By Nixon                                               H.B. No. 172

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to contract claims against a unit of state government.

 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-4           SECTION 1.  Title 5, Civil Practice and Remedies Code, is

 1-5     amended by adding Chapter 111 to read as follows:

 1-6               CHAPTER 111.  CONTRACT CLAIMS AGAINST THE STATE

 1-7           Sec. 111.001.  DEFINITION.  In this chapter, "unit of state

 1-8     government" means the state or an agency, department, commission,

 1-9     bureau, board, office, council, court, or other entity that is in

1-10     any branch of state government and that is created by the

1-11     constitution or a statute of this state, including a university

1-12     system or institution of higher education as defined by Section

1-13     61.003, Education Code.  The term does not include a county,

1-14     municipality, court of a county or municipality, special-purpose

1-15     district, or other political subdivision of this state.

1-16           Sec. 111.002.  PERMISSION TO SUE GRANTED; SOVEREIGN IMMUNITY

1-17     FROM SUIT FOR CERTAIN CLAIMS.  (a)  Subject to Section 111.003, a

1-18     claimant may bring a suit against a unit of state government that:

1-19                 (1)  alleges that the unit of state government has

1-20     breached a written contract with the claimant for:

1-21                       (A)  goods; or

1-22                       (B)  engineering or construction services; and

1-23                 (2)  is brought to recover money damages or, if

1-24     applicable, to compel alternative dispute resolution.

 2-1           (b)  The total amount of damages awarded to a claimant in a

 2-2     suit brought under this section may not exceed the total value of

 2-3     consideration the claimant was to receive under the contract,

 2-4     including any charge accepted by the unit of state government.

 2-5           (c)  An award of the following damages is not authorized:

 2-6                 (1)  consequential or similar damages; or

 2-7                 (2)  exemplary or punitive damages.

 2-8           Sec. 111.003.  ALTERNATIVE DISPUTE RESOLUTION SYSTEM.  If the

 2-9     affected unit of state government has established an alternative

2-10     dispute resolution process applicable to the subject matter of the

2-11     claim, a claimant may not bring suit for money damages under

2-12     Section 111.002 before complying with the alternative dispute

2-13     resolution process.

2-14           Sec. 111.004.  WAIVER OF SOVEREIGN IMMUNITY.  The state

2-15     waives its sovereign immunity to suit under common law only to the

2-16     extent authorized by Section 111.002.

2-17           Sec. 111.005.  VENUE.  A suit brought under this chapter

2-18     shall be brought in Travis County.

2-19           Sec. 111.006.  SERVICE OF CITATION.  In a suit brought under

2-20     this chapter, service of citation and other required process must

2-21     be made on:

2-22                 (1)  the attorney general; and

2-23                 (2)  the unit of state government with which the

2-24     claimant contracted.

2-25           Sec. 111.007.  PREJUDGMENT INTEREST.  Article 1.05, Title 79,

2-26     Revised Statutes (Article 5069-1.05, Vernon's Texas Civil

2-27     Statutes), applies to a judgment awarded to a claimant under this

 3-1     chapter, except that the applicable rate of interest may not exceed

 3-2     six percent.

 3-3           Sec. 111.008.  SETTLEMENT.  The attorney general may settle

 3-4     or compromise a suit brought under this chapter.

 3-5           Sec. 111.009.  PAYMENT OF JUDGMENT OR SETTLEMENT.  (a)  A

 3-6     unit of state government shall pay a judgment or settlement under

 3-7     this chapter from money appropriated to the unit of state

 3-8     government that the unit of state government is authorized to use

 3-9     for the goods, services, or property obtained under the contract on

3-10     which the suit was based.

3-11           (b)  To the extent money described by Subsection (a) is not

3-12     available to make the payment, the judgment or settlement may be

3-13     paid only from money appropriated by the legislature for payment of

3-14     the judgment or settlement.

3-15           Sec. 111.010.  EXECUTION ON STATE PROPERTY NOT AUTHORIZED.

3-16     This chapter does not authorize execution on property owned by the

3-17     state or a unit of state government.

3-18           Sec. 111.011.  APPLICATION OF OTHER LAWS.  Chapter 107 does

3-19     not apply to a suit brought under this chapter.

3-20           SECTION 2.  This Act takes effect September 1, 1997.

3-21           SECTION 3.  (a)  This Act applies only to a suit based on a

3-22     written contract described by Section 111.002, Civil Practice and

3-23     Remedies Code, as added by this Act, entered into by a unit of

3-24     state government on or after the effective date of this Act.  A

3-25     suit based on a contract entered into before the effective date of

3-26     this Act is governed by the law as it existed immediately before

3-27     the effective date of this Act, and that law is continued in effect

 4-1     for this purpose.

 4-2           (b)  For purposes of this section, a contract is entered into

 4-3     after the effective date of this Act if it is executed or renewed

 4-4     after the effective date of this Act.

 4-5           SECTION 4.  The importance of this legislation and the

 4-6     crowded condition of the calendars in both houses create an

 4-7     emergency and an imperative public necessity that the

 4-8     constitutional rule requiring bills to be read on three several

 4-9     days in each house be suspended, and this rule is hereby suspended.