1-1 By: Harris S.B. No. 662 1-2 (In the Senate - Filed February 20, 1995; February 21, 1995, 1-3 read first time and referred to Committee on Jurisprudence; 1-4 April 19, 1995, reported adversely, with favorable Committee 1-5 Substitute by the following vote: Yeas 4, Nays 0; April 19, 1995, 1-6 sent to printer.) 1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 662 By: Harris 1-8 A BILL TO BE ENTITLED 1-9 AN ACT 1-10 relating to certain agreements for the payment of subcontractors. 1-11 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-12 SECTION 1. Subchapter D, Chapter 35, Business & Commerce 1-13 Code, is amended by adding Section 35.521 to read as follows: 1-14 Sec. 35.521. AGREEMENT FOR PAYMENT OF CONSTRUCTION 1-15 SUBCONTRACTOR. (a) A provision of a contract or other agreement 1-16 by which payment from an original contractor to a subcontractor is 1-17 conditioned on receipt of payment from another person, including a 1-18 private or public owner for whom an improvement is being made, is 1-19 against public policy and is void. 1-20 (b) In this section: 1-21 (1) "Original contractor" means a person who contracts 1-22 with an owner to improve the owner's real property. It includes a 1-23 person who performs construction, construction management services, 1-24 remodeling, repairs, or improvements to the property. 1-25 (2) "Owner" means a person who has an interest in real 1-26 property. 1-27 (3) "Subcontractor" means a person who contracts to 1-28 furnish labor or material to an original contractor or another 1-29 subcontractor in connection with a contract to improve real 1-30 property. 1-31 SECTION 2. This Act applies only to a contract or other 1-32 agreement entered into on or after the effective date of this Act. 1-33 SECTION 3. This Act takes effect September 1, 1995. 1-34 SECTION 4. The importance of this legislation and the 1-35 crowded condition of the calendars in both houses create an 1-36 emergency and an imperative public necessity that the 1-37 constitutional rule requiring bills to be read on three several 1-38 days in each house be suspended, and this rule is hereby suspended. 1-39 * * * * *