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A BILL TO BE ENTITLED
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AN ACT
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relating to civil liability and responsibility for the consequences |
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of defects in the plans, specifications, or related documents for |
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the construction or repair of an improvement to real property. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Title 4, Business & Commerce Code, is amended by |
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adding Chapter 59 to read as follows: |
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CHAPTER 59. RESPONSIBILITY FOR DEFECTS IN PLANS AND SPECIFICATIONS |
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SUBCHAPTER A. GENERAL PROVISIONS |
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Sec. 59.0001. DEFINITIONS. In this chapter: |
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(1) "Construction" includes: |
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(A) the initial construction of an improvement to |
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real property; |
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(B) the construction of an addition to an |
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improvement to real property; or |
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(C) the repair, alteration, or remodeling of an |
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improvement to real property. |
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(2) "Contractor" means a person engaged in the |
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business of developing, constructing, fabricating, repairing, |
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altering, or remodeling improvements to real property. |
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(3) "Critical infrastructure facility" has the |
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meaning assigned by Section 423.0045, Government Code, provided |
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that the absence of fencing or signage described in the definition |
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provided by that section does not disqualify an item listed in that |
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definition from being classified or treated as a critical |
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infrastructure facility for purposes of this chapter. The term |
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includes: |
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(A) pipelines and pipeline appurtenances or |
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facilities, including pipes, valves, meters, pumps, compressors, |
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treating and processing facilities, cathodic protection |
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facilities, and any other equipment, facilities, devices, |
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structures, and buildings used or intended for use in the |
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gathering, transportation, treating, or processing of oil, gas, or |
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other minerals, and the liquefied or gaseous substances, |
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constituents, products, or mixtures derived from those minerals |
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through refining, processing, or other methods; |
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(B) utility-scale equipment or facilities to |
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transmit or distribute electricity; and |
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(C) utility-scale water storage facilities. |
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(4) "Design-build contract" means a contract in which |
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a single contractor agrees to: |
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(A) construct, repair, alter, or remodel an |
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improvement to real property; and |
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(B) be responsible for the development of plans, |
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specifications, or other design or bid documents used by the |
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contractor to construct, repair, alter, or remodel the improvement. |
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(5) "Subcontractor" means a contractor directly |
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retained and compensated by another contractor to perform labor or |
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perform labor and supply materials in the construction. |
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SUBCHAPTER B. CONTRACTOR RESPONSIBILITY |
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Sec. 59.0051. APPLICABILITY OF SUBCHAPTER. (a) This |
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subchapter applies only to a contract for the construction or |
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repair of an improvement to real property. |
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(b) This subchapter does not apply to a contract entered |
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into by a person for the construction or repair of a critical |
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infrastructure facility owned or operated by the person or any |
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building, structure, improvement, appurtenance, or other facility |
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owned by the person that is necessary to the operation of and |
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directly related to the critical infrastructure facility. For |
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purposes of this subsection, "person" includes a parent, |
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subsidiary, affiliated entity, joint venture partner, or owner of |
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the person. |
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(c) This chapter does not apply to the construction, repair, |
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alteration, or remodeling of an improvement to real property if: |
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(1) the construction, repair, alteration, or |
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remodeling is performed under a design-build contract; and |
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(2) the part of the plans, specifications, or other |
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design or bid documents for which the contractor is responsible |
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under the contract is the part alleged to be defective. |
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Sec. 59.0052. LIMITATION ON CONTRACTOR'S LIABILITY AND |
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RESPONSIBILITY FOR CERTAIN DEFECTS. (a) A contractor is not |
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responsible for the consequences of defects in and may not warranty |
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the accuracy, adequacy, sufficiency, or suitability of plans, |
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specifications, or other design or bid documents provided to the |
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contractor by: |
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(1) the person with whom the contractor entered into |
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the contract; or |
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(2) another person on behalf of the person with whom |
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the contractor entered into the contract. |
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(b) A contractor must, within a reasonable time of learning |
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of the defect, disclose in writing to the person with whom the |
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contractor enters into a contract the existence of any known defect |
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in the plans, specifications, or other design or bid documents that |
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is discovered by the contractor, or that reasonably should have |
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been discovered by the contractor using ordinary diligence, before |
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or during construction. |
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(c) A contractor who fails to disclose a condition as |
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required by Subsection (b) may be liable for the consequences of |
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defects that result from the failure to disclose. |
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Sec. 59.0053. STANDARD OF CARE FOR CERTAIN DESIGNS. Design |
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services provided under a design-build contract are subject to the |
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same standard of care requirements provided in Section 130.0021, |
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Civil Practice and Remedies Code. |
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Sec. 59.0054. WAIVER PROHIBITED. This subchapter may not |
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be waived by a contractor, subcontractor, or owner. A purported |
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waiver of this subchapter in violation of this section is void. |
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SECTION 2. The heading to Chapter 130, Civil Practice and |
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Remedies Code, is amended to read as follows: |
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CHAPTER 130. LIABILITY PROVISIONS [INDEMNIFICATION] IN CERTAIN |
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CONSTRUCTION CONTRACTS |
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SECTION 3. Chapter 130, Civil Practice and Remedies Code, |
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is amended by adding Section 130.0021 to read as follows: |
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Sec. 130.0021. ARCHITECT'S OR ENGINEER'S STANDARD OF CARE. |
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(a) A construction contract for architectural or engineering |
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services or a contract related to the construction or repair of an |
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improvement to real property that contains architectural or |
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engineering services as a component part must require that the |
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architectural or engineering services be performed with the |
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professional skill and care ordinarily provided by competent |
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architects or engineers practicing under the same or similar |
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circumstances and professional license. |
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(b) If a contract described by Subsection (a) contains a |
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provision establishing a different standard of care than the |
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standard described by Subsection (a): |
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(1) the provision is void and unenforceable; and |
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(2) the standard of care described by Subsection (a) |
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applies to the performance of the architectural or engineering |
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services. |
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(c) Section 130.004 does not limit the applicability of this |
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section. |
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SECTION 4. Section 130.004, Civil Practice and Remedies |
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Code, is amended to read as follows: |
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Sec. 130.004. OWNER OF INTEREST IN REAL PROPERTY. (a) |
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Except as provided by Section 130.002(b) or 130.0021, this chapter |
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does not apply to an owner of an interest in real property or |
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persons employed solely by that owner. |
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(b) Except as provided by Section 130.002(b) or 130.0021, |
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this chapter does not prohibit or make void or unenforceable a |
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covenant or promise to: |
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(1) indemnify or hold harmless an owner of an interest |
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in real property and persons employed solely by that owner; or |
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(2) allocate, release, liquidate, limit, or exclude |
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liability in connection with a construction contract between an |
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owner or other person for whom a construction contract is being |
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performed and a registered architect or licensed engineer. |
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SECTION 5. (a) The changes in law made by this Act apply |
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only to a contract entered into on or after the effective date of |
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this Act. A contract entered into before the effective date of this |
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Act is governed by the law in effect when the contract was entered |
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into, and the former law is continued in effect for that purpose. |
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(b) An original contract for the construction or repair of |
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an improvement to real property with the owner of an interest in |
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real property that is entered into before the effective date of this |
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Act, and a subcontract or purchase order for providing labor or |
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materials associated with that original contract, whether the |
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subcontract or purchase order is entered into before, on, or after |
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the effective date of this Act, is governed by the law in effect |
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when the original contract was entered into, and the former law is |
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continued in effect for that purpose. |
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SECTION 6. This Act takes effect September 1, 2021. |
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