Texas Construction Law Overview
Construction is one of Texas’s largest and most legally complex industries. Whether you’re building a commercial property in Houston or remodeling a home in Austin, Texas construction law governs nearly every step of the process. Contractors, property owners, developers, and design professionals must all understand their rights and responsibilities to avoid costly disputes and comply with state regulations.
This page introduces the key components of Texas construction law, including contracts, liens, defect claims, dispute resolution, and compliance requirements.
1. What Is Texas Construction Law?
Texas construction law refers to the legal rules, statutes, and court decisions that regulate construction projects throughout the state. It combines multiple areas of law, such as contracts, torts, real estate, and administrative law.
Some of the main legal sources include:
• Texas Property Code – especially Chapter 53, which governs mechanic’s liens
• Texas Business & Commerce Code – addresses contract terms and enforceability
• Texas Civil Practice and Remedies Code – outlines liability and damages
• Case law – provides judicial interpretation of construction issues
Understanding how these laws work together is essential for navigating construction disputes, enforcing payments, and defending against claims.
2. Common Parties in Texas Construction Projects
Construction law applies to many individuals and companies involved in a project. These include:
• General contractors
• Subcontractors
• Developers and real estate investors
• Architects and engineers
• Material suppliers
• Surety companies and lenders
• Public entities or private owners
Each party plays a different role and may have different legal rights and obligations depending on the project and contractual arrangements.
3. Construction Contracts
Construction contracts are the foundation of any legal relationship on a project. These agreements define the scope of work, timelines, payment terms, and procedures for handling disputes or changes.
Important contract provisions include:
• Scope of work and specifications
• Progress payment schedules and retainage
• Change order requirements
• Delay clauses and extensions
• Indemnity and insurance clauses
• Dispute resolution procedures (arbitration, mediation, or court)
Because Texas law allows parties to freely negotiate terms, the language of your contract will often control the outcome of any future disagreement.
4. Mechanic’s Liens in Texas
Texas offers strong lien rights to help contractors and suppliers secure payment for their work. A mechanic’s lien allows qualifying parties to place a legal claim on the property if they are not paid.
To enforce a lien in Texas, you must:
• Provide timely pre-lien notice (especially if you are a subcontractor or supplier)
• File the lien affidavit by the correct deadline, usually the 15th day of the third month after work ends
• Serve a copy of the lien on the property owner
• Consider filing suit to foreclose the lien if payment is not resolved
Strict compliance with deadlines and procedures is required. Filing incorrectly can invalidate your lien rights.
5. Common Construction Disputes
Disagreements are common in the construction industry. Some of the most frequent legal disputes in Texas include:
• Nonpayment or underpayment
• Construction defects (such as water damage or foundation failures)
• Delays in project completion
• Disagreements over change orders or scope changes
• Breach of contract or poor workmanship
• Negligent supervision or safety violations
Many of these disputes can be avoided or resolved early with the help of a well-drafted contract and proactive legal advice.
6. Licensing and Compliance
Unlike some states, Texas does not require state licensing for general contractors. However, specialty contractors such as electricians, plumbers, and HVAC professionals must hold licenses. In addition, many cities require local registration.
Contractors must also comply with:
• Building codes and permitting requirements
• OSHA and workplace safety regulations
• Insurance and bonding rules
• Environmental and stormwater control standards
Failing to comply with these requirements can delay projects or result in fines and penalties.
7. Dispute Resolution Options
Most construction contracts in Texas include a dispute resolution clause. These clauses determine how the parties will resolve disagreements, and can affect both timing and cost.
The primary options include:
• Mediation – A voluntary, non-binding process to negotiate a solution
• Arbitration – A binding process heard by a neutral arbitrator, often faster than court
• Litigation – A traditional lawsuit in a Texas court
Carefully reviewing dispute clauses before signing any agreement can help you avoid surprise limitations on your legal rights.
8. Best Practices for Risk Management
Contractors and developers can reduce legal exposure by following smart practices from the beginning of a project:
• Use detailed written contracts for all jobs
• Verify all licenses and insurance coverage
• Keep thorough records of communications, inspections, and change orders
• Understand lien rights and track deadlines
• Respond promptly to potential disputes
• Consult legal counsel early when issues arise
A small investment in risk management can prevent costly problems later.
9. When to Contact a Construction Lawyer
Not every construction issue becomes a legal battle, but some situations warrant early legal advice. You should consider speaking with a Texas construction attorney if:
• You are drafting or reviewing a construction contract
• You have not been paid or received a lien notice
• Your project is delayed or facing defect claims
• You are being sued or threatened with legal action
• A government agency has issued a citation or stop work order
Legal help is most effective when consulted before a problem escalates.
Conclusion
Texas construction law covers a wide range of issues from contract terms and lien rights to disputes and compliance. Every project brings its own challenges, but understanding the law helps you stay ahead of problems and protect your investment.
Guerra Days Law Group helps contractors, developers, and property owners across Texas with construction law matters. If you need legal guidance for your project, contact our office today to schedule a consultation.