Sections
Subchapter A General Provisions 251.001 – 251.003
Subchapter B Formation and Governing Documents 251.051 – 251.054
Subchapter C Management 251.101 – 251.104
Subchapter D Membership 251.151 – 251.154
Subchapter E Shares 251.201 – 251.204
Subchapter F Meetings and Voting 251.251 – 251.257
Subchapter G Capital and Net Savings 251.301 – 251.302
Subchapter H Reports and Records 251.351 – 251.354
Subchapter I Winding Up and Termination 251.401 – 251.404
Subchapter J Miscellaneous Provisions 251.451 – 251.452

Terms Used In Texas Business Organizations Code Chapter 251

  • Adjourn: A motion to adjourn a legislative chamber or a committee, if passed, ends that day's session.
  • Advice and consent: Under the Constitution, presidential nominations for executive and judicial posts take effect only when confirmed by the Senate, and international treaties become effective only when the Senate approves them by a two-thirds vote.
  • Affirmed: In the practice of the appellate courts, the decree or order is declared valid and will stand as rendered in the lower court.
  • Allegation: something that someone says happened.
  • Amortization: Paying off a loan by regular installments.
  • Answer: The formal written statement by a defendant responding to a civil complaint and setting forth the grounds for defense.
  • Appellate: About appeals; an appellate court has the power to review the judgement of another lower court or tribunal.
  • Appraisal: A determination of property value.
  • Appropriation: The provision of funds, through an annual appropriations act or a permanent law, for federal agencies to make payments out of the Treasury for specified purposes. The formal federal spending process consists of two sequential steps: authorization
  • Association: means an entity governed as an association under Title 6 or 7. See Texas Business Organizations Code 1.002
  • Attachment: A procedure by which a person's property is seized to pay judgments levied by the court.
  • Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
  • Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
  • Business: means a trade, occupation, profession, or other commercial activity. See Texas Business Organizations Code 1.002
  • Certificate of formation: means :
    (A) the document required to be filed with the filing officer under Chapter Texas Business Organizations Code 1.002
  • Chambers: A judge's office.
  • Child: includes an adopted child, regardless of whether the adoption occurred through:
    (1) an existing or former statutory procedure; or
    (2) an equitable adoption or acts of estoppel. See Texas Estates Code 22.004
  • Common law: The legal system that originated in England and is now in use in the United States. It is based on judicial decisions rather than legislative action.
  • Comptroller: means the state comptroller of public accounts. See Texas Government Code 312.011
  • Concurrent resolution: A legislative measure, designated "S. Con. Res." and numbered consecutively upon introduction, generally employed to address the sentiments of both chambers, to deal with issues or matters affecting both houses, such as a concurrent budget resolution, or to create a temporary joint committee. Concurrent resolutions are not submitted to the President/Governor and thus do not have the force of law.
  • Contract: A legal written agreement that becomes binding when signed.
  • Conviction: A judgement of guilt against a criminal defendant.
  • cooperative association: means an association governed as a cooperative association under Chapter Texas Business Organizations Code 1.002
  • Corporation: means an entity governed as a corporation under Title 2 or 7. See Texas Business Organizations Code 1.002
  • Counterclaim: A claim that a defendant makes against a plaintiff.
  • Decedent: A deceased person.
  • Deed: The legal instrument used to transfer title in real property from one person to another.
  • Department: means the Department of Agriculture. See Texas Agriculture Code 1.003
  • Deposition: An oral statement made before an officer authorized by law to administer oaths. Such statements are often taken to examine potential witnesses, to obtain discovery, or to be used later in trial.
  • Director: means an individual who serves on the board of directors of a foreign or domestic corporation. See Texas Business Organizations Code 1.002
  • Domestic: means , with respect to an entity, that the entity is formed under this code or the entity's internal affairs are governed by this code. See Texas Business Organizations Code 1.002
  • Donor: The person who makes a gift.
  • Effects: includes all personal property and all interest in that property. See Texas Government Code 312.011
  • Electronic funds transfer: The transfer of money between accounts by consumer electronic systems-such as automated teller machines (ATMs) and electronic payment of bills-rather than by check or cash. (Wire transfers, checks, drafts, and paper instruments do not fall into this category.) Source: OCC
  • Entitlement: A Federal program or provision of law that requires payments to any person or unit of government that meets the eligibility criteria established by law. Entitlements constitute a binding obligation on the part of the Federal Government, and eligible recipients have legal recourse if the obligation is not fulfilled. Social Security and veterans' compensation and pensions are examples of entitlement programs.
  • Entity: means a domestic entity or foreign entity. See Texas Business Organizations Code 1.002
  • Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
  • Escrow: Money given to a third party to be held for payment until certain conditions are met.
  • Estate: means a decedent's property, as that property:
    (1) exists originally and as the property changes in form by sale, reinvestment, or otherwise;
    (2) is augmented by any accretions and other additions to the property, including any property to be distributed to the decedent's representative by the trustee of a trust that terminates on the decedent's death, and substitutions for the property; and
    (3) is diminished by any decreases in or distributions from the property. See Texas Estates Code 22.012
  • Ex officio: Literally, by virtue of one's office.
  • Executor: A male person named in a will to carry out the decedent
  • Fiduciary: A trustee, executor, or administrator.
  • Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
  • Foreclosure: A legal process in which property that is collateral or security for a loan may be sold to help repay the loan when the loan is in default. Source: OCC
  • Foreign: means , with respect to an entity, that the entity is formed under, and the entity's internal affairs are governed by, the laws of a jurisdiction other than this state. See Texas Business Organizations Code 1.002
  • Garnishment: Generally, garnishment is a court proceeding in which a creditor asks a court to order a third party who owes money to the debtor or otherwise holds assets belonging to the debtor to turn over to the creditor any of the debtor
  • General-law municipality: means a municipality designated by Chapter Texas Local Government Code 1.005
  • Gift: A voluntary transfer or conveyance of property without consideration, or for less than full and adequate consideration based on fair market value.
  • Guardian: A person legally empowered and charged with the duty of taking care of and managing the property of another person who because of age, intellect, or health, is incapable of managing his (her) own affairs.
  • Home-rule municipality: means a municipality designated by Chapter Texas Local Government Code 1.005
  • in writing: includes any representation of words, letters, or figures, whether by writing, printing, or other means. See Texas Government Code 312.011
  • Indemnification: In general, a collateral contract or assurance under which one person agrees to secure another person against either anticipated financial losses or potential adverse legal consequences. Source: FDIC
  • Individual: means a natural person. See Texas Business Organizations Code 1.002
  • Injunction: An order of the court prohibiting (or compelling) the performance of a specific act to prevent irreparable damage or injury.
  • Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
  • Intestate: Dying without leaving a will.
  • Joint resolution: A legislative measure which requires the approval of both chambers.
  • Jurisprudence: The study of law and the structure of the legal system.
  • Justice: when applied to a magistrate, means justice of the peace. See Texas Government Code 312.011
  • Law: means , unless the context requires otherwise, both statutory and common law. See Texas Business Organizations Code 1.002
  • Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
  • Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
  • License: means a license, certificate of registration, or other legal authorization. See Texas Business Organizations Code 1.002
  • Lien: A claim against real or personal property in satisfaction of a debt.
  • Litigation: A case, controversy, or lawsuit. Participants (plaintiffs and defendants) in lawsuits are called litigants.
  • Member: means :
    (A) in the case of a limited liability company, a person who is a member or has been admitted as a member in the limited liability company under its governing documents;
    (B) in the case of a nonprofit corporation, a person who has membership rights in the nonprofit corporation under its governing documents;
    (C) in the case of a cooperative association, a member of a nonshare or share association;
    (D) in the case of a nonprofit association, a person who has membership rights in the nonprofit association under its governing documents; or
    (E) in the case of a professional association, a person who has membership rights in the professional association under its governing documents. See Texas Business Organizations Code 1.002
  • Month: means a calendar month. See Texas Government Code 312.011
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Mortgagee: The person to whom property is mortgaged and who has loaned the money.
  • Municipality: means a general-law municipality, home-rule municipality, or special-law municipality. See Texas Local Government Code 1.005
  • Oath: includes affirmation. See Texas Government Code 311.005
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Officer: means an individual elected, appointed, or designated as an officer of an entity by the entity's governing authority or under the entity's governing documents. See Texas Business Organizations Code 1.002
  • Organization: means a corporation, limited or general partnership, limited liability company, business trust, real estate investment trust, joint venture, joint stock company, cooperative, association, bank, insurance company, credit union, savings and loan association, or other organization, regardless of whether the organization is for-profit, nonprofit, domestic, or foreign. See Texas Business Organizations Code 1.002
  • Oversight: Committee review of the activities of a Federal agency or program.
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • Person: means an individual or a corporation, partnership, limited liability company, business trust, trust, association, or other organization, estate, government or governmental subdivision or agency, or other legal entity, or a series of a domestic limited liability company or foreign entity. See Texas Business Organizations Code 1.002
  • Person: includes a natural person and a corporation. See Texas Estates Code 22.027
  • Personal property: All property that is not real property.
  • Plaintiff: The person who files the complaint in a civil lawsuit.
  • Population: means the population shown by the most recent federal decennial census. See Texas Government Code 311.005
  • Power of attorney: A written instrument which authorizes one person to act as another's agent or attorney. The power of attorney may be for a definite, specific act, or it may be general in nature. The terms of the written power of attorney may specify when it will expire. If not, the power of attorney usually expires when the person granting it dies. Source: OCC
  • President: means the:
    (A) individual designated as president of an entity under the entity's governing documents; or
    (B) officer or committee of persons authorized to perform the functions of the principal executive officer of an entity without regard to the designated name of the officer or committee. See Texas Business Organizations Code 1.002
  • Presiding officer: A majority-party Senator who presides over the Senate and is charged with maintaining order and decorum, recognizing Members to speak, and interpreting the Senate's rules, practices and precedents.
  • Probate: Proving a will
  • Probation: A sentencing alternative to imprisonment in which the court releases convicted defendants under supervision as long as certain conditions are observed.
  • Property: means real and personal property. See Texas Government Code 311.005
  • Property: includes tangible and intangible property and an interest in that property. See Texas Business Organizations Code 1.002
  • Prosecute: To charge someone with a crime. A prosecutor tries a criminal case on behalf of the government.
  • Quorum: The number of legislators that must be present to do business.
  • Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
  • Remainder: An interest in property that takes effect in the future at a specified time or after the occurrence of some event, such as the death of a life tenant.
  • Secretary: means the:
    (A) individual designated as secretary of an entity under the entity's governing documents; or
    (B) officer or committee of persons authorized to perform the functions of secretary of an entity without regard to the designated name of the officer or committee. See Texas Business Organizations Code 1.002
  • Service of process: The service of writs or summonses to the appropriate party.
  • Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
  • Share: means a unit into which the ownership interest in a for-profit corporation, professional corporation, real estate investment trust, or professional association is divided, regardless of whether the share is certificated or uncertificated. See Texas Business Organizations Code 1.002
  • Signature: includes the mark of a person unable to write, and "subscribe" includes the making of such a mark. See Texas Government Code 312.011
  • Subpoena: A command to a witness to appear and give testimony.
  • Subscriber: means a person who agrees with or makes an offer to an entity to purchase by subscription an ownership interest in the entity. See Texas Business Organizations Code 1.002
  • Swear: includes affirm. See Texas Government Code 311.005
  • Temporary restraining order: Prohibits a person from an action that is likely to cause irreparable harm. This differs from an injunction in that it may be granted immediately, without notice to the opposing party, and without a hearing. It is intended to last only until a hearing can be held.
  • Testify: Answer questions in court.
  • Tort: A civil wrong or breach of a duty to another person, as outlined by law. A very common tort is negligent operation of a motor vehicle that results in property damage and personal injury in an automobile accident.
  • Treasurer: means the:
    (A) individual designated as treasurer of an entity under the entity's governing documents; or
    (B) officer or committee of persons authorized to perform the functions of treasurer of an entity without regard to the designated name of the officer or committee. See Texas Business Organizations Code 1.002
  • Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC
  • Trustee: A person or institution holding and administering property in trust.
  • Venue: The geographical location in which a case is tried.
  • Week: means seven consecutive days. See Texas Government Code 311.005
  • Writ: A formal written command, issued from the court, requiring the performance of a specific act.
  • Writ of certiorari: An order issued by the Supreme Court directing the lower court to transmit records for a case for which it will hear on appeal.
  • written: means an expression of words, letters, characters, numbers, symbols, figures, or other textual information that is inscribed on a tangible medium or that is stored in an electronic or other medium that is retrievable in a perceivable form. See Texas Business Organizations Code 1.002