| 1 | 1 | | 88R4726 SHH-F |
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| 2 | 2 | | By: Leach H.B. No. 1963 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to construction contract trust funds. |
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| 8 | 8 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 9 | 9 | | SECTION 1. Section 162.001, Property Code, is amended by |
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| 10 | 10 | | adding Subsection (a-1) to read as follows: |
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| 11 | 11 | | (a-1) Funds reserved or required to be reserved under |
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| 12 | 12 | | Section 53.101 are trust funds. |
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| 13 | 13 | | SECTION 2. Section 162.003(a), Property Code, is amended to |
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| 14 | 14 | | read as follows: |
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| 15 | 15 | | (a) An artisan, laborer, mechanic, contractor, |
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| 16 | 16 | | subcontractor, or materialman who labors or who furnishes labor or |
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| 17 | 17 | | material for the construction or repair of an improvement on |
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| 18 | 18 | | specific real property in this state is a beneficiary of any trust |
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| 19 | 19 | | funds: |
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| 20 | 20 | | (1) paid or received in connection with the |
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| 21 | 21 | | improvement; or |
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| 22 | 22 | | (2) reserved or required to be reserved under Section |
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| 23 | 23 | | 53.101 in connection with the improvement. |
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| 24 | 24 | | SECTION 3. Subchapter B, Chapter 162, Property Code, is |
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| 25 | 25 | | amended by adding Section 162.034 to read as follows: |
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| 26 | 26 | | Sec. 162.034. ATTORNEY'S FEES AND COSTS. The court shall |
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| 27 | 27 | | award costs and reasonable attorney's fees to a beneficiary who |
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| 28 | 28 | | prevails in an action brought against a trustee under this chapter. |
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| 29 | 29 | | SECTION 4. (a) Except as provided by Subsection (b) of this |
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| 30 | 30 | | section, the changes in law made by this Act apply only to a |
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| 31 | 31 | | construction contract that is entered into on or after the |
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| 32 | 32 | | effective date of this Act. |
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| 33 | 33 | | (b) Section 162.034, Property Code, as added by this Act, |
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| 34 | 34 | | applies only to an action commenced on or after the effective date |
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| 35 | 35 | | of this Act. |
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| 36 | 36 | | SECTION 5. This Act takes effect September 1, 2023. |
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