TAX CODE
CHAPTER 34. TAX SALES AND REDEMPTION
SUBCHAPTER A. TAX SALES
§ 34.01. SALE OF PROPERTY. (a) Real property seized
under a tax warrant issued under Subchapter E, Chapter 33, or
ordered sold pursuant to foreclosure of a tax lien shall be sold by
the officer charged with selling the property, unless otherwise
directed by the taxing unit that requested the warrant or order of
sale or by an authorized agent or attorney for that unit. The sale
shall be conducted in the manner similar property is sold under
execution except as otherwise provided by this subtitle.
(b) On receipt of an order of sale of real property, the
officer charged with selling the property shall endorse on the
order the date and exact time when the officer received the order.
The endorsement is a levy on the property without necessity for
going upon the ground. The officer shall calculate the total amount
due under the judgment, including all taxes, penalties, and
interest, plus any other amount awarded by the judgment, court
costs, and the costs of the sale. The costs of a sale include the
costs of advertising, and deed recording fees anticipated to be
paid in connection with the sale of the property. To assist the
officer in making the calculation, the collector of any taxing unit
that is party to the judgment may provide the officer with a
certified tax statement showing the amount of the taxes included in
the judgment that remain due that taxing unit and all penalties,
interest, and attorney's fees provided by the judgment as of the
date of the proposed sale. If a certified tax statement is provided
to the officer, the officer shall rely on the amount included in the
statement and is not responsible or liable for the accuracy of the
applicable portion of the calculation. A certified tax statement
is not required to be sworn to and is sufficient if the tax
collector or the collector's deputy signs the statement.
(c) The officer charged with the sale shall give written
notice of the sale in the manner prescribed by Rule 21a, Texas Rules
of Civil Procedure, as amended, or that rule's successor to each
person who was a defendant to the judgment or that person's
attorney.
(d) An officer's failure to send the written notice of sale
or a defendant's failure to receive that notice is insufficient by
itself to invalidate:
(1) the sale of the property; or
(2) the title conveyed by that sale.
(e) A notice of sale under Subsection (c) must substantially
comply with this subsection. The notice must include:
(1) a statement of the authority under which the sale
is to be made;
(2) the date, time, and location of the sale; and
(3) a brief description of the property to be sold.
(f) A notice of sale is not required to include field notes
describing the property. A description of the property is
sufficient if the notice:
(1) states the number of acres and identifies the
original survey;
(2) as to property located in a platted subdivision or
addition, regardless of whether the subdivision or addition is
recorded, states the name by which the land is generally known with
reference to that subdivision or addition; or
(3) by reference adopts the description of the
property contained in the judgment.
(g) For publishing a notice of sale, a newspaper may charge
a rate that does not exceed the greater of:
(1) two cents per word; or
(2) an amount equal to the published word or line rate
of that newspaper for the same class of advertising.
(h) If there is not a newspaper published in the county of
the sale, or a newspaper that will publish the notice of sale for
the rate authorized by Subsection (g), the officer shall post the
notice in writing in three public places in the county not later
than the 20th day before the date of the sale. One of the notices
must be posted at the door of the county courthouse.
(i) The owner of real property subject to sale may file with
the officer charged with the sale a written request that the
property be divided and that only as many portions be sold as
necessary to pay the amount due against the property, as calculated
under Subsection (b). In the request the owner shall describe the
desired portions and shall specify the order in which the portions
should be sold. The owner may not specify more than four portions
or a portion that divides a building or other contiguous
improvement. The request must be delivered to the officer not later
than the seventh day before the date of the sale.
(j) If a bid sufficient to pay the lesser of the amount
calculated under Subsection (b) or the adjudged value is not
received, the taxing unit that requested the order of sale may
terminate the sale. If the taxing unit does not terminate the sale,
the officer making the sale shall bid the property off to the taxing
unit that requested the order of sale, unless otherwise agreed by
each other taxing unit that is a party to the judgment, for the
aggregate amount of the judgment against the property or for the
market value of the property as specified in the judgment,
whichever is less. The duty of the officer conducting the sale to
bid off the property to a taxing unit under this subsection is
self-executing. The actual attendance of a representative of the
taxing unit at the sale is not a prerequisite to that duty.
(k) The taxing unit to which the property is bid off takes
title to the property for the use and benefit of itself and all
other taxing units that established tax liens in the suit. The
taxing unit's title includes all the interest owned by the
defendant, including the defendant's right to the use and
possession of the property, subject only to the defendant's right
of redemption. Payments in satisfaction of the judgment and any
costs or expenses of the sale may not be required of the purchasing
taxing unit until the property is redeemed or resold by the
purchasing taxing unit.
(l) Notwithstanding that property is bid off to a taxing
unit under this section, a taxing unit that established a tax lien
in the suit may continue to enforce collection of any amount for
which a former owner of the property is liable to the taxing unit,
including any post-judgment taxes, penalties, and interest, in any
other manner provided by law.
(m) The officer making the sale shall prepare a deed to the
purchaser of real property at the sale, to any other person whom the
purchaser may specify, or to the taxing unit to which the property
was bid off. The taxing unit that requested the order of sale may
elect to prepare a deed for execution by the officer. If the taxing
unit prepares the deed, the officer shall execute that deed. An
officer who executes a deed prepared by the taxing unit is not
responsible or liable for any inconsistency, error, or other defect
in the form of the deed. As soon as practicable after a deed is
executed by the officer, the officer shall either file the deed for
recording with the county clerk or deliver the executed deed to the
taxing unit that requested the order of sale, which shall file the
deed for recording with the county clerk. The county clerk shall
file and record each deed filed under this subsection and after
recording shall return the deed to the grantee.
(n) The deed vests good and perfect title in the purchaser
or the purchaser's assigns to the interest owned by the defendant in
the property subject to the foreclosure, including the defendant's
right to the use and possession of the property, subject only to the
defendant's right of redemption, the terms of a recorded
restrictive covenant running with the land that was recorded before
January 1 of the year in which the tax lien on the property arose, a
recorded lien that arose under that restrictive covenant that was
not extinguished in the judgment foreclosing the tax lien, and each
valid easement of record as of the date of the sale that was
recorded before January 1 of the year the tax lien arose. The deed
may be impeached only for fraud.
(o) If a bid sufficient to pay the amount specified by
Subsection (p) is not received, the officer making the sale, with
the consent of the collector who applied for the tax warrant, may
offer property seized under Subchapter E, Chapter 33, to a person
described by Section 11.181 or 11.20 for less than that amount. If
the property is offered to a person described by Section 11.181 or
11.20, the officer making the sale shall reopen the bidding at the
amount of that person's bid and bid off the property to the highest
bidder. Consent to the sale by the taxing units entitled to receive
proceeds of the sale is not required. The acceptance of a bid by the
officer under this subsection is conclusive and binding on the
question of its sufficiency. An action to set aside the sale on the
grounds that a bid is insufficient may not be sustained, except that
a taxing unit that participates in distribution of proceeds of the
sale may file an action before the first anniversary of the date of
the sale to set aside the sale on the grounds of fraud or collusion
between the officer making the sale and the purchaser.
(p) Except as provided by Subsection (o), property seized
under Subchapter E, Chapter 33, may not be sold for an amount that
is less than the lesser of the market value of the property as
specified in the warrant or the total amount of taxes, penalties,
interest, costs, and other claims for which the warrant was issued.
If a sufficient bid is not received by the officer making the sale,
the officer shall bid off the property to a taxing unit in the
manner specified by Subsection (j) and subject to the other
provisions of that subsection. A taxing unit that takes title to
property under this subsection takes title for the use and benefit
of that taxing unit and all other taxing units that established tax
liens in the suit or that, on the date of the seizure, were owed
delinquent taxes on the property.
(q) A sale of property under this section to a purchaser
other than a taxing unit:
(1) extinguishes each lien securing payment of the
delinquent taxes, penalties, and interest against that property and
included in the judgment; and
(2) does not affect the personal liability of any
person for those taxes, penalties, and interest included in the
judgment that are not satisfied from the proceeds of the sale.
(r) Except as provided by this subsection, a sale of real
property under this section must take place at the county
courthouse in the county in which the land is located. The
commissioners court of the county may designate an area in the
county courthouse or another location in the county where sales
under this section must take place and shall record any designated
area or other location in the real property records of the county.
If the commissioners court designates an area in the courthouse or
another location in the county for sales, a sale must occur in that
area or at that location. If the commissioners court does not
designate an area in the courthouse or another location in the
county for sales, a sale must occur in the same area in the
courthouse that is designated by the commissioners court for the
sale of real property under Section 51.002, Property Code.
(s) To the extent of a conflict between this section and a
provision of the Texas Rules of Civil Procedure that relates to an
execution, this section controls.
Acts 1979, 66th Leg., p. 2297, ch. 841, § 1, eff. Jan. 1, 1982.
Amended by Acts 1989, 71st Leg., ch. 796, § 32, eff. June 15,
1989; Acts 1991, 72nd Leg., ch. 854, § 2, eff. June 16, 1991;
Acts 1995, 74th Leg., ch. 1017, § 2, eff. Aug. 28, 1995; Acts
1997, 75th Leg., ch. 914, § 2, eff. Sept. 1, 1997; Acts 1999,
76th Leg., ch. 817, § 2, eff. Sept. 1, 1999; Acts 1999, 76th
Leg., ch. 1481, § 24, eff. Sept. 1, 1999; Acts 2001, 77th Leg.,
ch. 1430, § 26, eff. Sept. 1, 2001; Acts 2003, 78th Leg., ch.
319, § 8, eff. June 18, 2003.
§ 34.015. PERSONS ELIGIBLE TO PURCHASE REAL
PROPERTY. (a) In this section, "person" does not include a taxing
unit or an individual acting on behalf of a taxing unit.
(b) An officer conducting a sale of real property under
Section 34.01 may not execute a deed in the name of or deliver a deed
to any person other than the person who was the successful bidder.
The officer may not execute or deliver a deed to the purchaser of
the property unless the purchaser exhibits to the officer an
unexpired written statement issued under this section to the person
by the county assessor-collector of the county in which the sale is
conducted showing that:
(1) there are no delinquent taxes owed by the person to
that county; and
(2) for each school district or municipality having
territory in the county there are no known or reported delinquent ad
valorem taxes owed by the person to that school district or
municipality.
(c) On the written request of any person, a county
assessor-collector shall issue a written statement stating whether
there are any delinquent taxes owed by the person to that county or
to a school district or municipality having territory in that
county. A request for the issuance of a statement by the county
assessor-collector under this subsection must:
(1) sufficiently identify any property subject to
taxation by the county or by a school district or municipality
having territory in the county, regardless of whether the property
is located in the county, that the person owns or formerly owned so
that the county assessor-collector and the collector for each
school district or municipality having territory in the county may
determine whether the property is included on a current or a
cumulative delinquent tax roll for the county, the school district,
or the municipality under Section 33.03;
(2) specify the address to which the county
assessor-collector should send the statement;
(3) include any additional information reasonably
required by the county assessor-collector; and
(4) be sworn to and signed by the person requesting the
statement.
(d) On receipt of a request under Subsection (c), the county
assessor-collector shall send to the collector for each school
district and municipality having territory in the county, other
than a school district or municipality for which the county
assessor-collector is the collector, a request for information as
to whether there are any delinquent taxes owed by the person to that
school district or municipality. The county assessor-collector
shall specify the date by which the collector must respond to the
request.
(e) If the county assessor-collector determines that there
are delinquent taxes owed to the county, the county
assessor-collector shall include in the statement issued under
Subsection (c) the amount of delinquent taxes owed by the person to
that county. If the county assessor-collector is the collector for
a school district or municipality having territory in the county
and the county assessor-collector determines that there are
delinquent ad valorem taxes owed by the person to the school
district or municipality, the assessor-collector shall include in
the statement issued under Subsection (c) the amount of delinquent
taxes owed by the person to that school district or municipality.
(f) If the county assessor-collector receives a response
from the collector for a school district or municipality having
territory in the county indicating that there are delinquent taxes
owed to that school district or municipality on the person's
current or former property for which the person is personally
liable, the county assessor-collector shall include in the
statement issued under Subsection (c):
(1) the amount of delinquent taxes owed by the person
to that school district or municipality; and
(2) the name and address of the collector for that
school district or municipality.
(g) If the county assessor-collector determines that there
are no delinquent taxes owed by the person to the county or to a
school district or municipality for which the county
assessor-collector is the collector, the county assessor-collector
shall indicate in the statement issued under Subsection (c) that
there are no delinquent ad valorem taxes owed by the person to the
county or to the school district or municipality.
(h) If the county assessor-collector receives a response
from the collector for any school district or municipality having
territory in that county indicating that there are no delinquent ad
valorem taxes owed by the person to that school district or
municipality, the county assessor-collector shall indicate in the
statement issued under Subsection (c) that there are no delinquent
ad valorem taxes owed by the person to that school district or
municipality.
(i) If the county assessor-collector does not receive a
response from the collector for any school district or municipality
to whom the county assessor-collector sent a request under
Subsection (d) as to whether there are delinquent taxes on the
person's current or former property owed by the person to that
school district or municipality, the county assessor-collector
shall indicate in the statement issued under Subsection (c) that
there are no reported delinquent taxes owed by the person to that
school district or municipality.
(j) To cover the costs associated with the issuance of
statements under Subsection (c), a county assessor-collector may
charge the person requesting a statement a fee not to exceed $10 for
each statement requested.
(k) A statement under Subsection (c) must be issued in the
name of the requestor, bear the requestor's name, include the dates
of issuance and expiration, and be eligible for recording under
Section 12.001(b), Property Code. A statement expires on the 90th
day after the date of issuance.
(l) The deed executed by the officer conducting the sale
must name the successful bidder as the grantee and recite that the
successful bidder exhibited to that officer an unexpired written
statement issued to the person in the manner prescribed by this
section, showing that the county assessor-collector of the county
in which the sale was conducted determined that:
(1) there are no delinquent ad valorem taxes owed by
the person to that county; and
(2) for each school district or municipality having
territory in the county there are no known or reported delinquent ad
valorem taxes owed by the person to that school district or
municipality.
(m) If a deed contains the recital required by Subsection
(l), it is conclusively presumed that this section was complied
with.
(n) A person who knowingly violates this section commits an
offense. An offense under this subsection is a Class B misdemeanor.
(o) To the extent of a conflict between this section and any
other law, this section controls.
Added by Acts 2003, 78th Leg., ch. 1010, § 2, eff. Sept. 1, 2003.
§ 34.02. DISTRIBUTION OF PROCEEDS. (a) The proceeds
of a tax sale under Section 33.94 or 34.01 shall be applied in the
order prescribed by Subsection (b). The amount included under each
subdivision of Subsection (b) must be fully paid before any of the
proceeds may be applied to the amount included under a subsequent
subdivision.
(b) The proceeds shall be applied to:
(1) the costs of advertising the tax sale;
(2) any fees ordered by the judgment to be paid to an
appointed attorney ad litem;
(3) the original court costs payable to the clerk of
the court;
(4) the fees and commissions payable to the officer
conducting the sale;
(5) the expenses incurred by a taxing unit in
determining necessary parties and in procuring necessary legal
descriptions of the property if those expenses were awarded to the
taxing unit by the judgment under Section 33.48(a)(4);
(6) the taxes, penalties, interest, and attorney's
fees that are due under the judgment; and
(7) any other amount awarded to a taxing unit under the
judgment.
(c) If the proceeds are not sufficient to pay the total
amount included under any subdivision of Subsection (b), each
participant in the amount included under that subdivision is
entitled to a share of the proceeds in an amount equal to the
proportion its entitlement bears to the total amount included under
that subdivision.
(d) The officer conducting a sale under Section 33.94 or
34.01 shall pay any excess proceeds after payment of all amounts due
all participants in the sale as specified by Subsection (b) to the
clerk of the court issuing the warrant or order of sale.
(e) In this section, "taxes" includes a charge, fee, or
expense that is expressly authorized by Section 32.06 or 32.065. In
this section, "taxes" includes a charge, fee, or expense that is
expressly authorized by Section 32.06 or 32.065.
Acts 1979, 66th Leg., p. 2297, ch. 841, § 1, eff. Jan. 1, 1982.
Amended by Acts 1995, 74th Leg., ch. 131, § 2, eff. Sept. 1,
1995; Acts 1999, 76th Leg., ch. 1481, § 25, eff. Sept. 1, 1999;
Acts 2003, 78th Leg., ch. 319, § 9, eff. June 18, 2003.
§ 34.03. DISPOSITION OF EXCESS PROCEEDS. (a) The
clerk of the court shall:
(1) if the amount of excess proceeds is more than $25,
before the 31st day after the date the excess proceeds are received
by the clerk, send by certified mail, return receipt requested, a
written notice to the former owner of the property, at the former
owner's last known address according to the records of the court or
any other source reasonably available to the court, that:
(A) states the amount of the excess proceeds;
(B) informs the former owner of that owner's
rights to claim the excess proceeds under Section 34.04; and
(C) includes a copy or the complete text of this
section and Section 34.04; and
(2) regardless of the amount, keep the excess proceeds
paid into court as provided by Section 34.02(c) for a period of two
years after the date of the sale unless otherwise ordered by the
court.
(b) If no claimant establishes entitlement to the proceeds
within the period provided by Subsection (a), the clerk shall
distribute the excess proceeds to each taxing unit participating in
the sale in an amount equal to the proportion its taxes, penalties,
and interests bear to the total amount of taxes, penalties, and
interest due all participants in the sale.
(c) The clerk shall note on the execution docket in each
case the amount of the excess proceeds, the date they were received,
and the date they were transmitted to the taxing units
participating in the sale.
Acts 1979, 66th Leg., p. 2298, ch. 841, § 1, eff. Jan. 1, 1982.
Amended by Acts 1981, 67th Leg., 1st C.S., p. 169, ch. 13, § 132,
eff. Jan. 1, 1982; Acts 1999, 76th Leg., ch. 1185, § 1, eff.
Sept. 1, 1999.
§ 34.04. CLAIMS FOR EXCESS PROCEEDS. (a) A person,
including a taxing unit, may file a petition in the court that
ordered the seizure or sale setting forth a claim to the excess
proceeds. The petition must be filed before the second anniversary
of the date of the sale of the property. The petition is not
required to be filed as an original suit separate from the
underlying suit for seizure of the property or foreclosure of a tax
lien on the property but may be filed under the cause number of the
underlying suit.
(b) A copy of the petition shall be served, in the manner
prescribed by Rule 21a, Texas Rules of Civil Procedure, as amended,
or that rule's successor, on all parties to the underlying action
not later than the 20th day before the date set for a hearing on the
petition.
(c) At the hearing the court shall order that the proceeds
be paid according to the following priorities to each party that
establishes its claim to the proceeds:
(1) to the tax sale purchaser if the tax sale has been
adjudged to be void and the purchaser has prevailed in an action
against the taxing units under Section 34.07(d) by final judgment;
(2) to a taxing unit for any taxes, penalties, or
interest that have become due or delinquent on the subject property
subsequent to the date of the judgment or that were omitted from the
judgment by accident or mistake;
(3) to any other lienholder, consensual or otherwise,
for the amount due under a lien, in accordance with the priorities
established by applicable law;
(4) to a taxing unit for any unpaid taxes, penalties,
interest, or other amounts adjudged due under the judgment that
were not satisfied from the proceeds from the tax sale; and
(5) to each former owner of the property, as the
interest of each may appear.
(d) Interest or costs may not be allowed under this section.
(e) an order under this section is appealable.
(f) A person may not take an assignment of an owner's claim
to excess proceeds unless:
(1) the assignment is taken on or after the 36th day
after the date the excess proceeds are deposited in the registry of
the court;
(2) the assignment is in writing and signed by the
assignor; and
(3) the assignment document contains a sworn statement
by the assignor affirming:
(A) that the assignment was given voluntarily;
(B) the date on which the assignment was made and
that the date was not earlier than the 36th day after the date the
excess proceeds were deposited in the registry of the court;
(C) that the assignor has received the notice
from the clerk required by Section 34.03;
(D) the nature and amount of consideration given
for the assignment;
(E) the circumstances under which the excess
proceeds are in the registry of the court;
(F) the amount of the claim to excess proceeds in
the registry of the court;
(G) that the assignor has made no other
assignments of the assignor's claim to the excess proceeds; and
(H) that the assignor knows that the assignor may
retain counsel.
(g) An assignee who obtains excess proceeds without
complying with Subsection (f) is liable to the assignor for the
amount of excess proceeds obtained plus attorney's fees and
expenses.
(h) An assignee who files a petition setting forth a claim
to excess proceeds must attach a copy of the assignment document and
produce the original of the assignment document in court at the
hearing on the petition. If the original assignment document is
lost, the assignee must obtain the presence of the assignor to
testify at the hearing.
(i) A fee charged to obtain excess proceeds for an owner may
not be greater than 25 percent of the amount obtained or $1,000,
whichever is less.
Acts 1979, 66th Leg., p. 2298, ch. 841, § 1, eff. Jan. 1, 1982.
Amended by Acts 1983, 68th Leg., p. 4829, ch. 851, § 26, eff.
Aug. 29, 1983; Acts 1999, 76th Leg., ch. 1185, § 2, eff. Sept. 1,
1999; Acts 1999, 76th Leg., ch. 1481, § 26, eff. Sept. 1, 1999;
Acts 2001, 77th Leg., ch. 1420, § 18.007, eff. Sept. 1, 2001;
Acts 2001, 77th Leg., ch. 1430, § 27, eff. Sept. 1, 2001; Acts
2003, 78th Leg., ch. 319, § 10, eff. June 18, 2003.
§ 34.05. RESALE BY TAXING UNIT. (a) If property is
sold to a taxing unit that is a party to the judgment, the taxing
unit may sell the property at any time by public or private sale. In
selling the property, the taxing unit may, but is not required to,
use the procedures provided by Section 263.001, Local Government
Code, or Section 272.001, Local Government Code. The sale is
subject to any right of redemption of the former owner. The
redemption period begins on the date the deed to the taxing unit is
filed for record.
(b) Property sold pursuant to Subsections (c) and (d) of
this section may be sold for any amount. This subsection does not
authorize a sale of property in violation of Section 52, Article
III, Texas Constitution.
(c) The taxing unit purchasing the property by resolution of
its governing body may request the sheriff or a constable to sell
the property at a public sale. If the purchasing taxing unit has
not sold the property within six months after the date on which the
owner's right of redemption terminates, any taxing unit that is
entitled to receive proceeds of the sale by resolution of its
governing body may request the sheriff or a constable in writing to
sell the property at a public sale. On receipt of a request made
under this subsection, the sheriff or constable shall sell the
property as provided by Subsection (d), unless the property is sold
under Subsection (h) or (i) before the date set for the public sale.
(d) Except as provided by this subsection, all public sales
requested as provided by Subsection (c) shall be conducted in the
manner prescribed by the Texas Rules of Civil Procedure for the sale
of property under execution. The notice of the sale must contain a
description of the property to be sold, the number and style of the
suit under which the property was sold at the tax foreclosure sale,
and the date of the tax foreclosure sale. The description of the
property in the notice is sufficient if it is stated in the manner
provided by Section 34.01(f). If the commissioners court of a
county by order specifies the date or time at which or location in
the county where a public sale requested under Subsection (c) shall
be conducted, the sale shall be conducted on the date and at the
time and location specified in the order. The acceptance of a bid
by the officer conducting the sale is conclusive and binding on the
question of its sufficiency. An action to set aside the sale on the
grounds that the bid is insufficient may not be sustained in court,
except that a taxing unit that participates in distribution of
proceeds of the sale may file an action before the first anniversary
of the date of the sale to set aside the sale on the grounds of fraud
or collusion between the officer making the sale and the purchaser.
On conclusion of the sale, the officer making the sale shall prepare
a deed to the purchaser. The taxing unit that requested the sale
may elect to prepare a deed for execution by the officer. If the
taxing unit prepares the deed, the officer shall execute that deed.
An officer who executes a deed prepared by the taxing unit is not
responsible or liable for any inconsistency, error, or other defect
in the form of the deed. As soon as practicable after a deed is
executed by the officer, the officer shall either file the deed for
recording with the county clerk or deliver the executed deed to the
taxing unit that requested the sale, which shall file the deed for
recording with the county clerk. The county clerk shall file and
record each deed under this subsection and after recording shall
return the deed to the grantee.
(e) The presiding officer of a taxing unit selling real
property under Subsection (h) or (i), under Section 34.051, or
under Section 253.010, Local Government Code, or the sheriff or
constable selling real property under Subsections (c) and (d) shall
execute a deed to the property conveying to the purchaser the right,
title, and interest acquired or held by each taxing unit that was a
party to the judgment foreclosing tax liens on the property. The
conveyance shall be made subject to any remaining right of
redemption at the time of the sale.
(f) An action attacking the validity of a resale of property
pursuant to this section may not be instituted after the expiration
of one year after the date of the resale.
(g) A taxing unit to which property is bid off may recover
its costs of upkeep, maintenance, and environmental cleanup from
the resale proceeds without further court order.
(h) In lieu of a sale pursuant to Subsections (c) and (d) of
this section, the taxing unit that purchased the property may sell
the property at a private sale. Consent of each taxing unit
entitled to receive proceeds of the sale under the judgment is not
required. Property sold under this subsection may not be sold for
an amount that is less than the lesser of:
(1) the market value specified in the judgment of
foreclosure; or
(2) the total amount of the judgments against the
property.
(i) In lieu of a sale pursuant to Subsections (c) and (d) of
this section, the taxing unit that purchased the property may sell
the property at a private sale for an amount less than required
under Subsection (h) of this section with the consent of each taxing
unit entitled to receive proceeds of the sale under the judgment.
This subsection does not authorize a sale of property in violation
of Section 52, Article III, Texas Constitution.
Acts 1979, 66th Leg., p. 2298, ch. 841, § 1, eff. Jan. 1, 1982.
Amended by Acts 1983, 68th Leg., p. 4829, ch. 851, § 27, eff.
Aug. 29, 1983; Acts 1995, 74th Leg., ch. 499, § 1, eff. Aug. 28,
1995; Acts 1997, 75th Leg., ch. 310, § 1, eff. Sept. 1, 1997;
Acts 1997, 75th Leg., ch. 712, § 3, 4, eff. June 17, 1997; Acts
1997, 75th Leg., ch. 906, § 9, eff. Jan. 1, 1998; Acts 1997, 75th
Leg., ch. 1111, § 5, 8, eff. Sept. 1, 1997; Acts 1997, 75th Leg.,
ch. 1136, § 2, eff. Sept. 1, 1997; Acts 1997, 75th Leg., ch.
1192, § 2, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 1481,
§ 27 to 29, 42(2), eff. Sept. 1, 1999; Acts 2001, 77th Leg., ch.
1430, § 28, eff. Sept. 1, 2001.
§ 34.051. RESALE BY TAXING UNIT FOR THE PURPOSE OF URBAN
REDEVELOPMENT. (a) A municipality is authorized to resell tax
foreclosed property for less than the market value specified in the
judgment of foreclosure or less than the total amount of the
judgments against the property if consent to the conveyance is
evidenced by an interlocal agreement between the municipality and
each taxing unit that is a party to the judgment, provided, however,
that the interlocal agreement complies with the requirements of
Subsection (b).
(b) Any taxing unit may enter into an interlocal agreement
with the municipality for the resale of tax foreclosed properties
to be used for a purpose consistent with the municipality's urban
redevelopment plans or the municipality's affordable housing
policy. If the tax foreclosed property is resold pursuant to this
section to be used for a purpose consistent with the municipality's
urban redevelopment plan or affordable housing policy, the deed of
conveyance must refer to or set forth the applicable terms of the
urban redevelopment plan or affordable housing policy. Any such
interlocal agreement should include the following:
(1) a general statement and goals of the
municipality's urban redevelopment plans or affordable housing
policy, as applicable;
(2) a statement that the interlocal agreement concerns
only tax foreclosed property that is either vacant or distressed
and has a tax delinquency of six or more years;
(3) a statement that the properties will be used only
for a purpose consistent with an urban redevelopment plan or
affordable housing policy, as applicable, that is primarily aimed
at providing housing for families of low or moderate income;
(4) a statement that the principal goal of the
interlocal agreement is to provide an efficient mechanism for
returning deteriorated or unproductive properties to the tax rolls,
enhancing the value of ownership to the surrounding properties, and
improving the safety and quality of life in deteriorating
neighborhoods; and
(5) a provision that all properties are sold subject
to any right of redemption.
(c) The deed of conveyance of property sold under this
section conveys to the purchaser the right, title, and interest
acquired or held by each taxing unit that was a party to the
judgment of foreclosure, subject to any remaining right of
redemption at the time of the sale.
(d) An action attacking the validity of a sale of property
pursuant to this section may not be instituted after the expiration
of one year after the date of the sale and then only after the
unconditional tender into the registry of the court of an amount
equal to all taxes, penalties, interest, costs, and post-judgment
interest of all judgments on which the original foreclosure sale
was based.
Added by Acts 1997, 75th Leg., ch. 1136, § 3, eff. Sept. 1, 1997.
Amended by Acts 2001, 77th Leg., ch. 819, § 1, eff. June 14,
2001; Acts 2001, 77th Leg., ch. 1430, § 29, eff. Sept. 1, 2001.
§ 34.06. DISTRIBUTION OF PROCEEDS OF RESALE. (a) The
proceeds of a resale of property purchased by a taxing unit at a tax
foreclosure sale shall be paid to the purchasing taxing unit.
(b) The proceeds of the resale shall be distributed as
required by Subsections (c)-(e).
(c) The purchasing taxing unit shall first retain an amount
from the proceeds to reimburse the unit for reasonable costs, as
defined by Section 34.21, incurred by the unit for:
(1) maintaining, preserving, and safekeeping the
property;
(2) marketing the property for resale; and
(3) costs described by Subsection (f).
(d) After retaining the amount authorized by Subsection
(c), the purchasing taxing unit shall then pay all costs of the suit
and the sale of the property in the same manner and in the same order
of priority as provided by Sections 34.02(b)(1)-(5).
(e) After making the distribution under Subsection (d), any
remaining balance of the proceeds shall be paid to each taxing unit
participating in the sale in an amount equal to the proportion each
participant's taxes, penalties, and interest bear to the total
amount of taxes, penalties, and interest adjudged to be due all
participants in the sale.
(f) The purchasing taxing unit is entitled to recover from
the proceeds of a resale of the property any cost incurred by the
taxing unit in inspecting the property to determine whether there
is a release or threatened release of solid waste from the property
in violation of Chapter 361, Health and Safety Code, or a rule
adopted or permit or order issued by the Texas Natural Resource
Conservation Commission under that chapter, or a discharge or
threatened discharge of waste or a pollutant into or adjacent to
water in this state from a point of discharge on the property in
violation of Chapter 26, Water Code, or a rule adopted or permit or
order issued by the commission under that chapter, and in taking
action to remove or remediate the release or threatened release or
discharge or threatened discharge regardless of whether the taxing
unit:
(1) was required by law to incur the cost; or
(2) obtained the consent of each taxing unit entitled
to receive proceeds of the sale under the judgment of foreclosure to
incur the cost.
Acts 1979, 66th Leg., p. 2299, ch. 841, § 1, eff. Jan. 1, 1982.
Amended by Acts 1997, 75th Leg., ch. 38, § 1, eff. May 5, 1997;
Acts 1997, 75th Leg., ch. 906, § 10, eff. Jan. 1, 1998; Acts
1997, 75th Leg., ch. 914, § 3, eff. Sept. 1, 1997; Acts 1999,
76th Leg., ch. 1481, § 30, eff. Sept. 1, 1999; Acts 2003, 78th
Leg., ch. 319, § 11, eff. June 18, 2003.
§ 34.07. SUBROGATION OF PURCHASER AT VOID
SALE. (a) The purchaser at a void or defective tax sale or tax
resale is subrogated to the rights of the taxing unit in whose
behalf the property was sold or resold to the same extent a
purchaser at a void or defective sale conducted in behalf of a
judgment creditor is subrogated to the rights of the judgment
creditor.
(b) Except as provided by Subsection (c), the purchaser at a
void or defective tax sale or tax resale is subrogated to the tax
lien of the taxing unit in whose behalf the property was sold or
resold to the same extent a purchaser at a void or defective
mortgage or other lien foreclosure sale is subrogated to the lien of
the lienholder, and the purchaser is entitled to a reforeclosure of
the lien to which the purchaser is subrogated.
(c) If the purchaser at a void or defective tax sale or tax
resale paid less than the total amount of the judgment against the
property, the purchaser is subrogated to the tax lien only in the
amount the purchaser paid at the sale or resale.
(d) In lieu of pursuing the subrogation rights provided by
this section to which a purchaser is subrogated, a purchaser at a
void tax sale or tax resale may elect to file an action against the
taxing units to which proceeds of the sale were distributed to
recover an amount from each taxing unit equal to the distribution of
taxes, penalties, interest, and attorney's fees the taxing unit
received. In a suit filed under this subsection, the purchaser may
include a claim for, and is entitled to recover, any excess proceeds
of the sale that remain on deposit in the registry of the court or,
in the alternative, is entitled to have judgment against any party
to whom the excess proceeds have been distributed. A purchaser who
files a suit authorized by this subsection waives all rights of
subrogation otherwise provided by this section. This subsection
applies only to an original purchaser at a tax sale or resale and
only if that purchaser has not subsequently sold the property to
another person.
(e) If the purchaser prevails in a suit filed under
Subsection (d), the court shall expressly provide in its final
judgment that:
(1) the tax sale is vacated and set aside; and
(2) any lien on the property extinguished by the tax
sale is reinstated on the property effective as of the date on which
the lien originally attached to the property.
(f) A suit filed against the taxing units under Subsection
(d) may not be maintained unless the action is instituted before the
first anniversary of the date of sale or resale. In this
subsection:
(1) "Date of sale" means the first Tuesday of the month
on which the sheriff or constable conducted the sale of the property
under Section 34.01.
(2) "Date of resale" means the date on which the
grantor's acknowledgment was taken or, in the case of multiple
grantors, the latest date of acknowledgment by the grantors as
shown in the deed.
Acts 1979, 66th Leg., p. 2299, ch. 841, § 1, eff. Jan. 1, 1982.
Amended by Acts 1999, 76th Leg., ch. 1481, § 31, eff. Sept. 1,
1999; Acts 2001, 77th Leg., ch. 1430, § 30, eff. Sept. 1, 2001.
§ 34.08. CHALLENGE TO VALIDITY OF TAX SALE. (a) A
person may not commence an action that challenges the validity of a
tax sale under this chapter unless the person:
(1) deposits into the registry of the court an amount
equal to the amount of the delinquent taxes, penalties, and
interest specified in the judgment of foreclosure obtained against
the property plus all costs of the tax sale; or
(2) files an affidavit of inability to pay under Rule
145, Texas Rules of Civil Procedure.
(b) A person may not commence an action challenging the
validity of a tax sale after the time set forth in Section
33.54(a)(1) or (2), as applicable to the property, against a
subsequent purchaser for value who acquired the property in
reliance on the tax sale. The purchaser may conclusively presume
that the tax sale was valid and shall have full title to the
property free and clear of the right, title, and interest of any
person that arose before the tax sale, subject only to recorded
restrictive covenants and valid easements of record set forth in
Section 34.01(n) and subject to applicable rights of redemption.
(c) If a person is not barred from bringing an action
challenging the validity of a tax sale under Subsection (b) or any
other provision of this title or applicable law, the person must
bring an action no later than two years after the cause of action
accrues to recover real property claimed by another who:
(1) pays applicable taxes on the real property before
overdue; and
(2) claims the property under a registered deed
executed pursuant to Section 34.01.
(d) Subsection (c) does not apply to a claim based on a
forged deed.
Added by Acts 1997, 75th Leg., ch. 1136, § 4, eff. Sept. 1, 1997;
Acts 1997 75th Leg., ch. 1192, § 3, eff. Sept. 1, 1997. Amended
by Acts 1999, 76th Leg., ch. 1481, § 32, eff. Sept. 1, 1999.
SUBCHAPTER B. REDEMPTION
§ 34.21. RIGHT OF REDEMPTION. (a) The owner of real
property sold at a tax sale to a purchaser other than a taxing unit
that was used as the residence homestead of the owner or that was
land designated for agricultural use when the suit or the
application for the warrant was filed, or the owner of a mineral
interest sold at a tax sale to a purchaser other than a taxing unit,
may redeem the property on or before the second anniversary of the
date on which the purchaser's deed is filed for record by paying the
purchaser the amount the purchaser bid for the property, the amount
of the deed recording fee, and the amount paid by the purchaser as
taxes, penalties, interest, and costs on the property, plus a
redemption premium of 25 percent of the aggregate total if the
property is redeemed during the first year of the redemption period
or 50 percent of the aggregate total if the property is redeemed
during the second year of the redemption period.
(b) If property that was used as the owner's residence
homestead or was land designated for agricultural use when the suit
or the application for the warrant was filed, or that is a mineral
interest, is bid off to a taxing unit under Section 34.01(j) or (p)
and has not been resold by the taxing unit, the owner having a right
of redemption may redeem the property on or before the second
anniversary of the date on which the deed of the taxing unit is
filed for record by paying the taxing unit:
(1) the lesser of the amount of the judgment against
the property or the market value of the property as specified in
that judgment, plus the amount of the fee for filing the taxing
unit's deed and the amount spent by the taxing unit as costs on the
property, if the property was judicially foreclosed and bid off to
the taxing unit under Section 34.01(j); or
(2) the lesser of the amount of taxes, penalties,
interest, and costs for which the warrant was issued or the market
value of the property as specified in the warrant, plus the amount
of the fee for filing the taxing unit's deed and the amount spent by
the taxing unit as costs on the property, if the property was seized
under Subchapter E, Chapter 33, and bid off to the taxing unit under
Section 34.01(p).
(c) If real property that was used as the owner's residence
homestead or was land designated for agricultural use when the suit
or the application for the warrant was filed, or that is a mineral
interest, has been resold by the taxing unit under Section 34.05,
the owner of the property having a right of redemption may redeem
the property on or before the second anniversary of the date on
which the taxing unit files for record the deed from the sheriff or
constable by paying the person who purchased the property from the
taxing unit the amount the purchaser paid for the property, the
amount of the fee for filing the purchaser's deed for record, the
amount paid by the purchaser as taxes, penalties, interest, and
costs on the property, plus a redemption premium of 25 percent of
the aggregate total if the property is redeemed in the first year of
the redemption period or 50 percent of the aggregate total if the
property is redeemed in the second year of the redemption period.
(d) If the amount paid by the owner of the property under
Subsection (c) is less than the amount of the judgment under which
the property was sold, the owner shall pay to the taxing unit to
which the property was bid off under Section 34.01 an amount equal
to the difference between the amount paid under Subsection (c) and
the amount of the judgment. The taxing unit shall issue a receipt
for a payment received under this subsection and shall distribute
the amount received to each taxing unit that participated in the
judgment and sale in an amount proportional to the unit's share of
the total amount of the aggregate judgments of the participating
taxing units. The owner of the property shall deliver the receipt
received from the taxing unit to the person from whom the property
is redeemed.
(e) The owner of real property sold at a tax sale other than
property that was used as the residence homestead of the owner or
that was land designated for agricultural use when the suit or the
application for the warrant was filed, or that is a mineral
interest, may redeem the property in the same manner and by paying
the same amounts as prescribed by Subsection (a), (b), (c), or (d),
as applicable, except that:
(1) the owner's right of redemption may be exercised
not later than the 180th day following the date on which the
purchaser's or taxing unit's deed is filed for record; and
(2) the redemption premium payable by the owner to a
purchaser other than a taxing unit may not exceed 25 percent.
(f) If the owner of the real property makes an affidavit
that the owner has made diligent search in the county in which the
property is located for the purchaser at the tax sale or for the
purchaser at resale, and has failed to find the purchaser, that the
purchaser is not a resident of the county in which the property is
located, that the owner and the purchaser cannot agree on the amount
of redemption money due, or that the purchaser refuses to give the
owner a quitclaim deed to the property, the owner may redeem the
land by paying the required amount as prescribed by this section to
the assessor-collector for the county in which the property
described has been redeemed. The assessor-collector receiving the
payment shall give the owner a signed receipt witnessed by two
persons. The receipt, when recorded, is notice to all persons that
the property described has been redeemed. The assessor-collector
shall on demand pay the money received by the assessor-collector to
the purchaser.
(g) In this section:
(1) "Land designated for agricultural use" means land
for which an application for appraisal under Subchapter C or D,
Chapter 23, has been finally approved.
(2) "Costs" includes:
(A) the amount reasonably spent by the purchaser
for maintaining, preserving, and safekeeping the property,
including the cost of:
(i) property insurance;
(ii) repairs or improvements required by a
local ordinance or building code or by a lease of the property in
effect on the date of the sale;
(iii) discharging a lien imposed by a
municipality to secure expenses incurred by the municipality in
remedying a health or safety hazard on the property;
(iv) dues or assessments for maintenance
paid to a property owners' association under a recorded restrictive
covenant to which the property is subject; and
(v) impact or standby fees imposed under
the Local Government Code or Water Code and paid to a political
subdivision; and
(B) if the purchaser is a taxing unit to which the
property is bid off under Section 34.01, personnel and overhead
costs reasonably incurred by the purchaser in connection with
maintaining, preserving, safekeeping, managing, and reselling the
property.
(3) "Purchaser" includes a taxing unit to which
property is bid off under Section 34.01.
(4) "Residence homestead" has the meaning assigned by
Section 11.13.
(h) The right of redemption does not grant or reserve in the
former owner of the real property the right to the use or possession
of the property, or to receive rents, income, or other benefits from
the property while the right of redemption exists.
(i) The owner of property who is entitled to redeem the
property under this section may request that the purchaser of the
property, or the taxing unit to which the property was bid off,
provide that owner a written itemization of all amounts spent by the
purchaser or taxing unit in costs on the property. The owner must
make the request in writing and send the request to the purchaser at
the address shown for the purchaser in the purchaser's deed for the
property, or to the business address of the collector for the taxing
unit, as applicable. The purchaser or the collector shall itemize
all amounts spent on the property in costs and deliver the
itemization in writing to the owner not later than the 10th day
after the date the written request is received. Delivery of the
itemization to the owner may be made by depositing the document in
the United States mail, postage prepaid, addressed to the owner at
the address provided in the owner's written request. Only those
amounts included in the itemization provided to the owner may be
allowed as costs for purposes of redemption.
(j) A quitclaim deed to an owner redeeming property under
this section is not notice of an unrecorded instrument. The grantee
of a quitclaim deed and a successor or assign of the grantee may be a
bona fide purchaser in good faith for value under recording laws.
(k) The inclusion of dues and assessments for maintenance
paid to a property owners' association within the definition of
"costs" under Subsection (g) may not be construed as:
(1) a waiver of any immunity to which a taxing unit may
be entitled from a suit or from liability for those dues or
assessments; or
(2) authority for a taxing unit to make an expenditure
of public funds in violation of Section 50, 51, or 52(a), Article
III, or Section 3, Article XI, Texas Constitution.
Acts 1979, 66th Leg., p. 2300, ch. 841, § 1, eff. Jan. 1, 1979.
Amended by Acts 1989, 71st Leg., ch. 796, § 33, eff. June 15,
1989; Acts 1991, 72nd Leg., ch. 419, § 1, eff. Aug. 26, 1991;
Acts 1993, 73rd Leg., ch. 349, § 1, eff. May 29, 1993; Acts 1997,
75th Leg., ch. 906, § 11, eff. Jan. 1, 1998; Acts 1997, 75th
Leg., ch. 914, § 4, eff. Sept. 1, 1997; Acts 1997, 75th Leg., ch.
1111, § 6, 8, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 1481,
§ 33, eff. Sept. 1, 1999; Acts 2001, 77th Leg., ch. 231, § 1,
eff. May 22, 2001; Acts 2001, 77th Leg., ch. 1430, § 31, eff.
Sept. 1, 2001; Acts 2003, 78th Leg., ch. 319, § 12, eff. June 18,
2003; Acts 2003, 78th Leg., ch. 510, § 1.
§ 34.22. EVIDENCE OF TITLE TO REDEEM REAL
PROPERTY. (a) A person asserting ownership of real property sold
for taxes is entitled to redeem the property if he had title to the
property or he was in possession of the property in person or by
tenant either at the time suit to foreclose the tax lien on the
property was instituted or at the time the property was sold. A
defect in the chain of title to the property does not defeat an
offer to redeem.
(b) A person who establishes title to real property that is
superior to the title of one who has previously redeemed the
property is entitled to redeem the property during the redemption
period by paying the amounts provided by law to the person who
previously redeemed the property.
Acts 1979, 66th Leg., p. 2300, ch. 841, § 1, eff. Jan. 1, 1982.
§ 34.23. DISTRIBUTION OF REDEMPTION PROCEEDS. (a) If
the owner of property sold for taxes to a taxing unit redeems the
property before the property is resold, the taxing unit shall
distribute the redemption proceeds in the manner that proceeds of
the resale of property are distributed.
(b) Except as provided by Section 34.21(e), the owner of
property sold for taxes to a taxing unit may not redeem the property
from the taxing unit after the property has been resold.
Acts 1979, 66th Leg., p. 2300, ch. 841, § 1, eff. Jan. 1, 1982.
Amended by Acts 1997, 75th Leg., ch. 906, § 12, eff. Jan. 1,
1998.
