law-Prompt-Payment-Act | bad-faith insurance code violation claims |
PROMPT PAYMENT ACT CLAIM
Prompt Payment Act
The Prompt Payment Act provides that an owner of real property, who receives a written request for
payment from a contractor for an amount that is allowed under a contract for properly performed work,
must pay the amount, less any amount withheld as authorized by statute, not later than the thirty-fifth
day after the date the owner receives the request. TEX. PROP. CODE ANN. § 28.002(a). Section
28.004, captioned “Interest on Overdue Payment,” provides as follows:
(a) An unpaid amount required under this chapter begins to accrue interest on the day after the date on
which the payment becomes due.
(b) An unpaid amount bears interest at the rate of 1 1/2 percent each month.
(c) Interest on an unpaid amount stops accruing under this section on the earlier of:
(1) the date of delivery;
(2) the date of mailing, if payment is mailed and delivery occurs within three days; or
(3) the date a judgment is entered in an action brought under this chapter.
Id. § 28.004.
The Prompt Payment Act governs interest on an unpaid claim only to the date of judgment. See TEX.
PROP. CODE ANN. § 28.004(c). The Texas Finance Code governs postjudgment interest. See TEX.
FIN. CODE ANN. § 304.003(c)(2) (West 2006); Jarrin, 929 S.W.2d at 25 (“Post-judgment interest is. . .
mandated by statute.”).
CASES
Harris County Flood Control District v. Great American Ins. Co. (Tex.App. - Houston [14th Dist.] Feb. 25,
2010)(Hedges) (plea to the jurisdiction governmental immunity, prompt payment act,
quantum meruit)
Appellant, Harris County Flood Control District, appeals from the denial of its plea to the jurisdiction on the claims of
appellee, Great American Insurance Company, for quantum meruit and attorney’s fees. Because we conclude that
appellant has not waived its immunity relative to those claims, we reverse and dismiss in part, affirm in part, and remand.
AFFIRMED IN PART; REVERSED & REMANDED IN PART: Opinion by Chief Justice Hedges
Before Chief Justice Hedges, Justices Seymore and Senior Justice Margaret Mirabal
14-09-00571-CV Harris County Flood Control District v. Great American Insurance Company Appeal
from 157th District Court of Harris County
Trial Court Judge: Randy Wilson
Dissenting Opinion by Justice Mirabal in Harris County Flood Control Dist. v. Great American
Ins. Co. (re immunity from liability and attorneys fees)
ARCO Construction Co., Inc. v. Americon Services Co., Inc (Tex.App.- Houston [1st Dist.] May 15, 2008)
(Higley) (construction law, Prompt Payment Act, attorney's fees)
Before Justices Nuchia, Hanks and Higley
01-06-00846-CV ARCO Construction Company, Inc. v. Americon Services Company, Inc.
Appeal from County Civil Court at Law of Harris County
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