MISSISSIPPI LEGISLATURE
2019 Regular Session
To: Judiciary A
By: Representatives Lamar, Bain
AN ACT TO AMEND SECTION 89-1-69, MISSISSIPPI CODE OF 1972, TO CLARIFY THE EXCEPTIONS TO THE PROHIBITION AGAINST COVENANTS REQUIRING PAYMENT OF A FEE UPON THE TRANSFER OF REAL PROPERTY; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 89-1-69, Mississippi Code of 1972, is amended as follows:
89-1-69. (1) In this section, "property owners' association" means an incorporated or unincorporated association that:
(a) Is designated as the representative of the owners of property in a subdivision;
(b) Has a membership primarily consisting of the owners of the property covered by the dedicatory instrument for the subdivision; and
(c) Manages or regulates the subdivision for the benefit of the owners of property in the subdivision.
(2) A deed restriction or other covenant running with the land applicable to the conveyance of real property that requires a transferee of real property or the transferee's heirs, successors, or assigns to pay a declarant or other person imposing the deed restriction or covenant on the property or a third party designated by a transferor of the property a fee in connection with a future transfer of the property is prohibited. A deed restriction or other covenant running with the land that violates this section or a lien purporting to encumber the land to secure a right under a deed restriction or other covenant running with the land that violates this section is void and unenforceable. For purposes of this section, a conveyance of real property includes a conveyance or other transfer of an interest or estate in real property.
(3) This section does not apply to a deed restriction or other covenant running with the land that requires a fee associated with the conveyance of property in a subdivision that is payable to:
(a) A property owners' association that manages or regulates the subdivision or the association's managing agent if the subdivision contains more than one (1) platted lot and the right to collect a fee in connection with a future transfer of the property is evidenced by a deed restriction or covenant running with the land filed in the public land records;
(b) An entity organized under Section 501(c)(3), Internal Revenue Code of 1986 if the entity has a right to collect a fee in connection with a future transfer of the property evidenced by a deed restriction or covenant running with the land filed in the public land records; or
(c) A governmental entity.
SECTION 2. This act shall take effect and be in force from and after July 1, 2019.