FUNDAMENTAL CONTRACTOR PROTECTION UNDER THE TEXAS CONSTITUTION
In Texas, Article XVI, Section 37 of the Texas Constitution reads as follows:
“Mechanics, artisans and material men, of every class, shall have a lien upon the buildings and articles made or repaired by them for the value of their labor done thereon, or material furnished therefore…”
WHAT DOES THIS MEAN?
The Texas Constitution may protect you from nonpayment for your labor and materials. Texas’ Constitution grants certain qualifying contractors an automatic lien if they are not paid on a project. The beautiful thing about this type of lien is that it does not require the contractor to serve any specific kind of notice nor does the contractor have to file an affidavit. It is also important to mention that the Texas Practice & Remedies Code allows contractors to recover attorneys’ fees in a claim for rendered services, performed labor or furnished material.
In order to qualify for the Constitutional lien:
- Contractors/ subcontractors must be in privity of contract with the owner.
- The project cannot be a public works project or building.
- The project cannot consist of landscaping and other similar work.
Despite the protections under the Texas Constitution, it would be prudent for every contractor to follow the Texas Property Code and perfect a statutory lien. This is because if a third-party purchases property without knowledge of the contractor’s constitutional lien and the third-party does not have actual or constructive notice of the lien, the Constitutional lien will be unenforceable. This is in contrast to statutory liens filed pursuant to the Property Code.
IN A NUTSHELL
The constitutional lien is a basic form of protection for qualifying contractors. However, to cover all bases and afford yourself maximum protection, comply with the Texas Property Code and perfect all liens.
Should you have any questions regarding your business, please feel free to reach out to our office at 832-930-0529 or email@example.com.
None of the information given here is intended to be legal advice and it should not be construed as such.