HBA-JRA H.B. 69 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 69 By: Nixon, Joe Civil Practices 4/12/1999 Introduced BACKGROUND AND PURPOSE Currently, to seek legal redress against the state, a party must seek permission from the Legislature to sue the state. However, if the legislature waives this sovereign immunity, and the plaintiff prevails in the action against the state, the state remains immune from liability. A plaintiff cannot recover a court judgment from the state unless the state agrees to pay the judgment. H.B. 69 establishes a limited waiver of sovereign immunity and compels alternative dispute resolution for contracts involving engineering and construction services. Also, awards may not exceed the total value of the contract and may not include consequential, exemplary, and punitive damages. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Title 5, Civil Practice and Remedies Code, by adding Chapter 110, as follows: CHAPTER 110. CONTRACT CLAIMS AGAINST THE STATE Sec. 110.001. DEFINITION. Defines "unit of state government." Sec. 110.002. RIGHTS OF CONTRACTING PARTIES. Authorizes a claimant to proceed under Section 110.003 (Claim) with a claim alleging that a unit of state government (unit) has breached a written contract with the claimant for engineering or construction services. Waives sovereign immunity to an appeal under Section 110.006 (Appeal to Court). Sec. 110.003. CLAIM. Establishes that a claim may be filed with the chief administrative officer of the unit or another officer of the unit as designated in the contract (officer). Requires the sworn petition to contain a statement of the facts, the relief or remedy desired, a copy of the contract, and other relevant contract documents. Sec. 110.004. NEGOTIATION AND MEDIATION. Requires the officer to examine the claim and negotiate with the claimant to attempt a resolution. Requires the parties to mediate the claim with an independent mediator if it is not resolved within 31 days. Authorizes an extension to the mediation process if both parties agree. Requires the officer to provide the factual and legal basis for the position of the unit within 30 days after the end of the mediation if the mediation does not produce a settlement. Sec. 110.005. CONTESTED CASE HEARING. Authorizes the claimant to file an appeal with the unit. Provides that an appeal must state the factual and legal basis for the claim and must request that the claim be referred to the State Office of Administrative Hearings (SOAH) for a contested case hearing. Requires the unit to refer the claim to SOAH on receipt of an appeal. Sec. 110.006. APPEAL TO COURT. Specifies that the final order of the unit may be appealed as a final decision in a contested case under Section 2001.171, Government Code (Judicial Review), and that the appellate court may make an award under Section 110.007 (Award). Sec. 110.007. AWARD. Prohibits an award exceeding the amount of consideration the claimant was entitled to receive under the contract and prohibits consequential or similar damages, or exemplary damages. Sec. 110.008. VENUE. Requires an appeal brought under Section 110.006 (Appeal to Court) to be brought in Travis County. Sec. 110.009. SERVICE OF CITATION. Requires service of citation to be made on the attorney general and an officer of the unit against which the claim was brought. Sec. 110.010. PREJUDGMENT INTEREST. Provides that Chapter 304, Finance Code (Judgment Interest), applies to a judgment awarded under this chapter, except that the rate of interest may not exceed six percent. Sec. 110.011. SETTLEMENT. Authorizes the attorney general to settle or compromise an appeal. Sec. 110.012. PAYMENT OF JUDGMENT OR SETTLEMENT. Requires the unit to pay the judgment or settlement from money the unit is authorized to use for the services or property obtained under the contract on which the suit was based. To the extent such funds are unavailable, authorizes payment of the judgment or settlement only from funds appropriated by the legislature for the payment. Sec. 110.013. EXECUTION ON STATE PROPERTY NOT AUTHORIZED. Stipulates that this chapter does not authorize execution on property owned by the state or a unit of state government. Sec. 110.014. APPLICATION OF OTHER LAWS. Stipulates that Chapter 107 (Permission to Sue the State) does not apply to an appeal brought under Section 110.006 (Appeal to Court). SECTION 2. Effective date: September 1, 1999. SECTION 3. Makes application of this Act prospective. SECTION 4. Emergency clause.