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A BILL TO BE ENTITLED
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AN ACT
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relating to indemnity agreements between contractors and |
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subcontractors for services pertaining to certain wells or mines. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 127, Civil Practice and Remedies Code, |
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is amended by adding Section 127.0045 to read as follows: |
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Sec. 127.0045. SUBCONTRACTOR AGREEMENT. (a) Except as |
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provided by Subsection (b), this chapter applies to an agreement |
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pertaining to a well for oil, gas, or water or to a mine for a |
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mineral that provides: |
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(1) that a subcontractor will provide any part of a |
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contractor's services required under a separate contract with a |
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third party; and |
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(2) for a mutual or unilateral indemnity obligation |
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between the contractor, subcontractor, and third party. |
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(b) Subsection (a) does not apply to an agreement for which |
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the contractor, on or before entering into the agreement, provides |
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written notice to: |
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(1) the subcontractor that: |
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(A) describes the subcontractor's |
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indemnification obligations to the contractor and to the third |
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party with respect to the services the subcontractor will provide |
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under the agreement; |
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(B) is provided as a separate document from the |
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agreement; and |
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(C) is written in plain English and in a manner |
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that is clear, concise, and designed to enable the subcontractor to |
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understand the subcontractor's indemnity obligations under the |
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agreement; and |
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(2) the third party that states: |
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(A) whether the subcontractor possesses |
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liability insurance coverage or qualified self-insurance in |
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accordance with Section 127.005 for the subcontractor's indemnity |
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obligations; and |
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(B) the dollar limits of the subcontractor's |
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insurance policy or qualified self-insurance, if any. |
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SECTION 2. The change in law made by this Act applies only |
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to an agreement entered into on or after the effective date of this |
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Act. |
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SECTION 3. This Act takes effect September 1, 2021. |