A Matter of Trust – Avoiding the Pitfalls of the Texas Construction Trust Fund Act

Subcontractors have long celebrated—and general contractors long feared—the Texas Construction Trust Fund Act, codified in Chapter 162 of the Texas Property Code.  The Act, which is (ideally) construed broadly to primarily protect subcontractors, provides that payments “made to a contractor or ...

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Different Types of Construction Work: Chapter 56 vs. Chapter 53 and Why It Matters

If you are involved in the construction industry, you have probably heard of or dealt with mechanic’s liens. The majority of work performed on private Texas construction projects will fall under Chapter 53 of the Texas Property Code, to which mechanic’s liens apply. However, certain projects involve work ...

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Perfecting Bond Claims on Public Projects in Texas

Unlike with private commercial projects, liens cannot be filed against public projects in Texas. This means that unpaid subcontractors and suppliers do not have the same protections on public projects as those on private projects. On a private project, a subcontractor or supplier would ordinarily file a lien ...

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Top Five Construction Contract Modifications to Comply with Texas Law

Texas law has certain peculiarities which must be followed when a project is located in Texas.  To avoid surprises and unanticipated liability on construction projects, the parties should modify contracts consistent with Texas law—or at least be aware of the limitations that are in place due to certain Texas ...

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Part 1: Subcontractor Negotiating Tips for AIA Documents

What should a Subcontractor do when a General Contractor presents, to the Subcontractor, the 401A-2017 Standard Form of Agreement Between Contractor and Subcontractor (“A401”)?  While some provisions in the A401 are favorable to the Subcontractor, others are not.  This multi-part series explores some of the ...

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The Consequences of Betting the Ranch

Different types of damages may be recoverable from a breach of a design, construction, EPC or other construction-related contracts. The baseline damages are “direct” damages, which are necessarily caused by a breach and compensate for the losses, for example the costs to repair faulty work ...

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Call-Back Periods in Call-Back Warranties – the Confusion Surrounding Their Effect on Other Warranties in Construction Contracts

Commercial construction contracts between owners and contractors, such as the form AIA Document A201 contract, often include various express warranties whereby the contractor warrants its work on the project to the owner. Among those express warranties are the more common warranties that: (i) the materials and ...

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The Often Overlooked Protection Provided by a Statutory Payment Bond Under Chapter 53 of the Texas Property Code

Owners of construction projects are often surprised to learn that they are required to withhold 10% retainage on private construction projects in Texas. Failure to withhold 10% can result in liability up to that amount.[1]  Similarly, owners often continue to pay the general contractor after receiving a lien ...

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UPDATE – More Construction Bills to Watch in the 86th Texas Legislative Session

The Texas Legislature is back in session, and lawmakers generally have until March 8, 2019 to file bills for consideration this session. In our original post on January 31, 2019, we identified several bills of interest to the construction industry that had been filed as of that date. Since that post, the ...

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Construction Bills to Watch in the 86th Texas Legislative Session

The Texas Legislature is officially back in session. While lawmakers generally have until March 8, 2019 to file bills, many bills of interest to the construction industry have already been filed. Below is a list of some key construction related bills we will be following this session along with a description of the ...

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