BUSINESS ORGANIZATIONS CODE
CHAPTER 252. UNINCORPORATED NONPROFIT ASSOCIATIONS
§ 252.001. DEFINITIONS. In this chapter:
(1) "Member" means a person who, under the rules or
practices of a nonprofit association, may participate in the
selection of persons authorized to manage the affairs of the
nonprofit association or in the development of policy of the
nonprofit association.
(2) "Nonprofit association" means an unincorporated
organization, other than one created by a trust, consisting of
three or more members joined by mutual consent for a common,
nonprofit purpose. A form of joint tenancy, tenancy in common, or
tenancy by the entirety does not by itself establish a nonprofit
association, regardless of whether the co-owners share use of the
property for a nonprofit purpose.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.002. SUPPLEMENTARY GENERAL PRINCIPLES OF LAW AND
EQUITY. Principles of law and equity supplement this chapter
unless displaced by a particular provision of this chapter.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.003. TERRITORIAL APPLICATION. Real and personal
property in this state may be acquired, held, encumbered, and
transferred by a nonprofit association, regardless of whether the
nonprofit association or a member has any other relationship to
this state.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.004. REAL AND PERSONAL PROPERTY; NONPROFIT
ASSOCIATION AS BENEFICIARY. (a) A nonprofit association in its
name may acquire, hold, encumber, or transfer an estate or interest
in real or personal property.
(b) A nonprofit association may be a beneficiary of a trust,
contract, or will.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.005. STATEMENT OF AUTHORITY AS TO REAL
PROPERTY. (a) A nonprofit association may execute and record a
statement of authority to transfer an estate or interest in real
property in the name of the nonprofit association.
(b) An estate or interest in real property in the name of a
nonprofit association may be transferred by a person so authorized
in a statement of authority recorded in the county clerk's office in
the county in which a transfer of the property would be recorded.
(c) A statement of authority must contain:
(1) the name of the nonprofit association;
(2) the address in this state, including the street
address, if any, of the nonprofit association, or, if the nonprofit
association does not have an address in this state, its address out
of state; and
(3) the name or title of a person authorized to
transfer an estate or interest in real property held in the name of
the nonprofit association.
(d) A statement of authority must be executed in the same
manner as a deed by a person who is not the person authorized to
transfer the estate or interest.
(e) The county clerk may collect a fee for recording a
statement of authority in the amount authorized for recording a
transfer of real property.
(f) An amendment, including a cancellation, of a statement
of authority must meet the requirements for execution and recording
of an original statement. Unless canceled earlier, a recorded
statement of authority or its most recent amendment is canceled by
operation of law on the fifth anniversary of the date of the most
recent recording.
(g) If the record title to real property is in the name of a
nonprofit association and the statement of authority is recorded in
the county clerk's office of the county in which a transfer of real
property would be recorded, the authority of the person named in a
statement of authority is conclusive in favor of a person who gives
value without notice that the person lacks authority.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.006. LIABILITY IN TORT AND CONTRACT. (a) A
nonprofit association is a legal entity separate from its members
for the purposes of determining and enforcing rights, duties, and
liabilities in contract and tort.
(b) A person is not liable for a breach of a nonprofit
association's contract or for a tortious act or omission for which a
nonprofit association is liable merely because the person is a
member, is authorized to participate in the management of the
affairs of the nonprofit association, or is a person considered as a
member by the nonprofit association.
(c) A tortious act or omission of a member or other person
for which a nonprofit association is liable is not imputed to a
person merely because the person is a member of the nonprofit
association, is authorized to participate in the management of the
affairs of the nonprofit association, or is a person considered as a
member by the nonprofit association.
(d) A member of, or a person considered as a member by, a
nonprofit association may assert a claim against the nonprofit
association. A nonprofit association may assert a claim against a
member or a person considered as a member by the nonprofit
association.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.007. CAPACITY TO ASSERT AND DEFEND;
STANDING. (a) A nonprofit association, in its name, may
institute, defend, intervene, or participate in a judicial,
administrative, or other governmental proceeding or in an
arbitration, mediation, or any other form of alternative dispute
resolution.
(b) A nonprofit association may assert a claim in its name
on behalf of members of the nonprofit association if:
(1) one or more of the nonprofit association's members
have standing to assert a claim in their own right;
(2) the interests the nonprofit association seeks to
protect are germane to its purposes; and
(3) neither the claim asserted nor the relief
requested requires the participation of a member.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.008. EFFECT OF JUDGMENT OR ORDER. A judgment or
order against a nonprofit association is not by itself a judgment or
order against a member or a person considered as a member by the
nonprofit association.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.009. DISPOSITION OF PERSONAL PROPERTY OF INACTIVE
NONPROFIT ASSOCIATION. (a) If a nonprofit association has been
inactive for three years or longer, or a shorter period as specified
in a document of the nonprofit association, a person in possession
or control of personal property of the nonprofit association may
transfer the custody of the property:
(1) if a document of a nonprofit association specifies
a person to whom transfer is to be made under these circumstances,
to that person; or
(2) if no person is specified, to a nonprofit
association or nonprofit corporation pursuing broadly similar
purposes, or to a government or governmental subdivision, agency,
or instrumentality.
(b) Notwithstanding the above, if a nonprofit association
is classified under the Internal Revenue Code as a 501(c)(3)
organization or is or holds itself out to be established or
operating for a charitable, religious, or educational purpose, as
defined by Section 501(c)(3), Internal Revenue Code, then any
distribution must be made to another nonprofit association or
nonprofit corporation with similar charitable, religious, or
educational purposes.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.010. BOOKS AND RECORDS. (a) A nonprofit
association shall keep correct and complete books and records of
account for at least three years after the end of each fiscal year
and shall make the books and records available on request to members
of the association for inspection and copying.
(b) The attorney general may inspect, examine, and make
copies of the books, records, and other documents the attorney
general considers necessary and may investigate the association to
determine if a violation of any law of this state has occurred.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.011. APPOINTMENT OF AGENT TO RECEIVE SERVICE OF
PROCESS. (a) A nonprofit association may file in the office of
the secretary of state a statement appointing an agent authorized
to receive service of process.
(b) A statement appointing an agent must contain:
(1) the name of the nonprofit association;
(2) the federal tax identification number of the
nonprofit association, if applicable;
(3) the address in this state, including the street
address, if any, of the nonprofit association or, if the nonprofit
association does not have an address in this state, its address out
of state; and
(4) the name of the person in this state authorized to
receive service of process and the person's address, including the
street address, in this state.
(c) A statement appointing an agent must be signed by a
person authorized to manage the affairs of the nonprofit
association. The statement must also be signed by the person
appointed agent, who by signing accepts the appointment. The
appointed agent may resign by filing a resignation in the office of
the secretary of state and giving notice to the nonprofit
association.
(d) The secretary of state may collect a fee for filing a
statement appointing an agent to receive service of process, an
amendment, a cancellation, or a resignation in the amount charged
for filing similar documents.
(e) An amendment to a statement appointing an agent to
receive service of process must meet the requirements for execution
of an original statement.
(f) A statement appointing an agent may be canceled by
filing with the secretary of state a written notice of cancellation
executed by a person authorized to manage the affairs of the
nonprofit association. A notice of cancellation must contain:
(1) the name of the nonprofit association;
(2) the federal tax identification number of the
nonprofit association, if applicable;
(3) the date of filing of the nonprofit association's
statement appointing the agent; and
(4) a current street address, if any, of the nonprofit
association in this state or, if the nonprofit association does not
have an address in this state, its address out of state.
(g) The secretary of state may adopt forms and procedural
rules for filing documents under this section.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.012. CLAIM NOT ABATED BY CHANGE. A claim for
relief against a nonprofit association does not abate merely
because of a change in the members or persons authorized to manage
the affairs of the nonprofit association.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.013. SUMMONS AND COMPLAINT; SERVICE. (a) In an
action or proceeding against a nonprofit association, a summons and
complaint must be served on an agent authorized by appointment to
receive service of process, an officer, a managing or general
agent, or a person authorized to participate in the management of
its affairs, in accordance with the Civil Practice and Remedies
Code.
(b) Not later than the 10th day after the date of a request
by the attorney general to an officer or board member of a nonprofit
association or to the nonprofit association, the nonprofit
association shall provide to the attorney general the names,
current addresses, and telephone numbers of:
(1) each agent authorized to receive service of
process on behalf of the nonprofit association; and
(2) each officer, managing or general agent, and other
person authorized to participate in the management of the affairs
of the nonprofit association.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.014. UNIFORMITY OF APPLICATION AND
CONSTRUCTION. This chapter shall be applied and construed to make
uniform the law with respect to the subject of this chapter among
states enacting it.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.015. TRANSITION CONCERNING REAL AND PERSONAL
PROPERTY. If, before September 1, 1995, an estate or interest in
real or personal property was by the terms of the transfer
purportedly transferred to a nonprofit association, but under the
law the estate or interest was vested in a fiduciary such as
officers of the nonprofit association to hold the estate or
interest for members of the nonprofit association, on or after
September 1, 1995, the fiduciary may transfer the estate or
interest to the nonprofit association in its name, or the nonprofit
association, by appropriate proceedings, may require that the
estate or interest be transferred to it in its name.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.016. EFFECT ON OTHER LAW. This chapter replaces
existing law with respect to matters covered by this chapter but
does not affect other law covering unincorporated nonprofit
associations.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 252.017. CHAPTER CONTROLLING. (a) Except as
provided by Subsection (b), the only provisions of this code that
apply to or govern a nonprofit association are the provisions of
this chapter.
(b) Chapters 1 and 4 and, if a nonprofit association
designates an agent for service of process, Subchapter E, Chapter
5, apply to a nonprofit association.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
