PROPERTY CODE TITLE 16. TEXAS RESIDENTIAL CONSTRUCTION COMMISSION ACT CHAPTER 401. GENERAL PROVISIONS
PROPERTY CODE
TITLE 16. TEXAS RESIDENTIAL CONSTRUCTION COMMISSION ACT
SUBTITLE A. GENERAL PROVISIONS
CHAPTER 401. GENERAL PROVISIONS
§ 401.001. SHORT TITLE. This title may be cited as the
Texas Residential Construction Commission Act.
Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1,
2003.
§ 401.002. GENERAL DEFINITIONS. In this title:
(1) "Applicable building and performance standards" means:
(A) building and performance standards adopted
under Section 430.001; or
(B) for homes constructed before the adoption of building and performance standards under Section 430.001, the building and performance standards under any express warranty provided in writing by the builder or, if there is no express warranty, the usual and customary residential construction practices in effect at the time of the construction.
(2) "Applicable warranty period" means:
(A) a warranty period established under Section
430.001; or
(B) for construction to which the warranty periods adopted under Section 430.001 do not apply, any other construction warranty period that applies to the construction.
(3) "Approved architect" means an architect licensed by this state and approved by the commission to provide services to the commission in connection with the state-sponsored inspection and dispute resolution process.
(4) "Approved structural engineer" means a licensed professional engineer approved by the commission to provide services to the commission in connection with the state-sponsored inspection and dispute resolution process.
(5) "Commission" means the Texas Residential Construction Commission.
(6) "Home" means the real property and improvements and appurtenances for a single-family house or duplex.
(7) "Homeowner" means a person who owns a home or a subrogee or assignee of a person who owns a home.
(7-a) "Improvement to the interior of an existing home" means any modification to the interior living space of a home, which includes the addition or installation of permanent fixtures inside the home. An improvement to the interior of an existing home does not include improvements to an existing home if the improvements are designed primarily to repair or replace the home's component parts.
(8) "Limited statutory warranty and building and performance standards" means the limited statutory warranty and building and performance standards adopted by the commission under Section 430.001.
(8-a) "Material improvement" means a modification to an existing home that either increases or decreases the home's total square footage of living space that also modifies the home's foundation, perimeter walls, or roof. A material improvement does not include modifications to an existing home if the modifications are designed primarily to repair or replace the home's component parts.
(9) "Nonstructural matter" has the meaning assigned by the limited statutory warranty and building and performance standards adopted by the commission under Section 430.001.
(10) "Request" means a request submitted under Section 428.001.
(11) "State inspector" means a person employed by the commission under Section 427.002.
(12) "State-sponsored inspection and dispute resolution process" means the process by which the commission resolves a request.
(13) "Structural" means the load-bearing portion of a home.
(14) "Structural failure" has the meaning assigned by the limited statutory warranty and building and performance standards adopted by the commission under Section 430.001.
(15) "Third-party inspector" means a person appointed by the commission under Section 428.003.
(16) "Warranty of habitability" means a builder's obligation to construct a home or home improvement that is in compliance with the limited statutory warranties and building and performance standards adopted by the commission under Section 430.001 and that is safe, sanitary, and fit for humans to inhabit.
Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 843, § 6, eff. September 1,
2007.
§ 401.003. DEFINITION OF BUILDER. (a) In this title, "builder" means any person who, for a fixed price, commission, fee, wage, or other compensation, sells, constructs, or supervises or manages the construction of, or contracts for the construction of or the supervision or management of the construction of:
(1) a new home;
(2) a material improvement to a home, other than an improvement solely to replace or repair a roof of an existing home; or
(3) an improvement to the interior of an existing home when the cost of the work exceeds $10,000.
(b) The term includes:
(1) an owner, officer, director, shareholder, partner, affiliate, subsidiary, or employee of the builder;
(2) a risk retention group governed by Article 21.54, Insurance Code, that insures all or any part of a builder's liability for the cost to repair a residential construction defect; and
(3) a third-party warranty company and its administrator.
(c) The term does not include any person who:
(1) has been issued a license by this state or an agency of this state to practice a trade or profession related to or affiliated with residential construction if the work being done by the entity or individual to the home is solely for the purpose for which the license was issued; or
(2) sells a new home and:
(A) does not construct or supervise or manage the construction of the home; and
(B) holds a license issued under Chapter 1101, Occupations Code, or is exempt from that chapter under Section 1101.005, Occupations Code.
(d) The term does not include a nonprofit business entity that is exempt from taxation under Section 501(c)(3), Internal Revenue Code, if:
(1) the construction or supervision or management of the construction of the home, material improvement, or improvement sold by the nonprofit business entity is performed by a builder
registered under this title; (2) the builder contractually agrees to comply with the provisions of this title;
(3) the builder is contractually liable to the homeowner for the warranties and building and performance standards of this title; and
(4) the nonprofit business entity does not participate directly in the construction of the home, material improvement, or improvement.
Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1,
2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 843, § 7, eff. September 1,
2007.
Acts 2007, 80th Leg., R.S., Ch. 1082, § 1, eff. September
1, 2007.
§ 401.004. DEFINITION OF CONSTRUCTION DEFECT. (a) In this title, "construction defect" means:
(1) the failure of the design, construction, or repair of a home, an alteration of or a repair, addition, or improvement to an existing home, or an appurtenance to a home to meet the applicable warranty and building and performance standards during the applicable warranty period; and
(2) any physical damage to the home, an appurtenance to the home, or real property on which the home or appurtenance is affixed that is proximately caused by that failure.
(b) The term does not include a defect that arises or any damages that arise wholly or partly from:
(1) the negligence of a person other than the builder or an agent, employee, subcontractor, or supplier of the builder;
(2) failure of a person other than the builder or an agent, employee, subcontractor, or supplier of the builder to:
(A) take reasonable action to mitigate any damages that arise from a defect; or
(B) take reasonable action to maintain the home;
(3) normal wear, tear, or deterioration; or
(4) normal shrinkage due to drying or settlement of construction components within the tolerance of building and performance standards.
Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 2003.
§ 401.005. EXEMPTIONS. (a) This title does not apply to a home that is:
(1) built by the individual who owns the home, alone or with the assistance of the individual's employees or independent contractors; and
(2) used by the individual as the individual's primary residence for at least one year after the completion or substantial completion of construction of the home.
(b) This title does not apply to a homeowner or to a homeowner's real estate broker, agent, interior designer registered under Chapter 1053, Occupations Code, interior decorator, or property manager who supervises or arranges for the construction of an improvement to a home owned by the homeowner.
(c) An individual who builds a home or a material improvement to a home and sells the home immediately following completion of the building or remodeling and does not live in the home for at least one year following completion of the building or remodeling is responsible as a builder under the warranty obligation created by this title for work completed by the individual. Responsibility under this subsection does not automatically require an individual to register under Section 416.001.
Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 2003.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 843, § 8, eff. September 1,
2007.
§ 401.006. SUNSET PROVISION. The Texas Residential Construction Commission is subject to Chapter 325, Government Code (Texas Sunset Act). Unless continued in existence as provided by that chapter, the commission is abolished and this title expires September 1, 2009.
Added by Acts 2003, 78th Leg., ch. 458, § 1.01, eff. Sept. 1, 2003.
§ 401.007. INJUNCTION; APPEAL. (a) If the commission has reasonable cause to believe that a person is violating a statute to which this chapter applies, the commission, in addition to any other authorized action, may issue an order to cease and desist from the violation or an order to take affirmative action, or both, to enforce compliance. A person may appeal the order directly to district court in accordance with Chapter 2001, Government Code.
(b) Before issuing an order under this section, the commission shall set and give notice of a hearing before a hearings officer. The hearing is governed by Chapter 2001, Government Code. Based on the findings of fact, conclusions of law, and recommendations of the hearings officer, the commission by order may find whether a violation has occurred.
(c) The commission, after providing notice and an opportunity to appear for a hearing, may impose against a person who violates a cease and desist order an administrative penalty in an amount not to exceed $1,000 for each day of violation. In addition to any other remedy provided by law, the attorney general or the commission may institute in district court a suit for injunctive relief and to collect an administrative penalty. A bond is not required of the commission with respect to injunctive relief granted under this section. In the action, the court may enter as proper an order awarding a preliminary or final injunction.
(d) A suit by the attorney general under this section must be brought in Travis County.
(e) The attorney general and the commission may recover reasonable expenses incurred in obtaining injunctive relief under this section, including court costs, reasonable attorney's fees, investigative costs, witness fees, and deposition costs.
(f) If a party seeks review of the order by the commission, the party shall file a petition initiating judicial review not later than the 30th day after the date of the issuance of the decision.
Added by Acts 2007, 80th Leg., R.S., Ch. 843, § 9, eff. September 1, 2007.