By: Wentworth S.B. No. 1495
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 mechanic's, contractor's, and materialman's liens.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 1(c), Chapter 87, Acts of the 56th
1-5 Legislature, Regular Session, 1959 (Article 7.19-1, Vernon's Texas
1-6 Insurance Code), is amended to read as follows:
1-7 (c) A bond that is made, given, tendered, or filed under
1-8 Chapter 53 or 64, Property Code, or Chapter 2253, Government Code,
1-9 may be executed only by a surety company that is authorized and
1-10 admitted to write surety bonds in this state. If the amount of the
1-11 bond exceeds $100,000, the surety must also:
1-12 (1) hold a certificate of authority from the United
1-13 States secretary of the treasury to qualify as a surety on
1-14 obligations permitted or required under federal law; or
1-15 (2) have obtained reinsurance for any liability in
1-16 excess of $100,000 from a reinsurer that is authorized and admitted
1-17 as a reinsurer in this state and is the holder of a certificate of
1-18 authority from the United States secretary of the treasury to
1-19 qualify as a surety or reinsurer on obligations permitted or
1-20 required under federal law.
1-21 SECTION 2. Section 28.007(b), Property Code, is amended to
1-22 read as follows:
1-23 (b) Nothing in this statute shall be interpreted to change
2-1 the rights and obligations set forth in Chapter 53 or 64, Property
2-2 Code.
2-3 SECTION 3. The heading of Chapter 53, Property Code, is
2-4 amended to read as follows:
2-5 CHAPTER 53. MECHANIC'S, CONTRACTOR'S, OR MATERIALMAN'S LIEN
2-6 ON RESIDENTIAL PROPERTY
2-7 SECTION 4. Sections 53.001(8) and (9), Property Code, are
2-8 amended to read as follows:
2-9 (8) "Residence" means a single-family house, duplex,
2-10 triplex, or quadruplex or a unit in a multiunit structure used for
2-11 residential purposes that is:
2-12 (A) owned by one or more adult persons[;] and
2-13 [(B)] used or intended to be used as a dwelling by one
2-14 of the owners; or[.]
2-15 (B) being or intended to be newly constructed with the
2-16 purpose and intention of selling such to a person described in
2-17 (8)(A).
2-18 (9) "Residential construction contract" means a contract
2-19 between an owner and a contractor in which the contractor agrees to
2-20 construct or repair the owner's residence, including improvements
2-21 appurtenant to the residence. It does not include a residence
2-22 defined in (8)(B).
2-23 SECTION 5. Subchapter A, Chapter 53, Property Code, is
2-24 amended by adding Section 53.004 to read as follows:
2-25 Sec. 53.004. APPLICABILITY. This chapter applies only to
2-26 real property on which a residence is located.
3-1 SECTION 6. Section 53.021(a), Property Code, is amended to
3-2 read as follows:
3-3 (a) A person has a lien if:
3-4 (1) the person labors, specially fabricates material,
3-5 or furnishes labor or materials for construction or repair in this
3-6 state of a residence or any improvements appurtenant to a
3-7 residence, including[:]
3-8 [(A) a house, building, or improvement;]
3-9 [(B)] a levee or embankment to be erected for
3-10 the reclamation of overflow land along a river or creek if the
3-11 levee or embankment is connected to the lot on which the residence
3-12 is located[; or]
3-13 [(C) a railroad]; and
3-14 (2) the person labors, specially fabricates the
3-15 material, or furnishes the labor or materials under or by virtue of
3-16 a contract with the owner or the owner's agent, trustee, receiver,
3-17 contractor, or subcontractor.
3-18 SECTION 7. Sections 53.022(a), (c), and (d), Property Code,
3-19 are amended to read as follows:
3-20 (a) The lien extends to the residence or any improvements
3-21 appurtenant to the residence [house, building, fixtures, or
3-22 improvements], to the land reclaimed from overflow, [or the
3-23 railroad and all of its properties,] and to each lot of land
3-24 necessarily connected or reclaimed.
3-25 (c) A lien against land in a municipality [city, town, or
3-26 village] extends to each lot on which:
4-1 (1) the residence [house, building, or improvement] is
4-2 situated;
4-3 (2) any improvements appurtenant to the residence are
4-4 situated; or
4-5 (3) [on which] the labor was performed.
4-6 (d) A lien against land not in a municipality [city, town,
4-7 or village] extends to not more than 50 acres on which:
4-8 (1) the residence [house, building, or improvement] is
4-9 situated;
4-10 (2) any improvements appurtenant to the residence are
4-11 situated; or
4-12 (3) [on which] the labor was performed.
4-13 SECTION 8. Section 53.052(a), Property Code, is amended to
4-14 read as follows:
4-15 (a) Except as provided by Subsection (b), the person
4-16 claiming the lien must file an affidavit with the county clerk of
4-17 the county in which the property is located [or into which the
4-18 railroad extends] not later than the 15th day of the fourth
4-19 calendar month after the day on which the indebtedness accrues.
4-20 SECTION 9. Section 53.123(a), Property Code, is amended to
4-21 read as follows:
4-22 (a) Except as provided by this section, a mechanic's lien
4-23 attaches to the residence or any improvements appurtenant to the
4-24 residence [house, building, improvements, or railroad property] in
4-25 preference to any prior lien, encumbrance, or mortgage on the land
4-26 on which it is located, and the person enforcing the lien may have
5-1 the residence or any improvements appurtenant to the residence
5-2 [house, building, improvement, or any piece of the railroad
5-3 property] sold separately.
5-4 SECTION 10. Section 53.155, Property Code, is amended to
5-5 read as follows:
5-6 Sec. 53.155. TRANSFER OF PROPERTY SOLD. If the residence is
5-7 or any improvements appurtenant to the residence are [house,
5-8 building, improvement, or any piece of railroad property is] sold
5-9 separately, the officer making the sale shall place the purchaser
5-10 in possession. The purchaser is entitled to a reasonable time
5-11 after the date of purchase within which to remove the purchased
5-12 property.
5-13 SECTION 11. Subtitle B, Title 5, Property Code, is amended
5-14 by adding Chapter 64 to read as follows:
5-15 CHAPTER 64. MECHANIC'S, CONTRACTOR'S, OR MATERIALMAN'S
5-16 LIEN ON NONRESIDENTIAL PROPERTY
5-17 SUBCHAPTER A. GENERAL PROVISIONS
5-18 Sec. 64.001. DEFINITIONS. In this chapter:
5-19 (1) "Construction lender" means any mortgagee or
5-20 beneficiary under a deed of trust, including an assignee or
5-21 successor in interest of a mortgagee or beneficiary, who lends
5-22 funds for the cost of the construction, alteration, or repair of an
5-23 improvement.
5-24 (2) "Contract price" means the cost to the owner for
5-25 any part of construction or repair performed under an original
5-26 contract.
6-1 (3) "Improvement" includes:
6-2 (A) abutting sidewalks and streets and utilities
6-3 in or on those sidewalks and streets;
6-4 (B) clearing, grubbing, draining, or fencing of
6-5 land;
6-6 (C) wells, cisterns, tanks, reservoirs, or
6-7 artificial lakes or pools made for supplying or storing water;
6-8 (D) pumps, siphons, and windmills or other
6-9 machinery or apparatuses used for raising water for stock, domestic
6-10 use, or irrigation; and
6-11 (E) planting orchard trees, grubbing out
6-12 orchards and replacing trees, and pruning of orchard trees.
6-13 (4) "Labor" means labor used in the direct prosecution
6-14 of work.
6-15 (5) "Material" means all or part of:
6-16 (A) the material, machinery, equipment,
6-17 fixtures, or tools incorporated into work, consumed in the direct
6-18 prosecution of work, or ordered and delivered for incorporation or
6-19 consumption;
6-20 (B) rent at a reasonable rate and actual running
6-21 repairs at a reasonable cost for construction equipment used or
6-22 reasonably required and delivered for use in the direct prosecution
6-23 of work at the site of the construction or repair; or
6-24 (C) power, water, fuel, and lubricants consumed
6-25 or ordered and delivered for consumption in the direct prosecution
6-26 of work.
7-1 (6) "Mechanic's lien" means the lien provided by this
7-2 chapter.
7-3 (7) "Original contract" means an agreement to which an
7-4 owner is a party either directly or by implication of law.
7-5 (8) "Original contractor" means a person contracting
7-6 with an owner either directly or through the owner's agent.
7-7 (9) "Professional services" means services the
7-8 provision of which is governed by Article 249a, 3271a, or 5282c,
7-9 Vernon's Texas Civil Statutes, and which are performed by a person
7-10 registered or licensed under one of those articles in connection
7-11 with work performed on real property.
7-12 (10) "Specially fabricated material" means material
7-13 fabricated for use as a component of construction or repair so as
7-14 to be reasonably unsuitable for use elsewhere.
7-15 (11) "Subcontractor" means a person who has furnished
7-16 labor or materials to fulfill an obligation to an original
7-17 contractor or to a subcontractor to perform all or part of the work
7-18 required by an original contract.
7-19 (12) "Work" means any part of construction,
7-20 alteration, repair, or improvement performed under an original
7-21 contract.
7-22 Sec. 64.002. APPLICABILITY. This chapter applies to all
7-23 real property that is not residential property to which Chapter 53
7-24 applies.
7-25 Sec. 64.003. EXEMPTION. This chapter does not apply to a
7-26 lien created under Chapter 62, as added by Chapter 742, Acts of the
8-1 76th Legislature, Regular Session, 1999, or Chapter 62, as added by
8-2 Chapter 1571, Acts of the 76th Legislature, Regular Session, 1999.
8-3 Sec. 64.004. NOTICES. (a) This section applies to notices
8-4 required by this chapter.
8-5 (b) Any notice or other written communication may be
8-6 delivered in person to the party entitled to receive the notice or
8-7 to that party's agent, regardless of the manner prescribed by law.
8-8 (c) If a notice is sent by electronic means, the delivery is
8-9 sufficient if the party entitled to receive the notice or that
8-10 party's agent receives the notice.
8-11 (d) If notice is sent by registered or certified mail,
8-12 deposit or mailing of the notice in the United States mail in the
8-13 form required constitutes compliance with the notice requirement.
8-14 (e) If a written notice is received by the person entitled
8-15 to receive it, the method by which the notice is delivered is
8-16 immaterial.
8-17 (f) If an owner designates another person to whom notices or
8-18 other documents may be delivered, the failure by a claimant to
8-19 deliver a notice or other document to the person designated does
8-20 not invalidate an otherwise valid notice or lien.
8-21 Sec. 64.005. MORE THAN ONE ORIGINAL CONTRACTOR. On any work
8-22 there may be more than one original contractor for purposes of this
8-23 chapter.
8-24 Sec. 64.006. OWNER'S LIABILITY. (a) An owner is liable for
8-25 payment in full for all labor, materials, or professional services
8-26 furnished or to be furnished for work on the owner's property.
9-1 (b) A claimant may establish and foreclose a lien under this
9-2 chapter for unpaid labor, materials, or professional services as
9-3 provided by this chapter.
9-4 Sec. 64.007. ATTORNEY'S FEES. In any action brought under
9-5 this chapter, the court shall award to the prevailing party costs,
9-6 any interest provided for by law, and reasonable attorney's fees.
9-7 (Sections 64.008-64.020 reserved for expansion
9-8 SUBCHAPTER B. NOTICE OF COMMENCEMENT
9-9 Sec. 64.021. NOTICE OF COMMENCEMENT. (a) If an owner
9-10 enters into an original contract for work that exceeds $5,000, the
9-11 owner or the owner's authorized agent shall:
9-12 (1) file a notice of commencement in the office of the
9-13 county clerk of the county in which the property is located;
9-14 (2) continuously post at the site where the work is
9-15 performed:
9-16 (A) a certified copy of the notice; or
9-17 (B) a notarized document stating that the notice
9-18 has been filed with a copy of the notice attached; and
9-19 (3) provide to the local authority that issues
9-20 building permits or performs building inspections on or before the
9-21 date an application is made for a building inspection:
9-22 (A) a certified copy of the notice; or
9-23 (B) a notarized document stating that the notice
9-24 has been filed with a copy of the notice attached.
9-25 (b) The notice of commencement must be filed and posted as
9-26 required by Subsection (a) before work commences or before work
10-1 resumes after a default, termination, abandonment, or cessation of
10-2 work. This subsection applies regardless of whether any of the
10-3 work is covered by a payment bond that complies with this chapter.
10-4 (c) The notice of commencement must contain the following
10-5 information:
10-6 (1) a legal description of the property and the street
10-7 address of the property or, if no street address is available,
10-8 additional information sufficient to describe the physical location
10-9 of the property;
10-10 (2) a general description of the work that is the
10-11 subject of the original contract;
10-12 (3) the name and address of the owner and a
10-13 description of the owner's interest in the property;
10-14 (4) the name and address of the person who owns fee
10-15 simple title to the property, if different from the owner;
10-16 (5) the name and address of the original contractor;
10-17 (6) the name and address of the surety on the payment
10-18 bond established under this chapter, if any, and the amount of the
10-19 bond;
10-20 (7) the name and address of any person making a loan
10-21 for the work;
10-22 (8) the name and address of a person in this state,
10-23 other than the owner, who is designated by the owner as the person
10-24 on whom notices or other documents may be served under this
10-25 chapter; and
10-26 (9) any expiration date applicable to the notice
11-1 imposed under Subsection (g).
11-2 (d) A notice of commencement must be substantially similar
11-3 to the following form:
11-4 Permit No. _____
11-5 Issued by ______
11-6 NOTICE OF COMMENCEMENT
11-7 State of Texas
11-8 County of _________________
11-9 The undersigned hereby gives notice that improvements will be
11-10 made to certain real property, and in accordance with Chapter 64,
11-11 Property Code, the following information is provided in this notice
11-12 of commencement.
11-13 (1) Description of property (legal description of the
11-14 property and street address if available).
11-15 _______________________________________________________
11-16 (2) General description of improvement _________
11-17 _______________________________________________________
11-18 (3) Owner information:
11-19 (a) Name and address _______________________
11-20 (b) Interest in property ___________________
11-21 ________________________________________
11-22 (c) Name and address of person who owns fee
11-23 simple title (if other than owner)
11-24 ________________________________________
11-25 (4) Original Contractor:
11-26 (a) Name and address _____________________
12-1 ________________________________________
12-2 (b) Phone number ___________________________
12-3 (c) Fax number ___________________________
12-4 (optional, if service by fax is
12-5 acceptable)
12-6 (5) Surety:
12-7 (a) Name and address _____________________
12-8 ________________________________________
12-9 (b) Phone number ___________________________
12-10 (c) Fax number ___________________________
12-11 (optional, if service by fax is
12-12 acceptable)
12-13 (d) Amount of bond $________________________
12-14 (6) Lender:
12-15 (a) Name and address ______________________
12-16 ________________________________________
12-17 (b) Phone number ___________________________
12-18 (c) Fax number ____________________________
12-19 (optional, if service by fax is
12-20 acceptable)
12-21 (7) Each person in this state designated by owner
12-22 for service of notices or other documents:
12-23 (a) Name and address ______________________
12-24 ________________________________________
12-25 (b) Phone number ___________________________
12-26 (c) Fax number ____________________________
13-1 (optional, if service by fax is
13-2 acceptable)
13-3 (8) Expiration date of notice of commencement
13-4 __________________________________________________
13-5 _____________________________ (Signature of owner)
13-6 Sworn to and subscribed before me this ______ day
13-7 of ____, (year) by ____________________________ (name
13-8 of person making statement).
13-9 ___________________________ (Signature and seal of
13-10 Notary Public--State of Texas)
13-11 (e) A copy of any bond provided must be attached at the time
13-12 the notice of commencement is filed.
13-13 (f) The notice of commencement is effective on the date the
13-14 notice is filed in the county clerk's office as provided by this
13-15 section.
13-16 (g) A notice of commencement expires:
13-17 (1) one year after the date the notice is filed; or
13-18 (2) the date prescribed by the contract for completion
13-19 of the work if the contract between the owner and a contractor
13-20 named in the notice of commencement provides for a period for
13-21 completion that exceeds one year.
13-22 (h) The owner must sign the notice of commencement. The
13-23 owner may not authorize another person to sign on the owner's
13-24 behalf.
13-25 Sec. 64.022. FAILURE TO BEGIN WORK. If the work described
13-26 in the notice of commencement does not begin within 90 days after
14-1 the date the notice is filed, the notice is void.
14-2 Sec. 64.023. EFFECT OF NOTICE. Unless otherwise provided in
14-3 the notice of commencement, including an amended notice of
14-4 commencement, a notice of commencement is not effective after the
14-5 first anniversary of the date the notice of commencement is filed
14-6 against:
14-7 (1) a conveyance, transfer, or mortgage of or lien on
14-8 the real property described in the notice; or
14-9 (2) a creditor or subsequent purchaser for a valuable
14-10 consideration.
14-11 Sec. 64.024. RELIANCE ON INFORMATION. A person required or
14-12 entitled to file or provide a notice, lien, or claim under this
14-13 chapter may rely on the validity of the information contained in a
14-14 notice of commencement.
14-15 Sec. 64.025. AMENDED NOTICE. (a) An owner shall file and
14-16 post an amended notice of commencement prescribed by Section 64.021
14-17 when information contained in an existing notice of commencement
14-18 changes.
14-19 (b) The owner shall provide a copy of the amended notice to
14-20 each person who has provided a notice under Subchapter C.
14-21 (c) Information in an amended notice of commencement may not
14-22 be used as a basis to invalidate a notice, lien, or claim properly
14-23 filed or provided under this chapter if the person filing or
14-24 providing the notice, lien, or claim:
14-25 (1) relied on the information in the latest preceding
14-26 notice of commencement or amended notice of commencement; and
15-1 (2) filed or provided the notice, lien, or claim
15-2 before receiving the amended notice.
15-3 Sec. 64.026. APPLICABILITY TO BUILDING PERMITS. (a) A
15-4 local authority that issues building permits shall:
15-5 (1) print on the face of each permit in at least
15-6 12-point, capitalized, boldfaced type:
15-7 "WARNING TO OWNER: YOUR FAILURE TO FILE A NOTICE OF COMMENCEMENT
15-8 AS REQUIRED BY CHAPTER 64, PROPERTY CODE, MAY CONSTITUTE A
15-9 VIOLATION OF LAW AND RESULT IN THE FAILURE TO QUALIFY FOR BUILDING
15-10 INSPECTIONS.";
15-11 (2) provide with the permit application a written
15-12 statement that:
15-13 (A) summarizes the provisions of this chapter
15-14 relating to filing and posting requirements for a notice of
15-15 commencement; and
15-16 (B) encourages the owner to file a notice of
15-17 commencement and post a copy of the notice as provided by this
15-18 chapter;
15-19 (3) inform each applicant who is not the person whose
15-20 right, title, and interest is subject to attachment that, as a
15-21 condition precedent to the issuance of a building permit, the
15-22 applicant must promise in good faith to ensure delivery of the
15-23 statements provided under Subdivisions (1) and (2) to the person
15-24 whose property is subject to attachment;
15-25 (4) provide to the applicant at least two copies of a
15-26 notice of commencement form that complies with this subchapter;
16-1 (5) verify that the name and address of the owner, the
16-2 name of the contractor, and the location or address of the property
16-3 as each appears in the certified copy of the notice of commencement
16-4 is consistent with the information provided in the building permit
16-5 application; and
16-6 (6) provide the information contained in the certified
16-7 copy of the filed notice of commencement to any person on request.
16-8 (b) A local authority that issues building permits may not
16-9 perform or approve an inspection until the applicant complies with
16-10 Section 64.021(a)(3).
16-11 (c) This section does not require the filing of a notice of
16-12 commencement before the issuance of a building permit.
16-13 (d) A local authority that issues building permits is not
16-14 liable in any civil action for the failure to comply with the
16-15 requirements of this section.
16-16 (e) This section applies to each political subdivision that
16-17 has a system of issuing building permits for construction,
16-18 alterations, repairs, or other improvement on or to real property
16-19 located within the geographic limits of the political subdivision.
16-20 (Sections 64.027-64.050 reserved for expansion
16-21 SUBCHAPTER C. PRELIMINARY 30-DAY NOTICE
16-22 Sec. 64.051. PRELIMINARY 30-DAY NOTICE. (a) Except for an
16-23 original contractor or a person performing labor for wages, each
16-24 person who furnishes labor, materials, or professional services for
16-25 which a lien may be claimed under this chapter shall provide a
16-26 written preliminary 30-day notice as prescribed by this section to
17-1 the owner or reputed owner, the original contractor or reputed
17-2 contractor, the construction lender, if any, or reputed
17-3 construction lender, if any, and the person with whom the claimant
17-4 has contracted for the purchase of the labor, materials, or
17-5 professional services.
17-6 (b) A person claiming a lien under this chapter shall
17-7 provide the preliminary 30-day notice not later than the 30th day
17-8 after the date the claimant first furnishes labor, materials, or
17-9 professional services to the property. The notice may be provided
17-10 before the date the claimant first furnishes labor, materials, or
17-11 professional services.
17-12 (c) A person who enters into a contract to furnish specially
17-13 fabricated materials for which a lien may be claimed under this
17-14 chapter shall provide the preliminary 30-day notice to each person
17-15 referenced in Subsection (a) not later than the earlier of:
17-16 (1) the 30th day after the date the material would
17-17 reasonably have been required to be delivered; or
17-18 (2) the 30th day after the date:
17-19 (A) the owner or contractor materially breaches
17-20 or terminates the original contract; or
17-21 (B) the subcontract under which the specially
17-22 fabricated material is furnished is materially breached or
17-23 terminated.
17-24 (d) In addition to the methods of delivering notice provided
17-25 by Section 64.004, a person may deliver a preliminary 30-day notice
17-26 by first class mail. Delivery is complete under this subsection
18-1 when the notice is deposited or mailed in the United States mail in
18-2 the form required.
18-3 (e) The preliminary 30-day notice is not required to be
18-4 provided before the 30th day after the date the owner files and
18-5 posts the notice of commencement. The failure to provide a
18-6 preliminary 30-day notice before the 30th day after the date the
18-7 notice of commencement is filed and posted under Subchapter B does
18-8 not invalidate a lien under this chapter.
18-9 (f) The preliminary 30-day notice must contain:
18-10 (1) a general description of the labor, materials, or
18-11 professional services furnished or to be furnished;
18-12 (2) the name and address, and the telephone number, if
18-13 any, of the person furnishing the labor, materials, or professional
18-14 services;
18-15 (3) the name of the person who contracted for the
18-16 purchase of the labor, materials, or professional services;
18-17 (4) an estimate of the total price for the labor,
18-18 materials, or professional services and, if the contract is not for
18-19 a fixed amount, a description of the method described by the
18-20 contract to determine the amount to be paid under the contract;
18-21 (5) a description of the real property to which the
18-22 labor, materials, or professional services are furnished or are to
18-23 be furnished sufficient to identify the property, including a legal
18-24 description, subdivision plat, or street address; and
18-25 (6) the additional disclosures required in the form
18-26 described by Subsection (g).
19-1 (g) The preliminary 30-day notice must be substantially
19-2 similar to the following form:
19-3 PRELIMINARY 30-DAY LIEN NOTICE
19-4 In accordance with Chapter 64, Property Code, this notice is
19-5 not a lien and is not a reflection on the integrity of any
19-6 contractor or subcontractor.
19-7 This preliminary lien notice has been completed by
19-8 (name and address of claimant)
19-9 __________________________________________________
19-10 Date _____________________________________________
19-11 By _______________________________________________
19-12 Address __________________________________________
19-13 The name and address of the owner or reputed owner is
19-14 ______________________________________________
19-15 The name and address of the original contractor is
19-16 ____________________________________________________
19-17 You are hereby notified that the claimant has furnished or
19-18 will furnish labor, materials, or professional services of the
19-19 following general description: ___________________________________
19-20 The name and address of any lender or reputed lender,
19-21 including an assignee, is _________________________________________
19-22 The labor, materials, or professional services are or will be
19-23 furnished for work on the building, structure, or improvement
19-24 located at ___________________________ and situated on the real
19-25 property located in ______________ County, Texas, described as
19-26 follows: __________________________________________________________
20-1 The name and address of the person with whom the claimant has
20-2 contracted is _____________________________________________________
20-3 Check all applicable:
20-4 (____) The contract is for a fixed estimated amount and the
20-5 estimate of the total price of the labor, materials, or
20-6 professional services, or tools furnished or to be furnished, is
20-7 $______________.
20-8 (____) The contract is for a variable amount or it is for a
20-9 fixed and variable amount. The variable amount is computed based
20-10 on the following mechanism: ______________________________. As
20-11 of this date, the estimated amount for purposes of this notice is
20-12 $_________, but this amount may change.
20-13 (The following statement must be printed in
20-14 10-point boldfaced type.)
20-15 NOTICE TO PROPERTY OWNER
20-16 If bills are not paid in full for the labor, materials, or
20-17 services furnished, or to be furnished, the person to whom payment
20-18 is owed may claim a mechanic's lien against all or part of your
20-19 property and is entitled to foreclose on all or part of your
20-20 property to recover the amount owed. To protect yourself against
20-21 this consequence you should:
20-22 (1) require your contractor to provide a conditional waiver
20-23 and release as provided by Chapter 64, Property Code, signed by the
20-24 person giving you this notice before you make any payment to your
20-25 contractor;
20-26 (2) require your contractor to provide an unconditional
21-1 waiver and release as provided by Chapter 64, Property Code, signed
21-2 by the person giving you this notice after you make a payment to
21-3 your contractor;
21-4 (3) use any similar method or device that is appropriate
21-5 under the circumstances.
21-6 (The following language must be printed in a type at least as
21-7 large as the largest type used in the document:)
21-8 Not later than the 10th day after the date this preliminary
21-9 30-day notice is received by the owner, the owner shall:
21-10 (1) provide all information necessary to correct any
21-11 inaccuracies in the notice or forfeit the right to claim any
21-12 inaccuracy of that information as a defense to a claim under this
21-13 chapter; and
21-14 (2) provide to the person who has given the preliminary
21-15 30-day notice a copy of the payment bond, if any payment bond has
21-16 been filed in compliance with Chapter 64, Property Code, including
21-17 the name and address of the surety company and bonding agent
21-18 providing the payment bond.
21-19 If the owner fails to provide the bond information within the
21-20 10-day period, the claimant shall retain any rights that the
21-21 claimant would be precluded or prejudiced from asserting in a claim
21-22 against the bond if the loss of the right is a direct result of the
21-23 owner's failure to provide the bond information.
21-24 Date ___________________________
21-25 ________________________________ (Company name)
21-26 By _____________________________ (Signature)
22-1 ________________________________ (Title)
22-2 Sec. 64.052. DELAYED, ADDITIONAL, OR AMENDED PRELIMINARY
22-3 30-DAY NOTICE. (a) If labor, materials, or professional services
22-4 are furnished to property by a person who does not provide a
22-5 preliminary 30-day notice as required by Section 64.051, the person
22-6 is not precluded from providing a preliminary 30-day notice as
22-7 prescribed by this subchapter after furnishing additional labor,
22-8 materials, or professional services to the property. The person
22-9 may claim a lien only for the labor, materials, or professional
22-10 services furnished during the 30 days before the date the notice is
22-11 provided and for all labor, materials, or professional services
22-12 furnished thereafter.
22-13 (b) A person required by this subchapter to provide a
22-14 preliminary 30-day notice to the owner, to an original contractor,
22-15 to the construction lender, if any, and to the person with whom the
22-16 claimant has contracted is required to provide the notice only once
22-17 to each person with respect to all labor, materials, or
22-18 professional services furnished or to be furnished for the
22-19 building, structure, or improvement.
22-20 (c) If a preliminary 30-day notice contains a general
22-21 description of the labor, materials, or professional services
22-22 furnished or to be furnished, the notice is not defective if, after
22-23 the date of the notice, the person providing notice furnishes
22-24 labor, materials, or professional services that are not within the
22-25 scope of the general description.
22-26 Sec. 64.053. PROOF OF SERVICE OF NOTICE. (a) A person
23-1 required to provide proof that a preliminary 30-day notice was
23-2 provided as prescribed by this subchapter may provide that proof by
23-3 producing an acknowledgment of receipt of the notice that is
23-4 substantially similar to the following form:
23-5 ACKNOWLEDGMENT OF RECEIPT OF PRELIMINARY 30-DAY NOTICE
23-6 This acknowledges receipt on ____________________ (insert
23-7 date) of a copy of the preliminary 30-day notice at
23-8 ________________________________ (insert address).
23-9 Date: _______________ (Date this acknowledgment is executed)
23-10 ____________________________ (Signature of person
23-11 acknowledging receipt, with title if acknowledgment is made on
23-12 behalf of another person)
23-13 (b) If a person to whom a preliminary 30-day notice is
23-14 served fails to complete the acknowledgment or fails to complete
23-15 and return the acknowledgment within 30 days from the date of
23-16 mailing, proof of service may be shown by an affidavit of the
23-17 person sending the notice, showing the time, place, and manner of
23-18 mailing or delivery and stating the facts demonstrating that the
23-19 service was made as prescribed by this subchapter. The affidavit
23-20 must state the name and address of the person to whom a copy of the
23-21 notice was sent. The affidavit constitutes prima facie proof and
23-22 creates a rebuttable presumption of mailing or delivery.
23-23 (Sections 64.054-64.080 reserved for expansion
23-24 SUBCHAPTER D. PERSONS ENTITLED TO LIEN; SUBJECT PROPERTY
23-25 Sec. 64.081. PERSONS ENTITLED TO LIEN. (a) A person has a
23-26 lien if:
24-1 (1) the person labors, specially fabricates material,
24-2 or furnishes labor, materials, or professional services for
24-3 construction, alteration, or repair in this state of:
24-4 (A) a building, structure, or improvement;
24-5 (B) a levee or embankment to be erected for the
24-6 reclamation of overflow land along a river or creek; or
24-7 (C) a railroad; and
24-8 (2) the person labors, specially fabricates the
24-9 material, furnishes labor, materials, or professional services
24-10 under or by virtue of a contract with the owner or the owner's
24-11 agent, trustee, receiver, contractor, or subcontractor.
24-12 (b) A person who specially fabricates material has a lien
24-13 even if the material is not delivered.
24-14 (c) A person who provides professional services, but who
24-15 does not hold a license or certificate of registration to provide
24-16 those services, may not claim a lien under this chapter for those
24-17 services.
24-18 Sec. 64.082. PROPERTY TO WHICH LIEN EXTENDS. (a) The lien
24-19 extends to the building, fixtures, structure, or improvement, the
24-20 land reclaimed from overflow, or the railroad and all of its
24-21 properties, and to each lot of land necessarily connected or
24-22 reclaimed.
24-23 (b) A lien against land in a municipality extends to each
24-24 lot on which the building, structure, or improvement is situated or
24-25 on which the labor was performed.
24-26 (c) A lien against land not in a municipality extends to not
25-1 more than 50 acres on which the building, structure, or improvement
25-2 is situated or on which the labor was performed.
25-3 (d) The lien does not extend to abutting sidewalks, streets,
25-4 and utilities that are public property.
25-5 Sec. 64.083. PAYMENT SECURED BY LIEN. The lien secures
25-6 payment for:
25-7 (1) the labor performed or materials furnished for the
25-8 construction, alteration, or repair;
25-9 (2) the specially fabricated material, even if the
25-10 material has not been delivered or incorporated into the
25-11 construction, alteration, or repair; or
25-12 (3) the professional services provided.
25-13 Sec. 64.084. SHAM CONTRACT. (a) A person who labors,
25-14 specially fabricates materials, or furnishes labor, materials, or
25-15 professional services under a direct contractual relationship with
25-16 another person is considered to be in direct contractual
25-17 relationship with the owner and has a lien as an original
25-18 contractor, if:
25-19 (1) the owner contracted with the other person for the
25-20 construction or repair of a building, structure, or improvement and
25-21 the owner can effectively control that person through ownership of
25-22 voting stock, interlocking directorships, or otherwise;
25-23 (2) the owner contracted with the other person for the
25-24 construction, alteration, or repair of a building, structure, or
25-25 improvement and that other person can effectively control the owner
25-26 through ownership of voting stock, interlocking directorships, or
26-1 otherwise; or
26-2 (3) the owner contracted with the other person for the
26-3 construction, alteration, or repair of a building, structure, or
26-4 improvement and the contract was made without a good faith
26-5 intention of the parties that the other person was to perform the
26-6 contract.
26-7 (b) In this section, "owner" does not include a person who
26-8 has or claims a security interest only.
26-9 (Sections 64.085-64.100 reserved for expansion
26-10 SUBCHAPTER E. WAIVER OF LIEN
26-11 Sec. 64.101. WAIVER OF LIEN. (a) An owner or contractor by
26-12 any term of its contract, or otherwise, may not waive or impair the
26-13 claims or liens of other persons whether with or without notice
26-14 except by written consent as prescribed by this subchapter. Any
26-15 term of the contract to that effect is void.
26-16 (b) Any written consent to a waiver given by any person is
26-17 unenforceable unless the person executes and delivers a waiver and
26-18 release as prescribed by this subchapter.
26-19 (c) The waiver and release is effective to release the
26-20 property from claims and liens for the benefit of the owner, the
26-21 construction lender, the contractor, and the surety on a payment
26-22 bond only if:
26-23 (1) the waiver and release substantially follows one
26-24 of the forms prescribed by this subchapter;
26-25 (2) the waiver is signed by the claimant or the
26-26 claimant's authorized agent; and
27-1 (3) in the case of a conditional release, there is
27-2 evidence of payment to the claimant.
27-3 Sec. 64.102. CONDITIONS FOR WAIVER, RELEASE, OR IMPAIRMENT
27-4 OF CLAIM. (a) An oral or written statement purporting to waive,
27-5 release, or otherwise adversely affect a claim is not enforceable
27-6 and does not create an estoppel or impairment of a claim unless:
27-7 (1) the written waiver and release complies with this
27-8 subchapter; or
27-9 (2) the claimant has actually received payment in full
27-10 for the claim.
27-11 (b) This section does not affect the enforceability of an
27-12 accord and satisfaction regarding a bona fide dispute or any
27-13 agreement made in settlement of an action pending in any court if
27-14 the accord and satisfaction or agreement and settlement make
27-15 specific reference to the mechanic's lien or bond claims.
27-16 Sec. 64.103. PRESCRIBED FORMS FOR WAIVER AND RELEASE OF
27-17 CLAIM. (a) The waiver and release provided by any claimant is
27-18 unenforceable unless it substantially follows the applicable form
27-19 prescribed by this section.
27-20 (b) If the claimant is required to execute a waiver and
27-21 release in exchange for or to induce the payment of a progress
27-22 payment and the claimant is not paid in exchange for the waiver and
27-23 release or a single payee check or joint payee check is given in
27-24 exchange for the waiver and release, the waiver and release must be
27-25 substantially similar to the following form:
28-1 CONDITIONAL WAIVER AND RELEASE ON PROGRESS PAYMENT
28-2 Project ___________________
28-3 Job No. ___________________
28-4 On receipt by the undersigned of a check from
28-5 ________________ (maker of check) in the sum of $__________ (amount
28-6 of check) payable to _____________________ (payee or payees of
28-7 check) and when the check has been properly endorsed and has been
28-8 paid by the bank on which it is drawn, this document becomes
28-9 effective to release any mechanic's lien, any state or federal
28-10 statutory bond right, any private bond right, any claim for
28-11 payment, and any rights under any similar ordinance, rule, or
28-12 statute related to claim or payment rights for persons in the
28-13 undersigned's position that the undersigned has on the property of
28-14 ____________________ (owner) located at __________________________
28-15 (location) to the following extent ______________________ (job
28-16 description).
28-17 This release covers a progress payment for all labor,
28-18 services, or materials, including equipment, furnished to the
28-19 property or to __________________, (person with whom undersigned
28-20 contracted) on or before ____________ (date). This release does
28-21 not cover any retention or pending modifications or changes, or any
28-22 labor, services, or materials, including equipment, that are not
28-23 covered by progress payments furnished on, before, or after that
28-24 date. Retention and pending modifications and changes furnished on
28-25 or before the above date total ______________.
28-26 Before any recipient of this document relies on this
29-1 document, the recipient should verify evidence of payment to the
29-2 undersigned.
29-3 The undersigned warrants that the undersigned has already
29-4 paid or will use the funds received from this progress payment to
29-5 promptly pay in full all of the undersigned's laborers,
29-6 subcontractors, materialmen, and suppliers for all labor, services,
29-7 or materials, including equipment, furnished for or to the above
29-8 referenced project up to the above referenced date.
29-9 Date _____________________________
29-10 __________________________________ (Company name)
29-11 By _______________________________ (Signature)
29-12 __________________________________ (Title)
29-13 (c) If the claimant is required to execute a waiver and
29-14 release to prove the receipt of good and sufficient funds for a
29-15 progress payment and the claimant asserts in the waiver that the
29-16 claimant has been paid the progress payment, the waiver and release
29-17 must be substantially similar to the following form:
29-18 (Each unconditional waiver must contain the following
29-19 language printed at the top of the document in bold type at least
29-20 as large as the largest type used in the document but not smaller
29-21 than 12-point type:)
29-22 NOTICE:
29-23 This document waives rights unconditionally and states that
29-24 you have been paid for giving up those rights. This document is
29-25 enforceable against you if you sign it, even if you have not been
29-26 paid. If you have not been paid, use a conditional release form.
30-1 UNCONDITIONAL WAIVER AND RELEASE ON PROGRESS PAYMENT
30-2 Project ___________________
30-3 Job No. ___________________
30-4 The undersigned has been paid and has received a progress
30-5 payment in the sum of $___________ for all labor, services, or
30-6 materials, including equipment, furnished to the property or to
30-7 _____________________ (person with whom undersigned contracted) on
30-8 the property of ________________________________ (owner) located at
30-9 ________________________________________ to the following extent
30-10 ________________________________ (job description) and does hereby
30-11 release any mechanic's lien, any state or federal statutory bond
30-12 right, any private bond right, any claim for payment, and any
30-13 rights under any similar ordinance, rule, or statute related to
30-14 claim or payment rights for persons in the undersigned's position
30-15 that the undersigned has on the above referenced project to the
30-16 following extent.
30-17 This release covers a progress payment for all labor,
30-18 services, or materials, including equipment, furnished to the
30-19 property or to __________________, (person with whom undersigned
30-20 contracted) on or before ____________ (date). This release does
30-21 not cover any retention or pending modifications or changes, or any
30-22 labor, services, or materials, including equipment, that are not
30-23 covered by progress payments furnished on, before, or after that
30-24 date. Retention and pending modifications and changes furnished on
30-25 or before the above date total _____________.
30-26 The undersigned warrants that the undersigned has already
31-1 paid or will use the funds received from this progress payment to
31-2 promptly pay in full all of the undersigned's laborers,
31-3 subcontractors, materialmen, and suppliers for all labor, services,
31-4 or materials, including equipment, furnished for or to the above
31-5 referenced project up to the above referenced date.
31-6 Date _____________________________
31-7 __________________________________ (Company name)
31-8 By _______________________________ (Signature)
31-9 __________________________________ (Title)
31-10 (d) If the claimant is required to execute a waiver and
31-11 release in exchange for or in order to induce payment of a final
31-12 payment and the claimant is not paid in exchange for the waiver and
31-13 release or a single payee check or joint payee check is given in
31-14 exchange for the waiver and release, the waiver and release must be
31-15 substantially similar to the following form:
31-16 CONDITIONAL WAIVER AND RELEASE ON FINAL PAYMENT
31-17 Project ___________________
31-18 Job No. ___________________
31-19 On receipt by the undersigned of a check from
31-20 ________________ (maker of check) in the sum of $____________
31-21 payable to _____________________ (payee or payees of check) and
31-22 when the check has been properly endorsed and has been paid by the
31-23 bank on which it is drawn, this document becomes effective to
31-24 release any mechanic's lien, any state or federal statutory bond
31-25 right, any private bond right, any claim for payment, and any
31-26 rights under any similar ordinance, rule, or statute related to
32-1 claim or payment rights for persons in the undersigned's position,
32-2 the undersigned has on the property of _____________________
32-3 (owner) located at ______________________ to the following extent
32-4 ______________________ (job description).
32-5 This release covers the final payment to the undersigned for
32-6 all labor, services, or materials, including equipment, furnished
32-7 to the property or to __________________, (person with whom
32-8 undersigned contracted) except for disputed claims in the amount of
32-9 $_________.
32-10 Before any recipient of this document relies on the document,
32-11 the recipient should verify evidence of payment to the undersigned.
32-12 The undersigned warrants that the undersigned has already
32-13 paid or will use the funds received from this final payment to
32-14 promptly pay in full all of the undersigned's laborers,
32-15 subcontractors, materialmen, and suppliers for all labor, services,
32-16 or materials, including equipment, furnished for or to the above
32-17 referenced project up to the date of this waiver.
32-18 Date _____________________________
32-19 __________________________________ (Company name)
32-20 By _______________________________ (Signature)
32-21 __________________________________ (Title)
32-22 (e) If the claimant is required to execute a waiver and
32-23 release to prove the receipt of good and sufficient funds for a
32-24 final payment and the claimant asserts in the waiver that the
32-25 claimant has been paid the final payment, the waiver and release
32-26 must be substantially similar to the following form:
33-1 (Each unconditional waiver must contain the following
33-2 language printed at the top of the document in bold type at least
33-3 as large as the largest type used in the document but not smaller
33-4 than 12-point type:)
33-5 NOTICE:
33-6 This document waives rights unconditionally and states that
33-7 you have been paid for giving up those rights. This document is
33-8 enforceable against you if you sign it, even if you have not been
33-9 paid. If you have not been paid, use a conditional release form.
33-10 UNCONDITIONAL WAIVER AND RELEASE ON FINAL PAYMENT
33-11 Project ___________________
33-12 Job No. ___________________
33-13 The undersigned has been paid in full for all labor,
33-14 services, or materials, including equipment, furnished to the
33-15 property or to ___________________, (person with whom undersigned
33-16 contracted) on the property of ______________________ (owner)
33-17 located at ______________________ to the following extent
33-18 ______________________ (job description) and does hereby waive and
33-19 release any right to a mechanic's lien, any state or federal
33-20 statutory bond right, any private bond right, any claim for
33-21 payment, and any rights under any similar ordinance, rule, or
33-22 statute related to claim or payment rights for persons in the
33-23 undersigned's position, except for disputed claims for extra work
33-24 in the amount of $_________.
33-25 The undersigned warrants that the undersigned has already
33-26 paid or will use the funds received from this final payment to
34-1 promptly pay in full all of the undersigned's laborers,
34-2 subcontractors, materialmen, and suppliers for all labor, services,
34-3 or materials, including equipment, furnished for or to the above
34-4 referenced project.
34-5 Date _____________________________
34-6 __________________________________ (Company name)
34-7 By _______________________________ (Signature)
34-8 __________________________________ (Title)
34-9 Sec. 64.104. PUBLIC POLICY. (a) Notwithstanding any other
34-10 law and except as provided by Section 64.103, any contract,
34-11 agreement, or understanding waiving the right to file or enforce
34-12 any lien or claim created under this chapter is void as against
34-13 public policy.
34-14 (b) This section does not apply to a written agreement to
34-15 subordinate, release, or satisfy all or part of a lien claimed
34-16 after a notice of lien has been filed.
34-17 (Sections 64.105-64.120 reserved for expansion
34-18 SUBCHAPTER F. PROCEDURE TO PERFECT LIEN
34-19 Sec. 64.121. PROCEDURE TO PERFECT LIEN. (a) To perfect a
34-20 lien provided by this chapter, a person claiming a lien must:
34-21 (1) provide the preliminary 30-day notice as
34-22 prescribed by Subchapter C; and
34-23 (2) execute a notice and claim of lien as prescribed
34-24 by this section.
34-25 (b) The person claiming a lien must make duplicate copies of
34-26 the notice and claim of lien and file one copy with the county
35-1 clerk of the county in which the property subject to the lien is
35-2 located on or before the 120th day after the date a building,
35-3 structure, or improvement, or an alteration or repair of a
35-4 building, structure, or improvement, is completed or, if a notice
35-5 of completion has been filed, on or before the 60th day after the
35-6 date the notice of completion is filed. Not later than the 15th
35-7 day after the date the notice and claim of lien is filed, the
35-8 person claiming a lien shall provide the remaining copy to the
35-9 owner of the building, structure, or improvement at the address
35-10 given in the notice of commencement.
35-11 (c) The notice and claim of lien must be made under oath by
35-12 the claimant or a person with knowledge of the facts and must
35-13 contain:
35-14 (1) the legal description of the property to be
35-15 charged with a lien;
35-16 (2) the name of the owner or reputed owner of the
35-17 property, if known;
35-18 (3) the name of the person by whom the claimant was
35-19 employed or to whom the claimant furnished labor, materials, or
35-20 professional services, including equipment;
35-21 (4) a general statement of the type of labor or
35-22 professional services performed or the type of materials furnished
35-23 or specially fabricated by the claimant and, for a claimant other
35-24 than an original contractor, the amounts owed for the labor,
35-25 professional services, materials, or specially fabricated
35-26 materials;
36-1 (5) a statement of the amount of the claimant's claim,
36-2 after deducting credits and offsets;
36-3 (6) if completed, a statement of the date of
36-4 completion of the building, structure, or improvement, or any
36-5 alteration or repair of the building, structure, or improvement;
36-6 and
36-7 (7) a statement of the date any required preliminary
36-8 30-day notice was provided and a copy of the notice, including the
36-9 proof of mailing.
36-10 (d) The notice and claim of lien is not required to list
36-11 individual items of labor, services, or material furnished or
36-12 specially fabricated. The notice and claim of lien may use any
36-13 abbreviation or symbol customarily used in the trade of the person
36-14 furnishing the labor, services, or materials.
36-15 (e) For the purposes of this section, "completion" means the
36-16 earliest of:
36-17 (1) the 30th day after the date of the final
36-18 inspection and written final acceptance by the governmental body
36-19 that issued the building permit for the building, structure, or
36-20 improvement;
36-21 (2) if no building permit is issued or if the
36-22 governmental body that issued the building permit for the building,
36-23 structure, or improvement does not perform final inspections or
36-24 issue written final acceptances, the last date on which any labor,
36-25 materials, or professional services were furnished to the property;
36-26 or
37-1 (3) the earliest date on which there is a termination
37-2 of the original contract, abandonment of the project, or cessation
37-3 of labor for a period of 60 consecutive days, unless the cessation
37-4 of labor is due to a strike, shortage of materials, or act of
37-5 nature.
37-6 (f) The county clerk shall record the notice and claim of
37-7 lien in records kept for that purpose and shall index and
37-8 cross-index the notice and claim of lien in the names of the
37-9 claimant, original contractor, and owner. Failure of the county
37-10 clerk to properly record or index a filed notice and claim of lien
37-11 does not invalidate the lien.
37-12 Sec. 64.122. DUTY OF OWNER OF PROPERTY TO WITHHOLD PAYMENT
37-13 TO ORIGINAL CONTRACTOR. On service of a notice and claim of lien,
37-14 the owner shall retain, out of the amount due or to become due the
37-15 original contractor, the value of the labor, materials, or
37-16 professional services furnished as shown by the notice and claim of
37-17 lien. The owner shall provide to the original contractor a copy of
37-18 the notice and claim of lien not later than the fifth day after the
37-19 date the owner receives the notice and claim of lien. If the
37-20 contractor does not provide to the owner a written notice stating
37-21 that the contractor intends to dispute the claim before the 11th
37-22 day after the date the contractor receives the copy:
37-23 (1) the contractor is presumed to assent to the claim;
37-24 and
37-25 (2) the owner shall pay the claim.
37-26 (Sections 64.123-64.150 reserved for expansion
38-1 SUBCHAPTER G. NOTICE OF COMPLETION
38-2 Sec. 64.151. NOTICE OF COMPLETION. (a) A notice of
38-3 completion is a written notice that the owner or the owner's agent
38-4 may record at any time after work is completed.
38-5 (b) A notice of completion executed and delivered as
38-6 prescribed by this section establishes the completion date for
38-7 purposes of this subchapter.
38-8 (c) A notice of completion must be signed and verified by
38-9 the owner or the owner's agent and must contain the following
38-10 information:
38-11 (1) the name and address of the owner;
38-12 (2) the nature of the interest or estate in the
38-13 property owned;
38-14 (3) the legal description of the property and the
38-15 street address;
38-16 (4) the name of the original contractor, if any;
38-17 (5) the name and address of each predecessor in
38-18 interest if the property was transferred after the beginning of the
38-19 work;
38-20 (6) the nature of the work performed on the real
38-21 property; and
38-22 (7) the date of completion.
38-23 (d) The notice of completion must be substantially similar
38-24 to the following form:
38-25 NOTICE OF COMPLETION
38-26 (Each notice of completion must contain the following
39-1 language printed in a type at least as large as the largest type
39-2 used in the document:)
39-3 Notice: Receipt of a notice of completion may alter the time
39-4 you have to perfect a lien in accordance with Section 64.121,
39-5 Property Code.
39-6 NOTICE OF COMPLETION
39-7 Notice is hereby given that:
39-8 (1) The undersigned is owner of the interest or estate
39-9 stated below in the property described below, or the undersigned is
39-10 the owner's agent.
39-11 (2) The full name of the undersigned is
39-12 ____________________________________.
39-13 (3) The full address of the undersigned is
39-14 ____________________________________.
39-15 (4) The nature of the interest or estate of the owner is:
39-16 In Fee Simple. _______________. (If other than fee simple, strike
39-17 "In Fee Simple" and insert, for example, "Purchaser Under Contract
39-18 of Purchase" or "Lessee").
39-19 (5) The full name and address of each person, if any, who
39-20 holds an interest or estate with the undersigned, including a joint
39-21 tenant or a tenant-in-common, is:
39-22 Name Address
39-23 _______________________ ________________________
39-24 _______________________ ________________________
39-25 _______________________ ________________________
39-26 (6) The full name and address of each predecessor in
40-1 interest of the undersigned, if the property was transferred after
40-2 the beginning of the work, is:
40-3 Name Address
40-4 _______________________ ________________________
40-5 _______________________ ________________________
40-6 _______________________ ________________________
40-7 (7) The nature of work performed on the real property is
40-8 _______________________________.
40-9 (8) The completion date for the work on the property, as
40-10 determined under Section 64.121(e), Property Code. (Fill in the
40-11 appropriate completion date as determined under Section 64.121(e),
40-12 Property Code:)
40-13 (a) Date ______________________ (30 days after written
40-14 final acceptance by governmental body)
40-15 (b) Date ______________________ (last date on which
40-16 any labor, services, or materials, including equipment, were
40-17 furnished to the property)
40-18 (c) Date ______________________ (60 days after
40-19 cessation of labor)
40-20 (9) The name of the original contractor, if any, for the
40-21 work is _________________. (if no contractor, insert "none")
40-22 (10) The street address of the property is
40-23 ____________________________________. (include both address and
40-24 city with zip code)
40-25 (11) The legal description of property described above is
40-26 __________________________________. (attach exhibit if necessary)
41-1 Verification
41-2 I, the undersigned, certify that I am the owner or the
41-3 owner's agent for the property described in the above notice, or I
41-4 certify that I am the original contractor for the work performed on
41-5 the real property described in the above notice. I have read the
41-6 foregoing notice and know and understand the contents. The facts
41-7 stated are true and correct. I declare under penalty of perjury
41-8 that the foregoing is true and correct.
41-9 Executed on ______________________ (date) at
41-10 ________________ (place where signed), Texas
41-11 _______________________________ (print name)
41-12 _______________________ (personal signature)
41-13 ____________________________________ (title)
41-14 Sworn to and subscribed before me this __________ day of
41-15 ______, (year), by (name of person making statement). (Signature
41-16 and seal of Notary Public - State of Texas)
41-17 (e) To shorten the lien period under Section 64.121,
41-18 Property Code, a copy of the notice of completion and a written
41-19 statement of the date of filing of the notice and the county
41-20 clerk's record location information shall be provided by the owner
41-21 to the original contractor and all persons from whom the person
41-22 filing this notice has previously received a preliminary 30-day
41-23 notice as prescribed by Subchapter C and Section 64.004.
41-24 (f) If the property is owned by more than one person, a
41-25 notice of completion signed by fewer than all the owners must
41-26 include the name and address of each owner.
42-1 (g) The person executing the notice of completion shall file
42-2 the notice in the office of the county clerk of the county in which
42-3 the property is located. The county clerk shall index the notice
42-4 of completion under the index classification in which mechanic's
42-5 liens are recorded.
42-6 (h) The person filing the notice of completion, not later
42-7 than the 15th day after the date the notice is filed, shall serve a
42-8 copy of the notice, a written statement of the date of filing of
42-9 the notice, and the county clerk's record location information on
42-10 the original contractor and all persons from whom the owner has
42-11 previously received a preliminary 30-day notice. If the owner or
42-12 the owner's agent fails to provide the information within the
42-13 period prescribed by this subsection, the person may, not later
42-14 than the 120th day after the date of completion as defined by
42-15 Section 64.121, perfect a lien under this chapter.
42-16 (Sections 64.152-64.200 reserved for expansion
42-17 SUBCHAPTER H. STOP NOTICE; BONDED STOP NOTICE
42-18 Sec. 64.201. STOP NOTICE AND BONDED STOP NOTICE. (a) The
42-19 purpose of a stop notice is to give notice to an owner or
42-20 construction lender that labor, materials, or professional services
42-21 have been furnished and the person providing the notice has not
42-22 been paid for the labor, materials, or professional services. The
42-23 right to file a notice under this subchapter is independent and
42-24 cumulative of other rights prescribed by this chapter.
42-25 (b) A stop notice must be in writing, be signed by the
42-26 claimant or the claimant's agent, and state in general terms:
43-1 (1) the kind of labor, services, or materials,
43-2 including equipment, furnished or agreed to be furnished by the
43-3 claimant;
43-4 (2) the name of the person by whom the claimant was
43-5 employed or to whom the claimant furnished the labor, services, or
43-6 materials, including equipment;
43-7 (3) the estimated amount in value of the labor,
43-8 services, or materials, including equipment, furnished and the full
43-9 amount in value of the labor, services, or materials, including
43-10 equipment, agreed to be furnished; and
43-11 (4) the name and address, and telephone number, if
43-12 any, of the claimant.
43-13 (c) A stop notice is not invalid by reason of any defect in
43-14 form if the notice is sufficient to substantially inform the owner
43-15 or lender of the information required.
43-16 Sec. 64.202. PERSON ENTITLED TO PROVIDE STOP NOTICE;
43-17 CONDITIONS FOR SERVICE. (a) Any person, other than the original
43-18 contractor, who labors, specifically fabricates material, or
43-19 furnishes labor, materials, or professional services for work
43-20 performed on real property may provide a stop notice to the owner.
43-21 (b) Any person, including the original contractor, who
43-22 labors, specifically fabricates material, or furnishes labor,
43-23 materials, or professional services for work performed on real
43-24 property may provide a stop notice to the construction lender.
43-25 (c) Service of a stop notice is effective only if the
43-26 claimant:
44-1 (1) has provided a preliminary 30-day notice as
44-2 prescribed by Subchapter C;
44-3 (2) provides the stop notice before the expiration of
44-4 the period within which the claimant's notice and claim of lien
44-5 must be filed under Subchapter F; and
44-6 (3) in the case of a construction lender, provides the
44-7 stop notice to the manager or other responsible officer or person
44-8 at the office of the construction lender as indicated in the notice
44-9 of commencement provided under Subchapter B.
44-10 (d) A person described by Subsection (a) who fails to
44-11 provide a stop notice on or before the 60th day after a written
44-12 demand for a stop notice is received from the owner forfeits the
44-13 right to a mechanic's lien.
44-14 Sec. 64.203. EFFECT OF STOP NOTICE. (a) A construction
44-15 lender may withhold sufficient funds from the borrower or other
44-16 person to whom the lender or the owner is obligated to make
44-17 payments or advances out of the construction funds to pay the claim
44-18 for which a stop notice is received and any lien that is filed.
44-19 (b) On receipt of a stop notice:
44-20 (1) the construction lender may withhold funds
44-21 relating to the stop notice regardless of whether a payment bond
44-22 has been filed in the office of the county clerk of the county in
44-23 which the property where the work is performed is located;
44-24 (2) if a payment bond has been filed the construction
44-25 lender may withhold funds relating to the stop notice; and
44-26 (3) if a payment bond has been filed and the claimant
45-1 makes a written request for notice of the construction lender's
45-2 decision to withhold funds under Subdivision (1), the lender shall
45-3 provide to the claimant written notice of the lender's decision and
45-4 a copy of the bond not later than the 30th day after the date the
45-5 lender receives the stop notice.
45-6 (c) A construction lender is not liable for the failure to
45-7 provide a copy of the bond under Subsection (b)(3) if:
45-8 (1) the failure was not intentional and resulted from
45-9 a bona fide error;
45-10 (2) the lender maintains reasonable procedures to
45-11 avoid such an error; and
45-12 (3) the error was corrected not later than the 20th
45-13 day after the date the violation was discovered.
45-14 (d) On receipt of a stop notice, the owner shall withhold
45-15 sufficient funds from an original contractor to pay the claim for
45-16 which a stop notice is received and any lien filed, unless a
45-17 payment bond has been filed as prescribed by this subchapter.
45-18 (e) If the owner does not withhold funds because a payment
45-19 bond has been filed, the owner shall not later than the 30th day
45-20 after the date the stop notice is received provide a written notice
45-21 to the claimant at the address shown in the stop notice that:
45-22 (1) states that the bond has been filed; and
45-23 (2) includes a copy of the bond filed.
45-24 Sec. 64.204. BONDED STOP NOTICE. A bonded stop notice is a
45-25 stop notice described by this subchapter that is provided to a
45-26 construction lender or owner and accompanied by a bond that:
46-1 (1) provides good and sufficient sureties in a penal
46-2 sum equal to 125 percent of the amount of the claim; and
46-3 (2) has a condition that if the owner or lender
46-4 recovers a judgment in an action brought on a claim or on the lien
46-5 filed by the claimant, the claimant will pay:
46-6 (A) all costs that may be awarded to the owner,
46-7 construction lender, or non-claimant original contractor; and
46-8 (B) all damages that the owner, construction
46-9 lender, or non-claimant original contractor may sustain by reason
46-10 of the lien, not exceeding the sum specified in the bond.
46-11 Sec. 64.205. EFFECT OF BONDED STOP NOTICE. (a) Except as
46-12 provided by this section, on receipt of a bonded stop notice a
46-13 construction lender shall withhold sufficient funds from the
46-14 borrower or other person to whom the lender or the owner is
46-15 obligated to make payments or advances out of the construction
46-16 funds to pay the claim for which a bonded stop notice is received
46-17 and any lien that is filed.
46-18 (b) On receipt of a bonded stop notice:
46-19 (1) the construction lender shall withhold funds
46-20 relating to the bonded stop notice filed by an original contractor,
46-21 regardless of whether a payment bond has been filed in the office
46-22 of the county clerk of the county in which the property where the
46-23 work is performed is located;
46-24 (2) the construction lender shall withhold funds
46-25 relating to a bonded stop notice filed by any person described by
46-26 Section 64.202(a), unless a payment bond has been filed in the
47-1 office of the county clerk of the county in which the property
47-2 where the work is performed is located;
47-3 (3) if a payment bond has been filed, the construction
47-4 lender may withhold funds relating to a bonded stop notice; and
47-5 (4) if the claimant makes a written request for notice
47-6 of the construction lender's decision to withhold funds under
47-7 Subdivision (2) or (3), the lender shall provide to the claimant
47-8 written notice of the lender's decision and a copy of the bond not
47-9 later than the 30th day after the date the stop notice is received.
47-10 (c) A construction lender is not liable for the failure to
47-11 provide a copy of the bond under Subsection (b)(4) if:
47-12 (1) the failure was not intentional and resulted from
47-13 a bona fide error;
47-14 (2) the lender maintains reasonable procedures to
47-15 avoid such an error; and
47-16 (3) the error was corrected not later than the 20th
47-17 day after the date the violation was discovered.
47-18 Sec. 64.206. PRIORITIES. (a) An assignment by the owner or
47-19 contractor of construction loan funds, whether made before or after
47-20 a stop notice or bonded stop notice is provided to a construction
47-21 lender, does not take priority over the stop notice or bonded stop
47-22 notice, and the assignment has no effect on the right of a claimant
47-23 who provides the stop notice or bonded stop notice.
47-24 (b) If funds withheld or required to be withheld under a
47-25 stop notice or bonded stop notice are insufficient to pay in full
47-26 the claims of each person providing a notice, the funds shall be
48-1 distributed among the claimants in the same ratio that their
48-2 respective claims bear to the aggregate of all claims. This pro
48-3 rata distribution shall be made among the persons entitled to share
48-4 in the funds without regard to the order of time in which the
48-5 respective notices were provided or the respective actions were
48-6 commenced.
48-7 (c) A person who intentionally provides a false stop notice
48-8 or bonded stop notice or who intentionally includes in the notice
48-9 labor, services, or materials, including equipment, that are not
48-10 furnished for the property described in the notice forfeits all
48-11 rights to participate in the pro rata distribution of the funds.
48-12 Sec. 64.207. RELEASE OF STOP NOTICE OR BONDED STOP NOTICE.
48-13 (a) If an owner, construction lender, or any original contractor
48-14 or subcontractor disputes the accuracy or validity of a stop notice
48-15 or bonded stop notice, that person may file with the person on whom
48-16 the notice was served a bond.
48-17 (b) The bond must:
48-18 (1) be executed by a good and sufficient surety;
48-19 (2) be in a penal sum equal to 125 percent of the
48-20 amount stated in the notice; and
48-21 (3) contain a condition that the payment is for any
48-22 sum not exceeding the penal obligation of the bond, including the
48-23 amount of the claim and the costs of enforcing the claim.
48-24 (c) When the bond is filed, the funds withheld under the
48-25 stop notice or bonded stop notice shall be released.
48-26 Sec. 64.208. ENFORCEMENT OF RIGHTS ARISING FROM STOP NOTICE
49-1 OR BONDED STOP NOTICE. (a) If a stop notice or bonded stop notice
49-2 is filed by an original contractor, the original contractor is
49-3 entitled to recover on the notice only the net amount owed the
49-4 original contractor after deducting the bonded stop notice claims
49-5 of each subcontractor or material supplier who has given a bonded
49-6 stop notice under this subchapter based on labor, materials, or
49-7 professional services furnished on behalf of the original
49-8 contractor or the subcontractor or supplier.
49-9 (b) If a stop notice or bonded stop notice is filed by a
49-10 subcontractor, the subcontractor is entitled to recover on the
49-11 notice only the net amount owed the subcontractor after deducting
49-12 the bonded stop notice claims of each of the subcontractor's
49-13 subcontractors or material suppliers who has filed a bonded stop
49-14 notice based on labor, materials, or professional services
49-15 furnished on behalf of that subcontractor or supplier.
49-16 (c) An action against an owner or construction lender to
49-17 enforce payment of a claim stated in a stop notice or bonded stop
49-18 notice may be commenced at any time after the 10th day after the
49-19 date the owner or construction lender receives the notice. If no
49-20 action is taken to enforce payment of the claim on or before the
49-21 second anniversary of the date of service, the notice is no longer
49-22 effective and the funds shall be paid or delivered to the original
49-23 contractor or other person to whom the funds are owed.
49-24 (d) A stop notice or bonded stop notice is no longer
49-25 effective and funds withheld in connection with the notice shall be
49-26 paid or delivered to the person to whom the funds are owed if:
50-1 (1) an action to enforce the stop notice or bonded
50-2 stop notice is dismissed, unless the dismissal is without
50-3 prejudice; or
50-4 (2) a judgment is rendered against the claimant.
50-5 (e) Venue for an action on a stop notice or bonded stop
50-6 notice claim shall be in the county in which the property where the
50-7 work is performed is located.
50-8 (Sections 64.209-64.250 reserved for expansion
50-9 SUBCHAPTER I. PRIORITY AND PREFERENCE
50-10 Sec. 64.251. PREFERENCE OVER OTHER CREDITORS. All
50-11 subcontractors, laborers, materialmen, or professional service
50-12 providers who have a mechanic's lien have preference over other
50-13 creditors of the original contractor.
50-14 Sec. 64.252. EQUALITY OF LIENS. (a) Except as provided by
50-15 Section 64.253(d), the liens provided under this chapter are equal
50-16 in priority without reference to the date of filing of the notice
50-17 and claim of lien and without reference to the time of performance
50-18 of the labor or of the furnishing of materials or services.
50-19 (b) If the proceeds of a foreclosure sale of property are
50-20 insufficient to discharge all mechanics' liens against the
50-21 property, the proceeds shall be paid pro rata on the perfected
50-22 mechanics' liens on which an action is filed.
50-23 Sec. 64.253. PRIORITY OF MECHANIC'S LIEN OVER OTHER LIENS;
50-24 TIME OF INCEPTION. (a) Except as provided by this section, a
50-25 mechanic's lien attaches to a building, structure, improvement, or
50-26 railroad property in preference to any prior lien, encumbrance, or
51-1 mortgage on the real property on which the building, structure,
51-2 improvement, or railroad property is located, and the person
51-3 enforcing the lien may have the building, structure, or
51-4 improvement, or any piece of the railroad property sold separately.
51-5 (b) The mechanic's lien does not affect any lien,
51-6 encumbrance, or mortgage on the real property at the time of the
51-7 inception of the mechanic's lien, and the holder of the lien,
51-8 encumbrance, or mortgage is not required to be a party to an action
51-9 to foreclose the mechanic's lien.
51-10 (c) Except as provided by Subsection (d), for purposes of
51-11 this section, the time of inception of a mechanic's lien is the
51-12 earlier of the date of the commencement of work on the property or
51-13 the date of delivery of materials to the property on which the work
51-14 is to be performed.
51-15 (d) For purposes of this section, the time of inception of a
51-16 mechanic's lien for professional services is the date a notice and
51-17 claim of lien is filed under Section 64.121. The priority of a
51-18 lien claimed for professional services with respect to other
51-19 mechanics' liens is determined by the date of filing. A lien for
51-20 professional services is not valid or enforceable against a grantee
51-21 or purchaser who acquires an interest in the real property before
51-22 the time of inception of the lien.
51-23 (Sections 64.254-64.300 reserved for expansion
51-24 SUBCHAPTER J. RELEASE AND FORECLOSURE
51-25 Sec. 64.301. ENFORCEMENT OF REMEDIES AGAINST MONEY OWED
51-26 ORIGINAL CONTRACTOR OR SUBCONTRACTOR. (a) A creditor of an
52-1 original contractor may not collect, enforce a security interest
52-2 against, garnish, or levy execution on money owed the original
52-3 contractor or the contractor's surety from the owner. A creditor
52-4 of a subcontractor may not collect, enforce a security interest
52-5 against, garnish, or levy execution on money owed the subcontractor
52-6 to the prejudice of the subcontractors, mechanics, laborers,
52-7 materialmen, or their sureties.
52-8 (b) A surety issuing a payment bond or performance bond in
52-9 connection with work performed on real property has a priority
52-10 claim over other creditors of the surety's principal to contract
52-11 funds to the extent of any loss the surety suffers or incurs. That
52-12 priority does not excuse the surety from paying any obligations
52-13 that the surety may have under its payment bonds.
52-14 Sec. 64.302. RELEASE OF CLAIM OR LIEN. (a) When a debt for
52-15 labor, materials, or professional services is satisfied or paid by
52-16 collected funds, the person who furnished the labor, materials, or
52-17 professional services shall, not later than the 10th day after the
52-18 date of receipt of a written request, provide to the requesting
52-19 person a release of the indebtedness and any lien claimed, to the
52-20 extent of the indebtedness paid. An owner, original contractor, or
52-21 any person making the payment may request the release.
52-22 (b) A release of lien must be in a form that would permit
52-23 the release to be filed of record.
52-24 Sec. 64.303. DUTY OF CONTRACTOR TO DEFEND ACTION; RIGHTS OF
52-25 OWNER AGAINST CONTRACTOR. (a) An original contractor shall, at
52-26 the contractor's expense, defend an action to foreclose on a lien
53-1 filed by a person other than the contractor.
53-2 (b) If the action results in judgment on the lien against
53-3 the owner or the owner's property, the owner is entitled to deduct
53-4 the amount of the judgment and costs from any amount owed the
53-5 original contractor. If the owner has settled with the original
53-6 contractor in full, the owner is entitled to recover from the
53-7 original contractor any amount paid for which the original
53-8 contractor was originally liable.
53-9 Sec. 64.304. FORECLOSURE. A lien under this chapter may be
53-10 foreclosed only on the judgment of a court foreclosing the lien and
53-11 ordering the sale of the property subject to the lien.
53-12 Sec. 64.305. LIMITATION OF ACTION TO FORECLOSE LIEN. A lien
53-13 under this chapter expires on the second anniversary of the date
53-14 the lien is filed, unless:
53-15 (1) an action is brought within that period to
53-16 foreclose the lien; or
53-17 (2) a claimant is made a defendant to an action
53-18 brought by another claimant and the claimant files an answer or
53-19 cross-claim asserting the lien during that period.
53-20 Sec. 64.306. RIGHT OF CLAIMANT TO HAVE LAND AND IMPROVEMENTS
53-21 SOLD TOGETHER OR SEPARATELY. (a) A person enforcing a lien under
53-22 this chapter may have the land and a building, structure, or other
53-23 improvement sold together, or the person may have a building,
53-24 structure, or other improvement sold separately if the building,
53-25 structure, or other improvement can be removed without material
53-26 injury to the remaining property.
54-1 (b) If a building, structure, or other improvement is sold
54-2 separately, the officer making the sale shall place the purchaser
54-3 in possession. The purchaser is entitled to a reasonable time
54-4 after the date of the purchase within which to remove the purchased
54-5 property.
54-6 Sec. 64.307. DISCHARGE OF LIEN. A mechanic's lien or
54-7 affidavit claiming a mechanic's lien filed under this chapter may
54-8 be discharged of record by:
54-9 (1) filing a lien release signed by the claimant under
54-10 Section 64.302;
54-11 (2) failing to bring an action to foreclose the lien
54-12 in the county in which the property is located within the period
54-13 prescribed by this chapter;
54-14 (3) filing an original or certified copy of a final
54-15 judgment or decree of a court providing for the discharge; or
54-16 (4) filing a bond and notice in compliance with
54-17 Subchapter K.
54-18 (Sections 64.308-64.350 reserved for expansion
54-19 SUBCHAPTER K. BOND TO INDEMNIFY AGAINST LIEN
54-20 Sec. 64.351. BOND. (a) If a mechanic's lien, other than a
54-21 lien granted by an owner in a written contract, is attached or is
54-22 attempted to be attached by an instrument filed under this chapter,
54-23 any person may file a bond to indemnify against the lien.
54-24 (b) The bond shall be filed with the county clerk of the
54-25 county in which the property subject to the lien is located.
54-26 (c) A mechanic's lien claim against an owner's property is
55-1 discharged after:
55-2 (1) a bond that complies with Section 64.352 is filed;
55-3 (2) the notice of the bond is issued as provided by
55-4 Section 64.353; and
55-5 (3) the bond and notice are filed as provided by
55-6 Section 64.354.
55-7 Sec. 64.352. BOND REQUIREMENTS. A bond filed under this
55-8 subchapter must:
55-9 (1) describe the property on which each lien is
55-10 claimed;
55-11 (2) refer to each lien claimed in a manner sufficient
55-12 to identify the lien;
55-13 (3) if the total amount claimed in the liens does not
55-14 exceed $100,000, be in an amount that is double the amount of the
55-15 liens referred to in the bond;
55-16 (4) if the total amount claimed in the liens exceeds
55-17 $100,000, be in an amount that is the greater of:
55-18 (A) 1-1/2 times the amount of the liens; or
55-19 (B) the sum of $100,000 plus the amount of the
55-20 liens;
55-21 (5) be payable to the parties claiming the liens;
55-22 (6) be executed by:
55-23 (A) the party filing the bond as principal; and
55-24 (B) a corporate surety authorized and admitted
55-25 to engage in business in this state and licensed by this state to
55-26 execute the bond as surety, subject to Section 1, Chapter 87, Acts
56-1 of the 56th Legislature, Regular Session, 1959 (Article 7.19-1,
56-2 Vernon's Texas Insurance Code);
56-3 (7) contain a condition that the principal and
56-4 sureties will pay to the named obligees or their assignees the
56-5 amount that the named obligees would have been entitled to recover
56-6 if their claims had been proved to be valid and enforceable liens
56-7 on the property; and
56-8 (8) clearly and prominently display on the bond or an
56-9 attachment to the bond:
56-10 (A) the name of the surety executing the bond;
56-11 and
56-12 (B) the name of the surety contact person, if
56-13 any, and the mailing address, physical address, and area code and
56-14 telephone number for submitting any notice of claims.
56-15 Sec. 64.353. NOTICE OF BOND. (a) After the bond is filed,
56-16 the county clerk shall issue notice of the bond to all named
56-17 obligees.
56-18 (b) A copy of the bond must be attached to the notice.
56-19 (c) The notice must be served on each obligee as provided by
56-20 Section 64.004 by sending a copy of the notice and the bond to the
56-21 obligee, addressed to the claimant at the address stated in the
56-22 lien affidavit for the obligee.
56-23 (d) If the claimant's lien affidavit does not state the
56-24 claimant's address, the notice is not required to be sent to the
56-25 claimant.
56-26 Sec. 64.354. FILING OF BOND AND NOTICE. (a) The county
57-1 clerk shall record the bond, the notice, and a certificate of
57-2 mailing in the real property records.
57-3 (b) In acquiring an interest in or insuring title to real
57-4 property, a purchaser, insurer of title, or lender may rely on the
57-5 record of the bond and the notice to the same extent as if the lien
57-6 claimant had filed a release of lien in the real property records.
57-7 Sec. 64.355. ACTION ON BOND. (a) A party making or holding
57-8 a lien claim may not file an action on a bond filed under this
57-9 subchapter after the second anniversary of the date the notice is
57-10 served.
57-11 (b) The bond is not exhausted by one action against it.
57-12 Each named obligee or assignee of an obligee may maintain a
57-13 separate action on the bond in any court of jurisdiction in the
57-14 county in which the real property is located.
57-15 (Sections 64.356-64.400 reserved for expansion
57-16 SUBCHAPTER L. BOND TO PAY LIENS OR CLAIMS
57-17 Sec. 64.401. BOND. An original contractor who has a written
57-18 contract with the owner may provide at any time a bond for the
57-19 benefit of persons claiming a lien under this chapter.
57-20 Sec. 64.402. BOND REQUIREMENTS. A bond provided under this
57-21 subchapter must:
57-22 (1) be in a penal sum at least equal to the total of
57-23 the original contract amount;
57-24 (2) be in favor of the owner;
57-25 (3) have the written approval of the owner endorsed on
57-26 it;
58-1 (4) be executed by:
58-2 (A) the original contractor as principal; and
58-3 (B) a corporate surety authorized and admitted
58-4 to engage in business in this state and licensed by this state to
58-5 execute the bond as surety, subject to Section 1, Chapter 87, Acts
58-6 of the 56th Legislature, Regular Session, 1959 (Article 7.19-1,
58-7 Vernon's Texas Insurance Code);
58-8 (5) be conditioned on prompt payment for all labor,
58-9 subcontracts, materials, specially fabricated materials,
58-10 professional services, and the normal and usual extras which do not
58-11 exceed 50 percent of the contract price; and
58-12 (6) clearly and prominently display on the bond or an
58-13 attachment to the bond:
58-14 (A) the name of the surety executing the bond;
58-15 and
58-16 (B) the name of the surety contact person, if
58-17 any, and the mailing address, physical address, and area code and
58-18 telephone number for submitting any notice of claims.
58-19 Sec. 64.403. FILING OF BOND AND CONTRACT. (a) The bond and
58-20 the contract between the original contractor and the owner shall be
58-21 filed with the county clerk of the county in which is located all
58-22 or part of the owner's property on which the work is being
58-23 performed or is to be performed. A memorandum of the contract or a
58-24 copy of the contract may be substituted for the original.
58-25 (b) The plans, specifications, and general conditions of the
58-26 contract are not required to be filed.
59-1 (c) The county clerk shall record the bond and the contract
59-2 in the clerk's office and shall index and cross-index both in the
59-3 names of the original contractor and the owner in records kept for
59-4 that purpose.
59-5 (d) On request and payment of a reasonable fee, the county
59-6 clerk shall provide a copy of the bond and contract to any person.
59-7 (e) In any court of this state or in the United States, a
59-8 copy of the bond and contract certified by the county clerk
59-9 constitutes prima facie evidence of the contents, execution,
59-10 delivery, and filing of the originals.
59-11 Sec. 64.404. ACTION ON BOND. (a) A claimant may file an
59-12 action against the principal and surety on the bond either jointly
59-13 or severally.
59-14 (b) The claimant may file an action for the amount of the
59-15 claim and court costs.
59-16 (c) An action on the bond must be brought in the county in
59-17 which the property where work is being performed or will be
59-18 performed is located.
59-19 (d) The claimant must file an action on the bond not later
59-20 than the second anniversary of the date the claimant's claim is
59-21 perfected.
59-22 Sec. 64.405. CLAIMS IN EXCESS OF BOND AMOUNT. If valid
59-23 claims against a bond exceed the penal sum of the bond, each
59-24 claimant is entitled to a pro rata share of the penal sum.
59-25 Sec. 64.406. ATTEMPTED COMPLIANCE. (a) A bond shall be
59-26 construed to comply with this subchapter, and the rights and
60-1 remedies on the bond are enforceable in the same manner as on other
60-2 bonds under this subchapter, if the bond:
60-3 (1) is provided and filed in an attempt to comply with
60-4 this subchapter; or
60-5 (2) demonstrates by its terms an intent to comply with
60-6 this subchapter.
60-7 (b) A provision in any payment bond provided or filed in an
60-8 attempt to comply with this subchapter that expands or restricts
60-9 the rights or liabilities provided under this chapter shall be
60-10 disregarded and the provisions of this subchapter shall be read
60-11 into that bond.
60-12 (Sections 64.407-64.450 reserved for expansion
60-13 SUBCHAPTER M. LIEN ON MONEY OWED PUBLIC WORKS CONTRACTOR
60-14 Sec. 64.451. LIEN ON MONEY OWED PUBLIC WORKS CONTRACTOR. A
60-15 person has a lien on the money, bonds, or warrants owed a
60-16 contractor for work if the person:
60-17 (1) furnishes labor, materials, or professional
60-18 services to a contractor under an original contract that:
60-19 (A) does not exceed $25,000; and
60-20 (B) is for public improvements in this state;
60-21 and
60-22 (2) provides notice as required by this subchapter.
60-23 Sec. 64.452. PERSONS TO WHOM NOTICE GIVEN. A lien claimant
60-24 described by Section 64.451 must send written notice of the claim
60-25 to:
60-26 (1) the officials of the state, county, municipality,
61-1 school district, or other public entity whose duty it is to pay the
61-2 contractor; and
61-3 (2) the contractor at the contractor's last known
61-4 business or residence address.
61-5 Sec. 64.453. CONTENTS OF NOTICE. (a) Whether based on a
61-6 written or oral agreement, the notice must contain:
61-7 (1) the amount claimed;
61-8 (2) the name of the party to whom the materials were
61-9 delivered or for whom the labor or services were performed;
61-10 (3) the dates and place of delivery or performance;
61-11 (4) a description reasonably sufficient to identify
61-12 the materials delivered or labor or services performed and the
61-13 amount due;
61-14 (5) a description reasonably sufficient to identify
61-15 the work for which the material was delivered or the labor or
61-16 services performed; and
61-17 (6) the claimant's business address.
61-18 (b) The notice must be accompanied by the claimant's
61-19 statement under oath that the amount claimed is just and correct
61-20 and that all payments, lawful offsets, and credits known to the
61-21 claimant have been allowed.
61-22 Sec. 64.454. PREREQUISITE; TIME FOR NOTICE. (a) A lien
61-23 claimant must provide a preliminary 30-day notice as prescribed by
61-24 Subchapter C.
61-25 (b) The lien claimant must give a lien notice not later than
61-26 the last day of the second month following the month in which the
62-1 labor or service was performed or the material was furnished.
62-2 Sec. 64.455. OFFICIAL TO RETAIN FUNDS. A public official
62-3 who receives the notice shall retain an amount from the money,
62-4 bonds, or warrants owed the contractor that is enough to pay the
62-5 claim for which notice is provided.
62-6 Sec. 64.456. BOND FOR RELEASE OF LIEN. (a) If a claim is
62-7 filed attempting to attach a lien under this subchapter, the
62-8 contractor against whom the claim is made may file a bond with the
62-9 officials of the state, county, municipality, school district, or
62-10 other public entity whose duty it is to pay the money, bonds, or
62-11 warrants to the contractor.
62-12 (b) If the bond is approved by the proper official, the
62-13 filing of the bond releases and discharges all liens attached or
62-14 attempted to be attached by the filing of a claim, and the
62-15 appropriate officials shall pay the money, bonds, or warrants to
62-16 the contractor or the contractor's assignee.
62-17 Sec. 64.457. BOND REQUIREMENTS. A bond filed under Section
62-18 64.456 must:
62-19 (1) be in an amount equal to two times the amount of
62-20 the claims filed;
62-21 (2) be payable to the claimants;
62-22 (3) be executed by:
62-23 (A) the party filing the bond as principal; and
62-24 (B) a corporate surety authorized, admitted to
62-25 engage in business, and licensed by this state to execute the bond
62-26 as surety;
63-1 (4) contain a condition that:
63-2 (A) the principal and surety will pay to the
63-3 obligees named or to their assignees the amount of the claims or
63-4 the portions of the claims proved to be liens under this
63-5 subchapter; and
63-6 (B) the principal and surety will pay all court
63-7 costs adjudged against the principal in actions brought by a
63-8 claimant on the bond; and
63-9 (5) clearly and prominently display on the bond or an
63-10 attachment to the bond:
63-11 (A) the name of the surety executing the bond;
63-12 and
63-13 (B) the name of the surety contact person, if
63-14 any, and the mailing address, physical address, and area code and
63-15 telephone number for submitting any notice of claims.
63-16 Sec. 64.458. NOTICE OF BOND. An official with whom a bond
63-17 is filed under this subchapter shall send an exact copy of the bond
63-18 to all claimants in accordance with Section 64.004.
63-19 Sec. 64.459. ACTION ON BOND. (a) A claimant must file an
63-20 action on a bond filed under this subchapter not later than the
63-21 first anniversary of the date the bond is filed.
63-22 (b) The bond is not exhausted by one action on it. Each
63-23 obligee or obligee's assignee may maintain a separate action on the
63-24 bond in any court of jurisdiction.
63-25 SECTION 12. (a) This Act takes effect January 1, 2002.
63-26 (b) The changes in law made by this Act apply only to:
64-1 (1) a construction contract entered into on or after
64-2 January 1, 2002;
64-3 (2) funds received under a construction contract
64-4 entered into on or after January 1, 2002; or
64-5 (3) a building permit issued on or after January 1,
64-6 2002.
64-7 (c) A construction contract entered into before January 1,
64-8 2002, funds received under a construction contract entered into
64-9 before January 1, 2002, or a building permit issued before January
64-10 1, 2002, are governed by the law as it existed immediately before
64-11 January 1, 2002, and that law is continued in effect for that
64-12 purpose.