82R21321 CAE-D
By: Workman, et al. H.B. No. 1041
Substitute the following for H.B. No. 1041:
By: Cook C.S.H.B. No. 1041
A BILL TO BE ENTITLED
AN ACT
relating to the waiver of sovereign immunity for certain claims
arising under written contracts with state agencies.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Title 5, Civil Practice and Remedies Code, is
amended by adding Chapter 114 to read as follows:
CHAPTER 114. ADJUDICATION OF CLAIMS ARISING UNDER WRITTEN
CONTRACTS WITH STATE AGENCIES
Sec. 114.001. DEFINITIONS. In this chapter:
(1) "Adjudication" of a claim means the bringing of a
civil suit and prosecution to final judgment in county or state
court and includes the bringing of an arbitration proceeding and
prosecution to final resolution in accordance with any mandatory
procedures established in the contract subject to this chapter for
the arbitration proceedings.
(2) "Contract subject to this chapter" means a written
contract stating the essential terms of the agreement for providing
goods or services to the state agency that is properly executed on
behalf of the state agency.
(3) "State agency" means an agency, department,
commission, bureau, board, office, council, court, or other entity
that is in any branch of state government and that is created by the
constitution or a statute of this state, including a university
system or a system of higher education. The term does not include a
county, municipality, court of a county or municipality, special
purpose district, or other political subdivision of this state.
Sec. 114.002. APPLICABILITY. This chapter applies only to
a claim for breach of contract in which the matter in controversy
exceeds $250,000, exclusive of interest.
Sec. 114.003. WAIVER OF IMMUNITY TO SUIT FOR CERTAIN
CLAIMS. A state agency that is authorized by statute or the
constitution to enter into a contract and that enters into a
contract subject to this chapter waives sovereign immunity to suit
for the purpose of adjudicating a claim for breach of an express or
implied provision of the contract, subject to the terms and
conditions of this chapter.
Sec. 114.004. LIMITATIONS ON ADJUDICATION AWARDS. (a) The
total amount of money awarded in an adjudication brought against a
state agency for breach of an express or implied provision of a
contract subject to this chapter is limited to the following:
(1) the balance due and owed by the state agency under
the contract as it may have been amended, including any amount owed
as compensation for the increased cost to perform the work as a
direct result of owner-caused delays or acceleration;
(2) the amount owed for change orders or additional
work required to carry out the contract; and
(3) interest as allowed by law.
(b) Damages awarded in an adjudication brought against a
state agency arising under a contract subject to this chapter may
not include:
(1) consequential damages, except as allowed under
Subsection (a)(1);
(2) exemplary damages; or
(3) damages for unabsorbed home office overhead.
Sec. 114.005. CONTRACTUAL ADJUDICATION PROCEDURES
ENFORCEABLE. Adjudication procedures, including requirements for
serving notices or engaging in alternative dispute resolution
proceedings before bringing a suit or an arbitration proceeding,
that are stated in the contract subject to this chapter or that are
established by the state agency and expressly incorporated into the
contract are enforceable except to the extent those procedures
conflict with the terms of this chapter.
Sec. 114.006. NO WAIVER OF OTHER DEFENSES. This chapter
does not waive a defense or a limitation on damages available to a
party to a contract, other than a bar against suit based on
sovereign immunity.
Sec. 114.007. NO WAIVER OF IMMUNITY TO SUIT IN FEDERAL
COURT. This chapter does not waive sovereign immunity to suit in
federal court.
Sec. 114.008. NO WAIVER OF IMMUNITY TO SUIT FOR TORT
LIABILITY. This chapter does not waive sovereign immunity to a
claim arising from a cause of action for negligence.
Sec. 114.009. EMPLOYMENT CONTRACTS EXEMPT. This chapter
does not apply to an employment contract between a state agency and
an employee of that agency.
Sec. 114.010. NO RECOVERY OF ATTORNEY'S FEES. Attorney's
fees incurred by a state agency or any other party in the
adjudication of a claim by or against a state agency shall not be
awarded to any party in the adjudication unless the state agency has
entered into a written agreement that expressly authorizes the
prevailing party in the adjudication to recover its reasonable and
necessary attorney's fees.
Sec. 114.011. VENUE. A suit under this chapter may be
brought in a district court in:
(1) a county in which the events or omissions giving
rise to the claim occurred; or
(2) Travis County.
SECTION 2. Section 2260.002, Government Code, is amended to
read as follows:
Sec. 2260.002. APPLICABILITY. This chapter does not apply
to:
(1) a claim for personal injury or wrongful death
arising from the breach of a contract; [or]
(2) a contract executed or awarded on or before August
30, 1999; or
(3) a claim for breach of contract to which Chapter
114, Civil Practice and Remedies Code, applies.
SECTION 3. (a) Chapter 114, Civil Practice and Remedies
Code, as added by this Act, applies only to a claim arising under a
contract executed on or after September 1, 2011. A claim that
arises under a contract executed before September 1, 2011, is
governed by the law applicable to the claim immediately before the
effective date of this Act, and that law is continued in effect for
that purpose.
(b) Nothing in this Act is intended to create, rescind,
expand, or limit any waiver of sovereign immunity to suit
applicable to any contract executed before September 1, 2011.
SECTION 4. This Act takes effect September 1, 2011.