Texas Payment Bond Claim Laws

How Do I Initiate a Payment Bond Claim for Unpaid Withheld Retainage?

SUBCONTRACTORS/SUPPLIERS NOT HIRED BY THE GENERAL CONTRACTOR: If you were hired by anyone other than the General Contractor, then you are required to serve the General Contractor with the Notice of Retainage Agreement by the 15th day of the second month from when you first provide labor and/or materials to the Project.  The Notice must include at least the following information: (1) notice that your contract provides for the withholding of retainage; and (2) identification of the amount being retained.  This is a required Notice which must be sent in addition to the below notice. If this seems confusing, just to clarify.

ALL SUBCONTRACTORS/MATERIAL SUPPLIERS:  All Subcontractors/Material Suppliers whose contract allows for the withholding of retainage until completion of the Project, must serve a Notice of Claim for Retainage on the Surety and the General Contractor on or before the 90th day after the date of final completion of the “prime contract” (the contract between the Public Entity and the General Contractor) as a condition precedent to filing a Lawsuit to enforce the Surety to pay the retainage under the Payment Bond.  The Notice must include at least the following information: (1) the amount of the overall contract; (2) any amounts paid; and (3) the outstanding balance owed under the contract.


The deadline to serve a Notice is not extended if the 15th falls on a Sunday or legal holiday. Therefore, if your deadline falls on one of these days, you must serve the Notice on the preceding business day for it to be timely.

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