By Nixon H.B. No. 69 76R109 DLF-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to claims against a unit of state government relating to 1-3 contracts for certain services or projects. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Title 5, Civil Practice and Remedies Code, is 1-6 amended by adding Chapter 110 to read as follows: 1-7 CHAPTER 110. CONTRACT CLAIMS AGAINST THE STATE 1-8 Sec. 110.001. DEFINITION. In this chapter, "unit of state 1-9 government" means the state or an agency, department, commission, 1-10 bureau, board, office, council, court, or other entity that is in 1-11 any branch of state government and that is created by the 1-12 constitution or a statute of this state, including a university 1-13 system or institution of higher education as defined by Section 1-14 61.003, Education Code. The term does not include a county, 1-15 municipality, court of a county or municipality, special purpose 1-16 district, or other political subdivision of this state. 1-17 Sec. 110.002. RIGHTS OF CONTRACTING PARTIES. (a) A 1-18 claimant may proceed under Section 110.003 with respect to a claim 1-19 against a unit of state government that alleges that the unit has 1-20 breached a written contract with the claimant for engineering or 1-21 construction services. 1-22 (b) Sovereign immunity to suit is waived for purposes of an 1-23 appeal under Section 110.006. 1-24 Sec. 110.003. CLAIM. A claim may be made by filing a 2-1 petition with the chief administrative officer or, if designated in 2-2 the contract, another officer of the unit of state government. The 2-3 petition must: 2-4 (1) contain a concise statement of the facts relied on 2-5 by the claimant, the relief or remedy desired, a copy of the 2-6 contract, and other contract documents that pertain to the claim; 2-7 and 2-8 (2) be sworn to by the claimant or the claimant's 2-9 representative or attorney. 2-10 Sec. 110.004. NEGOTIATION AND MEDIATION. (a) The chief 2-11 administrative officer or, if designated in the contract, another 2-12 officer of the unit of state government, shall examine the claim 2-13 and negotiate in good faith with the claimant in an effort to 2-14 resolve the claim. 2-15 (b) If the claim is not resolved before the 31st day after 2-16 the date the claim is received, the parties shall mediate the claim 2-17 with an independent mediator selected by the parties. The 2-18 mediation shall be completed during the following 30 days or, if 2-19 both parties agree to the extension during the mediation process, 2-20 may continue for a longer period. 2-21 (c) If the mediation does not produce agreement as to the 2-22 claim, the chief administrative officer or, if designated in the 2-23 contract, another officer of the unit of state government, shall 2-24 respond to the claim providing the factual and legal basis for the 2-25 position of the unit as to the claim not later than the 30th day 2-26 after the date the mediation is terminated. 2-27 Sec. 110.005. CONTESTED CASE HEARING. (a) If the claimant 3-1 is not satisfied with the response to the claim by the unit of 3-2 state government, the claimant may file an appeal with the unit. 3-3 (b) The appeal must: 3-4 (1) state the factual and legal basis for the claim; 3-5 and 3-6 (2) request that the claim be referred to the State 3-7 Office of Administrative Hearings for a contested case hearing. 3-8 (c) On receipt of an appeal under Subsection (a), the unit 3-9 of state government shall refer the claim to the State Office of 3-10 Administrative Hearings for a contested case hearing under Chapter 3-11 2001, Government Code, as to the issues raised in the appeal. 3-12 Sec. 110.006. APPEAL TO COURT. The final order of the unit 3-13 of state government on the claim may be appealed as a final 3-14 decision in a contested case under Section 2001.171, Government 3-15 Code, and the court to which the claim is appealed may make an 3-16 award in accordance with Section 110.007. 3-17 Sec. 110.007. AWARD. (a) An award based on a claim made 3-18 under this chapter may not exceed the total value of the 3-19 consideration the claimant was to receive under the contract, 3-20 including any charge accepted by a unit of state government. 3-21 (b) The award may not include any: 3-22 (1) consequential or similar damages; or 3-23 (2) exemplary damages. 3-24 Sec. 110.008. VENUE. An appeal brought under Section 3-25 110.006 shall be brought in Travis County. 3-26 Sec. 110.009. SERVICE OF CITATION. In an appeal brought 3-27 under Section 110.006, service of citation and other required 4-1 process must be made on: 4-2 (1) the attorney general; and 4-3 (2) the chief administrative officer or another 4-4 officer of the unit of state government with which the claimant 4-5 contracted. 4-6 Sec. 110.010. PREJUDGMENT INTEREST. Chapter 304, Finance 4-7 Code, applies to a judgment awarded to a claimant under this 4-8 chapter, except that the applicable rate of interest may not exceed 4-9 six percent. 4-10 Sec. 110.011. SETTLEMENT. The attorney general may settle 4-11 or compromise an appeal brought under Section 110.006. 4-12 Sec. 110.012. PAYMENT OF JUDGMENT OR SETTLEMENT. (a) A 4-13 unit of state government shall pay a judgment or settlement under 4-14 this chapter from money appropriated to the unit that the unit is 4-15 authorized to use for the services or property obtained under the 4-16 contract on which the suit was based. 4-17 (b) To the extent money described by Subsection (a) is not 4-18 available to make the payment, the judgment or settlement may be 4-19 paid only from money appropriated by the legislature for payment of 4-20 the judgment or settlement. 4-21 Sec. 110.013. EXECUTION ON STATE PROPERTY NOT AUTHORIZED. 4-22 This chapter does not authorize execution on property owned by the 4-23 state or a unit of state government. 4-24 Sec. 110.014. APPLICATION OF OTHER LAWS. Chapter 107 does 4-25 not apply to an appeal brought under Section 110.006. 4-26 SECTION 2. This Act takes effect September 1, 1999. 4-27 SECTION 3. (a) This Act applies only to a suit based on a 5-1 written contract described by Section 110.002, Civil Practice and 5-2 Remedies Code, as added by this Act, entered into by a unit of 5-3 state government on or after the effective date of this Act. A 5-4 suit based on a contract entered into before the effective date of 5-5 this Act is governed by the law as it existed immediately before 5-6 the effective date of this Act, and that law is continued in effect 5-7 for that purpose. 5-8 (b) For purposes of this section, a contract is entered into 5-9 after the effective date of this Act if it is executed or renewed 5-10 after the effective date of this Act. 5-11 SECTION 4. The importance of this legislation and the 5-12 crowded condition of the calendars in both houses create an 5-13 emergency and an imperative public necessity that the 5-14 constitutional rule requiring bills to be read on three several 5-15 days in each house be suspended, and this rule is hereby suspended.