BILL ANALYSIS |
C.S.S.B. 807 |
By: Creighton |
Judiciary & Civil Jurisprudence |
Committee Report (Substituted) |
BACKGROUND AND PURPOSE
Interested parties contend that the protections provided for certain construction-related contracts concerning real property in Texas with respect to another state's law, litigation in the courts of another state, or arbitration in another state should be extended to other types of construction‑related contracts. C.S.S.B. 807 seeks to provide for this extension.
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CRIMINAL JUSTICE IMPACT
It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.
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RULEMAKING AUTHORITY
It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.
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ANALYSIS
C.S.S.B. 807 amends the Business & Commerce Code to change the type of construction-related contract to which the statutory provision making voidable a contract provision that subjects the contract or any conflict arising under the contract to another state's law, litigation in the courts of another state, or arbitration in another state applies from a contract principally for the construction or repair of an improvement to real property located in Texas to a construction contract, as defined by the bill, concerning real property located in Texas or an agreement collateral to or affecting the construction contract. The bill changes the party that may void the provision from the party obligated by the contract to perform the construction or repair to the party obligated by the contract or agreement to perform the work that is the subject of the construction contract.
C.S.S.B. 807 defines "construction contract" as a contract, subcontract, or agreement entered into or made by an owner, architect, engineer, contractor, construction manager, subcontractor, supplier, or material or equipment lessor for the design, construction, alteration, renovation, remodeling, or repair of, or for the furnishing of material or equipment for, a building, structure, appurtenance, or other improvement to or on public or private real property, including moving, demolition, and excavation connected with the real property. The bill includes in the term an agreement to which an architect, engineer, or contractor and an owner's lender are parties regarding an assignment of the construction contract or other modifications thereto.
C.S.S.B. 807 retains the inapplicability of the voidable contract provision to certain contracts but changes the purpose of the applicable contracts from the construction or repair of the real property improvement to the performance of work that is the subject of the construction contract.
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EFFECTIVE DATE
September 1, 2017.
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COMPARISON OF SENATE ENGROSSED AND SUBSTITUTE
While C.S.S.B. 807 may differ from the engrossed in minor or nonsubstantive ways, the following comparison is organized and formatted in a manner that indicates the substantial differences between the engrossed and committee substitute versions of the bill.
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