Texas’s amended Statutes of Repose will significantly and adversely affect governmental entities, who now have two fewer years to bring construction- and design-defect claims, while providing contractors and design professionals contracting with governmental entities greater protection from litigation.
In Texas, the “Statutes of Repose” (found in Sections 16.008 and 16.009 of the Texas Civil Practice & Remedies Code) have imposed a ten-year deadline by which parties must file lawsuits for certain construction- and design-defect claims against design professionals and contractors. Until this year, the ten-year deadline applied universally to lawsuits brought by any party (e.g., private or governmental entities).
The Texas Legislature has amended the Statutes of Repose, effective immediately, with respect to claims brought by governmental entities. Specifically, House Bill 3069 requires governmental entities to bring their defect claims against design professionals and contractors no later than eight years after substantial completion of the project (or the beginning of operation of equipment, if against design professionals), with the option of a one-year extension if a written claim is made against the contractor or design professional within the eight-year period. The ten-year deadline for claims brought by non-governmental entities is the same, including the option of a two-year extension if a written claim is made within the ten-year period.
The bill carves out three exceptions to the eight-year deadline for governmental entities: (1) TxDOT contracts, (2) projects receiving money from state or highway mass transit funds, and (3) certain civil works projects (e.g., roads, streets, utilities, water supply projects, wastewater conveyance facilities, airport runways, and other public infrastructure projects). In any of these three scenarios, the ten-year deadline applies.
These changes most significantly and adversely affect governmental entities, who now have two fewer years to bring construction- and design-defect claims. Conversely, the changes will provide contractors and design professionals contracting with governmental entities greater protection from litigation.