Disaster Remediation Contracts Statute
With catastrophic weather events, storm chasers inevitably arrive to take advantage of vulnerable citizens and businesses. Don’t fall victim to fly-by-night contractors who demand partial or full payment before any disaster remedial construction work begins.
In 2011, Texas passed a new law to help protect citizens from the ill intent of storm chasers by enacting the Disaster Remediation Contracts Statute. Chapter 58 of the Texas Business and Commerce Code applies to contractors who engage in remediation construction projects stemming from a natural disaster. The statute defines “disaster remediation” to mean “the removal, cleaning, sanitizing, demolition, reconstruction, or other treatment of improvements to real property performed because of damage or destruction to that property caused by a natural disaster.” “Natural disaster” means “the occurrence of widespread or severe damage, injury, or loss of life or property related to any natural cause, including fire, flood, earthquake, wind, storm, or wave action, that results in a disaster declaration by the governor or a local disaster declaration by a county judge under Chapter 418, Government Code.” In sum, any work performed to repair damage caused by Hurricane Harvey would fall under this definition.
All disaster remediation work subject to Chapter 58 must be reduced to writing, and contractors must adhere to the following three legal requirements when providing services for the individual, corporation, trust, partnership, association, or other private legal entity:
(1) the contractor cannot require a person to make a full or partial payment under a contract before the contractor begins work;
(2) the contractor cannot require that the amount of any partial payment under the contract exceed an amount reasonably proportionate to the work performed, including any materials delivered; and
(3) the contractor is mandated to include in any contract for disaster remediation services the following statement in conspicuous, boldfaced type of at least 10 points in size: “This contract is subject to Chapter 58, Business & Commerce Code. A contractor may not require a full or partial payment before the contractor begins work and may not require partial payments in an amount that exceeds an amount reasonably proportionate to the work performed, including any materials delivered.”
Any storm chaser who violates these legal requirements may be liable under the Texas Deceptive Trade Practices Act where a victim can potentially recover economic damages, treble damages, attorneys’ fees and mental anguishes under certain circumstances.
Under no circumstances can a contractor attempt to waive these statutory requirements through contract or other means. In the event a contractor includes a waiver provision in your agreement, Texas courts will interpret this provision to be void as a matter of law.
While the Disaster Remediation Contracts Statute applies to storm chasers, it does not apply to any local contractor for the performance of disaster remediation services if the contractor maintains for at least one year a physical business address in the county or adjacent counties in which the property is located. Regardless, the best practice to protect your interest would be to require any contractor who intends to provide such services to follow similar requirements.
 Tex. Bus. & Com. Code § 58.001(1).
 Id. § 58.001(3).
 Id. § 58.003.
 Id. § 58.004.
 Id. § 58.005.