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A BILL TO BE ENTITLED
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AN ACT
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relating to limits on certain actions arising out of attorney's fee |
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agreements and litigation expense agreements. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Title 6, Civil Practice and Remedies Code, is |
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amended by adding Chapter 165 to read as follows: |
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CHAPTER 165. LIMITATION OF ACTION ON CERTAIN ATTORNEY'S FEE |
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AGREEMENTS AND LITIGATION EXPENSE AGREEMENTS |
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Sec. 165.001. LIMITATION OF ACTION ON CERTAIN ATTORNEY'S |
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FEE AGREEMENTS AND LITIGATION EXPENSE AGREEMENTS. (a) A party to an |
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attorney's fee agreement or litigation expense agreement to which |
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this section applies, or a successor, heir, agent, attorney, or |
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assignee of the party, may not bring an action on a claim arising |
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out of the settlement agreement or the representation that is the |
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subject of the agreement except as provided by this section. |
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(b) This section applies to an attorney's fee agreement and |
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litigation expense agreement in which the fee is contingent on the |
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outcome of the matter for which the service is rendered and which |
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states in writing: |
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(1) the method by which the fee is to be determined; |
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(2) the litigation and other expenses to be deducted |
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from the recovery; and |
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(3) whether litigation expenses and other expenses are |
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to be deducted before or after the contingent fee is calculated. |
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(c) With respect to a case in which an attorney represents |
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two or more clients and makes an aggregate settlement of the |
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clients' claims, this section applies to a settlement agreement |
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approved by the client at the conclusion of the litigation that |
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additionally includes disclosure of: |
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(1) the existence and nature of all claims or pleas |
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involved; |
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(2) the nature and extent of the participation of each |
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client in the settlement; and |
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(3) the amount of remittance to each client and the |
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method by which the remittance is to be determined. |
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(d) A party may bring an action on a claim arising out of a |
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settlement agreement to which this section applies or the |
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representation that is the subject of the agreement only on the |
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ground that the agreement was obtained by corruption, coercion, or |
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force or that the agreement was forged as provided by Section 32.21, |
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Penal Code. |
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(e) In an action on a claim arising out of a settlement |
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agreement described by Subsection (c), or the settlement that is |
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the subject of the agreement, brought on grounds other than those |
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provided by Subsection (d), the settlement is irrebuttably presumed |
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to be: |
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(1) fully disclosed, read, understood, and |
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voluntarily entered into by all parties to the agreement; |
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(2) fair, accepted, reasonable, and made in the best |
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interests of the parties by the parties or through their attorneys; |
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and |
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(3) final and not subject to subsequent litigation. |
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(f) On motion of a party, a court shall dismiss with |
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prejudice an action on a claim arising out of a settlement agreement |
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to which this section applies or the representation that is the |
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subject of the agreement if the action is brought on grounds other |
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than those provided by Subsection (d). |
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SECTION 2. The change in law made by this Act applies only |
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to an action commenced or settled, or in which judgment was entered, |
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on or after the effective date of this Act. An action commenced or |
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settled, or in which judgment was entered, before the effective |
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date of this Act is governed by the law in effect immediately before |
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that date, and the former law is continued in effect for that |
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purpose. |
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SECTION 3. This Act takes effect September 1, 2013. |