When & How to File Construction Litigation
Texas has some unique laws with respect to construction defects. Until recently, it was one of the only states in which the law would hold contractors accountable for defects arising from plans furnished by the owner, and it also has some specific rules of engagement for homeowners who want to sue contractors for construction defects.
The latter set of rules is defined in what is called the Residential Construction Liability Act (RCLA) in Chapter 27 of the Texas property code. This law outlines the steps property owners need to take before filing a construction defect lawsuit in Texas, and it can be helpful to both homeowners and contractors alike.
About the Texas Residential Construction Liability Act
Texas saw over 9,000 new residential construction permits in April 2022 alone. With that number of new homes going up, construction defects are inevitable. The Texas Residential Construction Liability Act offers homeowners opportunity for remedy if their home is damaged as a result of a construction defect.
The TRCLA prevents homeowners from filing construction liability lawsuits outright, at least in most scenarios. Instead, they need to communicate with the contractor on the defects and let them know of their intent to take legal action. The contractor then has an opportunity to make a settlement offer, which may include performing needed repairs or providing monetary compensation. The law is very clear on what homeowners need to do and how they should go about it, and its strict timeframe can save both parties from a prolonged legal battle.
Texas RCLA Requirements for Homeowners and Contractors
The Texas RCLA has a very strict timeline for homeowners to follow if they notice severe construction defects in their home. The steps they need to follow include those outlined below.
Giving Notice to the Contractor
First, the homeowner must notify the contractor of their intention to file a construction defect lawsuit. This notice must be given 60 days prior to filing. In addition, it needs to be written and delivered by mail, return receipt requested.
After receiving the notice from the homeowner, the contractor then has 35 days to make a written request to inspect the property. The purpose for this inspection is to allow the contractor to determine the exact nature of the defect as well as the repairs that will be needed to resolve it.
After inspecting the property, the contractor can make a settlement offer to the homeowner. This offer must be made within 45 days of receiving the initial notice, and it may include offers to either repair the property, provide monetary compensation for any damage caused, or both.
Accept or Reject
If the homeowner accepts the settlement, the contractor will then have 45 days to make the needed repairs unless they are in some way delayed by the homeowner or other uncontrollable circumstances.
On the other hand, if the homeowner finds this offer unacceptable, they must notify the contractor of the reasons why they have found it unreasonable within 25 days. The contractor will then have 10 days to make a supplemental written settlement offer, which may or may not be accepted.
If no agreement can be reached, the homeowner can then file a lawsuit against the contractor.
Texas Construction Defect Statute of Limitations
In addition to the timeframe set forth under the RCLA, Texas law imposes additional time limits on construction liability lawsuits.
Statute of Limitations
One of these time limits is the construction defect statute of limitations. In Texas, that timeline is two (2) years for acts of negligence and four (4) years for breach of contract, fraud, and breach of warranty. That means you have two to four years to file a construction liability lawsuit, depending on the nature of the lawsuit.
Statute of Repose and the “Discovery Rule”
Often, the statute of limitations may not start counting down until after you discover that there is a problem. What this means is if a defect doesn’t become apparent until several years after construction was completed, you’ll still have time to file a lawsuit. That said, Texas also has a statute of repose that limits this time to 10 years, meaning you’ll have up to 12 to 14 years total to file a lawsuit.
Why Is There a Time Limit?
The primary reason for these time limits is to make sure there’s sufficient quality evidence to make sure the whole process is fair. Evidence deteriorates over time, and construction companies may change, be bought out, or dissolve altogether, which can ultimately make the homeowner’s claims harder to support. It also helps make sure contractors aren’t held indefinitely liable for jobs completed in the past. Ultimately, it’s about fairness for everyone involved.
Texas Construction Defect FAQs
How long is a builder liable for work in Texas?
Builders can be held liable for construction work for up to 12 to 14 years, depending on the nature of defects and resulting legal claims.
What qualifies as a construction defect?
In Texas, a construction defect is defined as poor workmanship that can result in either damage to the property or harm to a person.
Contact Texas Construction Litigation Attorneys
If you have discovered a defect in your home’s construction, the first course of action is to contact an attorney. The attorneys at Reid Dennis Frick can help you navigate this process, including following the steps outlined in the Texas RCLA. To schedule a consultation with a construction litigation attorney, contact us today.