Senate committee debates SB600 to strengthen heirs‑property protections; testimony split between advocates and investors

The Committee on Business & Commerce heard debate and public testimony on Senate Bill 600, a measure intended to strengthen due‑process protections for heirs’ property and to reduce predatory partition sales.

SB600, carried by Senator Sarah West, would require expanded notice to known co‑owners, permit posting of signs on property, require courts to appoint an attorney ad litem to attempt to locate unknown heirs, allow either party to request a settlement conference, and include provisions intended to ensure property sales occur at fair‑market value if partition results in sale. The committee heard opposing and supporting testimony and left the bill pending.

Why this matters: “Heirs’ property” refers to land owned jointly by descendants who inherited fractional, undivided interests. Advocates say the structure leaves families vulnerable to investors who buy small fractional interests and then force a partition sale; opponents say some proposed restrictions would curtail the market for minority interests and create constitutional takings risks.

Proponents, including Elizabeth Paradavila, a staff attorney at the St. Mary’s Real Estate Clinic, and Roland Love of the Texas Real Estate and Probate Trust Law Institute, said SB600 closes gaps in current law and protects families who lack the resources to litigate. Paradavila said she has represented low‑income homeowners in South Texas and described scenarios in which families faced eviction or loss of ancestral homes because of fractional ownership and aggressive partition actions. She told the committee the measure’s “bill of rights” and buyout protections would reduce fraud and predatory practices.

Paradavila: “The fractional ownership of heirs property makes it susceptible to predatory practices … The Bill of Rights and the buyout price protections under S.B. 600 discourage these predatory practices and lessen the chance of them falling victim to fraud.”

Opponents and cautionary witnesses included partition practitioners and investors who argued parts of the bill would limit property rights and raise constitutional concerns. San Antonio attorney Daniel Burke said certain provisions in the draft he reviewed—specifically a 10‑year moratorium on some investor‑led partition filings and a 50% ownership threshold for some filings—could amount to an unconstitutional taking if they prevent a cotenant from disposing of their interest.

Burke: “Inside the bill … there’s a 10 year moratorium on being able to file as well as a 50% requirement as being able to file for partition. Both I think are unconstitutional and would essentially constitute a taking under both the U.S. Constitution and the Texas Constitution.”

Other witnesses described a mix of outcomes in practice. Investor David Fanolio and others said they provide a market outlet for owners who lack resources or family agreement, while witness Rebecca Hansinger and Pamela Phillips said in personal testimony that working with a third party helped them preserve value or resolve intractable family disputes. Hansinger told the committee that, without a third‑party buyer, her family “would have walked away with nothing.”

Committee members asked about timelines and judicial management. Attorneys said the substitute creates steps—notice, ad litem appointment, settlement conference—that can lengthen the process; court control of the docket will determine how long. One panelist estimated an additional several months to a year could be added to some partition cases depending on the court’s schedule.

Committee action and next steps: The chair opened public testimony and closed the hearing after witnesses for and against the bill spoke. The committee left SB600 pending and senators said they were open to follow‑up discussions to balance protections for heirs with the property‑owner rights of minority interest holders. No final committee vote was taken.