Texas 2021 - 87th Regular

Texas Senate Bill SB219 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	S.B. No. 219
	1	+	87R25597 AJA-F
	2	+	By: Hughes S.B. No. 219
	3	+	(Leach, Gervin-Hawkins, Lucio III, Holland, et al.)
	4	+	Substitute the following for S.B. No. 219: No.
2	5
3	6
	7	+	A BILL TO BE ENTITLED
4	8		AN ACT
5	9		relating to civil liability and responsibility for the consequences
6	10		of defects in the plans, specifications, or related documents for
7		-	the construction or repair of an improvement to real property or of
8		-	a road or highway.
	11	+	the construction or repair of an improvement to real property.
9	12		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	13		SECTION 1. Title 4, Business & Commerce Code, is amended by
11	14		adding Chapter 59 to read as follows:
12	15		CHAPTER 59. RESPONSIBILITY FOR DEFECTS IN PLANS AND SPECIFICATIONS
13	16		SUBCHAPTER A. GENERAL PROVISIONS
14	17		Sec. 59.001. DEFINITIONS. In this chapter:
15	18		(1) "Construction" includes:
16	19		(A) the initial construction of an improvement to
17	20		real property;
18	21		(B) the construction of an addition to an
19	22		improvement to real property; or
20	23		(C) the repair, alteration, or remodeling of an
21	24		improvement to real property.
22	25		(2) "Contractor" means a person engaged in the
23	26		business of developing, constructing, fabricating, repairing,
24	27		altering, or remodeling improvements to real property.
25	28		(3) "Critical infrastructure facility" includes:
26	29		(A) a petroleum or alumina refinery;
27	30		(B) an electrical power generating facility,
28	31		substation, switching station, or control center;
29	32		(C) a chemical, polymer, or rubber manufacturing
30	33		facility;
31	34		(D) a water intake structure, water treatment
32	35		facility, wastewater treatment plant, or pump station;
33	36		(E) a natural gas compressor station;
34	37		(F) a liquid natural gas terminal or storage
35	38		facility;
36	39		(G) a telecommunications central switching
37	40		office or any structure used as part of a system to provide wired or
38	41		wireless telecommunications services;
39	42		(H) a port, railroad switching yard, trucking
40	43		terminal, or other freight transportation facility;
41	44		(I) a gas processing plant, including a plant
42	45		used in the processing, treatment, or fractionation of natural gas;
43	46		(J) a transmission facility used by a federally
44	47		licensed radio or television station;
45	48		(K) a steelmaking facility that uses an electric
46	49		arc furnace to make steel;
47	50		(L) a dam that is classified as a high hazard by
48	51		the Texas Commission on Environmental Quality;
49	52		(M) a concentrated animal feeding operation, as
50	53		defined by Section 26.048, Water Code;
51	54		(N) any portion of an aboveground oil, gas, or
52	55		chemical pipeline;
53	56		(O) an oil or gas drilling site;
54	57		(P) a group of tanks used to store crude oil, such
55	58		as a tank battery;
56	59		(Q) an oil, gas, or chemical production facility;
57	60		(R) an oil or gas wellhead;
58	61		(S) any oil and gas facility that has an active
59	62		flare;
60	63		(T) pipelines and pipeline appurtenances or
61	64		facilities, including pipes, valves, meters, pumps, compressors,
62	65		treating and processing facilities, cathodic protection
63	66		facilities, and any other equipment, facilities, devices,
64	67		structures, and buildings used or intended for use in the
65	68		gathering, transportation, treating, storage, or processing of
66	69		CO2, oil, gas, or other minerals, and the liquefied or gaseous
67	70		substances, constituents, products, or mixtures derived from those
68	71		minerals through refining, processing, or other methods;
69	72		(U) utility-scale equipment or facilities to
70	73		transmit or distribute electricity;
71	74		(V) utility-scale water or wastewater storage,
72	75		treatment, or transmission facilities;
73	76		(W) facilities used to manufacture or produce
74	77		transportation fuels and similar products, including gasoline,
75	78		kerosene, distillate fuel oils, residual fuel oils, lubricants,
76	79		asphalt, propane, ethanol, biodiesel, and renewable diesel; and
77	80		(X) commercial airport facilities used for the
78	81		landing, parking, refueling, shelter, or takeoff of aircraft,
79	82		maintenance or servicing of aircraft, aircraft equipment storage,
80	83		or navigation of aircraft.
81	84		(4) "Design" means work that is required under Title
82	85		6, Occupations Code, to be performed by or under the supervision of
83	86		a person licensed or registered under the statute.
84	87		(5) "Design-build contract" means a contract in which
85	88		a contractor agrees to:
86	89		(A) construct, repair, alter, or remodel an
87	90		improvement to real property; and
88	91		(B) be responsible for the development of plans,
89	92		specifications, or other design documents used by the contractor to
90	93		construct, repair, alter, or remodel the improvement.
91	94		(6) "Engineering, procurement, and construction
92	95		contract" means a construction contract where the contractor is
93	96		responsible for all of the engineering, procurement, and
94	97		construction activities to deliver the completed project.
95	98		Sec. 59.002. APPLICABILITY OF CHAPTER. (a) This chapter
96	99		applies only to a contract for the construction or repair of an
97	100		improvement to real property.
98	101		(b) This chapter does not apply to a contract entered into
99	102		by a person for the construction or repair of a critical
100	103		infrastructure facility owned or operated by the person or any
101	104		building, structure, improvement, appurtenance, or other facility
102	105		owned by the person that is necessary to the operation of and
103	106		directly related to the critical infrastructure facility. For
104	107		purposes of this subsection, "person" has the meaning assigned by
105	108		Section 311.005, Government Code, and includes a parent,
106	109		subsidiary, affiliated entity, joint venture partner, or owner of
107	110		the person.
108	111		(c) Except as provided by Section 59.052, this chapter does
109	112		not apply to the construction, repair, alteration, or remodeling of
110	113		an improvement to real property if:
111	114		(1) the construction, repair, alteration, or
112	115		remodeling is performed under a design-build contract and the part
113	116		of the plans, specifications, or other design documents for which
114	117		the contractor is responsible under the contract is the part
115	118		alleged to be defective; or
116	119		(2) the construction, repair, alteration, or
117	120		remodeling is performed under an engineering, procurement, and
118	121		construction contract and the part of the plans, specifications, or
119	122		other design documents for which the contractor is responsible
120	123		under the contract is the part alleged to be defective.
121	124		(d) Except as provided by Section 59.052, this chapter does
122	125		not apply to the portion of a contract between a person and a
123	126		contractor under which the contractor agrees to provide input and
124	127		guidance on plans, specifications, or other design documents to the
125	128		extent that:
126	129		(1) the contractor's input and guidance are provided
127	130		as the signed and sealed work product of a person licensed or
128	131		registered under Title 6, Occupations Code; and
129	132		(2) the work product is incorporated into the plans,
130	133		specifications, or other design documents used in construction.
131	134		Sec. 59.003. WAIVER PROHIBITED. This chapter may not be
132	135		waived. A purported waiver of this chapter in violation of this
133	136		section is void.
134	137		SUBCHAPTER B. CONTRACTOR RESPONSIBILITY
135	138		Sec. 59.051. LIMITATION ON CONTRACTOR'S LIABILITY AND
136	139		RESPONSIBILITY FOR CERTAIN DEFECTS. (a) A contractor is not
137	140		responsible for the consequences of design defects in and may not
138	141		warranty the accuracy, adequacy, sufficiency, or suitability of
139	142		plans, specifications, or other design documents provided to the
140	143		contractor by a person other than the contractor's agents,
141	144		contractors, fabricators, or suppliers, or its consultants, of any
142	145		tier.
143	146		(b) A contractor must, within a reasonable time of learning
144	147		of a defect, inaccuracy, inadequacy, or insufficiency in the plans,
145	148		specifications, or other design documents, disclose in writing to
146	149		the person with whom the contractor enters into a contract the
147	150		existence of any known defect in the plans, specifications, or
148	151		other design documents that is discovered by the contractor, or
149	152		that reasonably should have been discovered by the contractor using
150	153		ordinary diligence, before or during construction. In this
151	154		subsection, ordinary diligence means the observations of the plans,
152	155		specifications, or other design documents or the improvement to
153	156		real property that a contractor would make in the reasonable
154	157		preparation of a bid or fulfillment of its scope of work under
155	158		normal circumstances. Ordinary diligence does not require that the
156	159		contractor engage a person licensed or registered under Title 6,
157	160		Occupations Code, or any other person with specialized skills. A
158	161		disclosure under this subsection is made in the contractor's
159	162		capacity as contractor and not as a licensed professional under
160	163		Title 6, Occupations Code.
161	164		(c) A contractor who fails to disclose a defect as required
162	165		by Subsection (b) may be liable for the consequences of defects that
163	166		result from the failure to disclose.
164	167		Sec. 59.052. STANDARD OF CARE FOR CERTAIN DESIGNS. Design
165	168		services provided under a contract described by Section 59.002(c)
166	169		or (d) are subject to the same standard of care requirements
167	170		provided in Section 130.0021, Civil Practice and Remedies Code.
168	171		SECTION 2. The heading to Chapter 130, Civil Practice and
169	172		Remedies Code, is amended to read as follows:
170	173		CHAPTER 130. LIABILITY PROVISIONS [INDEMNIFICATION] IN CERTAIN
171	174		CONSTRUCTION CONTRACTS
172	175		SECTION 3. Chapter 130, Civil Practice and Remedies Code,
173	176		is amended by adding Section 130.0021 to read as follows:
174	177		Sec. 130.0021. ARCHITECT'S OR ENGINEER'S STANDARD OF CARE.
175	178		(a) A construction contract for architectural or engineering
176	179		services or a contract related to the construction or repair of an
177	180		improvement to real property that contains architectural or
178	181		engineering services as a component part must require that the
179	182		architectural or engineering services be performed with the
180	183		professional skill and care ordinarily provided by competent
181	184		architects or engineers practicing under the same or similar
182	185		circumstances and professional license.
183	186		(b) If a contract described by Subsection (a) contains a
184	187		provision establishing a different standard of care than the
185	188		standard described by Subsection (a):
186	189		(1) the provision is void and unenforceable; and
187	190		(2) the standard of care described by Subsection (a)
188	191		applies to the performance of the architectural or engineering
189	192		services.
190	193		(c) Section 130.004 does not limit the applicability of this
191	194		section.
192	195		SECTION 4. Section 130.004, Civil Practice and Remedies
193	196		Code, is amended to read as follows:
194	197		Sec. 130.004. OWNER OF INTEREST IN REAL PROPERTY. (a)
195	198		Except as provided by Section 130.002(b) or 130.0021, this chapter
196	199		does not apply to an owner of an interest in real property or
197	200		persons employed solely by that owner.
198	201		(b) Except as provided by Section 130.002(b) or 130.0021,
199	202		this chapter does not prohibit or make void or unenforceable a
200	203		covenant or promise to:
201	204		(1) indemnify or hold harmless an owner of an interest
202	205		in real property and persons employed solely by that owner; or
203	206		(2) allocate, release, liquidate, limit, or exclude
204	207		liability in connection with a construction contract between an
205	208		owner or other person for whom a construction contract is being
206	209		performed and a registered architect or licensed engineer.
207		-	SECTION 5. Section 473.003, Transportation Code, as added
208		-	by Chapter 382 (H.B. 2899), Acts of the 86th Legislature, Regular
209		-	Session, 2019, is amended by adding Subsection (c-1) to read as
210		-	follows:
211		-	(c-1) This section does not apply to a design-build
212		-	contract.
213		-	SECTION 6. (a) Except as provided by Subsection (c) of
214		-	this section, the changes in law made by this Act apply only to a
215		-	contract entered into on or after the effective date of this Act. A
216		-	contract entered into before the effective date of this Act is
217		-	governed by the law in effect when the contract was entered into,
218		-	and the former law is continued in effect for that purpose.
	210	+	SECTION 5. (a) The changes in law made by this Act apply
	211	+	only to a contract entered into on or after the effective date of
	212	+	this Act. A contract entered into before the effective date of this
	213	+	Act is governed by the law in effect when the contract was entered
	214	+	into, and the former law is continued in effect for that purpose.
219	215		(b) An original contract for the construction or repair of
220	216		an improvement to real property with the owner of an interest in
221	217		real property that is entered into before the effective date of this
222	218		Act, and a subcontract or purchase order for providing labor or
223	219		materials associated with that original contract, whether the
224	220		subcontract or purchase order is entered into before, on, or after
225	221		the effective date of this Act, is governed by the law in effect
226	222		when the original contract was entered into, and the former law is
227	223		continued in effect for that purpose.
228		-	(c) The changes in law made by this Act to Section 473.003,
229		-	Transportation Code, as added by Chapter 382 (H.B. 2899), Acts of
230		-	the 86th Legislature, Regular Session, 2019, are intended to
231		-	clarify existing law and apply to a contract entered into before,
232		-	on, or after the effective date of this Act.
233		-	SECTION 7. This Act takes effect September 1, 2021.
234		-	______________________________ ______________________________
235		-	President of the Senate Speaker of the House
236		-	I hereby certify that S.B. No. 219 passed the Senate on
237		-	April 8, 2021, by the following vote: Yeas 29, Nays 1; and that the
238		-	Senate concurred in House amendments on May 28, 2021, by the
239		-	following vote: Yeas 29, Nays 2.
240		-	______________________________
241		-	Secretary of the Senate
242		-	I hereby certify that S.B. No. 219 passed the House, with
243		-	amendments, on May 13, 2021, by the following vote: Yeas 113,
244		-	Nays 27, one present not voting.
245		-	______________________________
246		-	Chief Clerk of the House
247		-	Approved:
248		-	______________________________
249		-	Date
250		-	______________________________
251		-	Governor
	224	+	SECTION 6. This Act takes effect September 1, 2021.