DAVID J. WILLIS ATTORNEY
Copyright © 2016. All rights reserved worldwide.
Residential Evictions in Texas
by David J. Willis, J.D., LL.M.
Eviction is a judicial process by which an owner recovers possession of real property and, if appropriate, a judgment for unpaid rent, attorney’s fees (if any), and court costs against a defaulting tenant or occupant. The technical legal term “forcible detainer” applies when an owner seeks to evict a person lawfully in possession (e.g., a tenant); “forcible entry and detainer” (or FED for short) occurs when a person without legal authority (e.g., a trespasser) refuses to surrender possession.
Justice courts have original jurisdiction in eviction cases. (Tex. R. Civ. P. 510.3(b) and Tex. Prop. Code § 24.004) and may award damages up to $10,000. Note, however, that the “forcible entry and detainer action is not exclusive, but cumulative, of any other remedy that a party may have in the courts of this state. If all matters between the parties cannot be adjudicated in the justice court in which the forcible entry and detainer proceedings are pending due to the justice court’s limited subject matter jurisdiction, then either party may maintain an action in a court of competent jurisdiction for proper relief.” McGlothlin v. Kliebert, 672 S.W.2d 231, 233 (Tex. 1984).
Evictions are conducted in justice courts which are located in various neighborhood precincts around Texas counties. When an investor arrives ready to do his first eviction, he may be told that the “forcible docket” begins at a certain time and that there are perhaps twenty or more cases ahead of him.
The landlord’s objective is usually to gain a writ of possession and a judgment. However, because collecting judgments against residential tenants can be quite difficult in Texas (there is an extensive list of assets that are exempt from execution) the residential landlord may occasionally choose to be content with a judgment for possession only.
Basic Law and Procedure
Evictions are governed by Property Code chapter 24 and Civil Procedure Rule 500 et seq., the latter having been extensively revised by the Texas Supreme Court effective August 31, 2013 (The old Rules 523-591 and 737-755 were repealed).
The eviction should be filed with the justice of the peace in whose precinct the property is located. At the hearing, the judge will determine which party has the superior right to possession and what damages (e.g., back rent, attorney’s fees, and court costs), if any, will be awarded to the landlord. These are the only issues to be considered by the court. A counterclaim by the tenant, regardless of subject matter or merit, is not permitted in an FED. Such tenant suits must be brought by separate action in any court (including that same justice court) where venue and jurisdiction are allowed (Tex. Rule Civ. P. 510.3(e)). It is also inappropriate to raise issues of title, since justice courts do not have authority over suits “for trial of title to land. . . .” (Tex. Gov. Code § 37.031).
In the case of month-to-month tenancy (e.g., after a lease is expired) with no tenant default, the landlord may give a month’s written notice that the landlord desires possession. No more than that need be said—no allegation of default is necessary. If the tenant does not leave, then an FED can be filed. In the case of default on an existing lease—failure to pay rent, for example—then a written 3-day notice to vacate should be given, after which the landlord may file an FED (Tex. Prop. Code § 24.005).
If the property is abandoned, is an eviction necessary?
If a tenant has truly abandoned and vacated a property, the owner may re-enter without judicial process, take possession, and change the locks. However, problems can occur when some of the tenant’s possessions appear to remain on the premises. Abandonment has occurred when a property is “empty, that is, without contents of substantial value . . . the term ‘substantial value’ does not mean merely substantial monetary value, but the term includes value attributable to the utility of the furniture. It is well known that furniture, because of age and condition, may have little monetary value, but to the owner or user has substantial utility, and retention in the house would evidence the absence of complete abandonment. From the evidence recited we are of the view that the reasonable mind could conclude there was furniture of substantial value in the house and therefore it was not vacant.”Knoff v. U.S. Fidelity, 447 S.W.2d 497 (Tex. Civ. App.—Houston, 1969, no writ). If a substantial amount of personal property remains, the safer legal course is to pursue a formal eviction. It is a fact issue and a judgment call to be decided by the investor.
Eviction Pursuant to an Executory Contract
Eviction of a buyer/tenant under an executory contract (e.g., a contract for deed) is a special case, at least with regard to pre-filing notice and opportunity to cure the default. Texas law views buyers under contracts for deed as more than mere tenants. Prop. Code sec. 5.063 outlines requirements which must followed exactly if the notice letter and subject eviction are to be valid. Note that the delinquent amount must be broken down into principal and interest. If the buyer/tenant has paid less than 40% of the amount due or made less than 48 monthly payments, the seller/landlord must provide a 30 notice and opportunity to cure before seeking to regain possession of the property. If the default is not cured, then a 3 day notice to vacate may be given and an eviction may proceed normally from that point forward.
If the buyer/tenant has paid more than 40% of the amount due or made 48 or more monthly payments, then eviction is not available as a primary remedy. Pursuant to equity protection provisions of Prop. Code sec. 5.066, the seller/landlord must afford a 60 day notice and cure period, which is then followed by appointment of a trustee and a non-judicial foreclosure. Depending on the circumstances, an eviction may thereafter be required to regain possession.
Possession vs. Title Issues
There is a distinction between disputes concerning possession and disputes concerning title—although both may of course arise within the same case. Generally, justice courts have original jurisdiction over possession issues (Tex. Prop. Code § 24.004) and district courts have original jurisdiction over title issues (Tex. Const. art. V, § 8; Tex. Gov’t Code § 26.043). Rule 510.3(e) provides that the justice “court must adjudicate the right to actual possession and not title.”
The case Gibson v. Dynegy Midstream Services, L.P. 138 S.W.3d 518, 522 (Texas.App.—Fort Worth 2004, no pet.) puts it this way: “Justice courts may adjudicate possession when issues related to the title of real property are [only] tangentially or collaterally related to possession. If, however, the question of title is so integrally linked to the issue of possession that the right to possession cannot be determined without first determining title, then the justice courts and, on appeal, the county courts, lack jurisdiction over the matter.”
A Houston appeals court case takes this a step further: “Although a justice court has subject-matter jurisdiction over a forcible detainer action, the justice court, and a county court on appeal, lack jurisdiction to resolve any questions of title beyond the immediate right to possession . . . . On the hand, a justice court is not deprived of jurisdiction merely by the existence of a title dispute; rather, it is only deprived of jurisdiction if the right to immediate possession necessarily requires the resolution of a title dispute.” Black v. Washington Mutual Bank, 318 S.W.3d 414 (Tex.App.—Hous. [1st Dist.] 2010, pet. dism’d w.o.j.).
The practical result? A district court may pre-empt a justice court (or a county court that is hearing an FED appeal) on issues of possession when questions of title and possession are so integrally linked or intertwined that possession may not be determined without first determining title. In such cases, and only in such cases, may the justice court be deprived of jurisdiction. Bynum v. Lewis, 393 S.W.3d 916 (Tex.App—Tyler 2013, no pet.). Note that in Harris County, the county courts at law have the benefit of an exception under the Government Code and may hear title issues.
If the concepts of possession and title are legally distinct, is it then possible to pursue a judgment for possession in justice court while independently seeing the declaratory judgment of a district court regarding title? Yes. Moreover, the judgment rendered in the justice court as to possession is not determinative of the outcome of the district court proceeding. AAA Free Move Ministorage, LLC v. OIS Investments, Inc., 419 S.W.3d 522 (Tex.App.—San Antonio 2013, pet. denied). The justice court remedy of forcible detainer is designed to be a fast and efficient means of establishing which party has the superior right to possession of the property—so the res judicata effect of such a judgment is limited to this single narrow issue. The parties are free to sue one another under a different cause number (either in justice court or in a different forum) on other, related issues. Federal Home Loan Mortgage Corporation v. Pham, 449 S.W.3d 230 (Tex.App.—Houston [14th Dist.] 2014, no pet.).
Appeals: Cash Bonds versus Pauper’s Affidavit
Motions for new trial are not allowed. However, within five calendar days of judgment, the losing party may (with or without good reason) appeal the justice court’s judgment to the local county court at law. Tex. R. Civ. P. 510.9. The appeal results in the file being packed up and sent to the main county courthouse where it will be heard de novo (as a new case). Why is this so? It results from an interesting historical quirk: the justice court is not a court of record. No transcript is kept of the proceedings or testimony.
The justice of the peace will set a cash appeal bond which may be three times the monthly rent. Property Code sections 24.00511 and 24.00512 require that the JP’s judgment set the amount of the bond, a long overdue change. Either party may then contest the amount of the bond within five days. However, the cash bond may be waived if the tenant files an affidavit stating that he or she cannot afford it. The content of the “pauper’s bond” or “pauper’s affidavit” is prescribed by statute (Tex. Prop. Code §24.0052) and is considerably more complex than it used to be.
Once a pauper’s affidavit is filed, the landlord has the right to request a hearing and contest the affidavit, alleging that the tenant does in fact have sufficient resources for the bond. The tenant can be questioned on the subject of his or her assets and income. It is generally pointless to go through this exercise, however, since pauper’s bonds are almost always approved by justices of the peace, and the file is then turned over to county court (Tex. R. Civ. P. 510.9(c)).
If the tenant does not appeal within five days, the judgment of the justice court becomes final and the landlord may proceed to the enforcement phase by obtaining and serving a writ of possession. This requires going to the county clerk’s office and paying a nominal fee. The constable then serves the writ, but first usually posts a notice on the tenant’s door allowing 48 hours to move out. After that, the constable may show up with a truck, forcibly evict the tenant, and put the tenant’s possessions in storage where charges accrue at the tenant’s expense.
Pauper’s Bond Appellants
Important: A tenant who files a pauper’s affidavit must, after notice, pay a month’s rent to the justice court pursuant to Property Code section 24.0053—and do so before the file is shipped to county court. If the tenant fails to do so, section 24.0054 provides:
(a) During an appeal of an eviction case for nonpayment of rent, the justice court on request shall immediately issue a writ of possession, without hearing if:
(1) A tenant fails to pay the initial rent deposit into the justice court registry within five days of the date the tenant filed a pauper’s affidavit as required by Rule 749b(1), Texas Rules of Civil Procedure, and Section 24.0053;
(2) The justice court has provided the written notice required by Section 24.0053(a-1); and
(3) The justice court has not yet forwarded the transcript and original papers to the county court as provided by Subsection (a-2).
This provision gives landlords who prevail an effective remedy at the justice court level, without having to wait until the entire eviction file is transferred to the county clerk’s office and set up as a new case.
Rule 510.9 Motion in County Court: Obtaining a Writ of Possession
The use of pauper’s affidavits in appeals may in some respects appear unfair, but it can be turned to the landlord’s advantage: If the pauper’s bond is approved, and the county court takes over the case, the tenant is then obliged to begin making monthly rental payments to the court and continue to do so during the pendency of the appeal. If the tenant fails to do this (and most do) the landlord may seek immediate possession from the county court based on motion pursuant to Texas Rule of Civil Procedure 510.9(c)(5)(B), which permits a tenant to remain in possession only so long as the following requirements are met:
(i) Within 5 days of the date that the defendant files a sworn statement of inability to pay, it must pay into the justice court registry the amount set forth in the notice provided at the time the defendant filed the statement. If the defendant was provided with notice and fails to pay the designated amount into the justice court registry within 5 days, and the transcript has not been transmitted to the county clerk, the plaintiff is entitled, upon request and payment of the applicable fee, to a writ of possession, which the justice court must issue immediately and without hearing.
Cash or Surety Bond Appeals
(ii) During the appeal process as rent becomes due under the rental agreement, the defendant must pay the designated amount into the county court registry within 5 days of the rental due date under the terms of the rental agreement.
If an appeal bond (cash or surety) is posted, there is no requirement that the tenant pay rent while the appeal is pending. Even so, it is good practice for the landlord’s attorney to file a motion requesting payment of rent into the court registry based on the theory that no one should live for free, an argument to which judges are generally receptive. A preferential setting should also be requested if the county court in question does not already automatically provide such a setting in eviction cases.
The bad news for landlords? If the tenant is a professional deadbeat who has played this game before, the property may be tied up for months.
The remedy of foreclosure is available to lenders if the borrower defaults. Specified notice and other requirements must be followed if the foreclosure is to be valid. Tex. Prop. Code §§ 51.002 et seq. Foreclosure sales are held in Texas on the first Tuesday of each month between 10 a.m. and 4 p.m. This process gives the new owner title; the next step is to obtain possession.
The successful bidder at the foreclosure sale (likely the lender) gets a trustee’s deed which cuts off all junior liens including purchase money liens and mechanics liens. A valid foreclosure usually terminates existing leases as well. Coinmach Corp. v. Aspenwood Apartment Corp. 417 S.W.3d 909 (Tex. 2013). Even so, the new owner may not simply lock out a residential tenant. Tex. Prop. Code § 92.0081.
A brief review of leasehold terminology may be useful at this point. A tenant who remains in possession after expiration of a lease is a “holdover tenant.” If the tenant holds over without consent from the landlord, he is a “tenant at sufferance;” if holding over occurs with landlord consent, the tenant is a “tenant at will.”
If the occupant of residential property is a tenant at will or by sufferance then the new owner under the trustee’s deed must give the usual three-day notice to vacate, file an FED petition in justice court, get it served, have it heard by the justice of the peace, and then wait five days for a final judgment and a writ of possession. The new owner must then wait until the constable posts a 48-hour notice on the door and then forcibly removes a former borrower who is otherwise unwilling to leave. Elapsed time? Often three to four weeks, and even then the former borrower may appeal, possibly gaining additional free-rent time in the property.
Section 24.005(b) provides that new owners who have purchased foreclosed property must give a residential tenant in good standing “at least 30 days’ written notice if the purchaser [at foreclosure] chooses not to continue the lease.”
What if there is a wrongful foreclosure case pending in district court? Can the district court enjoin the eviction?
District courts have no jurisdiction to issue an injunction stopping an eviction. McGlothin v. Kliebert, 672 S.W.2d 231, 232 (Tex.1984); TMC Medical, Ltd. v. The Lasaters French Quarter Partnership, 880 S.W.2d 789 (Tex. App.—Tyler 1994, writ dism’d, w.o.j.).
Collecting Judgments from Tenants
The key objective for the owner is to gain a writ of possession. Obtaining a judgment for monetary damages against a residential tenant in Texas is usually an empty formality since such judgments are seldom collected. Texas has long been a safe harbor for debtors, and both the Texas Constitution and the Property Code exempt a long list of real and personal property from execution upon a judgment. The average residential tenant has very little that a landlord will be allowed to take and, since garnishment of wages is unconstitutional, collection is problematic. Often the best strategy is to record an abstract of the judgment against the tenant in the real property records in the hopes that one day in the next ten years the tenant will become affluent enough to own and sell property.
What does the attorney need from the client?
When asking that an attorney initiate the eviction process, the client should be prepared to supply (1) a copy of the lease agreement; (2) copies of any correspondence or demand letters; and (3) a brief summary of the specific items of monetary and technical default.
Information in this article is proved for general educational purposes only and is not offered as legal advice upon which anyone may rely. The law changes. Legal counsel relating to your individual needs and circumstances is advisable before taking any action that has legal consequences. Consult your tax advisor as well since we do not give tax advice. This firm does not represent you unless and until it is retained and expressly retained in writing to do so.
Copyright © 2016 by David J. Willis. All rights reserved worldwide. David J. Willis is board certified in both residential and commercial real estate law by the Texas Board of Legal Specialization. More information is available at his website, http://www.LoneStarLandLaw.com.