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  S.B. No. 1320
 
 
 
 
AN ACT
  relating to the execution of written instruments relating to
  residential real estate transactions and deeds conveying
  residential real estate in connection with certain transactions
  involving residential real estate; providing a civil penalty.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Title 2, Business & Commerce Code, is amended by
  adding Chapter 21 to read as follows:
  CHAPTER 21.  EXECUTION OF DEEDS IN CERTAIN TRANSACTIONS INVOLVING
  RESIDENTIAL REAL ESTATE
         Sec. 21.001.  DEFINITION. In this chapter, "residential
  real estate" means real property on which a dwelling designed for
  occupancy for one to four families is constructed or intended to be
  constructed.
         Sec. 21.002.  PROHIBITION OF EXECUTION OF DEEDS CONVEYING
  RESIDENTIAL REAL ESTATE IN CERTAIN TRANSACTIONS. (a)  A seller of
  residential real estate or a person who makes an extension of credit
  and takes a security interest or mortgage against residential real
  estate may not, before or at the time of the conveyance of the
  residential real estate to the purchaser or the extension of credit
  to the borrower, request or require the purchaser or borrower to
  execute and deliver to the seller or person making the extension of
  credit a deed conveying the residential real estate to the seller or
  person making the extension of credit.
         (b)  A deed executed in violation of this section is voidable
  unless a subsequent purchaser of the residential real estate, for
  valuable consideration, obtains an interest in the property after
  the deed was recorded without notice of the violation, including
  notice provided by actual possession of the property by the grantor
  of the deed. The residential real estate continues to be subject to
  the security interest of a creditor who, without notice of the
  violation, granted an extension of credit to a borrower based on the
  deed executed in violation of this section.
         (c)  A purchaser or borrower must bring an action to void a
  deed executed in violation of this section not later than the fourth
  anniversary of the date the deed was recorded.
         (d)  A purchaser or borrower who is a prevailing party in an
  action to void a deed under this section may recover reasonable and
  necessary attorney's fees.
         Sec. 21.003.  ACTION BY ATTORNEY GENERAL. (a)  The attorney
  general may bring an action on behalf of the state:
               (1)  for injunctive relief to require compliance with
  this chapter;
               (2)  to recover a civil penalty of $500 for each
  violation of this chapter; or
               (3)  for both injunctive relief and to recover the
  civil penalty.
         (b)  The attorney general is entitled to recover reasonable
  expenses incurred in obtaining injunctive relief or a civil
  penalty, or both, under this section, including court costs and
  reasonable attorney's fees.
         (c)  The court may make such additional orders or judgments
  as are necessary to return to the purchaser a deed conveying
  residential real estate that the court finds was acquired by means
  of any violation of this chapter.
         (d)  In bringing or participating in an action under this
  chapter, the attorney general acts in the name of the state and does
  not establish an attorney-client relationship with another person,
  including a person to whom the attorney general requests that the
  court award relief.
         (e)  An action by the attorney general must be brought not
  later than the fourth anniversary of the date the deed was recorded.
         SECTION 2.  Subsection (a), Section 121.005, Civil Practice
  and Remedies Code, is amended to read as follows:
         (a)  An officer may not take the acknowledgment of a written
  instrument unless the officer knows or has satisfactory evidence
  that the acknowledging person is the person who executed the
  instrument and is described in it. An officer may accept, as
  satisfactory evidence of the identity of an acknowledging person,
  only:
               (1)  the oath of a credible witness personally known to
  the officer; [or]
               (2)  a current identification card or other document
  issued by the federal government or any state government that
  contains the photograph and signature of the acknowledging person;
  or
               (3)  with respect to a deed or other instrument
  relating to a residential real estate transaction, a current
  passport issued by a foreign country.
         SECTION 3.  Section 24.004, Property Code, is amended to
  read as follows:
         Sec. 24.004.  JURISDICTION; DISMISSAL. (a)  Except as
  provided by Subsection (b), a [A] justice court in the precinct in
  which the real property is located has jurisdiction in eviction
  suits. Eviction suits include forcible entry and detainer and
  forcible detainer suits.
         (b)  A justice court does not have jurisdiction in a forcible
  entry and detainer or forcible detainer suit and shall dismiss the
  suit if the defendant files a sworn statement alleging the suit is
  based on a deed executed in violation of Chapter 21, Business &
  Commerce Code.
         SECTION 4.  This Act takes effect September 1, 2011.
 
 
 
 
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
         I hereby certify that S.B. No. 1320 passed the Senate on
  April 28, 2011, by the following vote:  Yeas 31, Nays 0;
  May 24, 2011, Senate refused to concur in House amendment and
  requested appointment of Conference Committee; May 27, 2011, House
  granted request of the Senate; May 29, 2011, Senate adopted
  Conference Committee Report by the following vote:  Yeas 31,
  Nays 0.
 
 
  ______________________________
  Secretary of the Senate    
 
         I hereby certify that S.B. No. 1320 passed the House, with
  amendment, on May 20, 2011, by the following vote:  Yeas 147,
  Nays 2, one present not voting; May 27, 2011, House granted request
  of the Senate for appointment of Conference Committee;
  May 29, 2011, House adopted Conference Committee Report by the
  following vote:  Yeas 112, Nays 15, two present not voting.
 
 
  ______________________________
  Chief Clerk of the House   
 
 
 
  Approved:
 
  ______________________________ 
             Date
 
 
  ______________________________ 
            Governor