Relating to choice of law and venue for certain construction contracts.
HB 2960 amends Texas law governing certain construction contracts to limit the enforceability of out-of-state choice-of-law, forum-selection, and arbitration provisions. Under the bill, if a construction contract or a related agreement requires disputes to be governed by another state’s law, litigated in another state’s courts, or arbitrated in another state, that provision is void as against public policy. The bill also provides that, when such a venue provision is void, any resulting action must generally be brought in Texas, in the county where the property involved in the dispute is located, unless the parties agree to a different venue after the dispute arises.
The bill revises Section 272.001 of the Business & Commerce Code by changing the treatment of these provisions from “voidable” to outright “void,” and it makes a conforming change to Section 15.020 of the Civil Practice and Remedies Code so that that venue statute does not apply when the venue agreement is void under Chapter 272. The changes apply only to construction contracts entered into or renewed on or after September 1, 2025.
The bill’s practical impact is to strengthen Texas-based venue and governing-law protections for parties performing construction work in Texas, especially contractors and subcontractors who may otherwise be required to litigate or arbitrate disputes outside the state. It also affects owners, developers, and other parties to construction agreements by limiting their ability to contract around Texas law and Texas courts for covered disputes.
The overall sentiment reflected in the legislative history is strongly favorable and noncontroversial. The bill passed the House 148-0 and the Senate 31-0, indicating broad bipartisan support and no recorded opposition in the floor votes. No committee transcript concerns are available in the provided materials, and the unanimous votes suggest the measure was viewed as a straightforward venue-and-public-policy clarification for construction contracts.
The main point of contention, as reflected in the text itself, is the restriction on contractual freedom: the bill overrides provisions that would send disputes to another state or apply another state’s law. That change is likely to be most significant for parties that prefer national or out-of-state dispute resolution clauses, but the available record shows no organized opposition or debate against the bill.
HB 2960 amends Chapter 272 of the Business & Commerce Code to make certain choice-of-law, out-of-state venue, and out-of-state arbitration provisions in construction contracts void as against public policy, rather than merely voidable. It also amends Section 15.020 of the Civil Practice and Remedies Code to conform venue rules when such provisions are void, generally requiring suit in Texas and in the county where the property is located unless the parties later agree otherwise. The bill applies prospectively to contracts entered into or renewed on or after September 1, 2025, affecting construction owners, contractors, subcontractors, and related parties.
The bill appears to have been received very positively and without meaningful opposition. It passed the House and Senate by overwhelming margins, including a unanimous Senate vote and a 148-0 House vote on third reading. The voting record suggests broad agreement that the bill is a targeted policy change for construction contracts rather than a controversial overhaul.
The principal substantive issue is whether parties to construction contracts should be allowed to choose another state’s law, forum, or arbitration location. HB 2960 resolves that issue in favor of Texas by voiding those provisions for covered contracts, which limits private contracting flexibility but protects Texas venue and law. No specific opponents, amendments, or committee objections are provided in the record, so any contention appears minimal or unrecorded.