Builders must be careful with money received from owners and keep good financial records on each project. Chapter 162 of the Texas Property Code, commonly referred to as the Texas Trust Fund Act (Act), is intended to protect those furnishing labor or materials for the construction or repair of property by declaring that funds are […]
Texas builders can be criminally liable for failing to comply with financial bookkeeping requirements and misusing construction funds paid by the owner. While many district attorney offices are reluctant to prosecute construction industry fraud, some DA offices will seek criminal prosecution in egregious circumstances. As a result, a builder needs to be aware of what […]
Having the right agreement in place is paramount in any project. Having the wrong agreement in place or an agreement with incorrect or insufficient information can cost companies millions. Many construction projects require builders to tap into the large array of contracts housed by the American Institute of Architects (AIA). The size of the project can determine which AIA documents are relevant and […]
In our previous article, we discussed the basic concepts of sales tax law in construction and how different scenarios in your projects might affect the collection of sales tax. This article will explain a few more concepts and delve into what is subject to sales tax in construction and which party is responsible for payment. […]
Do you know if you should be collecting sales tax on the services you provide? The sales tax rate in Texas is high, and improper collection of sales tax in construction or the lack thereof can leave you exposed to large financial liabilities. To minimize risk, builders should have some understanding of the tax system […]
Many complex laws and rules regulate a builder’s business. One such area concerns notices that a builder is required to provide. Texas law requires that residential construction contracts include specific notices and disclosures. Below we’ll review some of these and the consequences of failing to include them. Residential Construction Contract Disclosure Statements Texas Property Code […]
When an employee leaves to work for a competitor, he or she may have valuable knowledge of the builder’s trade secrets. If the builder has not protected its trade secrets, it may not be able to prevent the former employee from disclosing the builder’s valuable information to the competitor. The former employee could possibly reveal […]
Because of the cost and burden of keeping documents indefinitely, builders frequently ask how long various records should be maintained. There is no one size fits all answer because the answer depends on the type of document and the type of construction project. This article will discuss the various types of documents, the suggested retention periods, and […]
Builders are generally able to resolve disagreements with homeowners over a construction defect claim, but there are some things you should know to protect yourself. When a resolution cannot be reached, the Residential Construction Liability Act (RCLA), which is found in Chapter 27 of the Texas Property Code, governs such claims. Because of the protections afforded by […]
No insurance policy in the construction industry is more discussed – and cussed – than the infamous Commercial General Liability (“CGL”) policy. Unfortunately, many people do not have a good working understanding of the CGL policy or options that would provide more protection. As a result, a builder may pay for a loss that could […]