2005 Texas Property Code CHAPTER 426. GENERAL PROVISIONS

PROPERTY CODE

SUBTITLE D. STATE-SPONSORED INSPECTION AND DISPUTE RESOLUTION 
PROCESS;  STATUTORY WARRANTY AND BUILDING AND PERFORMANCE STANDARDS

CHAPTER 426. GENERAL PROVISIONS


	§ 426.001. APPLICABILITY OF SUBTITLE.  (a) This subtitle 
applies to a dispute between a builder and a homeowner if:
		(1)  the dispute arises out of an alleged construction 
defect, other than a claim solely for:
			(A)  personal injury, survival, or wrongful 
death;  or                     
			(B)  damage to goods;  and                                                   
		(2)  a request is submitted to the commission on or 
before the 10th anniversary of the date of the initial transfer of 
title from the builder to the initial owner of the home or the 
improvement that is the subject of the dispute or, if there is not a 
closing, the date on which the contract for construction of the 
improvement was entered into.
	(b)  This subtitle does not apply to a dispute arising out 
of:               
		(1)  an alleged violation of Section 27.01, Business &
Commerce Code;    
		(2)  a builder's wrongful abandonment of an improvement 
project before completion;  or
		(3)  a violation of Chapter 162.                                              
	(c)  For the purposes of this section, "damage to goods" does 
not include damage to a home.

Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 
2003.      


	§ 426.002. CONFLICT WITH CERTAIN OTHER LAW.  To the 
extent of any conflict between this subtitle and any other law, 
including Chapter 27 and the Deceptive Trade Practices-Consumer 
Protection Act (Subchapter E, Chapter 17, Business & Commerce 
Code), this subtitle prevails.

Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 
2003.      


	§ 426.003. REGISTRATION OF HOME.  (a) A builder shall 
register a new home with the commission on or before the 15th day of 
the month following the month in which the transfer of title from 
the builder to the homeowner occurs.  The registration must include 
the information required by the commission by rule and be 
accompanied by the fee required by Subsection (c).
	(b)  A builder who enters into a transaction governed by this 
title, other than the transfer of title of a new home from the 
builder to the seller, shall register the home involved in the 
transaction with the commission.  The registration must:
		(1)  include the information required by the commission 
by rule;            
		(2)  be accompanied by the fee required by Subsection 
(c);  and             
		(3)  be delivered to the commission not later than the 
15th day after the earlier of:
			(A)  the date of the agreement that describes the 
transaction between the homeowner and the builder;  or
			(B)  the commencement of the work on the home.                               
	(c)  A builder must remit to the commission a registration 
fee for each home registered with the commission in an amount 
determined by the commission.  The fee set by the commission under 
this subsection may not exceed $125.
	(d)  The commission may assess a late payment penalty that 
does not exceed $500 against a builder who fails to pay a required 
registration fee in the time prescribed by this section.

Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 
2003.      


	§ 426.004. FEES.  (a) A party who submits a request under 
this subtitle shall pay any amount required by the commission to 
cover the expense of the third-party inspector.
	(b)  The commission shall adopt rules permitting a waiver or 
reduction of the inspection expenses for homeowners demonstrating a 
financial inability to pay the expenses.
	(c)  If the transfer of the title of the home from the builder 
to the initial homeowner occurred before January 1, 2004, or if the 
contract for improvements or additions between the builder and 
homeowner was entered into before January 1, 2004, the person who 
submits a request involving the home shall pay, in addition to the 
inspection expenses required by this section, the registration fee 
required by Section 426.003.

Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 
2003.      


	§ 426.005. PREREQUISITE TO ACTION.  (a) A homeowner must 
comply with this subtitle before initiating an action for damages 
or other relief arising from an alleged construction defect.
	(b)  An action described by Subsection (a) must be filed:                      
		(1)  on or before the expiration of any applicable 
statute of limitations or by the 45th day after the date the 
third-party inspector issues the inspector's recommendation, 
whichever is later;  or
		(2)  if the recommendation is appealed, on or before 
the expiration of any applicable statute of limitations or by the 
45th day after the date the commission issues its ruling on the 
appeal, whichever is later.
	(c)  Any claim for personal injuries, damages to personal 
goods, or consequential damages or other relief arising out of an 
alleged construction defect must be included in any action 
concerning the construction defect.
	(d)  This section does not apply to an action that is 
initiated by a person subrogated to the rights of a claimant if 
payment was made pursuant to a claim made under an insurance policy.

Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 
2003.      


	§ 426.006. TIME FOR REQUESTING INSPECTION AND DISPUTE 
RESOLUTION.  The state-sponsored inspection and dispute resolution 
process must be requested on or before the second anniversary of the 
date of discovery of the conditions claimed to be evidence of the 
construction defect but not later than the 30th day after the date 
the applicable warranty period expires.

Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 
2003.      


	§ 426.007. ADMISSIBILITY OF CERTAIN EVIDENCE.  A person 
who submits a request for state-sponsored inspection and dispute 
resolution must disclose in the request the name of any person who, 
before the request is submitted, inspected the home on behalf of the 
requestor in connection with the construction defect alleged in the 
request.  If a person's name is known to the requestor at the time of 
the request and is not disclosed as required by this section, the 
requestor may not designate the person as an expert or use materials 
prepared by that person in:
		(1)  the state-sponsored inspection and dispute 
resolution process arising out of the request;  or
		(2)  any action arising out of the construction defect 
that is the subject of the request.

Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 
2003.      


	§ 426.008. REBUTTABLE PRESUMPTION OF THIRD-PARTY 
INSPECTOR'S RECOMMENDATION OR RULING BY PANEL OF STATE 
INSPECTORS.  (a) In any action involving a construction defect 
brought after a recommendation by a third-party inspector or ruling 
by a panel of state inspectors on the existence of the construction 
defect or its appropriate repair, the recommendation or ruling 
shall constitute a rebuttable presumption of the existence or 
nonexistence of a construction defect or the reasonable manner of 
repair of the construction defect.  A party seeking to dispute, 
vacate, or overcome that presumption must establish by a 
preponderance of the evidence that the recommendation or ruling is 
inconsistent with the applicable warranty and building and 
performance standards.
	(b)  The presumption established by this section applies 
only to an action between the homeowner and the builder.  A 
recommendation or ruling under this subtitle is not admissible in 
an action between any other parties.

Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 
2003.