Updating Those Outdated Deed Restrictions
As my previous blog pointed out, deed restrictions in the Houston region can be a form of constant frustration.
Whether you are a property owners association, a municipality, an investor, or a homeowner, you have undoubtedly experienced the frustration of outdated deed restrictions. So, what do you do if faced with deed restrictions that no longer conform to the nature of the neighborhood they were designed to protect? The simple answer is you amend those archaic deed restrictions and bring them into the modern age. However, simple is not always as simple as it may seem.
To begin with, you look to the Texas Property Code, specifically chapters 201, 204, 211, 212, 210 and 205. These six chapters provide the much-needed procedures for extending, creating, modifying, and removing archaic deed restrictions that no longer provide the benefit that was originally intended. Each chapter provides the procedures that are necessary to put a desired amendment into effect, and the applicability of each chapter varies depending on the size of the population in the city or county that the subdivision sits in. Chapters 201 and 204 are applicable to the more populated areas, while the remaining four chapters apply to the less populated areas of the State.
The focus of this blog will be on chapters 201 and 204 of the Texas Property Code, as they are the most relevant to the restrictions in the City of Houston and surrounding areas.
Most of the deed restrictions created in the last twenty years will likely have provisions that provide information on how those restrictions can be amended. For the most part, these provisions require a majority vote of the property owners to amend.
However, in the absence of such a specific provision, the full consent of all property owners is required before such an amendment can be made.
Both Chapters 201 and 204 allow for the extension or modification of deed restrictions by petition.
Section 201.004 provides that a petition may be filed under Chapter 201 to (1) extend or renew an unexpired restriction; (2) create a restriction; (3) add to or modify an existing restriction; or (4) modify an existing provision in an instrument creating a restriction that provides for extension of those restrictions.” The petition must be filed with the County Clerk’s office in the County where the subdivision is located and does not become effective until filed. Once the petition is properly filed, the amendment is applied to and becomes a burden on all property of the applicable subdivision.
Chapter 204 covers property owners’ associations and the powers given to these associations to modify or extend their restrictive covenants. Section 204.005 provides that an owner’s association has the authority to circulate and then approve a petition that concerns the extension or modification of the existing deed restrictions.
Under this chapter, such a petition circulated by the owner’s association is only effective if: “(1) the petition is approved by the owners, excluding lienholders, contract purchasers, and the owners of mineral interests, of at least 75 percent of the real property in the subdivision or a smaller percentage required by the original dedicatory instrument; and (2) the petition is filed as a dedicatory instrument with the county clerk of the county in which the subdivision is located.”
Amending your deed restrictions may seem straightforward, but rest assured, this is no easy endeavor. As we all know from our previous social experiences, it is not an easy task to get all neighbors to agree on a single subject. The information provided in this blog is only the tip of the iceberg when it comes to amending your restrictive covenants. Anyone desiring to make such an amendment should consult with their attorney to ensure the amendment is done correctly the first time in order to avoid any legal issues stemming from such change in the future.
Please do not rely on this article as legal advice. We can tell you what the law is, but until we know the facts of your given situation, we cannot provide legal guidance. This website is for informational purposes and not for the purposes of providing legal advice. Information about our commercial and business litigation practice can be found here.