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A BILL TO BE ENTITLED
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AN ACT
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relating to an award of litigation costs after the rejection of |
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certain settlement offers. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 42.004, Civil Practice and Remedies |
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Code, is amended by amending Subsections (a) and (d) and adding |
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Subsection (d-1) to read as follows: |
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(a) If a settlement offer is made and rejected and the |
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judgment to be rendered will be significantly less favorable to the |
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rejecting party than was the settlement offer, the offering party |
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shall recover litigation costs from the rejecting party. Subject |
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to Subsections (d) and (d-1), the amount of litigation costs |
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awarded under this chapter shall be determined by the court prior to |
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the entry of judgment. The court must, upon request, conduct a |
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hearing on a request for an award of litigation costs, at which the |
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affected parties may present evidence. |
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(d) If damages are awarded to the claimant, the [The] |
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litigation costs that may be awarded under this chapter may not be |
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greater than an amount computed by: |
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(1) determining the sum of: |
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(A) 50 percent of the economic damages to be |
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awarded to the claimant in the judgment; |
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(B) 100 percent of the noneconomic damages to be |
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awarded to the claimant in the judgment; and |
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(C) 100 percent of the exemplary or additional |
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damages to be awarded to the claimant in the judgment; and |
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(2) subtracting from the amount determined under |
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Subdivision (1) the amount of any statutory or contractual liens in |
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connection with the occurrences or incidents giving rise to the |
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claim. |
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(d-1) If damages are not awarded to the claimant, the |
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litigation costs that may be awarded under this chapter to the |
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defendant may not be greater than the amount of the defendant's most |
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recent settlement offer. |
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(e) If a claimant or defendant is entitled to recover fees |
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and costs under another law, that claimant or defendant may not |
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recover litigation costs in addition to the fees and costs |
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recoverable under the other law. |
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(f) If a claimant or defendant is entitled to recover fees |
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and costs under another law, the court must not include fees and |
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costs incurred by that claimant or defendant after the date of |
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rejection of the settlement offer when calculating the amount of |
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the judgment to be rendered under Subsection (a). |
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(g) If litigation costs are to be awarded against a |
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claimant, those litigation costs shall be awarded to the defendant |
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in the judgment as an offset against the claimant's recovery from |
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that defendant, or if damages are not awarded to the claimant, as a |
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judgment against the claimant. |
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SECTION 2. The change in law made by this Act applies only |
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to an action commenced on or after the effective date of this Act. |
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An action commenced before the effective date of this Act is |
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governed by the law in effect immediately before that date, and that |
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law is continued in effect for that purpose. |
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SECTION 3. This Act takes effect September 1, 2011. |