Contract Requirements for Disaster Repair Services in Texas

Texas just experienced one of the worst arctic weather events in its history. Governor Abbott issued a statewide disaster which triggers the provisions of TBCC 58.  If you are considering offering disaster repair services to those affected, here’s a friendly reminder of the additional contracting requirements needed for disaster repair that falls under the TBCC 58 rules.  A contractor offering remediation services:

(a) cannot request an upfront or interim payment that exceeds the reasonable value of the materials to be delivered or work to be performed and

(b) must include the following language in their contract: “This contract is subject to Chapter 58, Business & Commerce Code.  A contractor may not require a full or partial payment before the contractor begins work and may not require partial payments in an amount that exceeds an amount reasonably proportionate to the work performed, including any materials delivered.”

This warning can go anywhere in your contract but must be in conspicuous, boldfaced type of at least 10 points in size. If you use digital contracts, it’s easy to stick this provision in. If you’re using paper, you can easily meet the contract language requirement by either including the warning in an addendum or making a stamp that you can manually stamp on your paper contracts wherever you may have room. 

These requirements apply to ALL contracts, residential and commercial. They cannot be waived and a failure to follow these two requirements is a deceptive trade practice that opens you up to triple damages and attorney fees, but will not void your contract.

Note: These requirements DON’T apply to contractors who have, for at least a year prior to the declaration, maintained a physical address in the county where the storm occurred or a county adjacent to the affected storm county.  That means if you’re in Dallas County you don’t need the notice for work in Dallas or any immediately adjoining counties, but if you went to Rockwall or Travis you would need the notice. So we recommend that you just include in all your contracts so you know you’re covered.

© Karen Ensley and Brian Benitez, Ensley Benitez Law, PC, 2021. All rights reserved. This article is provided for educational reasons exclusively and is not meant to be construed as legal advice. Ensley Benitez Law, PC, will represent you only after being retained and that agreement is made in writing.