A New Determination Of Design Defect Liability For Texas Contractors

• Published date: 13 September 2021
• Subject Matter: Corporate/Commercial Law, Government, Public Sector, Real Estate and Construction, Contracts and Commercial Law, Government Contracts, Procurement & PPP, Construction & Planning
• Law Firm: Butler Snow LLP
• Author: Andrew D. Tingan

On September 1, 2021, Texas S.B. 219 went into effect. This new law incorporates Chapter 59 into the Texas Business and Commerce Code. In short, when a client provides plans or specifications containing design defects to a contractor, Chapter 59 limits contractor liability related to those design defects. The text of the law states:

A contractor is not responsible for the consequences of design defects in and may not warranty the accuracy, adequacy, sufficiency, or suitability of plans, specifications, or other design documents provided to the contractor by a person other than the contractor's agents, contractors, fabricators, or suppliers, or its consultants, of any tier. Tex. Bus. & Com. Code Ann. ' 59.051.

This new statute applies "only to a contract for the construction or repair of an improvement to real property." Id. at ' 59.002.

S.B. 219 diverges from the long-standing doctrine set out by the Supreme Court of Texas in Lonergan v. San Antonio. In Lonergan, a house collapsed before final completion as a result of a defect in the plans given to the contractor by the owner. Lonergan v. San Antonio Loan & Tr. Co.,104 S.W. 1061, 1062 (1907). Following the collapse, the contractor abandoned the project, and the owner sued the contractor. Id. The...