Ralph P. Larrison, Jr. v. Catalina Design
Texas Court of Appeals, 2nd District (Fort Worth) | 2011
What This Case Means for Subcontractors
A masonry subcontractor (Catalina Design) sued a general contractor owner (Larrison) for unpaid work on three commercial projects totaling $21,862. The court found that Larrison improperly held onto subcontractor payments without first paying current and past-due obligations to Catalina, violating construction trust fund laws. The court modified the judgment by reversing an attorney's fees award that lacked statutory support, but upheld the core finding that Larrison misapplied trust funds.
Key Takeaways
- •General contractors cannot retain subcontractor payments to cover their own costs or disputes—they must pay subs first before using funds for other project expenses or claims.
- •File a sworn account affidavit with your lien claim; the court may view failure to file a sworn denial as an admission of the debt.
- •Attorney's fees in construction disputes require specific statutory authorization—don't assume you'll recover them even if you win the case.
Larrison retained trust funds without first paying current or past due obligations to Catalina.
Frequently Asked Question
Can a general contractor hold my payment to cover their own project costs or disputes with the owner?
No. Texas courts have ruled that general contractors cannot retain subcontractor payments without first satisfying current and past-due obligations to the subcontractor. Trust funds held for subs must be paid before the GC uses money for other purposes, even if there are disputes about work quality or change orders.
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