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A BILL TO BE ENTITLED
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AN ACT
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relating to retainage under certain construction contracts. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 53.053(e), Property Code, is amended to |
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read as follows: |
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(e) A claim for retainage accrues on the last day of the |
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month in which all work called for by the contract between the owner |
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and the original contractor has been completed, finally settled, |
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terminated, or abandoned. |
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SECTION 2. Section 53.056(d), Property Code, is amended to |
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read as follows: |
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(d) Except as provided by Section 53.057, to [To] authorize |
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the owner to withhold funds under Subchapter D, the notice to the |
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owner must state that if the claim remains unpaid, the owner may be |
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personally liable and the owner's property may be subjected to a |
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lien unless: |
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(1) the owner withholds payments from the contractor |
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for payment of the claim; or |
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(2) the claim is otherwise paid or settled. |
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SECTION 3. Sections 53.057(a), (b), and (e), Property Code, |
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are amended to read as follows: |
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(a) A claimant may give notice under this section instead of |
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or in addition to notice under Section 53.056 or 53.252 if the |
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claimant is to labor, furnish labor or materials, or specially |
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fabricate materials, or has labored, furnished labor or materials, |
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or specially fabricated materials, under an agreement with an |
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original contractor or a subcontractor providing for retainage. |
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(b) The claimant must give notice that the claimant may have |
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a lien claim for retainage to the owner or reputed owner [notice of
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the retainage agreement] not later than the 25th [15th] day after |
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the date: |
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(1) the work under the original contract is completed; |
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(2) the original contract is terminated; or |
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(3) the original contractor abandons performance |
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under the contract [of the second month following the delivery of
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materials or the performance of labor by the claimant that first
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occurs after the claimant has agreed to the contractual retainage.
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If the agreement is with a subcontractor, the claimant must also
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give notice within that time to the original contractor]. |
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(e) If a claimant gives notice under this section [and
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Section 53.055 or, if the claim relates to a residential
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construction project, under this section and Section 53.252], the |
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claimant is not required to give any other notice as to the |
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retainage before the date the notice under Section 53.055 is |
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required. |
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SECTION 4. Section 53.081(c), Property Code, is amended to |
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read as follows: |
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(c) If notice is sent under Section 53.057, the owner may |
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withhold funds by retaining funds under Subchapter E for the period |
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required under Section 53.082 [immediately on receipt of a copy of
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the claimant's affidavit prepared in accordance with Sections
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53.052 through 53.055]. |
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SECTION 5. Section 53.103, Property Code, is amended to |
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read as follows: |
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Sec. 53.103. LIEN ON RETAINED FUNDS. A claimant has a lien |
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on the retained funds if the claimant: |
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(1) sends the notices required by this chapter in the |
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time and manner required; and |
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(2) files an affidavit claiming a lien in the period |
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required under Section 53.052 [not later than the 30th day after the
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earlier of the date:
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[(A) the work is completed;
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[(B) the original contract is terminated; or
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[(C)
the original contractor abandons
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performance under the original contract]. |
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SECTION 6. Section 53.106, Property Code, is amended to |
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read as follows: |
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Sec. 53.106. AFFIDAVIT OF COMPLETION. (a) An owner may |
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file with the county clerk of the county in which the property is |
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located an affidavit of completion. The affidavit must contain: |
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(1) the name and address of the owner; |
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(2) the name and address of the original contractor; |
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(3) a description, legally sufficient for |
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identification, of the real property on which the improvements are |
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located; |
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(4) a description of the improvements furnished under |
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the original contract; |
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(5) a statement that the improvements under the |
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original contract have been completed and the date of completion; |
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and |
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(6) a conspicuous statement that a claimant may not |
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have a lien on retained funds unless the claimant: |
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(A) complies with the notice requirement under |
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Section 53.057 not later than the 25th day after the date of |
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completion of the original contract; and |
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(B) files a lien affidavit not later than the |
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15th day after the fourth calendar month after the date of |
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completion of the original contract [files the affidavit claiming a
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lien not later than the 30th day after the date of completion]. |
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(b) A copy of the affidavit must be sent by certified or |
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registered mail to the original contractor not later than the date |
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the affidavit is filed and to each claimant who sends a notice of |
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lien liability to the owner under Section 53.056, 53.057, 53.058, |
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53.252, or 53.253 not later than the date the affidavit is filed or |
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the fifth [10th] day after the date the owner receives the notice of |
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lien liability, whichever is later. |
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(c) A copy of the affidavit must also be sent to each person |
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who furnishes labor or materials for the property and who furnishes |
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the owner with a written request for the copy. The owner must |
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furnish the copy to the person not later than the date the affidavit |
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is filed or the fifth [10th] day after the date the request is |
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received, whichever is later. |
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(d) Except as provided by this subsection, an affidavit |
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filed under this section on or before the fifth [10th] day after the |
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date of completion of the improvements is prima facie evidence of |
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the date the work under the original contract is completed for |
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purposes of this subchapter and Section 53.057. If the affidavit is |
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filed after the fifth [10th] day after the date of completion, the |
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date of completion for purposes of this subchapter and Section |
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53.057 is the date the affidavit is filed. This subsection does not |
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apply to a person to whom the affidavit was not sent as required by |
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this section. |
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SECTION 7. Sections 53.107(a), (b), (c), and (d), Property |
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Code, are amended to read as follows: |
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(a) Not later than the fifth [10th] day after the date an |
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original contract is terminated or the original contractor abandons |
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performance under the original contract, the owner shall give |
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notice to each subcontractor who, before the date of termination or |
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abandonment, has: |
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(1) given notice to the owner as provided by Section |
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53.056, 53.057, or 53.058; or |
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(2) sent to the owner by certified or registered mail a |
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written request for notice of termination or abandonment. |
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(b) The notice must contain: |
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(1) the name and address of the owner; |
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(2) the name and address of the original contractor; |
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(3) a description, legally sufficient for |
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identification, of the real property on which the improvements are |
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located; |
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(4) a general description of the improvements agreed |
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to be furnished under the original contract; |
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(5) a statement that the original contract has been |
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terminated or that performance under the contract has been |
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abandoned; |
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(6) the date of the termination or abandonment; and |
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(7) a conspicuous statement that a claimant may not |
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have a lien on the retained funds unless the claimant: |
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(A) complies with the notice requirement in |
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Section 53.057 not later than the 25th day after the date the |
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original contract is terminated or abandoned; and |
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(B) files an affidavit claiming a lien not later |
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than the 15th [30th] day of the fourth month after the date of the |
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termination or abandonment. |
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(c) A notice sent in compliance with this section on or |
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before the fifth [10th] day after the date of termination or |
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abandonment is prima facie evidence of the date the original |
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contract was terminated or work was abandoned for purposes of this |
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subchapter. |
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(d) A subcontractor to whom an owner fails to send notice |
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under this section is not required to comply with Section 53.057 to |
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claim contractual retainage and may claim a lien by filing a lien |
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affidavit as prescribed by Section 53.052 [who fails to file a lien
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affidavit in the time prescribed by Section 53.103(2) has a lien to
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the extent authorized under this subchapter if:
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[(1)
the subcontractor otherwise complies with this
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chapter; and
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[(2)
the owner did not provide the subcontractor
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notice as required by this section]. |
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SECTION 8. Subchapter E, Chapter 53, Property Code, is |
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amended by adding Section 53.108 to read as follows: |
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Sec. 53.108. NOTICE OF COMPLETION TO SECURE RETAINAGE |
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CLAIM. (a) Not later than the fifth day after the date of |
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completion, an owner shall send by certified mail, return receipt |
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requested, or registered mail a notice of completion to: |
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(1) the original contractor; |
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(2) any person who provides a notice under Section |
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53.056, 53.057, 53.058, 53.252, or 53.253; and |
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(3) any person who furnished labor or provided |
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materials for the improvement and requests a copy of the notice of |
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completion. |
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(b) The notice must contain: |
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(1) the name and address of the owner; |
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(2) the name and address of the original contractor; |
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(3) a description, legally sufficient for |
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identification, of the real property on which the improvements are |
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located; |
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(4) a description of the improvements furnished under |
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the original contract; |
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(5) a statement that the improvements under the |
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original contract have been completed; and |
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(6) the date of completion. |
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(c) A notice sent in compliance with this section is prima |
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facie evidence under Sections 53.053(e) and 53.057 of the date the |
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work under the original contract was completed. |
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(d) An owner who sends a copy of an affidavit of completion |
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as prescribed by Section 53.106 satisfies the requirements of this |
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section. |
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(e) A subcontractor to whom an owner fails to send notice |
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under this section is not required to comply with Section 53.057 to |
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claim contractual retainage and may claim a lien by filing a lien |
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affidavit as prescribed by Section 53.052. |
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SECTION 9. Section 53.057(c), Property Code, is repealed. |
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SECTION 10. Chapter 53, Property Code, as amended by this |
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Act, applies only to an original contract entered into on or after |
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the effective date of this Act and any lien arising under that |
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contract. An original contract entered into before the effective |
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date of this Act, and any lien arising under that contract, is |
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governed by the law in effect immediately before the effective date |
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of this Act, and that law is continued in effect for that purpose. |
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SECTION 11. This Act takes effect September 1, 2011. |