Disaster Remediation Contracts in Texas
In the aftermath of a natural disaster, consumers and contractors should be aware of Chapter 58 of the Texas Business and Commerce Code, which includes important consumer protections, as well requirements that must be followed by disaster remediation contractors.
Applicability
Chapter 58 applies to a contract between a person and a disaster remediation contractor for the performance of disaster remediation services on property owned or leased by the person.
Importantly, Chapter 58 does not apply to a contract between a person and a disaster remediation contractor for the performance of disaster remediation services on property owned or leased by the person if the contractor maintains for at least one year preceding the date of the contract a physical business address in: (1) the county in which the property is located; or (2) a county adjacent to the county in which the property is located.
Contract Requirements and Conduct of the Contractor
A contract subject to this Chapter 58 must be in writing.
Also, a disaster remediation contractor:
(1) may not require a person to make a full or partial payment under a contract before the contractor begins work;
(2) may not require that the amount of any partial payment under the contract exceed an amount reasonably proportionate to the work performed, including any materials delivered; and
(3) shall include in any contract for disaster remediation services the following statement in conspicuous, boldfaced type of at least 10 points in size: “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.”
Importantly, a person may not waive the protections of Chapter 58 and a violation of Chapter 58 by a disaster remediation contractor is a violation of the Texas Deceptive Trade Practices Act.