Benge General Contracting, LLC and James Benge v. Hertz Electric, LLC and HTJ Global Electric, LLC
Texas Court of Appeals, 5th District (Dallas) | 2021
What This Case Means for Subcontractors
Benge General Contracting hired Hertz Electric and HTJ Global Electric for electrical work on commercial sites. A dispute arose over contract scope and performance. The trial court awarded attorney's fees against the electrical contractors, but the appeals court reversed that decision, ruling that Texas law only allows attorney's fees against individuals and corporations—not limited liability companies (LLCs). The court affirmed all other damages and findings.
Key Takeaways
- •If you're sued as an LLC, the other party cannot recover attorney's fees under Texas Section 38.001, even if they win. This protection doesn't apply to sole proprietors or corporations.
- •Get written approval on contract scope before starting work. Benge stamped acceptance terms on bids, but disputes still arose over what was included versus excluded.
- •Lien waivers and change orders matter. Document every scope change in writing to avoid disputes over what work was actually required under the original bid.
Trial court abused discretion in awarding attorney's fees against LLC.
Frequently Asked Question
Can I be forced to pay the other contractor's attorney's fees if I lose a contract dispute?
It depends on your business structure. If you operate as an LLC, Texas law does not allow attorney's fees to be awarded against you. However, if you're a sole proprietor or corporation, you could be liable. Always structure your business carefully and document all contract terms and changes in writing.
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