HBA-ALS, NIK C.S.H.B. 2456 76(R)BILL ANALYSIS


Office of House Bill AnalysisC.S.H.B. 2456
By: Hartnett
Civil Practices
3/28/1999
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

In Williams v. Khalaf, 802 S.W. 2d 651 (Tex. 1990), the Texas Supreme Court
held Section 16.004, Civil Procedures and Remedies Code, to establish a
four-year statute of limitations for fraud and breach of fiduciary duty.
Prior to that holding, Texas courts held that fraud and breach of fiduciary
duty were subject to a two-year statute of limitations.  Numerous courts
after Williams have held that the four-year statute of limitations also
applies.  C.S.H.B. 2456 codifies the holding by the Texas Supreme Court
that puts a four-year statute of limitations on actions to be taken for
fraud and breach of fiduciary duty.  

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 16.004(a), Civil Practice and Remedies Code, as
follows: 

(a)  Adds fraud and breach of fiduciary duty to the actions a person must
bring suit on no later than four years after the day the cause of action
accrues. Makes nonsubstantive changes. 

SECTION 2.  Provides that it is the intent of this Act to clarify existing
law by resolving a conflict in case law concerning the applicable statute
of limitations for action for fraud and breach of fiduciary duty.  Provides
that it is not the intent of this Act to affect the two-year statute of
limitations applicable to an action for breach of the duty of good faith
and fair dealing. 

SECTION 3.Emergency clause.
  Effective date: 90 days after adjournment.

COMPARISON OF ORIGINAL TO SUBSTITUTE

The substitute modifies the original in SECTION 2 to set forth the intent
of this bill. The substitute also changes the original bill's effective
date of September 1, 1999, to 90 days after adjournment.