Texas Government Code 1371.059 – Validity and Incontestability
(a) If proceedings to authorize an obligation or credit agreement are approved by the attorney general and registered by the comptroller, each obligation or credit agreement, as applicable, or a contract providing revenue or security included in or executed and delivered according to the authorizing proceedings is incontestable in a court or other forum and is valid, binding, and enforceable according to its terms.
(b) Notwithstanding Subsection (a) and § 1371.003, and except as provided by this subsection, an obligation authorized by this chapter is not valid, binding, or enforceable unless the obligation is approved by the attorney general and registered by the comptroller in accordance with Chapter 1202. The attorney general’s approval and registration by the comptroller is not required for an obligation:
(1) to which Chapter 1202 does not apply or that is exempt from approval and registration as provided by § 1202.007(a)(1), (2), (3), (4), (6), or (7); or
(2) that matures within one year after the issuer receives payment for the obligation, regardless of whether the obligation is evidenced by an instrument with a nominal term of longer than one year.
Terms Used In Texas Government Code 1371.059
- Comptroller: means the state comptroller of public accounts. See Texas Government Code 312.011
- Contract: A legal written agreement that becomes binding when signed.
- Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Population: means the population shown by the most recent federal decennial census. See Texas Government Code 311.005
- Year: means 12 consecutive months. See Texas Government Code 311.005
(c) An issuer in the proceedings to authorize obligations or a credit agreement, or in a credit agreement, may agree to waive sovereign immunity from suit or liability for the purpose of adjudicating a claim to enforce the credit agreement or obligation or for damages for breach of the credit agreement or obligation. This subsection does not apply to an issuer that is:
(1) a state agency, including a state institution of higher education; or
(2) a county with a population of 1.5 million or more.