(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.

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Terms Used In Texas Property Code 221.061

  • Commission: means the Texas Real Estate Commission. See Texas Property Code 221.002
  • Contract: A legal written agreement that becomes binding when signed.
  • Developer: means :
    (A) any person, excluding a sales agent, who creates a timeshare plan or is in the business of selling timeshare interests or employs a sales agent to sell timeshare interests; or
    (B) any person who succeeds in the developer's interest by sale, lease, assignment, mortgage, or other transfer if the person:
    (i) offers at least 12 timeshare interests in a particular timeshare plan; and
    (ii) is in the business of selling timeshare interests or employs a sales agent to sell timeshare interests. See Texas Property Code 221.002
  • Escrow: Money given to a third party to be held for payment until certain conditions are met.
  • Escrow agent: means a bonded escrow company, a financial institution whose accounts are insured by a governmental agency or instrumentality, or an attorney or title insurance agent licensed in this state who is responsible for the receipt and disbursement of funds in accordance with this chapter. See Texas Property Code 221.002
  • Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
  • Fiduciary: A trustee, executor, or administrator.
  • Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
  • Purchaser: means any person, other than a developer, who by means of a voluntary transfer acquires a legal or equitable interest in a timeshare interest other than as a security for an obligation. See Texas Property Code 221.002
  • Timeshare interest: means a timeshare estate or timeshare use. See Texas Property Code 221.002
  • Timeshare plan: means any arrangement, plan, scheme, or similar method, excluding an exchange program but including a membership agreement, sale, lease, deed, license, or right-to-use agreement, by which a purchaser, in exchange for consideration, receives an ownership right in or the right to use accommodations for a period of time less than a year during a given year, but not necessarily consecutive years. See Texas Property Code 221.002
  • Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC

(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.