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Trying to figure out if I am still within the timeframe to send notices and move forward with this process

We were hired by a GC to do work on a state owned property. On August 28 we received a down payment and began work. We completed one of two stairwells. The general contractor terminated the contract and refused to pay. We sent the final invoice after work was completed on September 8. Originally I was told that in the state of Texas I was not required to send a preliminary notice but it was just brought to my attention that because it is a state owned property that I was required to send one and have potentially missed the deadline to so. I’m trying to confirm whether or not that is correct and if so if I am still able to proceed by sending a notice or what my next step would be . They also failed to provide the surety bond information so that presents a whole other situation ????PLEASE HELP. If not already, I’m running out of time.

1 reply

Nov 6, 2018

I'm sorry to hear about that! On both Texas public and private projects, there are some notice requirements for parties who don't have a direct contract with the property owner. However, the required notices are not quite a traditional "preliminary" notice. More commonly, they're referred to as monthly notices since they're actually not sent at the outset of the job, but rather throughout the life of the project. On Texas public projects, parties who do not have a contract directly with the contractor who furnished the payment bond must send notice in order to preserve the right to later make a claim against the bond. When required, this notice must be mailed no later than the 15th day of the 2nd month after each month in which the claimant furnished labor and/or materials for which there is an unpaid balance. Note that the notice must be given prior to the 15th of the month when the 15th falls on a weekend or legal holiday. But again, parties hired directly by the contractor who provided the bond need not provide such a notice - though sending the notice could go a long way toward compelling payment. As for an actual claim against the contractor's bond - such a claim must be must be mailed no later than the 15th day of the 3rd month after each month in which the claimant furnished labor and/or materials for which there is an unpaid balance. As for the bond information, under 2253.024 of the Texas Little Miller Act, the prime contractor on a public project must provide bond information (including a copy of the payment bond) upon written request from someone who performs work on the job. Thus, if a request has not been made in writing for bond information, it's likely a good idea to provide such a request sooner than later. Further, if a request has been made in writing but the information has still not been provided, it might be a good idea to reach out to the contractor and remind them that they're obligated to provide it. Further, if the contractor ultimately refuses, it could be helpful to request it from the public entity who commissioned the project, as well as the Texas Department of Insurance. It may be harder to obtain information that way, but ultimately obtaining the bond info could be very important. Finally, it's worth noting that there could be other options for recovery if a bond claim will ultimately not be a viable option. For one, sending a Notice of Intent to Make Bond Claim could be helpful - it acts as a warning, stating that if payment isn't made and made soon, then a bond claim will be filed. If the bond claim route doesn't look promising, or if a claimant wants to make additional attempts at recovery, another option may be to send a demand letter threatening legal action (such as breach of contract, unjust enrichment, or a claim under the Texas prompt payment laws, to name a few options). When sent through an attorney, a demand letter could be effective to compel payment. Finally, small claims court or traditional litigation might be good options for recovery. Small claims court can be risky, but it's inexpensive and efficient - note, though, that only claims of $10,000 or less may be made in Texas small claims court. Regarding litigation, it can be both risky and expensive, but when it comes down to it, litigation can be an effective recovery tool (or at least a valuable bargaining chip). Finally - this article from zlien may be helpful in understanding Texas bond claims and notices on public projects: Is Monthly Notice Required on a Texas Public Construction Project?

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