rights of a declarant or impose duties on
a declarant that are greater than or in addition to the declarant's
duties immediately before the date of the vote or amendment.
(c) This section and the following sections apply to a
condominium in this state for which the declaration was recorded
before January 1, 1994: Sections 82.005, 82.006, 82.007, 82.053,
82.054, 82.102(a)(1)-(7) and (12)-(22), 82.108, 82.111, 82.113,
82.114, 82.116, 82.157, and 82.161. The definitions prescribed by
Section 82.003 apply to a condominium in this state for which the
declaration was recorded before January 1, 1994, to the extent the
definitions do not conflict with the declaration. The sections
listed in this subsection apply only with respect to events and
circumstances occurring on or after January 1, 1994, and do not
invalidate existing provisions of the declaration, bylaws, or plats
or plans of a condominium for which the declaration was recorded
before January 1, 1994.
(d) Chapter 81 does not apply to a condominium for which the
declaration was recorded on or after January 1, 1994, and does not
invalidate any amendment to the declaration, bylaws, or plats and
plans of any condominium for which the declaration was recorded
before January 1, 1994, if the amendment would be permitted by this
chapter. The amendment must be adopted in conformity with the
procedures and requirements specified by those instruments and by
Chapter 81. If the amendment grants to a person a right, power, or
privilege permitted by this chapter, all correlative obligations,
liabilities, and restrictions prescribed by this chapter also apply
to that person.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
Amended by Acts 1997, 75th Leg., ch. 956, § 1, eff. Jan. 1, 1998.
§ 82.003. DEFINITIONS. (a) In this chapter:
(1) "Affiliate of a declarant" means any person who
controls, is controlled by, or is under common control with a
declarant. A person "controls" a declarant if the person is a
general partner, officer, director, or employer of the declarant;
directly or indirectly or acting in concert with one or more other
persons, or through one or more subsidiaries, owns, controls, holds
with power to vote or holds proxies representing more than 20
percent of the voting interests in the declarant; determines in any
manner the election of a majority of the directors of the declarant;
or has contributed more than 20 percent of the capital of the
declarant. A person "is controlled by" a declarant if the declarant
is a general partner, officer, director, or employer of the person;
directly or indirectly or acting in concert with one or more other
persons, or through one or more subsidiaries, owns, controls, holds
with power to vote, or holds proxies representing more than 20
percent of the voting interests in the person; determines in any
manner the election of a majority of the directors of the person;
or has contributed more than 20 percent of the capital of the
person.
(2) "Allocated interests" means the undivided
interest in the common elements, the common expense liability, and
votes in the association allocated to each unit.
(3) "Association" means the unit owners' association
organized under Section 82.101.
(4) "Board" means the board of directors or the body,
regardless of name, designated to act on behalf of the association.
(5) "Common elements" means all portions of a
condominium other than the units and includes both general and
limited common elements.
(6) "Common expense liability" means the liability for
common expenses allocated to each unit.
(7) "Common expenses" means expenditures made by or
financial liabilities of the association, together with any
allocations to reserves.
(8) "Condominium" means a form of real property with
portions of the real property designated for separate ownership or
occupancy, and the remainder of the real property designated for
common ownership or occupancy solely by the owners of those
portions. Real property is a condominium only if one or more of the
common elements are directly owned in undivided interests by the
unit owners. Real property is not a condominium if all of the
common elements are owned by a legal entity separate from the unit
owners, such as a corporation, even if the separate legal entity is
owned by the unit owners.
(9) "Conversion building" means a building that at any
time before creation of the condominium was occupied wholly or
partially by persons other than purchasers and persons who occupy
with the consent of purchasers.
(10) "Declarant" means a person, or group of persons
acting in concert, who:
(A) as part of a common promotional plan, offers
to dispose of the person's interest in a unit not previously
disposed of; or
(B) reserves or succeeds to any special declarant
right.
(11) "Declaration" means a recorded instrument,
however denominated, that creates a condominium, and any recorded
amendment to that instrument.
(12) "Development rights" means a right or combination
of rights reserved by a declarant in the declaration to:
(A) add real property to a condominium;
(B) create units, common elements, or limited
common elements within a condominium;
(C) subdivide units or convert units into common
elements; or
(D) withdraw real property from a condominium.
(13) "Disposition" means a voluntary transfer to a
purchaser of any legal or equitable interest in a unit but does not
include the transfer or release of a security interest.
(14) "General common elements" means common elements
that are not limited common elements.
(15) "Identifying number" means a symbol or address
that identifies only one unit in a condominium.
(16) "Leasehold condominium" means a condominium in
which all or a portion of the real property is subject to a lease the
expiration or termination of which will terminate the condominium
or reduce its size.
(17) "Limited common element" means a portion of the
common elements allocated by the declaration or by operation of
Section 82.052 for the exclusive use of one or more but less than
all of the units.
(18) "Plan" means a dimensional drawing that is
recordable in the real property records or the condominium plat
records and that horizontally and vertically identifies or
describes units and common elements that are contained in
buildings.
(19) "Plat" means a survey recordable in the real
property records or the condominium plat records and containing the
information required by Section 82.059. As used in this chapter,
"plat" does not have the same meaning as "plat" in Chapter 212 or
232, Local Government Code, or other statutes dealing with
municipal or county regulation of property development.
(20) "Purchaser" means a person, other than a
declarant, who by means of a voluntary transfer acquires a legal or
equitable interest in a unit other than a leasehold interest or as
security for an obligation.
(21) "Residential purposes" means recreational or
dwelling purposes, or both.
(22) "Special declarant rights" means rights reserved
for the benefit of a declarant to:
(A) complete improvements indicated on plats and
plans filed with the declaration;
(B) exercise any development right;
(C) make the condominium part of a larger
condominium or a planned community;
(D) maintain sales, management, and leasing
offices, signs advertising the condominium, and models;
(E) use easements through the common elements for
the purpose of making improvements within the condominium or within
real property that may be added to the condominium; or
(F) appoint or remove any officer or board member
of the association during any period of declarant control.
(23) "Unit" means a physical portion of the
condominium designated for separate ownership or occupancy, the
boundaries of which are described by the declaration.
(24) "Unit owner" means a declarant or other person
who owns a unit, or a lessee of a unit in a leasehold condominium
whose lease expires simultaneously with any lease the expiration or
termination of which will remove the unit from the condominium, but
does not include a person having an interest in a unit solely as
security for an obligation.
(b) Unless otherwise provided by the declaration or bylaws,
a term defined by Subsection (a) has the same meaning if used in a
declaration or bylaws.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.004. VARIATION BY AGREEMENT. Except as expressly
provided by this chapter, provisions of this chapter may not be
varied by agreement, and rights conferred by this chapter may not be
waived. A person may not act under a power of attorney or use any
other device to evade the limitations or prohibitions of this
chapter or the declaration.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.005. SEPARATE TITLES AND TAXATION. (a) If there
is a unit owner other than a declarant, each unit that has been
created, together with its interest in the common elements,
constitutes for all purposes a separate parcel of real property.
(b) If there is a unit owner other than a declarant, each
unit must be separately taxed and assessed, and no separate tax or
assessment may be rendered against common elements for which a
declarant has not reserved development rights. Any portion of the
common elements for which a declarant has reserved any development
right must be separately taxed and assessed against the declarant,
and the declarant alone is liable for payment of those taxes.
(c) If there is no unit owner other than a declarant, the
real property constituting the condominium may be taxed and
assessed in any manner provided by law.
(d) The laws relating to homestead exemptions from property
taxes apply to condominium units, which are entitled to homestead
exemptions in those cases in which the owner of a single family
dwelling would qualify.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.006. APPLICABILITY OF LOCAL ORDINANCES,
REGULATIONS, AND BUILDING CODES. A zoning, subdivision, building
code, or other real property use law, ordinance, or regulation may
not prohibit the condominium form of ownership or impose any
requirement on a condominium that it would not impose on a
physically identical development under a different form of
ownership. Otherwise, this chapter does not invalidate or modify
any provision of any zoning, subdivision, building code, or other
real property use law, ordinance, or regulation.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.007. CONDEMNATION. (a) If a unit is acquired by
condemnation, or if part of a unit is acquired by condemnation
leaving the unit owner with a remnant that may not practically or
lawfully be used for any purpose permitted by the declaration, the
condemnation award must compensate the unit owner for the unit and
its common element interest, whether or not any common element
interest is acquired. On acquisition, unless the decree provides
otherwise, the condemned unit's entire allocated interests are
automatically reallocated to the remaining units in proportion to
the respective allocated interests of those units before the
taking, and the association shall promptly prepare, execute, and
record an amendment to the declaration reflecting the
reallocations. A remnant of a unit remaining after part of a unit
is taken under this subsection is a common element.
(b) Except as provided by Subsection (a), if part of a unit
is acquired by condemnation, the award must compensate the unit
owner for the reduction in value of the unit and its common element
interest. On acquisition, the condemned unit's allocated interests
are reduced in proportion to the reduction in the size of the unit,
or on any other basis specified by the declaration, and the portion
of the allocated interests divested from the partially acquired
unit are automatically reallocated to that unit and the remaining
units in proportion to the respective allocated interests of those
units before the taking, with the partially acquired unit
participating in the reallocation on the basis of its reduced
allocated interests.
(c) If part of the common elements is acquired by
condemnation, the award must be paid to the association, as trustee
for the unit owners, and to persons holding liens on the condemned
property, as their interests may appear. The association shall
divide any portion of the award not used for any restoration or
repair of the remaining common elements among the unit owners in
proportion to their respective common element interests before the
taking, but the portion of the award attributable to the
acquisition of a limited common element must be equally divided
among the owners of the units to which that limited common element
was allocated at the time of acquisition, or in any manner the
declaration provides.
(d) The court decree shall be recorded in each county in
which any portion of the condominium is located.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.008. VENUE. Venue for an action to enforce a right
or obligation arising under the declaration, bylaws, or rules of
the association is in each county in which any part of the
condominium is located.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
SUBCHAPTER B. CREATION, ALTERATION, AND TERMINATION OF
CONDOMINIUMS
§ 82.051. CREATION OF CONDOMINIUM. (a) A condominium
may be created under this chapter only by recording a declaration
executed in the same manner as a deed by all persons who have an
interest in the real property that will be conveyed to unit owners
and by every lessor of a lease the expiration or termination of
which will terminate the condominium or reduce its size. The
declaration shall be recorded in each county in which any portion of
the condominium is located.
(b) A declarant may not convey an interest in a unit until
each holder of a mortgage on the unit immediately before conveyance
has executed a consent to declaration, and the consent has been
recorded, or is recorded concurrently with the conveyance, as part
of the declaration or an amendment to the declaration.
(c) If a recorded declaration is not properly executed, that
defect may be cured by a subsequent execution conforming to
Subsection (a). After an execution defect is cured by authority of
this subsection, the declaration is retroactively effective on the
date it was first recorded.
(d) A county clerk shall, without prior approval from any
other authority, record declarations and amendments to
declarations in the real property records, and a county clerk shall
record condominium plats or plans in the real property records or in
books maintained for that purpose, as a declarant may request. The
book for the condominium plat records shall be the same size and
type as the book for recording subdivision plats.
(e) This chapter does not affect or diminish the rights of
municipalities and counties to approve plats of subdivisions and
enforce building codes as may be authorized or required by law.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.052. UNIT BOUNDARIES. Except as otherwise
provided by the declaration or plat:
(1) if walls, floors, or ceilings are designated as
boundaries of a unit, then all lath, furring, wallboard,
plasterboard, plaster, paneling, tiles, wallpaper, paint, finished
flooring, and any other materials constituting part of the finished
surfaces are a part of the unit, and all other portions of the
walls, floors, or ceilings are a part of the common elements;
(2) if any chute, flue, duct, wire, conduit, bearing
wall, bearing column, or any other fixture is partially within and
partially outside the designated boundaries of a unit, then the
portion serving only that unit is a limited common element
allocated solely to that unit, and the portion serving more than one
unit or the common elements is a part of the general common
elements;
(3) subject to Subdivision (2), the spaces, interior
partitions, and other fixtures and improvements within the
boundaries of a unit are a part of the unit; and
(4) shutters, awnings, window boxes, doorsteps,
stoops, porches, balconies, patios, and exterior doors and windows
or other fixtures designed to serve a single unit, but located
outside the unit's boundaries, are limited common elements
allocated exclusively to that unit.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.053. CONSTRUCTION AND VALIDITY OF DECLARATION AND
BYLAWS. (a) The provisions of the declaration and bylaws are
severable.
(b) The rule against perpetuities may not be applied to
defeat any provision of the declaration, bylaws, or rules of the
association.
(c) If there is a conflict between the provisions of the
declaration and the bylaws, the declaration prevails except to the
extent the declaration is inconsistent with this chapter.
(d) Title to a unit and common elements is not made
unmarketable or otherwise affected by a provision of unrecorded
bylaws or by reason of an insubstantial failure of the declaration
to comply with this chapter. Whether a substantial failure impairs
marketability is not affected by this chapter.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.054. DESCRIPTION OF UNITS. A description of a unit
is a sufficient legal description of the unit and all rights,
obligations, and interests appurtenant to the unit that were
created by the declaration or bylaws if the description contains:
(1) the name of the condominium;
(2) the recording data for the declaration, including
any amendments, plats, and plans;
(3) the county in which the condominium is located;
and
(4) the identifying number of the unit.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.055. CONTENTS OF DECLARATION FOR ALL
CONDOMINIUMS. The declaration for a condominium must contain:
(1) the name of the condominium, which must include
the word "condominium" or be followed by the words "a condominium"
or a phrase that includes the word "condominium," and the name of
the association;
(2) the name of each county in which any part of the
condominium is located;
(3) a legally sufficient description of the real
property included in the condominium;
(4) a description of the boundaries of each unit
created by the declaration, including the unit's identifying
number;
(5) a statement of the maximum number of units that the
declarant reserves the right to create;
(6) a description of the limited common elements other
than those listed in Sections 82.052(2) and (4);
(7) a description of any real property, except real
property subject to development rights, that may be allocated
subsequently as limited common elements, together with a statement
that the property may be so allocated;
(8) an allocation to each unit of its allocated
interests;
(9) any restrictions on use, occupancy, or alienation
of the units;
(10) a description of and the recording data for
recorded easements and licenses appurtenant to or included in the
condominium or to which any portion of the condominium is or may
become subject by reservation in the declaration;
(11) the method of amending the declaration;
(12) a plat or plan or the recording data of a plat or
plan that has been recorded in the real property or condominium plat
records;
(13) a statement of the association's obligation under
Section 82.111(i) to rebuild or repair any part of the condominium
after a casualty or any other disposition of the proceeds of a
casualty insurance policy;
(14) a description of any development rights and other
special declarant rights reserved by the declarant, together with a
legally sufficient description of the real property to which each
of those rights applies, and a time limit within which each of those
rights must be exercised;
(15) if any development right may be exercised with
respect to different parcels of real property at different times, a
statement to that effect, together with:
(A) either a statement fixing the boundaries of
those portions and regulating the order in which those portions may
be subjected to the exercise of each development right, or a
statement that no assurances are made in those regards; and
(B) a statement as to whether, if any development
right is exercised in any portion of the real property subject to
that development right, that development right must be exercised in
all or in any other portion of the remainder of that real property;
(16) all matters required by this chapter to be stated
in the declaration; and
(17) any other matters the declarant considers
appropriate.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.056. LEASEHOLD CONDOMINIUMS. (a) Any lease the
expiration or termination of which may terminate the condominium or
reduce its size must be recorded. The lessor shall sign the
declaration, and the declaration must state:
(1) the recording data for the lease;
(2) the date on which the lease is scheduled to expire;
(3) a legally sufficient description of the real
property subject to the lease;
(4) any right of the unit owners to redeem the
reversion and the manner in which the unit owners may exercise that
right, or a statement that the unit owners do not have that right;
(5) any right of the unit owners to remove
improvements within a reasonable time after the expiration or
termination of the lease, or a statement that the unit owners do not
have that right; and
(6) any right of the unit owners to renew the lease and
the conditions of renewal, or a statement that the unit owners do
not have that right.
(b) After the declaration for a leasehold condominium is
recorded, neither the lessor nor the lessor's successor in interest
may terminate the leasehold interest of a unit owner who makes
timely payment of the unit owner's share of the rent and otherwise
complies with all covenants that, if violated, would entitle the
lessor to terminate the lease. A unit owner's leasehold interest is
not affected by failure of any other person to pay rent or fulfill
any other covenant.
(c) Acquisition of the leasehold interest of a unit owner by
the owner of the reversion or remainder does not merge the leasehold
and fee simple interests unless the leasehold interests of all unit
owners subject to that reversion or remainder are acquired.
(d) If the expiration or termination of a lease decreases
the number of units in a condominium, the allocated interests shall
be reallocated as though those units had been taken by condemnation
unless otherwise provided by the declaration. Reallocation shall
be confirmed by an amendment to the declaration prepared, executed,
and recorded by the association.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.057. ALLOCATION OF COMMON ELEMENT INTERESTS, VOTES,
AND COMMON EXPENSE LIABILITIES. (a) The declaration shall
allocate a fraction or percentage of undivided interests in the
common elements and in the common expenses of the association, and a
portion of the votes in the association, to each unit and state the
formulas used to establish those allocations. These allocations
may not discriminate in favor of units owned by a declarant.
(b) If units may be added to or withdrawn from the
condominium, the declaration must state the formulas to be used to
reallocate the allocated interests among all units included in the
condominium after the addition or withdrawal.
(c) The declaration may provide:
(1) that different allocations of votes must be made
to the units on particular matters specified in the declaration;
and
(2) for class voting on specified issues affecting the
class if necessary to protect valid interests of the class.
(d) A declarant may not use cumulative or class voting to
evade any limitation imposed on declarants by this chapter. Units
may not constitute a class because the units are owned by a
declarant.
(e) Except for minor variations due to rounding, the sums of
the undivided interests in the common elements and of the common
expense liabilities allocated at any time to all the units shall
each equal one if stated as fractions or 100 percent if stated as
percentages. If a discrepancy exists between an allocated interest
and the result derived from application of the pertinent formula,
the allocated interest prevails.
(f) The common elements are not subject to partition. Any
purported conveyance, judicial sale, or other voluntary or
involuntary transfer of an undivided interest in the common
elements without the unit to which that interest is allocated is
void.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.058. LIMITED COMMON ELEMENTS. (a) The limited
common elements and the provisions of the declaration relating to
the right to use the limited common elements may not be altered
without the consent of each affected unit owner and the owner's
first lien mortgagee.
(b) Except as otherwise provided by the declaration, a
limited common element may be reallocated by an amendment to the
declaration, executed by the unit owners between or among whose
units the reallocation is made. The persons executing the
amendment shall deliver it to the association, which shall record
it at the expense of the reallocating unit owners.
(c) A common element not previously allocated as a limited
common element may not be allocated except pursuant to the
declaration made in accordance with Section 82.055(7). The
allocation shall be made by amendment to the declaration.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.059. PLATS AND PLANS. (a) Plats and plans are a
part of the declaration and may be recorded as a part of the
declaration or separately. Each plat or plan must be legible and
contain a certification that the plat or plan contains all
information required by this section.
(b) Each plat must show:
(1) the name and a survey or general schematic map of
the entire condominium;
(2) the location and dimensions of all real property
not subject to development rights, or subject only to the
development right to withdraw, and the location and dimensions of
all existing improvements within that real property;
(3) a legally sufficient description of any real
property subject to development rights, labeled to identify the
rights applicable to each parcel;
(4) the extent of any encroachments by or on any
portion of the condominium;
(5) to the extent feasible, a legally sufficient
description of all easements serving or burdening any portion of
the condominium, and the location of any underground utility line
that is actually known by the declarant at the time of filing the
declaration to have been constructed outside a recorded easement;
(6) the location and dimensions of any vertical unit
boundaries not shown or projected on recorded plans and the unit's
identifying number;
(7) the location, with reference to established data,
of any horizontal unit boundaries not shown or projected on
recorded plans and the unit's identifying number;
(8) a legally sufficient description of any real
property in which the unit owners will own only an estate for years,
labeled as "leasehold real property";
(9) the distance between noncontiguous parcels of real
property constituting the condominium;
(10) the location and dimensions of limited common
elements, other than those described by Sections 82.052(2) and (4);
(11) in the case of real property not subject to
development rights, all other matters required by law on land
surveys; and
(12) the distance and bearings locating each building
from all other buildings and from at least one boundary line of the
real property constituting the condominium.
(c) A plat may also show the intended location and
dimensions of a contemplated improvement to be constructed anywhere
within the condominium, which must be labeled either "MUST BE
BUILT" or "NEED NOT BE BUILT."
(d) To the extent not shown on the plats, plans must show:
(1) the location and dimensions of the vertical
boundaries of each unit, and the unit's identifying number;
(2) the horizontal unit boundaries, with reference to
established data, and the unit's identifying number; and
(3) any units, appropriately identified, in which the
declarant has reserved the right to create additional units or
common elements.
(e) Unless the declaration provides otherwise, the
horizontal boundaries of part of a unit located outside a building
have the same elevation as the horizontal boundaries of the inside
part and need not be depicted on the plats and plans. Interior
walls and partitions within a unit need not be included in the plats
or plans.
(f) On exercising any development right, the declarant
shall record either new plats and plans necessary to conform to the
requirements of this section or new certifications of plats and
plans previously recorded if those plats and plans otherwise
conform to the requirements of this section.
(g) An independent licensed surveyor or engineer shall
certify at least one plat, whether contained in one or more pages,
showing all perimeter land boundaries of the condominium, except
for additional real property, and showing the locations on the
ground of all buildings labeled "MUST BE BUILT" in relation to land
boundaries. Certification of any other plat or plan required by
this chapter shall be made by an independent licensed architect,
surveyor, or engineer.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.060. EXERCISE OF DEVELOPMENT RIGHT. (a) To
exercise a development right, the declarant must prepare, execute,
and record an amendment to the declaration and record new plats and
plans for that real property. The declarant is the unit owner of
any units created. The amendment to the declaration must assign an
identifying number to each new unit created and, except for
subdivision or conversion of units described by Subsection (b),
reallocate the allocated interest among all units. The amendment
must describe any limited common elements created, designating the
unit to which each is allocated.
(b) Development rights may be reserved within any real
property added to the condominium if the amendment adding the real
property includes the information required by Section 82.055 or
82.056, as appropriate, and the plats and plans include the
information required by Section 82.059(b). This provision does not
extend the time limit on the exercise of development rights imposed
by the declaration. Real property to be added is not part of a
condominium or subject to a declaration until the declaration is
amended to make the additional real property part of the
condominium.
(c) Whenever a declarant exercises a development right to
subdivide or convert a unit previously created into additional
units, common elements, or both:
(1) if the declarant converts the unit entirely to
common elements, the amendment to the declaration must reallocate
all the allocated interests of the unit among the other units as if
the unit had been taken by condemnation; and
(2) if the declarant subdivides the unit into two or
more units, whether or not any part of the unit is converted into
common elements, the amendment to the declaration must reallocate
all the allocated interests of the unit among the units created by
the subdivision in any reasonable manner prescribed by the
declarant.
(d) If the declaration provides that all or a portion of the
real property is subject to the development right of withdrawal:
(1) if all the real property is subject to withdrawal,
and the declaration does not describe separate portions of real
property subject to that right, none of the real property may be
withdrawn after a unit has been conveyed to a purchaser; and
(2) if a portion or portions are subject to
withdrawal, no portion may be withdrawn after a unit in that portion
has been conveyed to a purchaser.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.061. ALTERATIONS OF UNITS. (a) Subject to the
provisions of the declaration and other provisions of law, a unit
owner:
(1) may make improvements or alterations to the
owner's unit that do not impair the structural integrity or
mechanical systems or lessen the support of any portion of the
condominium;
(2) may not change the appearance of the common
elements or the exterior appearance of a unit or any other portion
of the condominium without prior written permission of the
association; and
(3) after acquiring an adjoining unit or an adjoining
part of an adjoining unit, with the prior written approval of the
association, may remove, alter, and create apertures in an
intervening partition, even if the partition in whole or in part is
a common element, if those acts do not impair the structural
integrity or mechanical systems or lessen the support of any
portion of the condominium.
(b) Removal of partitions or creation of apertures under
Subsection (a)(3) is not an alteration of boundaries.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.062. RELOCATION OF BOUNDARIES BETWEEN ADJOINING
UNITS. Subject to the declaration, the boundaries between
adjoining units may be relocated by an amendment to the declaration
on written application to the association by the owners of those
units. If the owners of the adjoining units have specified a
reallocation between their units of their allocated interests, the
application must state the proposed reallocations. Unless the
board determines not later than the 30th day after the date the
application is received that the reallocation is unreasonable, the
association shall prepare an amendment that identifies the units
involved, states the reallocation, is executed by the applying unit
owners, and contains words of conveyance between them. At the
expense of the applying unit owners, the association shall prepare
and record the amendment and plats or plans necessary to show the
altered boundaries between adjoining units, and the units'
dimensions and identifying numbers.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.063. SUBDIVISION OF UNITS. (a) If the
declaration expressly permits, a unit may be subdivided into two or
more units. Subject to the declaration, on written application of a
unit owner to subdivide a unit and after payment by the unit owner
of the cost of preparing and recording amendments and plats, the
association shall prepare, execute, and record an amendment to the
declaration, including the plats and plans, subdividing the unit.
(b) The amendment to the declaration must be executed by the
owner of the unit to be subdivided, assign an identifying number to
each unit created, and reallocate the allocated interests formerly
allocated to the subdivided unit to the new units in any reasonable
manner prescribed by the owner of the subdivided unit.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.064. EASEMENT FOR ENCROACHMENTS. To the extent
that a unit or common element encroaches on another unit or common
element, a valid easement for the encroachment exists. The
easement does not relieve a unit owner of liability in case of the
owner's wilful misconduct nor relieve a declarant or any other
person of liability for failure to adhere to the plats and plans.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.065. USE FOR SALES PURPOSES. The declaration may
permit a declarant to maintain sales, leasing, or management
offices and models in units or on common elements in the condominium
if the declaration specifies the rights of a declarant with regard
to the number, size, location, and relocation of the offices and
models. If the declaration fails to expressly permit an office or
model, a declarant may maintain no more than one unit as a model and
no more than one unit as an office for sales, leasing, and
management purposes at any one time. A sales, leasing, or
management office or model not designated as a unit by the
declaration is a common element and is subject to the exclusive use
of a declarant until the declarant ceases to be a unit owner or
until the declarant no longer uses the office or model for such
purposes, whichever occurs earlier. A declarant may modify the
exterior of a sales, leasing, or management office to conform to the
aesthetic exterior plan of the condominium. A declarant who ceases
to be a unit owner ceases to have any rights with regard to an office
or model unless it is removed within a reasonable time from the
condominium in accordance with a right to remove reserved in the
declaration. Subject to limitations in the declaration, a
declarant may maintain signs on the common elements that advertise
the condominium for sale or lease. This section is subject to local
ordinances and other state law.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.066. EASEMENT RIGHTS. Subject to the declaration,
a declarant has an easement through the common elements as may be
reasonably necessary for discharging the declarant's obligations
or exercising special declarant rights whether arising under this
chapter or reserved by the declaration.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.067. AMENDMENT OF DECLARATION. (a) Except as
provided by Subsection (b), a declaration, including the plats and
plans, may be amended only by vote or agreement of unit owners to
which at least 67 percent of the votes in the association are
allocated, or any larger majority the declaration specifies. A
declaration may specify a smaller number only if all of the units
are restricted exclusively to nonresidential use. An amendment to
a declaration may be adopted:
(1) by written ballot that states the exact wording or
substance of the amendment and that specifies the date by which a
ballot must be received to be counted;
(2) at a meeting of the members of the association
after written notice of the meeting has been delivered to an owner
of each unit stating that a purpose of the meeting is to consider an
amendment to the declaration; or
(3) by any method permitted by the declaration.
(b) The amendment procedures of this section do not apply to
amendments that may be executed by:
(1) a declarant under Section 82.051(c), 82.059(f), or
82.060 or Subsection (f);
(2) the association under Section 82.007, 82.056(d),
82.058(c), 82.062, or 82.063 or Subsection (f); or
(3) certain unit owners under Section 82.058(b),
82.062, 82.063(b), or 82.068(b).
(c) An action to challenge the validity of an amendment
adopted by the association under this section must be brought
before the first anniversary of the date the amendment is recorded.
(d) To be effective, an amendment to the declaration must be
recorded in each county in which any portion of the condominium is
located.
(e) Except as permitted or required by this chapter, an
amendment may not create or increase special declarant rights,
increase the number of units, change the boundaries of a unit, alter
or destroy a unit or limited common element, change a unit's
allocated interest, or change the use restrictions on a unit unless
the amendment is approved by 100 percent of the votes in the
association. Except as agreed to by the declarant, an amendment may
not increase or otherwise modify the obligations imposed by a
declaration on a declarant, or reduce or otherwise modify the
rights granted by a declaration to a declarant, including special
declarant rights.
(f) If permitted by the declaration, the board or the
declarant, if the declarant owns a unit that has never been
occupied, may without a vote of the unit owners or approval of the
association amend the declaration in any manner necessary to meet
the requirements of the Federal National Mortgage Association, the
Federal Home Loan Mortgage Corporation, the Federal Housing
Administration, or the Veterans Administration.
(g) Amendments to the declaration required by this chapter
to be recorded by the association must be prepared, executed,
recorded, and certified by an officer of the association designated
for that purpose or, in the absence of designation, by the president
of the association.
(h) An association may amend the declaration to authorize
the board:
(1) to bring an action to evict a tenant of a unit
owner for the tenant's violation of the declaration, bylaws, or
rules of the association;
(2) to bring an action to evict a tenant of a unit
owner who fails to pay the association for the cost of repairs to
common elements damaged substantially by the owner's tenant; or
(3) to collect rents from a tenant of a unit owner who
is at least 60 days' delinquent in the payment of any amount due to
the association.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.0675. RESTRICTION RELATING TO CLUB
MEMBERSHIP. (a) A provision of a declaration or recorded
contract that requires owners of units in a condominium to maintain
a membership in a specified private club is not valid after the 10th
anniversary of the date the provision is recorded or renewed unless
renewed after the ninth anniversary of that date in the manner
provided by the declaration or recorded contract for amending the
declaration or recorded contract and the text of the renewed
provision is filed in the real property records of each county in
which the condominium is located.
(b) A provision described by this section may not be enacted
or renewed as a bylaw by the unit owners' association.
Added by Acts 2003, 78th Leg., ch. 1101, § 2, eff. Sept. 1, 2003.
§ 82.068. TERMINATION OF CONDOMINIUM. (a) Unless the
declaration provides otherwise and except for a taking of all the
units by condemnation, a condominium may be terminated only by the
agreement of 100 percent of the votes in the association and each
holder of a deed of trust or vendor's lien on a unit. The
declaration may not allow a termination by less than 80 percent of
the votes in the association if any unit is restricted exclusively
to residential uses.
(b) An agreement of unit owners to terminate a condominium
must be evidenced by the execution or ratification of a termination
agreement by the requisite number of unit owners. If, pursuant to a
termination agreement, the real property constituting the
condominium is to be sold following termination, the termination
agreement must set forth the terms of the sale. To be effective, a
termination agreement and all ratifications of the agreement must
be recorded in each county in which a portion of the condominium is
located.
(c) The association, on behalf of the unit owners, may
contract for the sale of real property in the condominium, but the
contract is not binding on the unit owners until it is approved
under Subsections (a) and (b). If the real property constituting
the condominium is to be sold following termination, on termination
title to that real property vests in the association as trustee for
the holders of all interests in the units, and the association has
all powers necessary and appropriate to effect the sale, including
the power to convey the interests of nonconsenting owners. Until
the sale has been concluded and the proceeds distributed, the
association shall continue to exist and retains the powers it had
before termination. Proceeds of the sale must be distributed to
unit owners and lienholders as their interests may appear, in
proportion to the respective interests of unit owners as provided
by Subsection (f). Unless the termination agreement specifies
differently, as long as the association holds title to the real
property, each unit owner and the owner's successors in interest
have an exclusive right to occupy the portion of the real property
that formerly constituted the owner's unit. During that period of
occupancy a unit owner and the owner's successors in interest
remain liable for all assessments and other obligations imposed on
unit owners by this chapter or the declaration.
(d) If the real property constituting the condominium is not
to be sold following termination, on termination title to the real
property vests in the unit owners as tenants in common in proportion
to their respective interests, and liens on the units shift
accordingly. While the tenancy in common exists, a unit owner and
the owner's successors in interest have an exclusive right to
occupy the portion of the real property that formerly constituted
the owner's unit.
(e) Following termination of the condominium, and after
payment of or provision for the claims of the association's
creditors, the assets of the association shall be distributed to
unit owners in proportion to their respective interests. The
proceeds of sale described by Subsection (c) and held by the
association as trustee are not assets of the association.
(f) The interest of a unit owner referred to in Subsections
(c), (d), and (e) is, except as provided by Subsection (g), the fair
market value of the owner's unit, limited common elements, and
common element interest immediately before the termination, as
determined by one or more independent appraisers selected by the
association. The decision of the independent appraisers shall be
distributed to the unit owners and becomes final unless disapproved
by unit owners of units to which 25 percent of the votes in the
association are allocated not later than the 30th day after the date
of distribution. The proportion of a unit owner's interest to that
of all unit owners is determined by dividing the fair market value
of the unit owner's unit and common element interest by the total
fair market values of all the units and common elements.
(g) If a unit or a limited common element is destroyed to the
extent that an appraisal of the fair market value before the
destruction cannot be made, the interest of a unit owner is the
owner's common element interest immediately before the
termination.
(h) Foreclosure or enforcement of a lien or encumbrance
against the entire condominium does not of itself terminate the
condominium, and foreclosure or enforcement of a lien or
encumbrance against a portion of the condominium does not withdraw
that portion from the condominium, unless the portion is
withdrawable real property or unless the mortgage being foreclosed
was recorded before the date the declaration was recorded and the
mortgagee did not consent in writing to the declaration.
(i) By agreement of the same percentage of unit owners that
is required to terminate the condominium, the unit owners may
rescind a termination agreement and reinstate the declaration in
effect immediately before the election to terminate. To be
effective, the rescission agreement must be in writing, executed by
the unit owners who desire to rescind, and recorded in each county
in which any portion of the condominium is located.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.069. RIGHTS OF SECURED LENDERS. The declaration
may require that all or a specified number or percentage of the
mortgagees or beneficiaries of deeds of trust encumbering the units
approve specified actions of the unit owners or the association as a
condition to the effectiveness of those actions, but a requirement
for approval may not operate to:
(1) deny or delegate control over the general
administrative affairs of the association by the unit owners or the
board; or
(2) prevent the association or the board from:
(A) commencing, intervening in, or settling any
litigation or proceeding; or
(B) receiving and distributing insurance
proceeds under Section 82.111.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.070. MEETING AT WHICH AMENDMENTS MAY BE
ADOPTED. (a) An association or a board may not meet to adopt an
amendment or other change to the declaration, articles of
incorporation, bylaws, or rules of the association unless the
association or board has given to each unit owner a document showing
the specific amendment or other change that would be made to the
declaration, articles of incorporation, bylaws, or rules.
(b) The information described by Subsection (a) must be
given to each unit owner after the 20th day but before the 10th day
preceding the date of the meeting. The information is considered to
have been given to a unit owner on the date the information is
personally delivered to the unit owner, as shown by a receipt signed
by the unit owner, or on the date shown by the postmark on the
information after it is deposited in the United States mail with a
proper address and postage paid.
Added by Acts 1997, 75th Leg., ch. 956, § 2, eff. Jan. 1, 1998.
SUBCHAPTER C. CONDOMINIUM MANAGEMENT
§ 82.101. ORGANIZATION OF UNIT OWNERS' ASSOCIATION. A
unit owners' association must be organized as a profit or nonprofit
corporation. The declarant may not convey a unit until the
secretary of state has issued a certificate of incorporation under
Article 3.03, Texas Business Corporation Act, or Article 3.03,
Texas Non-Profit Corporation Act (Article 1396-3.03, Vernon's
Texas Civil Statutes). The membership of the association at all
times consists exclusively of all the unit owners or, following
termination of the condominium, all former unit owners entitled to
distribution of proceeds, or the owners' heirs, successors, or
assigns.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.102. POWERS OF UNIT OWNERS'
ASSOCIATION. (a) Unless otherwise provided by the declaration,
the association, acting through its board, may:
(1) adopt and amend bylaws;
(2) adopt and amend budgets for revenues,
expenditures, and reserves, and collect assessments for common
expenses from unit owners;
(3) hire and terminate managing agents and other
employees, agents, and independent contractors;
(4) institute, defend, intervene in, settle, or
compromise litigation or administrative proceedings in its own name
on behalf of itself or two or more unit owners on matters affecting
the condominium;
(5) make contracts and incur liabilities relating to
the operation of the condominium;
(6) regulate the use, maintenance, repair,
replacement, modification, and appearance of the condominium;
(7) adopt and amend rules regulating the use,
occupancy, leasing or sale, maintenance, repair, modification, and
appearance of units and common elements, to the extent the
regulated actions affect common elements or other units;
(8) cause additional improvements to be made as a part
of the common elements;
(9) acquire, hold, encumber, and convey in its own
name any right, title, or interest to real or personal property,
except common elements of the condominium;
(10) grant easements, leases, licenses, and
concessions through or over the common elements;
(11) impose and receive payments, fees, or charges for
the use, rental, or operation of the common elements and for
services provided to unit owners;
(12) impose interest and late charges for late
payments of assessments, returned check charges, and, if notice and
an opportunity to be heard are given, reasonable fines for
violations of the declaration, bylaws, and rules of the
association;
(13) adopt and amend rules regulating the collection
of delinquent assessments and the application of payments;
(14) adopt and amend rules regulating the termination
of utility service to a unit, the owner of which is delinquent in
the payment of an assessment that is used, in whole or in part, to
pay the cost of that utility;
(15) impose reasonable charges for preparing,
recording, or copying declaration amendments, resale certificates,
or statements of unpaid assessments;
(16) enter a unit for bona fide emergency purposes
when conditions present an imminent risk of harm or damage to the
common elements, another unit, or the occupants;
(17) assign its right to future income, including the
right to receive common expense assessments, but only to the extent
the declaration so provides;
(18) suspend the voting privileges of or the use of
certain general common elements by an owner delinquent for more
than 30 days in the payment of assessments;
(19) purchase insurance and fidelity bonds it
considers appropriate or necessary;
(20) exercise any other powers conferred by the
declaration or bylaws;
(21) exercise any other powers that may be exercised
in this state by a corporation of the same type as the association;
and
(22) exercise any other powers necessary and proper
for the government and operation of the association.
(b) The declaration may not impose limitations on the power
of the association to deal with the declarant that are more
restrictive than the limitations imposed on the power of the
association to deal with other persons.
(c) To be enforceable, a bylaw or rule of the association
must not be arbitrary or capricious.
(d) Before an association may charge the unit owner for
property damage for which the unit owner is liable or levy a fine
for violation of the declaration, bylaws, or rules, the association
shall give to the unit owner a written notice that:
(1) describes the violation or property damage and
states the amount of the proposed fine or damage charge;
(2) states that not later than the 30th day after the
date of the notice, the unit owner may request a hearing before the
board to contest the fine or damage charge; and
(3) allows the unit owner a reasonable time, by a
specified date, to cure the violation and avoid the fine unless the
unit owner was given notice and a reasonable opportunity to cure a
similar violation within the preceding 12 months.
(e) The association may give a copy of the notice required
by Subsection (d) to an occupant of the unit. The association must
give notice of a levied fine or damage charge to the unit owner not
later than the 30th day after the date of levy.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.103. BOARD MEMBERS AND OFFICERS. (a) Except as
provided by the declaration, bylaws, or this chapter, the board
shall act in all instances on behalf of the association if in the
good-faith judgment of the board the action is reasonable. Each
officer or member of the board is liable as a fiduciary of the unit
owners for the officer's or member's acts or omissions. All acts of
the association must be by and through the board unless otherwise
provided by the declaration or bylaws or by law.
(b) The board may not act on behalf of the association to
amend the declaration except as permitted by this chapter, to
terminate the condominium, to elect members of the board, or to
determine the qualifications, powers and duties, or terms of office
of board members. The board may fill a vacancy in its membership
for the unexpired portion of a term.
(c) Subject to Subsection (d), the declaration may provide
for a period of declarant control of the association during which a
declarant, or persons designated by the declarant, may appoint and
remove the officers and members of the board. Regardless of the
period provided by the declaration, a period of declarant control
terminates not later than the 120th day after conveyance of 75
percent of the units that may be created to unit owners other than a
declarant. Transfer of special declarant rights does not terminate
the period of declarant control. A declarant may voluntarily
surrender the right to appoint and remove officers and members of
the board before termination of the period, but in that event the
declarant may require, for the duration of the period that the
declarant would otherwise control, that specified actions of the
association or board be approved by the declarant before they
become effective.
(d) Not later than the 120th day after conveyance of 50
percent of the units that may be created to unit owners other than a
declarant, not less than one-third of the members of the board must
be elected by unit owners other than the declarant.
(e) Not later than the termination of a period of declarant
control, the unit owners shall elect a board of at least three
members who need not be unit owners. The board shall elect the
officers before the 31st day after the date declarant control
terminates. The persons elected shall take office on election.
(f) An officer or director of the association is not liable
to the association or any unit owner for monetary damages for an act
or omission occurring in the person's capacity as an officer or
director unless:
(1) the officer or director breached a fiduciary duty
to the association or a unit owner;
(2) the officer or director received an improper
benefit; or
(3) the act or omission was in bad faith, involved
intentional misconduct, or was one for which liability is expressly
provided by statute.
(g) Subsection (f) does not diminish a limitation of
liability provided an officer or director of the association by the
declaration, bylaws, articles of incorporation of the association,
or other laws.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.104. TRANSFER OF SPECIAL DECLARANT
RIGHTS. (a) Special declarant rights created or reserved under
this chapter may not be transferred except by an instrument
evidencing the transfer recorded in each county in which any
portion of the condominium is located. The instrument is not
effective unless executed by the transferee.
(b) On transfer of any special declarant right, a transferor
is not relieved of an obligation or liability arising before the
transfer. A transferor is not liable for an act or omission or a
breach of an obligation arising from the exercise of a special
declarant right by a successor declarant who is not an affiliate of
the transferor.
(c) Unless otherwise provided by a mortgage instrument or
deed of trust, in case of foreclosure of a mortgage, tax sale,
judicial sale, sale by a trustee under a deed of trust, or sale
under Bankruptcy Code or receivership proceedings, of a unit owned
by a declarant or of real property in a condominium subject to
development rights, a person acquiring title to all the real
property being foreclosed or sold may request to succeed to all
special declarant rights or only to rights reserved by the
declaration to maintain models, offices, and signs. The judgment
or instrument conveying title may provide for transfer of only the
special declarant rights requested.
(d) On foreclosure, tax sale, judicial sale, sale by a
trustee under a deed of trust, or sale under Bankruptcy Code or
receivership proceedings of all units and other real property in a
condominium owned by a declarant:
(1) the declarant ceases to have any special declarant
rights; and
(2) the period of declarant control terminates unless
the judgment or instrument conveying title provides for transfer of
all special declarant rights held by that declarant to a successor
declarant.
(e) The liabilities and obligations of a person who succeeds
to special declarant rights are as follows:
(1) a successor to a special declarant right who is an
affiliate of a declarant is subject to all obligations and
liabilities imposed on the transferor by this chapter or by the
declaration;
(2) a successor to a special declarant right, other
than a successor described by Subdivision (3) or (4), who is not an
affiliate of a declarant, is subject to all obligations and
liabilities imposed on the transferor by this chapter or by the
declaration;
(3) a successor to only a right reserved by the
declaration to maintain models, offices, and signs, who is not an
affiliate of a declarant, may not exercise any other special
declarant right, and is not subject to any liability or obligation
as a declarant, except the obligation to provide a condominium
information statement and any liability arising as a result; and
(4) a successor to all special declarant rights held
by the successor's transferor who is not an affiliate of that
declarant and who succeeded to those rights pursuant to a deed in
lieu of foreclosure or a judgment or instrument conveying title to
units under Subsection (c) may declare the person's intention in a
recorded instrument to hold those rights solely for transfer to
another person; thereafter, until all special declarant rights are
transferred to a person acquiring title to any unit owned by the
successor, or until an instrument permitting exercise of all those
rights is recorded, the successor may not exercise any of those
rights other than any right held by the successor's transferor to
control the board as provided by Section 82.103(c) for the duration
of the period of declarant control, and an attempt to exercise those
rights is void; so long as a successor declarant may not exercise
special declarant rights under this subdivision, the successor is
not subject to any liability or obligation as a declarant other than
liability for acts and omissions under Section 82.103(a).
(f) This section does not subject a successor to a special
declarant right to any claims against or other obligations of a
transferor declarant, other than claims and obligations arising
under this chapter or the declaration.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.105. TERMINATION OF CONTRACTS AND LEASES OF
DECLARANT. An association in a residential or recreational
condominium may terminate, without penalty, contracts or leases
between the association and a declarant or an affiliate of a
declarant if:
(1) the contract is entered into by the association
while controlled by the declarant;
(2) the association terminates the contract or lease
before the first anniversary of the date a board elected by the unit
owners takes office; and
(3) the association gives at least 90 days' notice of
its intent to terminate the contract or lease to the other party.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.106. BYLAWS. (a) The administration and
operation of the condominium are governed by the bylaws, which must
provide for:
(1) the number of members on the board and the titles
of the officers of the association;
(2) election by the board of a president, treasurer,
secretary, and any other officers the bylaws specify;
(3) the qualifications, powers and duties, terms of
office, and the manner of electing and removing a board member or
officer and filling vacancies;
(4) the powers, if any, that the board or an officer
may delegate to other persons or to a managing agent;
(5) the designation of officers who are authorized to
prepare, execute, certify, and record amendments to the declaration
on behalf of the association;
(6) the method of amending the bylaws; and
(7) the manner of notice of meetings of the
association.
(b) Subject to the declaration, the bylaws may provide for
other matters the association considers desirable, necessary, or
appropriate.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.107. UPKEEP OF CONDOMINIUM. (a) Except as
provided by the declaration or Subsections (b) and (c), the
association is responsible for maintenance, repair, and
replacement of the common elements, and each unit owner is
responsible for maintenance, repair, and replacement of the owner's
unit. Each unit owner shall afford to the association and the other
unit owners, and to their agents or employees, access through the
owner's unit reasonably necessary for those purposes. If damage is
inflicted on the common elements or on any unit through which access
is taken, the unit owner responsible for the damage, or the
association if it is responsible, is liable for the prompt repair of
the damage.
(b) Except as provided by the declaration, each unit owner
is responsible for the cost of maintenance, repair, and replacement
of any utility installation or equipment serving only the owner's
unit, without regard to whether the installation or equipment is
located wholly or partially outside the designated boundaries of
the unit. For purposes of this subsection, utility installations
and equipment include electricity, water, sewage, gas, water
heaters, heating and air conditioning equipment, and television
antennas.
(c) Except as provided by the declaration, each unit owner
is responsible for the cost of maintenance, repair, and replacement
of windows and doors serving only the owner's unit.
(d) Unless otherwise provided by the declaration, the
association may enter a unit, after giving notice to the owner and
occupant of the unit, to:
(1) prevent or terminate waste of water purchased by
the association as a common expense; or
(2) perform maintenance and repairs of the condominium
that, if not performed, may result in increased damage by water to
components of the condominium that the association maintains.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.108. MEETINGS. (a) Meetings of the association
must be held at least once each year. Unless the declaration
provides otherwise, special meetings of the association may be
called by the president, a majority of the board, or unit owners
having at least 20 percent of the votes in the association.
(b) Meetings of the association and board must be open to
unit owners, subject to the right of the board to adjourn a meeting
of the board and reconvene in closed executive session to consider
actions involving personnel, pending litigation, contract
negotiations, enforcement actions, matters involving the invasion
of privacy of individual unit owners, or matters that are to remain
confidential by request of the affected parties and agreement of
the board. The general nature of any business to be considered in
executive session must first be announced at the open meeting.
(c) Unless the declaration, bylaws, or articles of
incorporation of the association provide otherwise:
(1) a meeting of the board may be held by any method of
communication, including electronic and telephonic, if:
(A) notice of the meeting has been given in
accordance with Subsection (e);
(B) each director may hear and be heard by every
other director; and
(C) the meeting does not involve voting on a
fine, damage assessment, appeal from a denial of architectural
control approval, or suspension of a right of a particular
association member before the member has an opportunity to attend a
board meeting to present the member's position, including any
defense, on the issue; and
(2) the board may act by unanimous written consent of
all the directors, without a meeting, if:
(A) the board action does not involve voting on a
fine, damage assessment, appeal from a denial of architectural
control approval, or suspension of a right of a particular
association member before the member has an opportunity to attend a
board meeting to present the member's position, including any
defense, on the issue; and
(B) a record of the board action is filed with the
minutes of board meetings.
(d) Notice of a meeting of the association must be given as
provided by the bylaws, or, if the bylaws do not provide for notice,
notice must be given to each unit owner in the same manner in which
notice is given to members of a nonprofit corporation under Section
A, Article 2.11, Texas Non-Profit Corporation Act (Article
1396-2.11, Vernon's Texas Civil Statutes).
(e) Notice of a meeting of the board must be given as
provided by the bylaws, or, if the bylaws do not provide for notice,
notice must be given to each board member in the same manner in
which notice is given to members of the board of a nonprofit
corporation under Section B, Article 2.19, Texas Non-Profit
Corporation Act (Article 1396-2.19, Vernon's Texas Civil
Statutes).
(f) An association, on the written request of a unit owner,
shall inform the unit owner of the time and place of the next
regular or special meeting of the board. If the association
representative to whom the request is made does not know the time
and place of the meeting, the association promptly shall obtain the
information and disclose it to the unit owner or inform the unit
owner where the information may be obtained.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
Amended by Acts 1997, 75th Leg., ch. 956, § 3, eff. Jan. 1, 1998.
§ 82.109. QUORUMS. (a) Unless the bylaws provide
otherwise, a quorum is present throughout any meeting of the
association if persons entitled to cast at least 20 percent of the
votes that may be cast for election of the board are present in
person or by proxy at the beginning of the meeting. The bylaws may
not reduce the standard for a quorum to less than 10 percent.
(b) Unless the bylaws specify a larger percentage, a quorum
is present throughout a meeting of the board if persons entitled to
cast at least 50 percent of the votes on the board are present at the
beginning of the meeting.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.110. VOTING AND PROXIES. (a) If only one of the
multiple owners of a unit is present at a meeting of the
association, that person may cast the vote or votes allocated to
that unit. If more than one of the multiple owners is present, the
vote or votes allocated to that unit may be cast only in accordance
with the owners' unanimous agreement unless the declaration
provides otherwise. Multiple owners are in unanimous agreement if
one of the multiple owners casts the votes allocated to a unit and
none of the other owners makes prompt protest to the person
presiding over the meeting.
(b) Votes allocated to a unit may be cast under a written
proxy duly executed by a unit owner. If a unit is owned by more than
one person, each owner of the unit may vote or register protest to
the casting of votes by the other owners of the unit through a proxy
duly executed by the unit owner. A unit owner may not revoke a proxy
given under this section except by giving actual notice of
revocation to the person presiding over a meeting of the
association. A proxy is void if it is not dated or if it purports to
be revocable without notice. A proxy terminates one year after its
date unless it specifies a shorter or longer time.
(c) Cumulative voting is not allowed.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.111. INSURANCE. (a) Beginning not later than the
time of the first conveyance of a unit to a person other than a
declarant, the association shall maintain, to the extent reasonably
available:
(1) property insurance on the insurable common
elements insuring against all risks of direct physical loss
commonly insured against, including fire and extended coverage, in
a total amount of at least 80 percent of the replacement cost or
actual cash value of the insured property as of the effective date
and at each renewal date of the policy; and
(2) commercial general liability insurance, including
medical payments insurance, in an amount determined by the board
but not less than any amount specified by the declaration covering
all occurrences commonly insured against for death, bodily injury,
and property damage arising out of or in connection with the use,
ownership, or maintenance of the common elements.
(b) If a building contains units having horizontal
boundaries described in the declaration, the insurance maintained
under Subsection (a)(1), to the extent reasonably available, must
include the units, but need not include improvements and
betterments installed by unit owners.
(c) If the insurance described by Subsections (a) and (b) is
not reasonably available, the association shall cause notice of
that fact to be delivered or mailed to all unit owners and
lienholders. The declaration may require the association to carry
any other insurance, and the association in any event may carry any
other insurance the board considers appropriate to protect the
condominium, the association, or the unit owners. This section
does not affect the right of a holder of a mortgage on a unit to
require a unit owner to acquire insurance in addition to that
provided by the association.
(d) Insurance policies carried under Subsection (a) must
provide that:
(1) each unit owner is an insured person under the
policy with respect to liability arising out of the person's
ownership of an undivided interest in the common elements or
membership in the association;
(2) the insurer waives its right to subrogation under
the policy against a unit owner;
(3) no action or omission of a unit owner, unless
within the scope of the unit owner's authority on behalf of the
association, will void the policy or be a condition to recovery
under the policy; and
(4) if, at the time of a loss under the policy, there
is other insurance in the name of a unit owner covering the same
property covered by the policy, the association's policy provides
primary insurance.
(e) A claim for any loss covered by the policy under
Subsection (a)(1) must be submitted by and adjusted with the
association. The insurance proceeds for that loss shall be payable
to an insurance trustee designated by the association for that
purpose, if the designation of an insurance trustee is considered
by the board to be necessary or desirable, or otherwise to the
association, and not to any unit owner or lienholder.
(f) The insurance trustee or the association shall hold
insurance proceeds in trust for unit owners and lienholders as
their interests may appear. Subject to Subsection (i), the
proceeds paid under a policy must be disbursed first for the repair
or restoration of the damaged common elements and units, and unit
owners and lienholders are not entitled to receive payment of any
portion of the proceeds unless there is a surplus of proceeds after
the property has been completely repaired or restored, or the
condominium is terminated.
(g) An insurance policy issued to the association does not
prevent a unit owner from obtaining insurance for the owner's own
benefit.
(h) The insurer issuing the policy may not cancel or refuse
to renew it less than 30 days after written notice of the proposed
cancellation or nonrenewal has been mailed to the association.
(i) Any portion of the condominium for which insurance is
required that is damaged or destroyed shall be promptly repaired or
replaced by the association unless the condominium is terminated,
repair or replacement would be illegal under any state or local
health or safety statute or ordinance, or at least 80 percent of the
unit owners, including each owner of a unit or assigned limited
common element that will not be rebuilt or repaired, vote to not
rebuild. A vote to not rebuild does not increase an insurer's
liability to loss payment obligation under a policy, and the vote
does not cause a presumption of total loss. The cost of repair or
replacement in excess of the insurance proceeds and reserves is a
common expense. If the entire condominium is not repaired or
replaced, any insurance proceeds attributable to the damaged common
elements shall be used to restore the damaged area to a condition
compatible with the remainder of the condominium, the insurance
proceeds attributable to units and limited common elements that are
not rebuilt shall be distributed to the owners of those units and
the owners of the units to which those limited common elements were
assigned, or to their mortgagees, as their interests may appear,
and the remainder of the proceeds shall be distributed to all the
unit owners as their interests may appear. If the unit owners vote
to not rebuild any unit, that unit's allocated interests shall be
automatically reallocated on the vote as if the unit had been
condemned, and the association shall prepare, execute, and record
an amendment to the declaration reflecting the reallocation.
Section 82.068 governs the distribution of insurance proceeds if
the condominium is terminated.
(j) The provisions of this section may be varied or waived
if all the units in a condominium are restricted to nonresidential
use.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.112. ASSESSMENTS FOR COMMON EXPENSES. (a) Until
an association makes a common expense assessment, a declarant shall
pay all the expenses of the condominium as the expenses accrue.
After an initial assessment by an association, assessments must be
made at least annually and must be based on a budget adopted at
least annually by the association. The association's reserves and
the unit owners' working capital contributions may not be used to
pay operational expenses until the declarant control terminates.
(b) From the date of the initial assessment until declarant
control terminates, or three years from a declarant's first
conveyance of a unit, whichever is earlier, the declarant shall
periodically pay to the association:
(1) an amount equal to all operational expenses of the
association, less the operational expense portion of the
assessments paid by unit owners other than declarant; or
(2) the common expense liability allocated to each
unit owned by the declarant.
(c) Common expenses shall be assessed against all units
conveyed, rented, or used as models or offices by the declarant and
against all units owned by a declarant after termination of a
declarant's control or three years from a declarant's first
conveyance of a unit, whichever is earlier, in accordance with the
common expense liability allocated to each unit. A past due
assessment or installment of an assessment may bear interest at a
lawful rate established by the association.
(d) Except as provided by the declaration and Section
82.107, a common expense for the maintenance, repair, or
replacement of a limited common element shall be assessed against
all the units as if it were for a general common element.
(e) If common expense liabilities are reallocated, common
expense assessments and an assessment installment not yet due shall
be recomputed in accordance with the reallocated common expense
liabilities.
(f) A declaration may allow the accumulation of reserve
funds for an unspecified period to provide for any anticipated
expense of the condominium.
(g) This section does not prevent a declarant from
collecting from a purchaser at closing the prorated amount of any
expenses, such as insurance or taxes, that the declarant has
prepaid to the association or directly to others on behalf of the
unit that is being purchased.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.113. ASSOCIATION'S LIEN FOR ASSESSMENTS. (a) An
assessment levied by the association against a unit or unit owner is
a personal obligation of the unit owner and is secured by a
continuing lien on the unit and on rents and insurance proceeds
received by the unit owner and relating to the owner's unit. In
this section, "assessments" means regular and special assessments,
dues, fees, charges, interest, late fees, fines, collection costs,
attorney's fees, and any other amount due to the association by the
unit owner or levied against the unit by the association, all of
which are enforceable as assessments under this section unless the
declaration provides otherwise.
(b) The association's lien for assessments has priority
over any other lien except:
(1) a lien for real property taxes and other
governmental assessments or charges against the unit unless
otherwise provided by Section 32.05, Tax Code;
(2) a lien or encumbrance recorded before the
declaration is recorded;
(3) a first vendor's lien or first deed of trust lien
recorded before the date on which the assessment sought to be
enforced becomes delinquent under the declaration, bylaws, or
rules; and
(4) unless the declaration provides otherwise, a lien
for construction of improvements to the unit or an assignment of the
right to insurance proceeds on the unit if the lien or assignment is
recorded or duly perfected before the date on which the assessment
sought to be enforced becomes delinquent under the declaration,
bylaws, or rules.
(c) The association's lien for assessments is created by
recordation of the declaration, which constitutes record notice and
perfection of the lien. Unless the declaration provides otherwise,
no other recordation of a lien or notice of lien is required.
(d) By acquiring a unit, a unit owner grants to the
association a power of sale in connection with the association's
lien. By written resolution, a board may appoint, from time to
time, an officer, agent, trustee, or attorney of the association to
exercise the power of sale on behalf of the association. Except as
provided by the declaration, an association shall exercise its
power of sale pursuant to Section 51.002.
(e) The association has the right to foreclose its lien
judicially or by nonjudicial foreclosure pursuant to the power of
sale created by this chapter or the declaration, except that the
association may not foreclose a lien for assessments consisting
solely of fines. Costs of foreclosure may be added to the amount
owed by the unit owner to the association. A unit owner may not
petition a court to set aside a sale solely because the purchase
price at the foreclosure sale was insufficient to fully satisfy the
owner's debt.
(f) The association may bid for and purchase the unit at
foreclosure sale as a common expense. The association may own,
lease, encumber, exchange, sell, or convey a unit.
(g) The owner of a unit used for residential purposes and
purchased by an association at a foreclosure sale of the
association's lien for assessments may redeem the unit not later
than the 90th day after the date of the foreclosure sale. To redeem
the unit, the owner must pay to the association all amounts due the
association at the time of the foreclosure sale, interest from the
date of foreclosure sale to the date of redemption at the rate
provided by the declaration for delinquent assessments, reasonable
attorney's fees and costs incurred by the association in
foreclosing the lien, any assessment levied against the unit by the
association after the foreclosure sale, and any reasonable cost
incurred by the association as owner of the unit, including costs of
maintenance and leasing. On redemption, the association shall
execute a deed to the redeeming unit owner. The exercise of the
right of redemption is not effective against a subsequent purchaser
or lender for value without notice of the redemption after the
redemption period expires unless the redeeming unit owner records
the deed from the association or an affidavit stating that the owner
has exercised the right of redemption. A unit that has been
redeemed remains subject to all liens and encumbrances on the unit
before foreclosure. All rents and other income collected from the
unit by the association from the date of foreclosure sale to the
date of redemption belong to the association, but the rents and
income shall be credited against the redemption amount. An
association purchasing a unit at a sale foreclosing its lien may not
transfer ownership of the unit during the redemption period to a
person other than a redeeming owner.
(h) If a unit owner defaults in the owner's monetary
obligations to the association, the association may notify other
lien holders of the default and the association's intent to
foreclose its lien. The association shall notify any holder of a
recorded lien or duly perfected mechanic's lien against a unit who
has given the association a written request for notification of the
unit owner's monetary default or the association's intent to
foreclose its lien.
(i) This section does not prohibit the association from
taking a deed in lieu of foreclosure or from filing suit to recover
a money judgment for sums that may be secured by the lien.
(j) At any time before a nonjudicial foreclosure sale, a
unit owner may avoid foreclosure by paying all amounts due the
association.
(k) If, on January 1, 1994, a unit is the homestead of the
unit owner and is subject to a declaration that does not contain a
valid assessment lien against the unit, the lien provided by this
section does not attach against the unit until the unit ceases to be
the homestead of the person owning it on January 1, 1994.
(l) Foreclosure of a tax lien attaching against a unit under
Chapter 32, Tax Code, does not discharge the association's lien for
assessments under this section or under a declaration for amounts
becoming due to the association after the date of foreclosure of the
tax lien.
(m) If a unit owner is delinquent in payment of assessments
to an association, at the request of the association a holder of a
recorded lien against the unit may provide the association with
information about the unit owner's debt secured by the holder's lien
against the unit and other relevant information. At the request of
a lien holder, the association may furnish the lien holder with
information about the condominium and the unit owner's obligations
to the association.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.114. ASSOCIATION RECORDS. (a) The association
shall keep:
(1) detailed financial records that comply with
generally accepted accounting principles and that are sufficiently
detailed to enable the association to prepare a resale certificate
under Section 82.157;
(2) the plans and specifications used to construct the
condominium except for buildings originally constructed before
January 1, 1994;
(3) the condominium information statement prepared
under Section 82.152 and any amendments;
(4) the name and mailing address of each unit owner;
(5) voting records, proxies, and correspondence
relating to amendments to the declaration; and
(6) minutes of meetings of the association and board.
(b) All financial and other records of the association shall
be reasonably available at its registered office or its principal
office in this state for examination by a unit owner and the owner's
agents. An attorney's files and records relating to the
association are not records of the association and are not subject
to inspection by unit owners or production in a legal proceeding.
(c) The association shall, as a common expense, annually
obtain an independent audit of the records. Copies of the audit
must be made available to the unit owners. An audit required by
this subsection shall be performed by a certified public accountant
if required by the bylaws or a vote of the board of directors or a
majority vote of the members of the association voting at a meeting
of the association.
(d) A declarant shall furnish copies to the association of
the information required by Subsection (a) on the date the first
unit is sold.
(e) Not later than the 30th day after the date of acquiring
an interest in a unit, the unit owner shall provide the association
with:
(1) the unit owner's mailing address, telephone
number, and driver's license number, if any;
(2) the name and address of the holder of any lien
against the unit, and any loan number;
(3) the name and telephone number of any person
occupying the unit other than the unit owner; and
(4) the name, address, and telephone number of any
person managing the unit as agent of the unit owner.
(f) A unit owner shall notify the association not later than
the 30th day after the date the owner has notice of a change in any
information required by Subsection (e), and shall provide the
information on request by the association from time to time.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.115. ASSOCIATION AS TRUSTEE. A third person
dealing with an association in the association's capacity as a
trustee may assume without inquiry the existence of trust powers
and their proper exercise by the association. A third person who
lacks actual knowledge that an association is exceeding or
improperly exercising its powers is fully protected in dealing with
the association as if the association possessed and properly
exercised the powers it purports to exercise. A third person is not
bound to ensure the proper application of trust assets paid or
delivered to an association in its capacity as trustee.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.116. MANAGEMENT CERTIFICATE. (a) An association
shall record in each county in which any portion of the condominium
is located a certificate, signed and acknowledged by an officer of
the association, stating:
(1) the name of the condominium;
(2) the name of the association;
(3) the location of the condominium;
(4) the recording data for the declaration;
(5) the mailing address of the association, or the
name and mailing address of the person or entity managing the
association; and
(6) other information the association considers
appropriate.
(b) The association shall record a management certificate
not later than the 30th day after the date the association has
notice of a change in any information in a recorded certificate
required by Subdivisions (a)(1)-(5).
(c) The association and its officers, directors, employees,
and agents are not subject to liability to any person for delay or
failure to record a management certificate, unless the delay or
failure is wilful or caused by gross negligence.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.117. OBLIGATIONS OF UNIT OWNERS. Without limiting
the obligations of the unit owners and except as provided by the
declaration, bylaws, rules of the association, or this chapter, the
unit owner:
(1) shall pay assessments, interest, and other charges
properly levied by the association against the owner or the owner's
unit, and shall pay regular periodic assessments without demand by
the association;
(2) shall comply with the declaration, bylaws, and
rules of the association, including any amendments;
(3) shall pay for damage to the condominium caused by
the negligence or wilful misconduct of the owner, an occupant of the
owner's unit, or the owner or occupant's family, guests, employees,
contractors, agents, or invitees; and
(4) is liable to the association for violations of the
declaration, bylaws, or rules of the association, including any
amendments, by the owner, an occupant of the owner's unit, or the
owner or occupant's family, guests, employees, agents, or invitees,
and for costs incurred by the association to obtain compliance,
including attorney's fees whether or not suit is filed.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
SUBCHAPTER D. PROTECTION OF PURCHASERS
§ 82.151. APPLICABILITY. (a) This subchapter applies
to each unit subject to this chapter, except as provided by
Subsection (b) or as modified or waived by the agreement of a
purchaser of a unit in a condominium in which all units are
restricted to nonresidential use.
(b) A condominium information statement or resale
certificate need not be prepared or delivered in the case of:
(1) a gratuitous disposition of a unit;
(2) a disposition pursuant to court order;
(3) a disposition by a government or governmental
agency;
(4) a disposition by foreclosure or deed in lieu of
foreclosure; or
(5) a disposition that may be canceled at any time, for
any reason, and without penalty.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.152. LIABILITY FOR CONDOMINIUM INFORMATION
STATEMENT. (a) Except as provided by Subsection (b), a declarant
shall prepare a condominium information statement before offering
to the public any interest in a unit.
(b) A declarant may transfer responsibility for preparation
of all or a part of the condominium information statement to a
successor declarant or to a person in the business of selling real
property who intends to offer units in the condominium for the
person's own account. On such transfer, the transferor shall
provide the transferee with any information necessary to enable the
transferee to prepare a condominium information statement.
(c) A declarant or other person in the business of selling
real property who offers a unit for the person's own account to a
purchaser shall provide a purchaser of a unit with a copy of the
condominium information statement, as amended, before conveyance
of the unit or the date of a contract of sale, whichever is earlier.
(d) The person preparing all or part of the condominium
information statement is liable for any false or misleading
statement or for any omission of material fact in the portion of the
condominium information statement that the person prepared. If a
declarant did not prepare any part of a condominium information
statement that the declarant delivers, the declarant is not liable
for any false or misleading statement or any omission of material
fact unless the declarant actually knew or should have known of the
statement or omission.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.153. CONDOMINIUM INFORMATION STATEMENTS IN
GENERAL. (a) A condominium information statement must contain or
accurately disclose:
(1) the name and principal address of the declarant
and of the condominium;
(2) a general description of the condominium that
includes the types of units and the maximum number of units;
(3) the minimum and maximum number of additional
units, if any, that may be included in the condominium;
(4) a brief narrative description of any development
rights reserved by a declarant and of any conditions relating to or
limitations upon the exercise of development rights;
(5) copies of the declaration, articles of
incorporation of the association, the bylaws, any rules of the
association, and amendments to any of them, and copies of leases and
contracts, other than loan documents, that are required by the
declarant to be signed by purchasers at closing;
(6) a projected or pro forma budget for the
association that complies with Subsection (b) for the first fiscal
year of the association following the date of the first conveyance
to a purchaser, identification of the person who prepared the
budget, and a statement of the budget's assumptions concerning
occupancy and inflation factors;
(7) a general description of each lien, lease, or
encumbrance on or affecting the title to the condominium after
conveyance by the declarant;
(8) a copy of each written warranty provided by the
declarant;
(9) a description of any unsatisfied judgments against
the association and any pending suits to which the association is a
party or which are material to the land title and construction of
the condominium of which a declarant has actual knowledge;
(10) a general description of the insurance coverage
provided for the benefit of unit owners; and
(11) current or expected fees or charges to be paid by
unit owners for the use of the common elements and other facilities
related to the condominium.
(b) A budget under Subsection (a)(6) must be prepared in
accordance with generally accepted accounting principles and a
consideration of the physical condition of the condominium and be
based on assumptions that, to the best of the declarant's knowledge
and belief, are reasonable. The budget must include:
(1) a statement of the amount included, or a statement
that no amount is included, in the budget as a reserve; and
(2) the projected monthly common expense assessment
for each type of unit.
(c) A declarant shall promptly amend the condominium
information statement to reflect a material and substantial change
in its contents. If the change may adversely affect a prospective
purchaser who has received a condominium information statement, the
declarant shall furnish a copy of the amendment to the prospective
purchaser before closing.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.154. CONDOMINIUMS WITH CONVERSION BUILDINGS. If a
building contains units that may be occupied for residential use,
the condominium information statement of a condominium containing
any conversion building must additionally contain:
(1) a dated statement by the declarant, based on a
report by an independent architect or engineer, describing the
present condition of all structural components and mechanical and
electrical installations material to the use and enjoyment of the
building;
(2) a dated statement by the declarant of the expected
useful life of each item reported in Subdivision (1) or a statement
that no representations are made in that regard; and
(3) a list of violations of building code or other
governmental regulations of which the declarant has received notice
and that have not been cured, together with the estimated cost of
curing those violations.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.155. CONDOMINIUM SECURITIES. A declarant
satisfies all requirements relating to preparation of a condominium
information statement if an interest in the condominium is
currently registered with the Securities and Exchange Commission of
the United States and if the declarant delivers to the purchaser a
copy of the public offering statement filed with the commission.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.156. PURCHASER'S RIGHT TO CANCEL. (a) If a
purchaser of a unit from a unit owner other than a declarant has not
received from the seller the declaration, bylaws, and association
rules required by Section 82.157 before the purchaser executes a
contract of sale or if the contract does not contain an underlined
or bold-print provision acknowledging the purchaser's receipt of
those documents and recommending that the purchaser read those
documents before executing the contract, the purchaser may cancel
the contract before the sixth day after the date the purchaser
receives those documents. If a purchaser has not received a resale
certificate before executing a contract of sale, the purchaser may
cancel the contract before the sixth day after the date the
purchaser receives the resale certificate or executes a waiver
under Section 82.157, whichever occurs first.
(b) If a purchaser from a declarant has not received the
condominium information statement before the purchaser executes a
contract of sale or if a contract does not contain an underlined or
bold-print provision acknowledging the purchaser's receipt of the
condominium information statement and recommending that the
purchaser read the condominium information statement before
executing the contract, the purchaser may cancel the contract
before the sixth day after the date the purchaser receives the
condominium information statement.
(c) If a purchaser elects to cancel a contract under
Subsection (a) or (b), the cancellation must be by hand-delivering
written notice of cancellation to the declarant or selling unit
owner or by mailing notice of cancellation by certified United
States mail, return receipt requested, to the offeror or the
offeror's agent for service of process within the five-day
cancellation period. Cancellation is without penalty, and all
payments made by the purchaser before cancellation must be
refunded.
(d) A selling unit owner may not require a purchaser to
close until the purchaser is given the declaration, bylaws, and any
association rules. A declarant may not require a purchaser to close
until a condominium information statement has been furnished to the
purchaser.
Added by Acts 1993, 73rd Leg., ch. 244, § 1, eff. Jan. 1, 1994.
§ 82.157. RESALE OF UNIT. (a) Except as provided by
Subsection (c), if a unit owner other than a declarant intends to
sell a unit, before executing a contract or conveying the unit, the
unit owner must furnish to the purchaser a current copy of the
declaration, bylaws, any association rules, and a resale
certificate that must have been prepared not earlier than three
months before the date it is delivered to the purchaser. The resale
certificate must be issued by the association and must contain the
current operating budget of the association and statements of:
(1) any right of first refusal or other restraint
contained in the declaration that restricts the right to transfer a
unit;
(2) the amount of the periodic common expense
assessment and the unpaid common expenses or special assessments
currently due and payable from the selling unit owner;
(3) other unpaid fees or amounts payable to the
association by the selling unit owner;
(4) capital expenditures, if any, approved by the
association for the next 12 months;
(5) the amount of reserves, if any, for capital
expenditures and of portions of those reserves designated by the
association for a specified project;
(6) any unsatisfied judgments against the
association;
(7) the nature of any pending suits against the
association;
(8) insurance coverage provided for the benefit of
unit owners;
(9) whether the board has knowledge that any
alterations or improvements to the unit or to the limited common
elements assigned to that unit violate the declaration, bylaws, or
association rules;
(10) whether the board has received notice from a
governmental authority concerning violations of health or building
codes with respect to the unit, the limited common elements
assigned to that unit, or any other portion of the condominium;
(11) the remaining term of any leasehold estate that
affects the condominium and the provisions governing an extension
or renewal of the lease; and
(12) the name, mailing address, and telephone number
of the association's managing agent, if any.
(b) Not later than the 10th day after the date of receiving a
written request by a unit owner, an association shall furnish to the
selling unit owner or the owner's agent a resale certificate signed
and dated by an officer or authorized agent of the association
containing the information required by Subsection (a). A selling
unit owner or the owner's agent is not liable to the purchaser for
erroneous information provided by the association in the
certificate. If an association does not furnish a resale
certificate or any information required in the certificate within
the 10-day period, the unit owner may provide the purchaser with a
sworn affidavit signed by the unit owner in lieu of the certificate.
An affidavit must state that the unit owner requested information
from the association concerning its financial condition, as
required by this section, and that the association did not timely
provide a resale certificate or the information required in the
certificate. If a unit owner has furnished an affidavit to a
purchaser, the unit owner and the purchaser may agree in writing to
waive the requirement to furnish a resale certificate. The
association is not liable to a selling unit owner for delay or
failure to furnish a resale
