By Brimer                                             H.B. No. 1080
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to public accountants and to certain acts of public
    1-3  accountants.
    1-4        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-5        SECTION 1.  Title 4, Civil Practice and Remedies Code, is
    1-6  amended by adding Chapter 86 to read as follows:
    1-7                    CHAPTER 86.  PUBLIC ACCOUNTANTS
    1-8        Sec. 86.001.  DEFINITION.  In this chapter, "accountant"
    1-9  means a person holding a certificate or registration issued by the
   1-10  Texas State Board of Public Accountancy.
   1-11        Sec. 86.002.  LIABILITY LIMITED.  An accountant is not liable
   1-12  for an act or omission committed in connection with compiling,
   1-13  reviewing, certifying, auditing, or otherwise reporting or
   1-14  analyzing a financial statement or other information unless:
   1-15              (1)  the injured person contracted directly with the
   1-16  accountant to perform those services; or
   1-17              (2)  the accountant:
   1-18                    (A)  was aware at the time the services were
   1-19  performed that the financial statement or other information would
   1-20  be made available to the injured person for use in connection with
   1-21  a specified transaction and the injured person was specifically
   1-22  identified to the accountant;
   1-23                    (B)  communicated directly with the injured
    2-1  person concerning the financial statement or other information; and
    2-2                    (C)  was aware that the injured person intended
    2-3  to rely on the financial statement or other information in
    2-4  connection with the specified transaction and communicated that
    2-5  awareness by words or conduct.
    2-6        SECTION 2.  This Act takes effect September 1, 1993, and
    2-7  applies only to a cause of action that accrues on or after that
    2-8  date.  A cause of action that accrued before the effective date of
    2-9  this Act is governed by the law in effect at the time the action
   2-10  accrued, and the former law is continued in effect for that
   2-11  purpose.
   2-12        SECTION 3.  The importance of this legislation and the
   2-13  crowded condition of the calendars in both houses create an
   2-14  emergency and an imperative public necessity that the
   2-15  constitutional rule requiring bills to be read on three several
   2-16  days in each house be suspended, and this rule is hereby suspended.
   2-17                       COMMITTEE AMENDMENT NO. 1
   2-18        Amend HB 1080 on page 2 between lines 4 and 5 by adding the
   2-19  following subparagraph (3):
   2-20        (3)  For purposes of subparagraph (2) above, if the
   2-21  accountant (i) identifies in writing to the client those persons
   2-22  who are intended to rely on the services, and (ii) sends a copy of
   2-23  such writing or similar statement to those persons identified in
   2-24  the writing or statement, then such accountant or any of its
   2-25  employees, partners, members, officers or shareholders may be held
    3-1  liable only to such persons intended to so rely, in addition to
    3-2  those persons in privity of contract with such accountant.
    3-3                                                              Averitt