By: Johnson S.B. No. 1612
(In the Senate - Filed February 25, 2025; March 10, 2025,
read first time and referred to Committee on Business & Commerce;
April 14, 2025, reported favorably by the following vote: Yeas 10,
Nays 0; April 14, 2025, sent to printer.)
Click here to see the committee vote
A BILL TO BE ENTITLED
AN ACT
relating to construction contract trust funds.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 162.001, Property Code, is amended by
adding Subsection (a-1) to read as follows:
(a-1) Except as provided by this subsection, funds reserved
or required to be reserved under Section 53.101 are trust funds
under this chapter. Funds reserved or required to be reserved under
Section 53.101 for the construction or repair of a new or existing
single-family house, duplex, triplex, or quadruplex, to be used for
residential purposes, including improvements appurtenant to the
residence, are not trust funds under this chapter.
SECTION 2. Section 162.003(a), Property Code, is amended to
read as follows:
(a) An artisan, laborer, mechanic, contractor,
subcontractor, or materialman who labors or who furnishes labor or
material for the construction or repair of an improvement on
specific real property in this state is a beneficiary of any trust
funds:
(1) paid or received in connection with the
improvement; or
(2) reserved or required to be reserved under Section
53.101 in connection with the improvement.
SECTION 3. Subchapter B, Chapter 162, Property Code, is
amended by adding Section 162.034 to read as follows:
Sec. 162.034. ATTORNEY'S FEES AND COSTS. The court shall
award costs and reasonable attorney's fees to a beneficiary who
prevails in an action brought against a trustee under this chapter.
SECTION 4. (a) Except as provided by Subsection (b) of this
section, the changes in law made by this Act apply only to a
construction contract that is entered into on or after the
effective date of this Act.
(b) Section 162.034, Property Code, as added by this Act,
applies only to an action commenced on or after the effective date
of this Act.
SECTION 5. This Act takes effect September 1, 2025.
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