By Ritter H.B. No. 3122
Line and page numbers may not match official copy.
Bill not drafted by TLC or Senate E&E.
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to prompt payment requirements for work performed by
1-3 contractors and subcontractors on certain real property.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 28.002, Property Code, is amended to read
1-6 as follows:
1-7 Sec. 28.002. Prompt Pay Required. (a) If an owner or a
1-8 person authorized to act on behalf of the owner receives a written
1-9 payment request from a contractor for an amount that is allowed to
1-10 the contractor under the contract for properly performed work or
1-11 suitably stored or specially fabricated materials, the owner shall
1-12 pay the amount to the contractor, less any amount withheld as
1-13 authorized by statute, not later than the 21st [35th] day after the
1-14 date the owner receives the request.
1-15 (b) A contractor who receives a payment under Subsection (a)
1-16 or otherwise from an owner in connection with a contract to improve
1-17 real property shall pay each of its subcontractors the portion of
1-18 the owner's payment, including interest, if any, that is
1-19 attributable to work properly performed or materials suitably
1-20 stored or specially fabricated as provided under the contract by
1-21 that subcontractor to the extent of that subcontractor's interest
1-22 in the owner's payment. The payment required by this subsection
1-23 must be made not later than the seventh day after the date the
2-1 contractor receives the owner's payment.
2-2 (c) A subcontractor who receives a payment under Subsection
2-3 (b) or otherwise from a contractor in connection with a contract to
2-4 improve real property shall pay each of its subcontractors the
2-5 portion of the payment, including interest, if any, that is
2-6 attributable to work properly performed or materials suitably
2-7 stored or specially fabricated as provided under the contract by
2-8 that subcontractor, to the extent of that subcontractor's interest
2-9 in the payment. The payment required by this subsection must be
2-10 made not later than the seventh day after the date the
2-11 subcontractor receives the contractor's payment.
2-12 SECTION 2. (a) This Act takes effect September 1, 2001.
2-13 (b) The changes in law made by this Act apply only to a
2-14 contract or agreement involving work performed on real property by
2-15 a contractor or subcontractor that is entered into on or after the
2-16 effective date of this Act. A contract or agreement entered into
2-17 before the effective date of this Act is governed by the law in
2-18 effect when the contract was entered into, and the former law is
2-19 continued in effect for that purpose.
2-20 SECTION 3. The importance of this legislation and the crowded
2-21 condition of the calendars in both houses create an emergency and
2-22 an imperative public necessity that the constitutional rule
2-23 requiring bills to be read on three several days in each house be
2-24 suspended, and this rule is hereby suspended.