5.28 Execution Sales


In General

An execution sale is a sale under a statutory power made by a sheriff, constable, marshall, commissioner, or other ministerial officer by authority of a writ of execution. An execution sale, if legally made and followed by a conveyance to the purchaser, vests the title of the judgment debtor in the purchaser. The sale must be made under a judgment by a court having jurisdiction of both the subject matter and the parties. In Texas, a debtor of a Tax Lien foreclosure may redeem the property for 2 years after the Sheriffs Deed. There is no right of redemption of a sale under an execution of an abstract of judgment.

Execution sales are not judicial sales. In the case of an execution sale, the sheriff or the sheriff's deputy sells the property by the mere authority of the writ, and title passes without judicial confirmation. A judicial sale is made in pursuance of an order or decree of court and must be reported back to and confirmed by the court before an effective conveyance can be executed. (such as sales of wards' properties) Additionally, an execution sale is made by an officer of the law pursuant to power conferred by statute and by the writ, whereas a judicial sale is made by the court or by a direct agent of the court. Sale on general execution is a statutory method of enforcing payment of a personal judgment for money out of any nonexempt property of the debtor, while a judicial sale is based upon an order for the sale of specific property.


Insuring Purchasers At Execution Sales

The insurance of a purchaser at an execution sale, even when insuring a bona fide purchaser, is an extrahazardous risk, because such sales are susceptible to judicial attack on any of the following grounds:

  • Lack of validity of the judgment.
  • Improper or defective form of notice of levy.
  • Debtors are persons entitled to exemption rights.
  • Real property exempt from execution. (Homestead)
  • Deed executed before the right of redemption has expired.
  • Prior to the sale the judgment debtor had been judicially declared incompetent.
  • Intervening liens on other interests, if any, may not be extinguished by the sale due to lack of satisfactory notice to the holder of intervening liens or other interests.
  • Judgment rendered in a suit commenced without proper notice (due process of law) due to lack of personal service on the Defendant. A defendant has 3 years after entry of a judgment to file a motion seeking to have the judgment (and underlying execution sale) set aside.

In general, execution sales not confirmed by a court of record having jurisdiction over the parties SHOULD NOT BE INSURED except when long possession of the title coupled with payment of taxes has eliminated risk of attack. Any deviation from the above guideline must be specifically authorized by a Texas Underwriter.