Texas § PR.221.061 - ESCROW OR TRUST ACCOUNT REQUIRED

§ PR.221.061. ESCROW OR TRUST ACCOUNT REQUIRED

ESCROW OR TRUST ACCOUNT REQUIRED. (a) A developer or escrow agent of a timeshare plan shall deposit in an escrow or trust account in a federally insured depository 100 percent of all funds received during the purchaser's cancellation period. (b) An escrow agent owes the purchaser a fiduciary duty. (c) The escrow agent and the developer shall execute an agreement that includes a statement providing that: (1) funds may be disbursed to the developer from the escrow or trust account by the agent only: (A) after the purchaser's cancellation period has expired; and (B) as provided by the purchase contract, subject to this subchapter; and (2) if the purchaser cancels the purchase contract as provided by the contract, the funds must be paid to: (A) the purchaser; or (B) the developer if the purchaser's funds have been refunded previously by the developer. (d) If a developer contracts to sell a timeshare interest and the construction of the building in which the timeshare interest is located has not been completed when the cancellation period expires, the developer shall continue to maintain all funds received from the purchaser under the purchase agreement in the escrow or trust account until construction of the building is completed. The documentation required for evidence of completion of construction includes: (1) a certificate of occupancy; (2) a certificate of substantial completion; (3) evidence of a public safety inspection equivalent to Subdivision (1) or (2) from a government agency in the applicable jurisdiction; or (4) any other evidence acceptable to the commission. Added by Acts 1987, 70th Leg., ch. 167, Sec. 6.03, eff. Sept. 1, 1987. Renumbered from Sec. 201.061 by Acts 1989, 71st Leg., ch. 2, Sec. 13.03(b), eff. Aug. 28, 1989. Amended by: Acts 2005, 79th Leg., Ch. 539 (H.B. 1045 ), Sec. 10, eff. January 15, 2006.