Bill Text: TX HB1999 | 2019-2020 | 86th Legislature | Enrolled
Bill Title: Relating to certain construction liability claims concerning public buildings and public works.
Spectrum: Bipartisan Bill
Status: (Passed) 2019-06-14 - Effective immediately [HB1999 Detail]
Download: Texas-2019-HB1999-Enrolled.html
H.B. No. 1999 |
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relating to certain construction liability claims concerning | ||
public buildings and public works. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subtitle F, Title 10, Government Code, is | ||
amended by adding Chapter 2272 to read as follows: | ||
CHAPTER 2272. CERTAIN CONSTRUCTION LIABILITY CLAIMS | ||
Sec. 2272.001. DEFINITIONS. In this chapter: | ||
(1) "Action" means a court or judicial proceeding or | ||
an arbitration. The term does not include an administrative | ||
action. | ||
(2) "Construction" includes: | ||
(A) the initial construction of an improvement to | ||
real property; | ||
(B) the construction of an addition to an | ||
improvement to real property; or | ||
(C) the repair, alteration, or remodeling of an | ||
improvement to real property. | ||
(3) "Construction defect" means a deficiency in the | ||
construction of an improvement to real property, including a | ||
deficiency in or arising out of the design, specifications, | ||
surveying, planning, or supervision of the construction, that is | ||
the result of: | ||
(A) the use of defective materials, products, or | ||
components in the construction; | ||
(B) a violation of a building code applicable by | ||
law to the construction; | ||
(C) a failure of the design of an improvement to | ||
real property to meet the professional standards of care applicable | ||
at the time of governmental approval of the design or as otherwise | ||
applicable if no governmental approval of the design was required | ||
or obtained; or | ||
(D) a failure to perform the construction in | ||
accordance with the accepted trade standards for good and | ||
workmanlike construction. | ||
(4) "Contractor" means a person engaged in the | ||
business of developing, constructing, fabricating, repairing, | ||
altering, or remodeling improvements to real property. | ||
(5) "Design professional" means an individual | ||
registered as an architect under Chapter 1051, Occupations Code, or | ||
a person licensed as an engineer under Chapter 1001, Occupations | ||
Code. | ||
(6) "Governmental entity" means: | ||
(A) the state; | ||
(B) a municipality, county, public school | ||
district, or special-purpose district or authority; | ||
(C) a district, county, or justice of the peace | ||
court; | ||
(D) a board, commission, department, office, or | ||
other agency in the executive branch of state government, including | ||
an institution of higher education as defined by Section 61.003, | ||
Education Code; | ||
(E) the legislature or a legislative agency; or | ||
(F) the Supreme Court of Texas, the Texas Court | ||
of Criminal Appeals, a court of appeals, or the State Bar of Texas | ||
or another judicial agency having statewide jurisdiction. | ||
(7) "Subcontractor" means a contractor directly | ||
retained and compensated by another contractor to perform labor or | ||
perform labor and supply materials in the construction. | ||
(8) "Supplier" means a person who provides only | ||
materials, equipment, or other supplies for the construction. | ||
Sec. 2272.002. APPLICABILITY OF CHAPTER. (a) This chapter | ||
applies only to a claim: | ||
(1) for: | ||
(A) damages arising from damage to or loss of | ||
real or personal property caused by an alleged construction defect | ||
in an improvement to real property that is a public building or | ||
public work; or | ||
(B) indemnity or contribution for damages | ||
described by Paragraph (A); | ||
(2) asserted by a governmental entity with an interest | ||
in the public building or public work affected by the alleged | ||
construction defect; and | ||
(3) asserted against a contractor, subcontractor, | ||
supplier, or design professional. | ||
(b) This chapter does not apply to: | ||
(1) a claim for personal injury, survival, or wrongful | ||
death; | ||
(2) a claim involving the construction of residential | ||
property covered under Chapter 27, Property Code; | ||
(3) a contract entered into by the Texas Department of | ||
Transportation; | ||
(4) a project that receives money from a state or | ||
federal highway fund; or | ||
(5) a civil works project as defined by Section | ||
2269.351 | ||
. | ||
Sec. 2272.003. REPORT. (a) Before bringing an action | ||
asserting a claim to which this chapter applies, the governmental | ||
entity must provide each party with whom the governmental entity | ||
has a contract for the design or construction of an affected | ||
structure a written report by certified mail, return receipt | ||
requested, that clearly: | ||
(1) identifies the specific construction defect on | ||
which the claim is based; | ||
(2) describes the present physical condition of the | ||
affected structure; and | ||
(3) describes any modification, maintenance, or | ||
repairs to the affected structure made by the governmental entity | ||
or others since the affected structure was initially occupied or | ||
used. | ||
(b) Not later than the fifth day after the date a contractor | ||
receives a report under Subsection (a), the contractor must provide | ||
a copy of the report to each subcontractor retained on the | ||
construction of the affected structure whose work is subject to the | ||
claim. | ||
Sec. 2272.004. OPPORTUNITY TO INSPECT AND CORRECT. (a) | ||
Before bringing an action asserting a claim to which this chapter | ||
applies, the governmental entity must allow each party with whom | ||
the governmental entity has a contract for the design or | ||
construction of an affected structure and who is subject to the | ||
claim and any known subcontractor or supplier who is subject to the | ||
claim: | ||
(1) a reasonable opportunity to inspect any | ||
construction defect or related condition identified in the report | ||
for a period of 30 days after sending the report required by Section | ||
2272.003; and | ||
(2) at least 120 days after the inspection to: | ||
(A) correct any construction defect or related | ||
condition identified in the report; or | ||
(B) enter into a separate agreement with the | ||
governmental entity to correct any construction defect or related | ||
condition identified in the report. | ||
(b) The governmental entity is not required to allow a party | ||
to make a correction or repair under Subsection (a) if: | ||
(1) the party: | ||
(A) is a contractor and cannot provide payment | ||
and performance bonds to cover the corrective work; | ||
(B) cannot provide liability insurance or | ||
workers' compensation insurance; | ||
(C) has been previously terminated for cause by | ||
the governmental entity; or | ||
(D) has been convicted of a felony; or | ||
(2) the governmental entity previously complied with | ||
the process required by Subsection (a) regarding a construction | ||
defect or related condition identified in the report and: | ||
(A) the defect or condition was not corrected as | ||
required by Subsection (a)(2)(A) or an agreement under Subsection | ||
(a)(2)(B); or | ||
(B) the attempt to correct the construction | ||
defect or related condition identified in the report resulted in a | ||
new construction defect or related condition. | ||
Sec. 2272.005. TOLLING OF LIMITATIONS AND REPOSE PERIODS. | ||
If the report and opportunity to correct required by Sections | ||
2272.003 and 2272.004 are provided during the final year of a | ||
limitations or repose period applicable to the claim, the | ||
limitations or repose period is tolled until the first anniversary | ||
of the date on which the report is provided. | ||
Sec. 2272.006. DISMISSAL. (a) If a governmental entity | ||
brings an action asserting a claim to which this chapter applies | ||
without complying with Sections 2272.003 and 2272.004, the court, | ||
arbitrator, or other adjudicating authority shall dismiss the | ||
action without prejudice. | ||
(b) If an action is dismissed without prejudice under | ||
Subsection (a) and the governmental entity brings a second action | ||
asserting a claim to which this chapter applies without complying | ||
with Sections 2272.003 and 2272.004, the court, arbitrator, or | ||
other adjudicating authority shall dismiss the action with | ||
prejudice. | ||
Sec. 2272.007. RECOVERY OF REPORT COSTS. If a report | ||
provided by a governmental entity under Section 2272.003 identifies | ||
a construction defect that is corrected under Section 2272.004 or | ||
for which the governmental entity recovers damages, the party | ||
responsible for that construction defect shall pay the reasonable | ||
amounts incurred by the governmental entity to obtain the report | ||
with respect to identification of that construction defect. | ||
Sec. 2272.008. EMERGENCY REPAIRS BY GOVERNMENTAL ENTITY. | ||
This chapter does not prohibit or limit a governmental entity from | ||
making emergency repairs to the property as necessary to protect | ||
the health, safety, and welfare of the public or a building | ||
occupant. | ||
Sec. 2272.009. INSURANCE TREATMENT OF CLAIM. If a party, in | ||
connection with a potential claim against the party, receives a | ||
written notice of an alleged construction defect or a report under | ||
Section 2272.003 identifying a construction defect and provides the | ||
notice or report to the party's insurer, the insurer shall treat the | ||
provision of the notice or report to the party as the filing of a | ||
suit asserting that claim against the party for purposes of the | ||
relevant policy terms. | ||
SECTION 2. (a) Chapter 2272, Government Code, as added by | ||
this Act, applies only to a cause of action that accrues on or after | ||
the effective date of this Act. | ||
(b) Section 2272.009, Government Code, as added by this Act, | ||
applies only to an insurance policy delivered, issued for delivery, | ||
or renewed on or after January 1, 2020. | ||
SECTION 3. This Act takes effect immediately if it receives | ||
a vote of two-thirds of all the members elected to each house, as | ||
provided by Section 39, Article III, Texas Constitution. If this | ||
Act does not receive the vote necessary for immediate effect, this | ||
Act takes effect September 1, 2019. | ||
______________________________ | ______________________________ | |
President of the Senate | Speaker of the House | |
I certify that H.B. No. 1999 was passed by the House on April | ||
25, 2019, by the following vote: Yeas 99, Nays 34, 1 present, not | ||
voting; and that the House concurred in Senate amendments to H.B. | ||
No. 1999 on May 23, 2019, by the following vote: Yeas 108, Nays 34, | ||
2 present, not voting. | ||
______________________________ | ||
Chief Clerk of the House | ||
I certify that H.B. No. 1999 was passed by the Senate, with | ||
amendments, on May 21, 2019, by the following vote: Yeas 29, Nays | ||
2. | ||
______________________________ | ||
Secretary of the Senate | ||
APPROVED: __________________ | ||
Date | ||
__________________ | ||
Governor |