Relating to damages in certain contract claims against the state.
The implications of SB1950 could be significant for contractors and service providers working with the state. By allowing for the recovery of attorney’s fees in specific contract claims, the legislation aims to provide an additional layer of protection for entities that engage in business with the state. This may encourage smaller contractors to pursue legitimate claims without the fear that they will be unable to recover their legal costs, thereby potentially increasing competition for state contracts.
Senate Bill 1950 relates to damages awarded in certain contract claims against the state of Texas. Specifically, the bill proposes an amendment to Section 2260.003 of the Government Code, allowing for the inclusion of attorney's fees in cases of contract breaches. This provision applies specifically to claims concerning written contracts for engineering, architectural, or construction services, as well as materials directly related to those services. The bill establishes limits on the amount in controversy, which must be less than $250,000, excluding various fees and interests.
While the bill seeks to address fairness in contract claims, there may be contention surrounding the limitations placed on the amount in controversy. Critics could argue that limiting claims to under $250,000 might restrict the ability of larger contractors to seek restitution for significant damages. Furthermore, the requirement that the claims must pertain strictly to engineering or construction-related contracts may lead to discussions about the inclusivity of other contract-related claims, potentially leaving certain entities without adequate recourse.