A general contractor (Larrison) sold his company while owing a masonry subcontractor (Catalina) final payment on three projects. The court found Larrison misapplied construction trust funds by keeping money that should have gone to pay Catalina's outstanding invoices. The trial court's judgment was upheld, but the court removed attorney's fees that weren't supported by statute. This case shows that general contractors can't hold onto trust funds owed to subs, even when selling the company.
Trust funds held for subcontractors must be paid before the GC can use or retain that money for other purposes—no exceptions for disputes or company sales
If you're owed money when a GC sells their company, the sale doesn't erase the debt; you can pursue the original owner personally under Texas Property Code § 162.031