Texas 2019 - 86th Regular

Texas House Bill HB1999 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	H.B. No. 1999
	1	+	By: Leach, et al. (Senate Sponsor - Creighton) H.B. No. 1999
	2	+	(In the Senate - Received from the House April 26, 2019;
	3	+	May 7, 2019, read first time and referred to Committee on State
	4	+	Affairs; May 15, 2019, reported adversely, with favorable
	5	+	Committee Substitute by the following vote: Yeas 9, Nays 0;
	6	+	May 15, 2019, sent to printer.)
	7	+	Click here to see the committee vote
	8	+	COMMITTEE SUBSTITUTE FOR H.B. No. 1999 By: Creighton
2	9
3	10
	11	+	A BILL TO BE ENTITLED
4	12		AN ACT
5	13		relating to certain construction liability claims concerning
6	14		public buildings and public works.
7	15		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	16		SECTION 1. Subtitle F, Title 10, Government Code, is
9	17		amended by adding Chapter 2272 to read as follows:
10	18		CHAPTER 2272. CERTAIN CONSTRUCTION LIABILITY CLAIMS
11	19		Sec. 2272.001. DEFINITIONS. In this chapter:
12	20		(1) "Action" means a court or judicial proceeding or
13	21		an arbitration. The term does not include an administrative
14	22		action.
15	23		(2) "Construction" includes:
16	24		(A) the initial construction of an improvement to
17	25		real property;
18	26		(B) the construction of an addition to an
19	27		improvement to real property; or
20	28		(C) the repair, alteration, or remodeling of an
21	29		improvement to real property.
22	30		(3) "Construction defect" means a deficiency in the
23	31		construction of an improvement to real property, including a
24	32		deficiency in or arising out of the design, specifications,
25	33		surveying, planning, or supervision of the construction, that is
26	34		the result of:
27	35		(A) the use of defective materials, products, or
28	36		components in the construction;
29	37		(B) a violation of a building code applicable by
30	38		law to the construction;
31	39		(C) a failure of the design of an improvement to
32	40		real property to meet the professional standards of care applicable
33	41		at the time of governmental approval of the design or as otherwise
34	42		applicable if no governmental approval of the design was required
35	43		or obtained; or
36	44		(D) a failure to perform the construction in
37	45		accordance with the accepted trade standards for good and
38	46		workmanlike construction.
39	47		(4) "Contractor" means a person engaged in the
40	48		business of developing, constructing, fabricating, repairing,
41	49		altering, or remodeling improvements to real property.
42	50		(5) "Design professional" means an individual
43	51		registered as an architect under Chapter 1051, Occupations Code, or
44	52		a person licensed as an engineer under Chapter 1001, Occupations
45	53		Code.
46	54		(6) "Governmental entity" means:
47	55		(A) the state;
48	56		(B) a municipality, county, public school
49	57		district, or special-purpose district or authority;
50	58		(C) a district, county, or justice of the peace
51	59		court;
52	60		(D) a board, commission, department, office, or
53	61		other agency in the executive branch of state government, including
54	62		an institution of higher education as defined by Section 61.003,
55	63		Education Code;
56	64		(E) the legislature or a legislative agency; or
57	65		(F) the Supreme Court of Texas, the Texas Court
58	66		of Criminal Appeals, a court of appeals, or the State Bar of Texas
59	67		or another judicial agency having statewide jurisdiction.
60	68		(7) "Subcontractor" means a contractor directly
61	69		retained and compensated by another contractor to perform labor or
62	70		perform labor and supply materials in the construction.
63	71		(8) "Supplier" means a person who provides only
64	72		materials, equipment, or other supplies for the construction.
65	73		Sec. 2272.002. APPLICABILITY OF CHAPTER. (a) This chapter
66	74		applies only to a claim:
67	75		(1) for:
68	76		(A) damages arising from damage to or loss of
69	77		real or personal property caused by an alleged construction defect
70	78		in an improvement to real property that is a public building or
71	79		public work; or
72	80		(B) indemnity or contribution for damages
73	81		described by Paragraph (A);
74	82		(2) asserted by a governmental entity with an interest
75	83		in the public building or public work affected by the alleged
76	84		construction defect; and
77	85		(3) asserted against a contractor, subcontractor,
78	86		supplier, or design professional.
79	87		(b) This chapter does not apply to:
80	88		(1) a claim for personal injury, survival, or wrongful
81	89		death;
82	90		(2) a claim involving the construction of residential
83	91		property covered under Chapter 27, Property Code;
84	92		(3) a contract entered into by the Texas Department of
85	93		Transportation;
86	94		(4) a project that receives money from a state or
87	95		federal highway fund; or
88	96		(5) a civil works project as defined by Section
89		-	2269.351
90		-	.
	97	+	2269.351, Government Code.
91	98		Sec. 2272.003. REPORT. (a) Before bringing an action
92	99		asserting a claim to which this chapter applies, the governmental
93	100		entity must provide each party with whom the governmental entity
94	101		has a contract for the design or construction of an affected
95	102		structure a written report by certified mail, return receipt
96	103		requested, that clearly:
97	104		(1) identifies the specific construction defect on
98	105		which the claim is based;
99	106		(2) describes the present physical condition of the
100	107		affected structure; and
101	108		(3) describes any modification, maintenance, or
102	109		repairs to the affected structure made by the governmental entity
103	110		or others since the affected structure was initially occupied or
104	111		used.
105	112		(b) Not later than the fifth day after the date a contractor
106	113		receives a report under Subsection (a), the contractor must provide
107	114		a copy of the report to each subcontractor retained on the
108	115		construction of the affected structure whose work is subject to the
109	116		claim.
110	117		Sec. 2272.004. OPPORTUNITY TO INSPECT AND CORRECT. (a)
111	118		Before bringing an action asserting a claim to which this chapter
112	119		applies, the governmental entity must allow each party with whom
113	120		the governmental entity has a contract for the design or
114	121		construction of an affected structure and who is subject to the
115	122		claim and any known subcontractor or supplier who is subject to the
116	123		claim:
117	124		(1) a reasonable opportunity to inspect any
118	125		construction defect or related condition identified in the report
119	126		for a period of 30 days after sending the report required by Section
120	127		2272.003; and
121	128		(2) at least 120 days after the inspection to:
122	129		(A) correct any construction defect or related
123	130		condition identified in the report; or
124	131		(B) enter into a separate agreement with the
125	132		governmental entity to correct any construction defect or related
126	133		condition identified in the report.
127	134		(b) The governmental entity is not required to allow a party
128	135		to make a correction or repair under Subsection (a) if:
129	136		(1) the party:
130	137		(A) is a contractor and cannot provide payment
131	138		and performance bonds to cover the corrective work;
132	139		(B) cannot provide liability insurance or
133	140		workers' compensation insurance;
134	141		(C) has been previously terminated for cause by
135	142		the governmental entity; or
136	143		(D) has been convicted of a felony; or
137	144		(2) the governmental entity previously complied with
138	145		the process required by Subsection (a) regarding a construction
139	146		defect or related condition identified in the report and:
140	147		(A) the defect or condition was not corrected as
141	148		required by Subsection (a)(2)(A) or an agreement under Subsection
142	149		(a)(2)(B); or
143	150		(B) the attempt to correct the construction
144	151		defect or related condition identified in the report resulted in a
145	152		new construction defect or related condition.
146	153		Sec. 2272.005. TOLLING OF LIMITATIONS AND REPOSE PERIODS.
147	154		If the report and opportunity to correct required by Sections
148	155		2272.003 and 2272.004 are provided during the final year of a
149	156		limitations or repose period applicable to the claim, the
150	157		limitations or repose period is tolled until the first anniversary
151	158		of the date on which the report is provided.
152	159		Sec. 2272.006. DISMISSAL. (a) If a governmental entity
153	160		brings an action asserting a claim to which this chapter applies
154	161		without complying with Sections 2272.003 and 2272.004, the court,
155	162		arbitrator, or other adjudicating authority shall dismiss the
156	163		action without prejudice.
157	164		(b) If an action is dismissed without prejudice under
158	165		Subsection (a) and the governmental entity brings a second action
159	166		asserting a claim to which this chapter applies without complying
160	167		with Sections 2272.003 and 2272.004, the court, arbitrator, or
161	168		other adjudicating authority shall dismiss the action with
162	169		prejudice.
163	170		Sec. 2272.007. RECOVERY OF REPORT COSTS. If a report
164	171		provided by a governmental entity under Section 2272.003 identifies
165	172		a construction defect that is corrected under Section 2272.004 or
166	173		for which the governmental entity recovers damages, the party
167	174		responsible for that construction defect shall pay the reasonable
168	175		amounts incurred by the governmental entity to obtain the report
169	176		with respect to identification of that construction defect.
170	177		Sec. 2272.008. EMERGENCY REPAIRS BY GOVERNMENTAL ENTITY.
171	178		This chapter does not prohibit or limit a governmental entity from
172	179		making emergency repairs to the property as necessary to protect
173	180		the health, safety, and welfare of the public or a building
174	181		occupant.
175	182		Sec. 2272.009. INSURANCE TREATMENT OF CLAIM. If a party, in
176	183		connection with a potential claim against the party, receives a
177	184		written notice of an alleged construction defect or a report under
178	185		Section 2272.003 identifying a construction defect and provides the
179	186		notice or report to the party's insurer, the insurer shall treat the
180	187		provision of the notice or report to the party as the filing of a
181	188		suit asserting that claim against the party for purposes of the
182	189		relevant policy terms.
183	190		SECTION 2. (a) Chapter 2272, Government Code, as added by
184	191		this Act, applies only to a cause of action that accrues on or after
185	192		the effective date of this Act.
186	193		(b) Section 2272.009, Government Code, as added by this Act,
187	194		applies only to an insurance policy delivered, issued for delivery,
188	195		or renewed on or after January 1, 2020.
189	196		SECTION 3. This Act takes effect immediately if it receives
190	197		a vote of two-thirds of all the members elected to each house, as
191	198		provided by Section 39, Article III, Texas Constitution. If this
192	199		Act does not receive the vote necessary for immediate effect, this
193	200		Act takes effect September 1, 2019.
194		-	______________________________ ______________________________
195		-	President of the Senate Speaker of the House
196		-	I certify that H.B. No. 1999 was passed by the House on April
197		-	25, 2019, by the following vote: Yeas 99, Nays 34, 1 present, not
198		-	voting; and that the House concurred in Senate amendments to H.B.
199		-	No. 1999 on May 23, 2019, by the following vote: Yeas 108, Nays 34,
200		-	2 present, not voting.
201		-	______________________________
202		-	Chief Clerk of the House
203		-	I certify that H.B. No. 1999 was passed by the Senate, with
204		-	amendments, on May 21, 2019, by the following vote: Yeas 29, Nays
205		-	2.
206		-	______________________________
207		-	Secretary of the Senate
208		-	APPROVED: __________________
209		-	Date
210		-	__________________
211		-	Governor
	201	+	* * * * *