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A BILL TO BE ENTITLED
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AN ACT
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relating to beneficiaries of construction payment trust funds. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 162.001(c), Property Code, is amended to |
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read as follows: |
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(c) A fee payable to a contractor is not considered trust |
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funds if: |
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(1) the [If a] contractor and property owner have |
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entered into a written construction contract for the improvement of |
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specific real property in this state before the commencement of |
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construction of the improvement and the contract provides for the |
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payment by the owner of the costs of construction and a reasonable |
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fee specified in the contract payable to the contractor; and |
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(2) [,] the fee is earned as provided by the contract |
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and paid to the contractor or disbursed from a construction account |
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described by Section 162.006, if applicable [is not considered
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trust funds]. |
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SECTION 2. Section 162.003, Property Code, is amended to |
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read as follows: |
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Sec. 162.003. BENEFICIARIES OF TRUST FUNDS. (a) An |
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artisan, laborer, mechanic, contractor, subcontractor, or |
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materialman who labors or who furnishes labor or material for the |
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construction or repair of an improvement on specific real property |
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in this state is a beneficiary of any trust funds paid or received |
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in connection with the improvement. |
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(b) A property owner is a beneficiary of trust funds |
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described by Section 162.001 in connection with a residential |
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construction contract, including funds deposited into a |
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construction account described by Section 162.006. |
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SECTION 3. The change in law made by this Act applies only |
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to funds that become trust funds under Section 162.001, Property |
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Code, as amended by this Act, on or after the effective date of this |
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Act. Funds that become trust funds before the effective date of |
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this Act are governed by the law in effect immediately before the |
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effective date of this Act, and that law is continued in effect for |
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that purpose. |
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SECTION 4. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2009. |