Posts By: Chris Wielinski

Who Decides Who Decides Who Decides?
The Dawn of Fourth-Order Arbitration Disputes

Posted by & filed under Articles, Blogs.

Cokinos | Young Principal Kyle Zunker (San Antonio) authored an article, published in The Construction Law Journal, Volume 20, Number 2, examining recent decisions from the U.S. Supreme Court and Texas Supreme Court regarding “fourth-order” arbitration disputes. In the article, Zunker explains how the rapidly evolving law of arbitrability impacts the construction industry and why precise contract drafting is more important than ever.

Thirty years ago, in First Options of Chicago, Inc. v. Kaplan,[1] the United States Supreme Court held that arbitrators, not courts, have the primary power to decide arbitrability when there is “clear and unmistakable evidence” that the parties agreed to arbitrate arbitrability.[2] While First Options was not the first time the Court recognized that parties could delegate arbitrability to an arbitrator,[3] the case is seminal because the Court explained its rationale in unprecedented detail and framed the three layers (or orders) of arbitration disputes: (i) the merits of the dispute, (ii) whether the parties agreed to arbitrate the merits, and (iii) who decides whether the parties agreed to arbitrate the merits.[4]

Last year, in Coinbase, Inc. v. Suski,[5] the United States Supreme Court recognized a fourth layer of arbitration disputes:

What happens if parties have multiple agreements that conflict as to the third-order question of who decides arbitrability?[6]

Coinbase involved the operator of a cryptocurrency exchange platform and several of the platform’s users.[7] The parties first entered into a user agreement containing the following arbitration clause:

This Arbitration Agreement includes, without limitation, disputes arising out of or related to the interpretation or application of the Arbitration Agreement, including the enforceability, revocability, scope, or validity of the Arbitration Agreement or any portion of the Arbitration Agreement. All such matters shall be decided by an arbitrator and not by a court or judge.[8]

After executing the user agreement, the platform operator offered a sweepstakes allowing users to enter for a chance to win Dogecoin.[9] The users agreed to the sweepstakes’ official rules, which contained the following forum-selection clause:

The California courts (state and federal) shall have sole jurisdiction over any controversies regarding the [sweepstakes] promotion, and the laws of the State of California shall govern the promotion. Each entrant waives any and all objections to jurisdiction and venue in those courts for any reason and hereby submits to the jurisdiction of those courts.[10]

A dispute arose from the sweepstakes, and a group of users filed a class-action complaint in the U.S. District Court for the Northern District of California.[11] The platform operator moved to compel arbitration of the dispute, including the arbitrability issue. The district court concluded that the sweepstakes’ official rules superseded the user agreement and denied the motion to compel arbitration, and the Ninth Circuit affirmed.[12]

The Supreme Court “granted certiorari to answer the question of who—a judge or arbitrator—should decide whether a subsequent contract supersedes an earlier arbitration agreement that contains a delegation clause.”[13] The Court noted that “the question whether these parties agreed to arbitrate arbitrability can be answered only by determining which contract applies.”[14] The Court held that, as to “the conflict between the delegation clause in the first contract and forum selection clause in the second, the question is whether the parties agreed to send the given dispute to arbitration—and, per usual, that question must be answered by a court.”[15] The Court concluded “that a court, not an arbitrator, must decide whether the parties’ first agreement was superseded by their second.”[16]

In other words, the United States Supreme Court held that a court would decide whether the court or arbitrator would decide whether the court or arbitrator would decide the merits of the case. The preceding sentence is not a series of typographical errors. This meta-question is easiest to grasp when viewed as an extension of the first, second, and third-order disputes that precede it:

First-Order: The merits
Second-Order: Who decides the merits (i.e. arbitration or litigation)
Third-Order: Who decides who decides the merits (i.e. delegation of arbitrability)
Fourth-Order: Who decides who decides who decides the merits

At first glance, Coinbase appears to be a holding of limited application arising from an idiosyncratic fact pattern. But this article explores whether Coinbase might be the harbinger of a new era of fourth-order arbitration disputes—especially in Texas construction law.

  1. THE LAW REGARDING THIRD AND FOURTH-ORDER ARBITRATION DISPUTES IS DYNAMIC AND LIKELY TO CONTINUE DEVELOPING

    Recent history shows that Coinbase is unlikely to be the final word on arbitration disputes. In 2018, the Texas Supreme Court formally recognized First Options and held parties can agree to arbitrate arbitrability.[17] In the seven years since then, the Texas Supreme Court has issued at least eleven opinions regarding third and fourth-order arbitration disputes,[18] and Justice Busby has authored at least two dissents, including one stemming from a denial of a motion for rehearing last year.[19] During that same period, the United States Supreme Court issued three opinions regarding third and fourth-order arbitration disputes.[20]

    Taken together, the two high courts have issued at least 14 opinions shaping arbitration practice in Texas over the past 7 years. Based on this track record, practitioners in Texas have good reason to expect that: (i) contracting parties and their lawyers will draft arbitration agreements with language taken from and aimed at the most recent case law regarding third and fourth-order disputes, (ii) litigants and their counsel will make creative arguments regarding the terms of those arbitration agreements when third and fourth-order disputes arise, and (iii) courts will continue issuing opinions concerning those arbitration agreements and arguments. For example, in the short space between the writing and final editing of this article, two intermediate courts of appeals issued opinions concerning Coinbase and fourth-order arbitration disputes.[21]

  2. AS THE LAW DEVELOPS, FOURTH-ORDER DISPUTES MAY NOT BE CONFINED TO THE EXPRESSLY-CONFLICTING-CONTRACT SCENARIO IN COINBASE

    When describing how the dispute in Coinbase differed from first, second, and third-order arbitration disputes, the Court stated: “This case involves a fourth [order of dispute]: What happens if parties have multiple agreements that conflict as to the third-order question of who decides arbitrability?”[22] As suggested by the Court’s use of the indefinite article “a” rather than the definite article “the,” is it possible that the Court was identifying just one example of a fourth-order dispute? Might there be other fourth-order disputes (beyond the expressly-conflicting-contracts scenario) in which the parties disagree about who decides who decides arbitrability? This article explores three other potential fourth-order dispute scenarios

    1. What Constitutes “Implicitly Sending Arbitrability Disputes to the Courts?”

      As noted above, in Coinbase, the parties entered into contracts that were expressly contradictory. But, near the end of the opinion, when addressing arguments raised by the petitioner, the Court expanded its holding: “[W]here, as here, parties have agreed to two contracts—one sending arbitrability disputes to arbitration, and the other either explicitly or implicitly sending arbitrability disputes to the courts—a court must decide which contract governs.”[23] In his concurrence, Justice Gorsuch proposed a hypothetical: “Just imagine a master contract providing that ‘all disputes arising out of related to this or future agreements between the parties, including questions concerning whether a dispute should be routed to arbitration, shall be decided by an arbitrator.’ Absent some later amendment, a provision like that would seem to require a court to step aside.”[24]

      Now, consider this hypothetical: a general contractor and a subcontractor enter into a master subcontract that provides for arbitration with delegation of arbitrability and, subsequently, a work order that contains an arbitration agreement with no delegation of arbitrability. Is the work order’s silence on delegation “implicitly sending arbitrability disputes to the courts?” Is the work order’s arbitration clause an “amendment” to the master subcontract’s arbitration clause? And finally, who—the court or the arbitrator—will decide these two questions?

    2. Where Is the Line between Existence and Scope?

      Earlier this year, the Texas Supreme Court decided a case in which the parties disputed whether there was an agreement to delegate arbitrability for the personal injury claims at issue.[25] In Cerna as Next Friend of R.W. v. Pearland Urban Air, L.L.C.,[26] the plaintiff signed an arbitration agreement with a delegation clause when she visited a trampoline park in August.[27] The plaintiff returned to the park in November but did not sign an arbitration agreement on this occasion.[28] In a suit for injuries arising from the second visit to the trampoline park, the plaintiff argued that no arbitration agreement existed for the November visit.[29]

      The Court rejected the plaintiff’s argument, reasoning that it regarded “the scope of the August Agreement, not its existence.”[30] The Court explained that “[a]n argument about an agreement’s ‘existence,’ when confined to a particular claim, crosses the threshold from existence to scope. Such a dispute concerns not if an agreement to arbitrate exists, but which claims are arbitrable under that agreement.”[31] This distinction is critical because “only courts can decide existence, but scope can be delegated.”[32] Because it found the dispute regarded scope rather than existence, the Court remanded with instructions for the trial court to compel arbitration, including the issue of arbitrability.[33]

      The Court’s distinction between existence and scope makes sense in theory but raises a question about where to draw the line. In Cerna, the Court noted that the August arbitration agreement, which included a delegation clause, did not specify its duration.[34] If the agreement had limited its duration––for example, to one month––would the Court have found that the dispute concerned the existence of an agreement rather than its scope?

      What if an arbitration agreement were limited, either expressly or impliedly, to a certain subject matter, like a particular construction project? Consider the following hypothetical. A general contractor enters into a contract with a subcontractor for a large project (Project A). It is undisputed that the contract exists and includes an arbitration agreement with a delegation clause assigning issues of arbitrability to the arbitrator. Following the successful completion of Project A, the contractor and subcontractor cease doing business together. Fast forward ten years. The contractor, needing to supplement its workforce on a smaller project (Project B), reaches out to the same subcontractor. Because Project B is small and the contractor is facing a tight schedule, the contractor does not bother entering into a written contract with the subcontractor; instead, the parties merely discuss pricing over the phone, and the subcontractor begins work. A dispute then arises between the contractor and subcontractor regarding Project B.

      Does the delegation clause from the contract for Project A apply to this dispute, and who makes that decision? Under Cerna, the answer to that depends on whether this is a dispute about (i) the scope of the arbitration agreement from Project A or (ii) the non-existence of an arbitration agreement for Project B. But this raises yet another fourth-order question: who decides whether the dispute concerns scope or existence?

    3. What about Waiver?

      If one party argues that the other has waived its right to arbitration through its litigation conduct, is that a fourth-order dispute?

      In G.T. Leach Builders, L.L.C. v. Sapphire V.P., L.P.[35]—a case decided before the Texas Supreme Court officially recognized First Options and the delegation of arbitrability—the Texas Supreme Court held that “the question of whether a party has waived its right to arbitration through its litigation conduct is a question of arbitrability for the courts to decide.”[36] The Court reasoned that “the question of whether a party has waived its right to arbitration by its conduct in litigation is just another way of asking the first question of arbitrability: whether there is a presently enforceable arbitration agreement.”[37]

      However, the Court subsequently called this rule into question when it decided TotalEnergies E&P USA, Inc. v. MP Gulf of Mexico, L.L.C.[38] In that case, the Court held that the parties had delegated issues of arbitrability to the arbitrator by incorporating the American Arbitration Association (“AAA”) rules into their agreement, because the AAA rules grant the arbitrator the authority to determine arbitrability.[39] In a footnote, the Court favorably cited to a Tenth Circuit opinion holding that incorporation of the AAA rules “constitutes clear and unmistakable evidence that the parties agreed to arbitrate arbitrability issues, including the issue of waiver.”[40] Although the Court did not squarely address waiver, its recognition of delegation-by-incorporation and its citation to the Tenth Circuit precedent suggest that parties may delegate the issue of waiver to the arbitrator.Since the Texas Supreme Court issued TotalEnergies, at least two intermediate courts have ruled on disputes regarding the arbitrability of waiver by litigation conduct.[41] In Fidelity Auto Group, the parties agreed to arbitrate “[a]ny claim or dispute, whether in contract, tort, statute or otherwise (including the interpretation and scope of this Arbitration Provision, and the arbitrability of the claim or dispute), between you and us[.]”[42] The arbitration clause further provided, “You may choose the American Arbitration Association . . . or any other organization to conduct the arbitration subject to our approval.”[43]

      When evaluating how this arbitration provision applied to an allegation of waiver, the Ninth Court of Appeals first recited the legal principle from G.T. Leach—“[w]hether a party waived its right to arbitration by its litigation conduct is generally for the courts to decide.”[44] The court then acknowledged TotalEnergies and stated, “The Supreme Court of Texas recently held that ‘as a general rule, an agreement to arbitrate in accordance with the AAA or similar rules constitutes a clear and unmistakable agreement that the arbitrator must decide whether the parties’ dispute must be resolved through arbitration.’”[45]

      However, the court noted that “the express language of the parties’ agreement did not adopt the AAA Commercial Rules or require that they be used. Here, the arbitration provision only says the parties ‘may choose’ the AAA or ‘any other organization’ subject to Baytown Nissan’s approval.”[46] Accordingly, the court held that the trial court, not the arbitrator, should determine waiver because “[n]either the arbitration agreement nor the delegation clause mentions waiver by litigation conduct, and there is no clear and unmistakable evidence overcoming the presumption that the court will decide that issue.”[47]

      In Humphries Construction, the First Court of Appeals cited Fidelity Auto and followed its logic—first noting that waiver is generally a question for the courts to decide and then acknowledging that parties can delegate arbitrability issues to the arbitrator.[48] Unlike Fidelity Auto, however, the arbitration provision in Humphries Construction expressly adopted the AAA rules: “. . . any Claim . . . shall be administered by the American Arbitration Association in accordance with current Construction Industry Arbitration Rules.”[49]

      The contractor argued that, under TotalEnergies, the parties’ adoption of the AAA rules demonstrated their clear and unmistakable intent to delegate the issue of waiver by litigation conduct to the arbitrator.[50] The court disagreed and stated that, “TotalEnergies did not address the question of whether delegation to the arbitrator of the power to rule on ‘any objection with respect to the existence, scope, or validity of the arbitration agreement’ also delegates to the arbitrator the exclusive power to decide the issues of waiver by litigation conduct.”[51] Again citing to Fidelity Auto, the court in Humphries Construction held that “[b]ecause neither the Arbitration Rules nor the Construction Contract address who has the power to decide the issue of waiver by litigation conduct, we cannot say that the parties clearly and unmistakably delegated this issue to the arbitration panel.”[52]

      In summary, both the Fidelity Auto and Humphries Construction courts recognized that the issue of waiver could be delegated to an arbitrator, but found no “clear and unmistakable” agreement to delegate in their respective cases.[53] In both cases, the courts treated waiver as a special issue of arbitrability that required a more specific delegation: “Since waiver by litigation conduct is one presumptively for the courts, if the parties desire to overcome this presumption and delegate it, they must do so by clear and express language. If the arbitration agreement omits any mention of waiver, the issue has not been clearly and unmistakably delegated to the arbitrator.”[54] These holdings suggest that delegation of the issue of waiver is possible if, but only if, the delegation clause expressly and specifically identifies “waiver” as being delegated to the arbitrator.

      The Fourteenth Court of Appeals encountered that type of delegation clause in Energy Transfer L.P. v. Mook.[55] The operative clause stated: “The Arbitrator—and not any federal, state, or local court or agency—will have the exclusive authority to resolve any dispute relating to the interpretations, applicability, scope, alleged waiver, enforceability, or formation of this Agreement.”[56] While the court’s opinion was not focused on waiver, the court noted that “the parties agreed to arbitrate any dispute with respect to the scope or validity of the Agreement and any dispute related to the applicability, scope, alleged waiver, or enforceability of the Agreement[.]”[57] It is worth pointing out that the court, when reciting what the parties had agreed to delegate to the arbitrator, omitted “formation of this Agreement,” even though the delegation clause includes those words.[58] The court’s omission demarcates the logical limit of delegation—the parties cannot delegate the issue of whether they ever formed an agreement to delegate.

      If parties may delegate the issue of waiver by litigation conduct through a clear and unmistakable agreement—as the case law suggests—does the law provide any limits on the functional scope of that delegation? A limitless ability threatens harsh results that fail to pass the gut-check test. Consider the following hypothetical. A subcontractor sues a general contractor in state court, and the general contractor files a counterclaim. Between the claims and counterclaims, the parties assert numerous causes of action and damages. Over the course of eighteen months, the parties exchanged discovery, designated experts and produced reports, conducted numerous depositions, and filed competing motions for summary judgment and to exclude experts. The court grants some motions and denies others, shaping the contours of the case for trial. At the final pretrial conference, just one week before trial, the contractor moves to compel arbitration and points to the arbitration agreement with a robust delegation clause that expressly delegates “alleged waiver by litigation conduct” to the arbitrator. The subcontractor responds that the contractor has waived its right to arbitration by litigation conduct. Can the trial court rule on this issue?

      The answer may depend on whether the subcontractor contends that the contractor waived not only the right to arbitrate the merits but also the right to arbitrate arbitrability issues, including waiver. The foundational rule of arbitration is “that because arbitration is a matter of contract, courts must decide in the first instance whether a valid arbitration agreement exists.”[59] This inquiry includes whether an agreement “still exists at all” in light of a subsequent agreement.[60] Or, as the United States Supreme Court explained when discussing the severability doctrine in Coinbase, “[i]f a party challenges the validity … of the precise agreement to arbitrate at issue, the federal court must consider the challenge before ordering compliance with that arbitration agreement.”[61] If the subcontractor argues that the general contractor waived the agreement to arbitrate arbitrability, has the subcontractor (i) raised an issue of whether the agreement “still exists at all” and challenged “the validity of the precise agreement to arbitrate at issue” or (ii) merely raised an issue of arbitrability that the parties delegated to the arbitrator? And again, who—court or arbitrator—decides that question?

  3. TAKEAWAY FOR CONSTRUCTION PRACTITIONERS

    This article raises more questions than it answers, but there are at least three takeaways for the construction law practitioner.

    First, the law surrounding arbitration disputes is evolving, and construction law is prone to third and fourth-order disputes. In construction, it is common for (i) two parties to have multiple contracts that overlap with each other and (ii) for contracts between different parties, on a single project, to reference and incorporate each other. Inconsistencies among these contracts regarding arbitration, arbitrability, and delegation may brew multiple disputes that could make their way up to appeals.

    Second, as the law continues to develop, the issues are becoming more complex. Practitioners handling third and fourth-order arbitration disputes should be ready to analyze issues such as delegation by incorporation, existence versus scope, procedural versus substantive arbitrability issues, and the severability doctrine. The good news is that there is no shortage of case law regarding these issues, as shown by the cases cited in this article.

    Finally, attorneys involved in contract preparation should stay current with evolving case law and the arbitration rules referenced in their contracts. Whether an arbitration provision delegates arbitrability issues to an arbitrator—and whether that delegation extends to specific questions, such as waiver by litigation conduct—turns on the precise language of the clause and any arbitration rules it incorporates by reference.

About the Author

Kyle A. Zunker focuses on construction law and civil appeals. He has represented owners, general contractors, subcontractors, material suppliers, and engineers across a wide range of legal, factual, and technical issues arising from industrial and commercial construction projects. Zunker is a go-to lawyer for complex, high-pressure disputes because of his ability to distill voluminous facts and complex issues into succinct, persuasive arguments. As an attorney who handles appeals, litigation, arbitration, and contract drafting, Zunker advocates with a holistic perspective and is driven by his passion to provide clients with effective, efficient solutions rather than aimless, expensive legal busywork. He can be reached at 210-293-8751 or KZunker@CokinosLaw.com.

Kyle A. Zunker

About Cokinos | Young

Cokinos | Young has led Texas construction and real estate law for over three decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, and that remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young. Learn more at cokinoslaw.com.

[1] 514 U.S. 938, 942-44 (1995).
[2] Id.
[3] See, e.g., AT&T Techs., Inc. v. Communications Workers of Am., 475 U.S. 643, 649 (1986) (“[u]nless the parties clearly and unmistakably provide otherwise, the question of whether the parties agreed to arbitrate is to be decided by the court, not the arbitrator.”); see also United Steelworkers of Am. v. Warrior & Gulf Nav. Co., 363 U.S. 574, 583 n. 7 (1960) (citing Cox, Reflections Upon Labor Arbitration, 72 Harv.L.Rev. 1482, 1508-1509). The United States Supreme Court’s recognition of the ability to delegate arbitrability dates back to a footnote in a 1960 Court opinion, which cited a 1959 law review article authored by then-Royall Professor of Law Archibald Cox, who subsequently served as Solicitor General of the United States and as special prosecutor in the Watergate scandal.
[4] First Options of Chicago, Inc., 514 U.S. at 942-43.
[5] 602 U.S. 143, 149 (2024).
[6] Id. at 148–49 (citation modified).
[7] Id. at 146.
[8] Id.
[9] Id.
[10] Id. at 146–47.
[11] Id. at 147.
[12] Id.
[13] Id.
[14] Id. at 150.
[15] Id. at 150 (emphasis in original).
[16] Id. at 152.
[17]See Jody James Farms, J.V. v. Altman Grp., Inc., 547 S.W.3d 624, 631 (Tex. 2018).
[18] See, e.g., RSL Funding, L.L.C. v. Newsome, 569 S.W.3d 116, 120 (Tex. 2018); Robinson v. Home Owners Mgmt. Enterprises, Inc., 590 S.W.3d 518 (Tex. 2019); San Antonio River Auth. v. Austin Bridge & Rd., L.P., 601 S.W.3d 616 (Tex. 2020); Bonsmara Nat. Beef Co., L.L.C. v. Hart of Tex. Cattle Feeders, L.L.C., 603 S.W.3d 385 (Tex. 2020); Baby Dolls Topless Saloons, Inc. v. Sotero, 642 S.W.3d 583 (Tex. 2022); Transcor Astra Grp. S.A. v. Petrobras Am. Inc., 650 S.W.3d 462 (Tex. 2022); TotalEnergies E&P USA, Inc. v. MP Gulf of Mexico, L.L..C, 667 S.W.3d 694 (Tex. 2023); Lennar Homes of Tex. Land & Constr., Ltd. v. Whiteley, 672 S.W.3d 367 (Tex. 2023); All. Auto Auction of Dallas, Inc. v. Lone Star Cleburne Autoplex, Inc., 674 S.W.3d 929 (Tex. 2023); Lennar Homes of Tex. Inc. v. Rafiei, 687 S.W.3d 726 (Tex. 2024); Cerna as Next Friend of R.W. v. Pearland Urban Air, L.L.C., 714 S.W.3d 585 (Tex. 2025).
[19] See Paul v. Roy F. & Joann Cole Mitte Found., 683 S.W.3d 405 (Tex. 2024) (Busby, J. dissenting); TotalEnergies, 667 S.W.3d at 725 (Busy, J., dissenting).
[20] See Henry Schein, Inc. v. Archer & White Sales, Inc., 586 U.S. 63 (2019); New Prime Inc. v. Oliveira, 586 U.S. 105 (2019); Coinbase, Inc. v. Suski, 602 U.S. 143 (2024).
[21] Chadwick v. Lynn, No. 02-25-00193-CV, 2025 WL 3119019, *4-6 (Tex. App.—Fort Worth Nov. 6, 2025, no pet. h.); Judson Motors Ltd. d/b/a Universal Toyota v. Jane Doe, No. 08-24-00054-CV, 2025 WL 3118963, *6 n. 9 (Tex. App.—El Paso Nov. 6, 2025, no pet. h.).
[22] 602 U.S. 143, 149 (2024) (emphasis added).
[23] Id. at 152 (emphasis added as to “or implicitly”).
[24] Id. at 153 (Gorsuch, J., concurring).
[25] See Cerna as Next Friend of R.W. v. Pearland Urban Air, L.L.C., 714 S.W.3d 585 (Tex. 2025).
[26] 714 S.W.3d 585 (Tex. 2025).
[27] Id. at 587.
[28] Id. at 587-88.
[29] Id. at 589.
[30] Id. at 590 (emphasis in original).
[31] Id. at 591 (emphasis in original).
[32] Id. at 590.
[33] Id. at 592. Consistent with the point above regarding the dynamic state of the law, the plaintiff in Cerna filed a petition for writ of certiorari with the United States Supreme Court, which is pending as of the writing of this article.
[34] Id. at 588.
[35] 458 S.W.3d 502 (Tex. 2015).
[36] G.T. Leach Builders, L.L.C. v. Sapphire V.P., L.P., 458 S.W.3d 502, 519 (Tex. 2015) (citing Perry Homes v. Cull, 258 S.W.3d 580, 588 (Tex. 2008).
[37] Id.
[38] 667 S.W.3d 694 (Tex. 2023).
[39] Id. at 708-09.
[40] Id. at 706 n. 11 (quoting Goldgroup Res., Inc. v. DynaResource de Mex., S.A. de C.V., 994 F.3d 1181, 1191 (10th Cir. 2021)) (emphasis added).
[41] Humphries Constr. Corp. v. Highland Vill. Ltd. P’ship, No. 01-23-00651-CV, 2025 WL 2471797, *1-2, 10-11 (Tex. App.—Houston [1st Dist.] Aug. 28, 2025, no pet. h.); Fid. Auto Grp., L.L.C. v. Hargroder, 689 S.W.3d 1 (Tex. App.—Beaumont 2024, no pet.).
[42] Fid. Auto Grp., 689 S.W.3d at 7.
[43] Id.
[44] Id. at 12.
[45] Id. at 13 (quoting TotalEnergies, 667 S.W.3d at 708).
[46] Id.
[47] Id. (citation modified).
[48] Humphries Constr. Corp. v. Highland Vill. Ltd. P’ship, No. 01-23-00651-CV, 2025 WL 2471797, at *10-11 (Tex. App.—Houston [1st Dist.] Aug. 28, 2025, no pet. h.).
[49] Id. at *2.
[50] Id. at *13.
[51] Id. at *14.
[52] Id. at *14.
[53] Id. at *14; Fid. Auto Grp., L.L.C. v. Hargroder, 689 S.W.3d 1, 13 (Tex. App.—Beaumont 2024, no pet.).
[54] Id. at 13; see Humphries Constr. Corp., 2025 WL 2471797 at *13-14.
[55] Energy Transfer LP v. Moock, 2025 WL 155984, (Tex. App.—Houston [14th Dist.] June 3, 2025, no pet.).
[56] Id. at *15.
[57] Id. (emphasis added).
[58] Id.
[59] TotalEnergies, 667 S.W.3d at 720.
[60] Cerna, 714 S.W.3d at 589 (Tex. 2025); see Coinbase, 602 U.S. at 152.
[61] Coinbase, 602 U.S. at 151.

Cokinos | Young Celebrates Attorney Promotions

Posted by & filed under News.

Cokinos | Young is proud to recognize the exceptional accomplishments of several attorneys whose talent, leadership, and dedication continue to strengthen our firm and the clients we serve.

We are pleased to announce the elevation of Roland Driscoll, Alec Dudley, Allegra Lezak, Matthew Longoria, and Anne Penix to Principal, as well as the promotion of Samuel Crecelius and Marshall Swanson to Senior Counsel.

Each of these attorneys has demonstrated outstanding legal skill, sound judgment, and a deep commitment to client service. Their promotions recognize years of hard work and the meaningful impact they have made within their practices and across the firm.

“These promotions reflect the strength of our bench and the caliber of attorneys who define Cokinos | Young,” said President and CEO Gregory Cokinos. “Samuel, Marshall, Roland, Alec, Allegra, Matthew, and Anne have each earned the respect of their colleagues and clients through consistent excellence, leadership, and professionalism. We are proud to recognize their contributions and excited for what lies ahead.”

Founding Partner Marc Young echoed that sentiment, emphasizing the firm’s continued investment in its people.

“One of the most rewarding parts of building this firm has been watching our attorneys grow into leaders,” Young said. “These promotions are well deserved and represent not only past accomplishments, but also the confidence we have in each of them to help shape the future of Cokinos | Young.”

At Cokinos | Young, we believe that investing in our people is essential to delivering the highest level of service to our clients. We congratulate our newly promoted Senior Counsel and Principals on this well-earned milestone and look forward to their continued success.

Please join us in congratulating these outstanding attorneys on this important professional milestone!

Roland Driscoll focuses his practice on civil litigation, with an emphasis on construction litigation, representing the interests of owners, general contractors, subcontractors, and suppliers in New York, New Jersey, and federal courts. He also has significant experience in personal injury matters, including wrongful death and catastrophic injury claims. He has represented municipalities, hospitals, and owners of commercial premises in a variety of personal injury actions.

Alec Dudley focuses his practice on construction law and commercial litigation.  Alec graduated magna cum laude from St. Mary’s University School of Law in the top five percent of his class.  During law school, Alec also served as the Managing Executive Editor for the St. Mary’s Law Journal and interned for Chief Justice Sandee B. Marion of the Texas Fourth Court of Appeals.

Allegra Lezak’s practice primarily focuses on construction law and commercial litigation, with experience representing residential and commercial construction clients throughout litigation and arbitration. Her work includes contract and payment disputes, delay claims, mechanic’s and materialman’s liens, construction defect cases, premises and products liability, negligence, and other residential and commercial construction matters. While in law school, Allegra represented clients in the civil litigation clinic and was a competitive member of the mock trial team.

Matthew Longoria is an attorney with trial and transactional experience who previously served as a municipal attorney, representing governmental entities and guiding land use and zoning, personnel and employment matters, and water and wastewater utility disputes. As a municipal prosecutor, he was the lead attorney in more than two dozen jury and bench trials, achieving successful verdicts. A San Antonio native, Matthew has a diverse background in creative and legal fields and studied intellectual property law at Beihang University in Beijing, China, with a focus on emerging Chinese copyright and trademark law.

Anne Penix’s analytical, detail-oriented approach to the law stems from her background in science and mathematics. A Midwest native, she earned her Bachelor of Science in Molecular and Integrative Physiology as a Chancellor’s Scholar at the University of Illinois. This experience reinforced the importance of precision and attention to detail. At Georgetown Law, Anne worked as a research assistant in income taxation and edited articles for the Georgetown International Environmental Law Review. She enjoys tackling complex legal questions in construction and insurance litigation. She has devoted much of her career to related areas, including employment discrimination, wage-and-hour disputes, ethics compliance, and employment eligibility.

Sam Crecelius represents clients in all phases of litigation, including mediation, trial, and appeals.  A decorated U.S Army combat veteran, Sam knows the value of hard work, discipline, and perseverance in the face of adversity, and he applies those values to each case he handles.  His practice focuses on coverage litigation, construction defect litigation, commercial litigation, and premises liability litigation.  For each client, regardless of the subject matter, Sam leverages his real-world experience to obtain a favorable outcome.

Marshall Swanson is a San Antonio native and commercial litigation attorney. Since 2015, Marshall’s practice has focused on complex civil, general business, and construction litigation. His experience covers a variety of areas, including mechanic’s liens, contract and payment disputes, partnership litigation, personal injury defense, post-judgment collections, business entity formation, and industry contract negotiations for clients in the construction and maritime sectors.

About Cokinos | Young

Cokinos | Young has led Texas construction and real estate law for over three decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, and that remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young. Learn more at cokinoslaw.com.

Cokinos | Young Secures Victory Eviscerating a $5 Million Lost-Profits Case filed in Jefferson County, Texas

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Cokinos | Young is proud to announce a significant litigation win in Beaumont, where our team, led by attorneys Parker Fauntleroy, Peter Wells, and Jude des Bordes, secured a summary judgment in favor of our client, Dashiell Corporation, ending a $5 million lost-profits lawsuit.

The Plaintiff, an electrical contractor, originally filed suit asserting claims for tortious interference, conspiracy, and negligence stemming from an incident at a Port Arthur refinery in which one of the Plaintiff’s employees was injured. Early in the litigation, our team successfully eliminated the tortious interference and conspiracy claims through an Anti-SLAPP motion, substantially narrowing the scope of the case. After those claims were dismissed, the Plaintiff attempted to pivot, alleging that Dashiell was responsible for the incident that injured one of its employees and, as a result, caused Plaintiff to lose future work at several Southeast Texas refineries, totaling more than $5 million in claimed lost profits.

The Plaintiff proceeded with extensive discovery, including multiple depositions. Once discovery concluded, our team filed a comprehensive summary judgment motion asserting, among other arguments, that the economic loss rule barred the remaining negligence claim as a matter of law. The Court agreed and granted the motion, signing an order dismissing the case in its entirety. This rare summary judgment win, secured in a jurisdiction where such rulings are hard to come by, underscores both the strength of our client’s defenses and the effectiveness of our litigation strategy.

The result reflects exceptional work and coordination by the entire team. Jude led the briefing with thorough and compelling analysis, while Peter argued the motion and handled the depositions essential to our strategy. Parker provided steady guidance throughout the case to ensure a unified and strategic approach. Together, the team delivered a clear and decisive defense in the face of repeated, well-fought attempts by opposing counsel to keep the case alive.

This victory highlights Cokinos | Young’s commitment to vigorously defending our clients wherever they find themselves, and we are proud of the outstanding work that led to this successful result.

J. Parker Fauntleroy
Peter B. Wells IV
Jude K.A. des Bordes

About Cokinos | Young

Cokinos | Young has led Texas construction and real estate law for over three decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, and that remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young. Learn more at cokinoslaw.com.

Supreme Court of Texas Issues Landmark Ruling Affirming Contractor Protections Under Section 97.002

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Cokinos | Young is proud to congratulate Tony Golz, Patrick Garner, Gregory Cokinos, and Dana Livingston on a significant victory before the Supreme Court of Texas on behalf of longtime client SpawGlass Civil Construction, Inc., a ruling with broad implications for contractors and the construction industry across the state.

In Third Coast Services, LLC and SpawGlass Civil Construction, Inc. v. Castaneda, the Supreme Court clarified the scope of Texas Civil Practice and Remedies Code Section 97.002, which provides liability protection to contractors performing work on highways for the Texas Department of Transportation (TxDOT). The Court held that Section 97.002 applies to contractors who construct or repair highways for TxDOT even when they are not in direct contractual privity with the Department, rejecting the appellate court’s attempt to impose a privity requirement not found in the statute’s text.

The Court further confirmed that work performed on state highway projects, including related infrastructure such as frontage roads and traffic-control systems, qualifies as construction or repair “for” TxDOT when TxDOT ultimately owns, operates, or maintains the roadway. This ruling recognizes the reality of modern transportation projects, which are often delivered through layered agreements involving counties and other local entities while still serving TxDOT’s system.

While the case has been remanded to the court of appeals for consideration of the remaining statutory elements, the Supreme Court’s decision marks a significant milestone. It provides long-needed clarity, strengthens statutory protections for contractors, and supports more predictable risk allocation on complex highway and infrastructure projects throughout Texas.

Congratulations again to Tony, Patrick, Gregory, Dana, and the entire team on this important win for SpawGlass and the Texas construction community.

Anthony T. Golz
W. Patrick Garner
Gregory M. Cokinos
Dana Livingston

About Cokinos | Young

Cokinos | Young has led Texas construction and real estate law for over three decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, and that remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young. Learn more at cokinoslaw.com.

Order from the Courts: A Uniform Approach Begins to Emerge on the Texas Anti-Indemnity Act’s Effect on an Additional Insurer’s Duty to Defend

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Dallas attorneys Travis Brown and Sam Crecelius authored an article for the December edition of Construction News examining how Texas courts are clarifying the Texas Anti-Indemnity Act’s impact on an additional insurer’s duty to defend. Recent cases show a consistent approach emerging: courts first determine whether indemnity and insurance provisions comply with the TAIA, and when they do, insurers cannot avoid their duty to defend simply because the allegations may implicate the additional insured’s own negligence. Travis and Sam conclude by encouraging contractors to review their indemnity and insurance provisions, as well as their additional insured endorsements, to ensure TAIA compliance.

The Texas Legislature passed Subchapter C of Chapter 151 of the Texas Insurance Code, the Texas Anti-Indemnity Act (the “TAIA”), effective January 1, 2012, which applies exclusively to “construction contracts,” as that term is defined in the statute. Broadly speaking, Section 151.102 of the TAIA voids indemnity provisions to the extent they require an indemnitor to defend or indemnify an indemnitee for the indemnitee’s own negligence or fault. Unlike previous anti-indemnity statutes, such as the Texas Oilfield Anti-Indemnity Act, the TAIA also expressly prohibits additional insured coverage, “the scope of which is prohibited under [Section 151.102].”

Before the TAIA, a carrier’s duty to defend a party seeking additional insured coverage was determined by two questions: (1) is the party an additional insured under the policy based on the additional insured requirements in the construction contract and the provisions in the insurance policy addressing additional insured status; and (2) if so, is there even a single allegation in the pleading that potentially states a claim covered under the policy? If the answer to both questions was ‘yes,’ the CGL carrier owed the additional insured a defense against the entire lawsuit.

However, following the passage of the TAIA, with its prohibition on “additional insured” coverage for the additional insured/indemnitee’s own fault, many insurers argued that rather than having to defend the entire lawsuit if there was a single covered allegation, they were now entirely relieved of their duty to defend (even covered allegations) if there was a single allegation for which providing a defense or indemnity would violate the TAIA.

Until recently, there was little guiding case law to resolve this recurring dispute. However, a recent series of Texas federal district court cases has clarified the issue.  A uniform approach emerges from these cases, in which courts first evaluate whether the contractual-indemnity and additional insured provisions comply with the TAIA. If they do, courts readily find a duty to defend the entire suit, irrespective of any allegations of the additional insured’s own fault for which, standing alone, a defense would be prohibited under the TAIA.

The first of these cases, BNSF Railway Co. v. Jones Lang Lasalle Americas, Inc. (N.D. Tex. Feb. 24, 2022), was not an additional insurance case. But the Court expressly rejected the indemnitor’s more moderate argument that, because of the TAIA, rather than a defense to the entire lawsuit, the indemnitor could only owe a defense to those claims involving the indemnitor’s own negligence. The court disagreed, noting that if the underlying complaint “includes even one covered claim, the insurer must defend the entire suit.”

In Knife River Corp. – S. v. Zurich American Insurance Co. (N.D. Tex. Mar. 8, 2022), decided a few weeks later, the court did not specifically address the issue of whether the duty to defend applied to the “entire lawsuit,” but the court did establish the proper order of the analysis, evaluating the issue of compliance with the TAIA before turning to an “eight corners” analysis of the allegations in the pleadings.

In Phoenix Insurance Co. v. Knife River Corp. S. (S.D. Tex. July 27, 2023 & Sept. 11, 2023), the court adopted this same order of the analysis. Id. (citing Knife River and following that court’s approach of “assessing whether insurance policy violated TAIA prior to conducting the duty to defend analysis.”). That case tied the concepts from BNSF and Knife River together, first evaluating whether the contract provisions complied with the TAIA and, finding that they did, holding that there was a duty to defend the entire lawsuit in the face of mixed allegations of both the indemnitor’s and indemnitee’s negligence.

At first glance, the most recent case, Allied World Assurance Co. (U.S.) Inc. v. Acadia Insurance Co. (E.D. Tex. Sept 9, 2024) would seem to contradict the cases above and revive the argument that a single allegation of the indemnitee’s negligence excuses the additional insurer from its defense obligation. The court appeared to reference an insurer’s duty to defend “the entire suit” as a basis for holding that there could be no duty to defend when there were allegations of the additional insured’s fault. But in fact, the court analyzed in the same order as the cases above, first finding the additional insured provision invalid because it provided coverage for bodily injury “caused, in whole or in part, by” the indemnitor’s negligence—meaning it expressly provided coverage for bodily injury that was also caused in part by the indemnitee’s negligence, violating the TAIA.

Considering these recent opinions, general contractors building in Texas should evaluate the indemnity and insurance provisions of their subcontracts to ensure compliance with the TAIA. They might also consider adding language to those insurance provisions requiring additional insured endorsements, which the Insurance Services Office has recently explicitly promulgated to comply with various state anti-indemnity acts, such as the TAIA.

About the Authors

Travis Brown leads the firm’s Insurance Coverage and Risk Management practice group and serves as Managing Principal of the Dallas office. With more than a decade of experience, he helps clients ensure carriers meet their obligations. Travis represents contractors, owners, subcontractors, and energy-sector clients in complex coverage disputes and has secured significant multi-million-dollar recoveries across a wide range of claims. If you have any questions regarding the Texas Anti-Indemnity Act or a related legal inquiry, Travis can be contacted via email at TBrown@CokinosLaw.com.

Sam Crecelius is a key member of Cokinos | Young’s Dallas office whose practice includes coverage, construction defect, commercial, and premises liability litigation. A decorated U.S. Army combat veteran, Sam brings discipline, perseverance, and real-world experience to every stage of litigation, from mediation to trial and appeal, and works diligently to achieve favorable outcomes for his clients. If you have any questions regarding the Texas Anti-Indemnity Act or a related legal inquiry, Sam can be contacted via email at SCrecelius@CokinosLaw.com.

Travis M. Brown
E. Samuel Crecelius III

About Cokinos | Young

Cokinos | Young has led Texas construction and real estate law for over three decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, and that remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young. Learn more at cokinoslaw.com.

Cokinos | Young Earns National and Regional Recognition in 2026 Best Law Firms®

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Cokinos | Young is proud to be recognized once again in the 2026 edition of Best Law Firms®, ranked by Best Lawyers®. This year marks the firm’s 16th consecutive appearance on the prestigious list, reflecting our continued commitment to excellence and client service. Cokinos earned national rankings in three practice areas and regional recognition in thirteen practice areas.

The Best Law Firms® distinction is awarded to firms demonstrating professional excellence and consistently strong feedback from clients and peers. Eligibility for inclusion requires that at least one attorney within the firm be recognized in the current edition of The Best Lawyers in America®.

The 2026 edition of The Best Lawyers in America® honors the top four percent of practicing attorneys nationwide. Thirty-seven Cokinos | Young attorneys earned this distinction, with San Antonio Principal Stephanie O’Rourke additionally named 2026 “Lawyer of the Year.”

Cokinos | Young honorees include:

Lauren S. Aldredge, Johnathan M. Bailey, David A. Brooks, Travis M. Brown, Bianca Cedrone, Craig H. Clendenin, Gregory M. Cokinos, Stephanie H. Cook, Taylor V. Cooksey, Stanley W. Curry, Chance K. Decker, Jay K. Farwell, J. Parker Fauntleroy, W. Patrick Garner, Charles W. Getman, Anthony T. Golz, John L. Grayson, Gabriel S. Head, Michael B. Hiddemen, Philip M. Kinkaid, Beau E. LeBlanc, Dana Livingston, Robert J. MacPherson, Shelly D. Masters, Robert J. Naudin Jr., Stephanie L. O’Rourke, Craig E. Power, Russell W. Smith, Darrell W. Taylor, C. Matthew Thompson, David L. Tolin, Christopher C. Wan, John C. Warren, Peter B. Wells IV, Patrick J. Wielinski, Marc A. Young.

Rankings are presented in national and metropolitan tiers, reflecting the high respect a firm has earned among other leading lawyers and clients for its capabilities, professionalism, and integrity.

Cokinos | Young received the following rankings in the 2026 Best Law Firms® lists:

  • National Tier 1
    • Appellate Practice
    • Construction Law
    • Litigation – Construction
  • Regional Tier 1
    • Austin
      • Appellate Practice
      • Commercial Litigation
      • Construction Law
      • Litigation – Construction
    • Dallas/Fort Worth
      • Construction Law
      • Insurance Law
      • Litigation – Construction
      • Litigation – Insurance
    • Houston
      • Appellate Practice
      • Commercial Litigation
      • Construction Law
      • Litigation – Construction
      • Personal Injury Litigation – Defendants
      • Real Estate Law
    • San Antonio
      • Commercial Litigation
      • Construction Law
      • Litigation – Construction
  • Regional Tier 2
    • Houston
      • Bankruptcy and Creditor Debtor Rights / Insolvency and Reorganization Law
      • Litigation – Bankruptcy
    • New Jersey
      • Construction Law
      • Litigation – Construction
  • Regional Tier 3
    • Houston
      • Admiralty & Maritime Law
      • Corporate Law
      • Product Liability Litigation – Defendants
    • New Jersey
      • Commercial Litigation

As Cokinos | Young continues to expand its presence from coast to coast and across Texas and beyond, this recognition underscores the firm’s steadfast dedication to providing practical, results-driven counsel across a full range of legal disciplines. From complex construction and commercial disputes to corporate, insurance, and real estate matters, our attorneys remain focused on delivering exceptional value and strategic solutions for every client we serve.

ABOUT COKINOS | YOUNG

Cokinos | Young has led Texas construction and real estate law for over three and a half decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, which remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young.

ABOUT BEST LAW FIRMS®

Best Law Firms®, ranked by Best Lawyers® and respected for over 15 years, is the most credible ranking of exceptional law firms globally. It is rooted in a rigorous, peer-to-peer, industry-driven evaluation. A ranking from Best Law Firms signifies a high-quality practice and a breadth of legal expertise. Ranked firms, presented in three tiers, are recognized on a national and metropolitan scale, providing legal professionals with an elevated stature from the Best Law Firms recognition.

ABOUT BEST LAWYERS®

Best Lawyers® is the oldest and most respected peer-review research and accolades company in the legal profession. Best Lawyers compiles extensive recognitions by conducting exhaustive peer-review surveys in which tens of thousands of leading lawyers confidentially evaluate the work of their fellow legal professionals within their local market and specialty. Lawyers are not required or allowed to pay a fee to be listed; therefore, recognition by Best Lawyers is considered a singular honor.

Tariff Whiplash: A Contractor’s Playbook

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Austin Principal, Shelly Masters, wrote an article for the November edition of Construction News magazine. In this article, Shelly covers how tariff volatility creates sudden cost and schedule shocks for construction, and explains why the best defense is prompt notice, disciplined risk allocation, and contracts with clear escalation, tariff, delay, and dispute-resolution clauses backed by practical bidding and documentation habits.

Tariffs have flipped on, off, and sideways; construction leaders feel it first. Steel, aluminum, specialty components, delivery calendars, and even bid validity dates all move with the headlines. It is not a replay of the pandemic, but it rhymes: sudden shocks, thin margins, and contracts that often say little about price spikes. The solution is not guesswork. Disciplined notice, clear risk allocation, and day-to-day habits match what your contract says.

Start with notice and triage. Most private contracts require written notice of cost or schedule impacts within days. Miss that window, and you can waive relief. On live jobs, issue prompt written notices reserving rights, even if you do not yet know the full impact, then audit the agreement: does it allow schedule extensions, price adjustments, or both? Force majeure typically buys time, not money, so plan on additional tools if you need dollars as well as days.

Five contract levers do the heavy lifting:

  1. Change in Law or After Imposed Tax. If tariffs are enacted after execution, some contracts treat them as a change order event. That can unlock time and price relief, provided you meet strict notice and proof requirements. Confirm whether your form includes this clause and how it defines “law,” “duty,” or “tax.”
  2. Material Price Escalation. Post 2020, many owners accept calibrated escalation language tied to objective triggers; for example, a 5 to 10 percent move in a published index or documented vendor quotes. This reduces the need to pad bids just in case, keeps both sides whole during swings, and limits disputes when the trigger is clear and the adjustment math is pre-agreed.
  3. Tariff Specific Riders. A narrower option: if particular imported components are hit with new duties, pricing adjusts by a formula, often the actual duty percentage applied to the affected material cost. Contracts can add thresholds to ignore minor blips and optional caps or cost sharing so owners see a bounded exposure.
  4. Delay Language. Tariffs create time loss, shipment holds, repricing pauses, and sourcing changes. Standard “no damage for delay” clauses convert those impacts into time only. Seek a carve-out making tariff-driven delays compensable, or pair force majeure with an express cost mechanism for extended general conditions, demobilization/remobilization, or re-procurement.
  5. Swift and practical dispute resolution. Build a realistic, cost-effective path that delivers decisions while the project continues. Use a tiered ladder that starts with prompt project-level negotiation on a short fuse, then executive escalation, then a standing neutral or dispute review board empowered to issue interim binding decisions within a defined period, such as 14 to 30 days. Provide for emergency or expedited arbitration for stop-the-job issues with tight timelines, limited discovery, remote hearings, and time-limited awards, and include a continuation of work clause so the field does not grind to a halt. Allow court carve-outs only for liens and truly urgent injunctions. For smaller disputes, consider document-only decisions with page limits and reasonable fee shifting against clearly unreasonable positions.

If your contract is silent, relief is still possible. Many parties now pre-agree that if tariffs change before purchase, a change order will equitably adjust the price based on documented vendor quotes. When owners resist open-ended exposure, propose guardrails: caps, share the first percent thresholds, or allowances for specific materials. Clear, bounded mechanisms beat inflated bids and mid-project standoffs.

Align operations with the paper: shorten bid validity, lock supplier quotes through acceptance with contemporaneous backup, and match quote windows to your bid validity. Explore approved substitutes or domestic sourcing that meet the spec to avoid tariffed items, engage the design team and owner early to pre-approve alternates. Memorialize any substitutions by change order to prevent scope ambiguity.

Pick delivery methods that share risk. Cost plus with a Guaranteed Maximum Price, paired with contingency and allowances for volatile items, rides price swings better than a bare lump sum. Unit pricing for materials can also help. If you must sign a fixed price, bake in escalation or tariff riders, targeted allowances, and realistic lead time assumptions so the schedule is not a hostage to procurement.

Owners and lenders rarely sign what they do not understand. Bring project math, not just principles. Show how a 25 percent duty on steel would move the GMP or consume contingency. Offer calibrated options: an index-based escalation clause, a tariff rider with a cap, or a split threshold cost share. When stakeholders see a bounded, data-tied solution, they are more likely to adopt it and less likely to demand worst-case pricing.

Finally, treat tariff announcements like any other claim event. Issue a written notice to every required party within the contract window. Track the but-for delta: retain pre and post tariff quotes, index printouts, supplier letters on lead times, and schedule fragnets tying material unavailability or repricing to specific activities. Follow claim procedures exactly.

Tariff policy will move, and uncertainty is the constant. Leaders who pair vigilant notice with smart clauses and disciplined bidding keep projects on track without turning every headline into a crisis. Expect the unexpected, and write contracts as dynamic as the markets you build in. Make it standard practice to review and update your templates and project-specific terms on a regular cadence, with a strong focus on reducing risks unique to your business, your supply chain, and your delivery model. Remember that change orders are contracts, and they should clearly document the compromise, scope, time, price, and conditions that the parties have agreed to.

About the Author

Shelly Masters is a Principal in the Austin office of Cokinos Young, a firm with over 30 years of experience representing the construction industry. A Texas-based trial lawyer, she litigates high-stakes construction, commercial, and product liability disputes, including complex delay, defect, and breach claims. She advises clients nationwide and trains teams on liens, bonds, and contracts. For inquiries regarding tariffs or related challenges, Shelly can be reached at (512) 615-1139 or smasters@cokinoslaw.com.

Shelly D. Masters

About Cokinos | Young

Cokinos | Young has led Texas construction and real estate law for over three decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, and that remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young. Learn more at cokinoslaw.com.

Course of Construction Coverage Gaps Under CGL Wrap-Up Insurance Policies

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Pat Wielinski has published an article in the October edition of Construction News magazine. In this article, Pat covers how modifications to commercial general liability (CGL) insurance policies, including Controlled Insurance Programs (CIPs), especially the deletion of limited property damage exclusions and replacement with broad course-of-construction exclusions, can create significant coverage gaps. He also examines recent case law and offers strategies to help mitigate these risks through careful policy and contract review.

Controlled Insurance Programs (“CIPs,” “wrap-ups” or simply “wraps”) are promoted as particularly well-suited for large construction projects where all eligible participants are insured under a single program. Theoretically, a wrap eliminates multiple carriers and duplicated coverages. For successful wrap treatment, the project must be of sufficient dollar value to be eligible, the sponsor must be capable of administering the wrap, and coverages must be adequate to apply to claims for the wrap to be effective. However, depending on the entity sponsoring the owner-controlled insurance program (“OCIP”) or a contractor in a contractor-controlled insurance program (“CCIP”), it is the insurer that effectively maintains ultimate control of the claims. But the potential for gaps in coverage has emerged as a disadvantage where property damage occurs during construction operations.

While most wrap-up CGL policies utilize similar exclusions to those found in standard CGL forms, they are endorsed to add provisions to adapt the policy to the wrap-up platform, such as by extending the completed operations coverage to the length of the statute of repose, including all tiers on the project as named insureds, limiting the insured location to a specific project or projects, and revising certain exclusions in the policy. Often, standard property damage exclusions may also be deleted altogether, but are usually then replaced with another or others.

One of the most troublesome CIP modifications to the customary CGL property damage exclusions is an endorsement that deletes Exclusions j(5) and j(6), the operations and incorrect work exclusions. Those standard exclusions apply to operations in progress, stating that the insurance does not apply to property damage to “that particular part” of real property on which the named insured or its subcontractors are performing operations, if the property damage arises out of those operations, or if the property must be restored, repaired, or replaced because the named insured’s work was incorrectly performed on it. The “that particular part” formulation is intended to preserve coverage for other property damaged by the excluded particular part.

One might be tempted to believe that the deletion of the standard j(5) and(6) exclusions is a win for the insured participants and that coverage would be increased by the deletion of exclusions. Not so fast! While these two provisions are framed as exclusions, many courts have relied on the “that particular part” formulation to narrowly interpret the exclusion scope and uphold coverage.

Unfortunately, the deletion of these property damage exclusions from the CGL form is usually accompanied by attachment of a considerably more onerous and absolute endorsement to the CIP CGL policy, stating that the insurance does not apply to property damage at or to the insured project during the course of construction or operations (i.e., before the substantial completion of the project). Gone is the “that particular part” limitation, and the modification is often made through a stand-alone endorsement that may be labeled in various ways, such as “Property Damage to Work in Progress,” “Course of Construction Endorsement,” “Property Damage to Contract Works,” or “Exclusion  Damage to the Project During the Course of Construction.”

Insurance underwriters often refer to this type of provision as the “builder’s risk exclusion,” apparently on the assumption that builder’s risk insurance, rather than liability insurance, should provide coverage for property damage to the work that occurs during the course of construction. This overly simplistic approach ignores the fact that builder’s risk policies contain many gaps in coverage versus a standard CGL policy, particularly as to defective construction. The exclusion can thus create a significant gap for participants in a wrap-up project for property damage occurring during the course of operations, depending on their ability to coordinate and rely upon coverage within their own insurance policies. First and foremost, a builder’s risk policy is a first-party property policy that does not include a defense obligation for the insurer. Therefore, when the insured looks to the wrap-up CGL policy for defense of a claim involving property damage during construction, it may be excluded, and no defense is available under the CIP. In addition, builder’s risk coverage may not provide coverage for certain types of risks, such as consequential damages, certain soft costs, and faulty workmanship/design (absent an ensuing loss clause that preserves coverage for damage to other non-defective work caused by the defective work). Coverage for such damages may otherwise be covered under a CGL policy, but for a course of construction exclusion attached to a wrap-up.

The course of construction exclusion and its deletion of the broader j.(5) and j.(6) exclusions was touched on by the court in the recent case of Liberty Surplus Insurance Corp. v. Kaufman Lynn Construction, Inc., 130 F.4th 903 (11th Cir. 2025).  Though decided under Florida law, the opinion is one of the first to do so and is of potential country-wide impact. The AGC and NAHB filed an amici curiae brief in that case in support of the insured contractor, calling the court’s attention to the incongruity of denying course of operations coverage under a wrap-up program. Their efforts caught the court’s attention in what it hinted to be an unfair “sleight of hand” by attaching a more onerous course of conduct endorsement to a wrap-up policy intended to provide coverage for everyone on the project. Unfortunately, the court decided not to address that issue because the builder’s risk policy was not included in the court record. The result in the Liberty Surplus v. Kaufman case seems somewhat less than ringing, but the court’s observations moved the needle slightly away from the inclusion of course of construction exclusions in wrap-up policies.

Negotiation to remove or limit course of conduct exclusions in CIP CGL policies​ is not usually a viable option, as underwriters are hesitant to do so. Of course, all terms of an insurance policy, particularly manuscripted provisions, should be carefully reviewed at issuance because departures from standard policy language can create more opportunity for possible denial by insurers in the claims stage. Nevertheless, the following might mitigate the negative effects of an absolute course of conduct exclusion (or prevent other gaps):

  • During underwriting, submit a specification of the insured project that closely tracks the contract, particularly for completion.
  • Link or incorporate the definition of “complete” or “completion” in the course of construction exclusion with the standard definition of the “products-completed operations hazard” in the CGL policy that deems completion to occur when the owner occupies a portion of the project.
  • Negotiate a provision in the contract specifying that standard unendorsed CGL coverage must be included in the wrap-up and that failure to provide those coverages allows the contractor to purchase it at the owner’s expense or reimbursement by the owner for a denied claim, similar to AIA Document A201, Section 11.2.2, as to builder’s risk coverage.
  • Amend the participant’s practice CGL policies to include difference in conditions (DIC) coverage to fill in the gaps in a wrap-up program.

About the Author

Pat Wielinski is a principal in the Dallas/Fort Worth office of Cokinos | Young, having founded the firm’s insurance coverage and risk management group. With over 40 years of experience, he advises clients on insurance coverage, contractual risk transfer, and complex construction-related claims, while serving as a leading voice in the industry through his publications, national presentations, and amicus work on behalf of major construction trade organizations such as the Associated General Contractors of America. For inquiries regarding Controlled Insurance Programs or related coverage challenges, Pat can be reached at (817) 635-3620 or pwielinski@cokinoslaw.com.

Patrick J. Wielinski

About Cokinos | Young

Cokinos | Young has led Texas construction and real estate law for over three decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, and that remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young. Learn more at cokinoslaw.com.

Gregory Cokinos Earns Top 100 Honors as Cokinos | Young Attorneys Shine in 2025 Texas Super Lawyers® and Rising Stars Lists

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It is a privilege to announce that 27 Cokinos | Young attorneys have been honored in the 2025 edition of Texas Super Lawyers®, which includes 17 attorneys named to the Texas Super Lawyers® list and 10 to the Texas Super Lawyers® Rising Stars List.

This year marks an incredible milestone as Founding Principal Gregory Cokinos again earned a place on the Top 100 Texas Super Lawyers® and Top 100 Houston Super Lawyers® lists, his 15th and 18th consecutive appearances, respectively. This continued distinction highlights his exceptional leadership and decades of legal excellence in construction and business litigation.

“This achievement reflects the extraordinary talent and dedication of our attorneys across the state,” said Founding Principal Marc Young. “We are proud of Gregory’s repeated honors among the Top 100 attorneys in Texas and Houston. His leadership continues to set the tone for our firm’s culture and success.”

“I am humbled to be included on these Top 100 lists, but more importantly, I am proud of the number of Cokinos | Young attorneys being recognized this year,” added President and CEO Gregory Cokinos. “These rankings reflect the hard work, talent, and commitment of our team, who make a difference for our clients and the industry.”

Cokinos | Young congratulates this year’s attorneys on this well-deserved achievement and remains committed to delivering top-tier legal counsel across Texas and beyond. The full list of honorees will be published in the Texas Super Lawyers® magazine and featured in the October 2025 issue of Texas Monthly.

We are honored to celebrate the accomplished attorneys recognized on the 2025 Texas Super Lawyers® list:

Austin:
Lauren S. Aldredge – Civil Litigation: Defense
Dana Livingston – Appellate
Marc A. Young – Construction Litigation

Dallas:
Travis M. Brown – Insurance Coverage
Patrick J. Wielinski – Insurance Coverage

Houston:
Craig H. Clendenin – Construction Litigation
Gregory M. Cokinos – Construction Litigation; Top 100 List for Texas (15th Year) and Houston (18th Year)
J. Parker Fauntleroy – Personal Injury General: Defense
John L. Grayson – Construction Litigation
Craig E. Power – Bankruptcy: Business
Russell W. Smith – Construction Litigation
C. Matthew Thompson – Construction Litigation
Christopher C. Wan – Construction Litigation
John C. Warren – Construction Litigation

San Antonio:
Chance K. Decker – Business Litigation
Gabriel S. Head – Construction Litigation
Stephanie L. O’Rourke – Construction Litigation

We are also honored to celebrate the next generation of legal leaders named to the 2025 Texas Super Lawyers®: Rising Stars list:

Dallas:
Abigail E. Chacón – Alternative Dispute Resolution (ADR)
R. Anderson Sessions – Business Litigation
Milo S. Bobbitt – Appellate Law

Houston:
Jude K.A. des Bordes – Personal Injury General: Plaintiff
Allegra S. Lezak – Alternative Dispute Resolution (ADR)
Kathleen E. Madere – Construction Litigation
Mitchell R. Powell – Personal Injury General: Defense
Joseph D. Walker – Construction Litigation

San Antonio:
Christian C. Trevino – Construction Litigation
Kyle A. Zunker – Construction Litigation

About Cokinos | Young

Cokinos | Young has led Texas construction and real estate law for over three decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, and that remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young. Learn more at cokinoslaw.com.

Legislative Update: An Examination of Key Bills from the 89th Legislative Session

Posted by & filed under Articles.

The 89th legislative session of the Texas Legislature ran from January 14, 2025, to June 2, 2025. During that time, approximately 6,500 bills were filed, with over 300 ultimately passed into law. While these bills dealt with a variety of topics, construction-related issues, including the always vital “lien” and “trust fund” laws, were no exception. Key bills pertaining to the construction industry are detailed below, along with the current legislative status of the bill.

Senate Bill, “SB” 929, implemented a practical change to the Texas mechanic’s lien statute.

As many readers of this article will know, Chapter 53 of the Texas Property Code imposes strict deadlines for sending lien notices and recording lien affidavits. Prior to this session, if a statutory lien notice or filing deadline (under Chapter 53) fell on a weekend or holiday, ambiguity existed regarding whether that deadline was extended to the next business day. Thus, a diligent lien claimant needed to act before the weekend to avoid potentially losing its perfected lien rights. SB 929 addresses this issue. Any such deadline automatically extends to the first business day following the weekend or holiday. This clarification benefits general contractors, subcontractors, and suppliers alike, because it gives the mechanic’s lien statute uniformity with traditional calculations of deadlines under Texas law. The bill passed and was signed into law by Governor Abbott on May 21, 2025 (effective immediately).

SB 841 amended the Texas Construction Trust Fund Act to allow a “qualified assignee” to also be a beneficiary of the construction trust.

Before this legislative session, under the Texas Construction Trust Fund Act, a beneficiary was defined as an artisan, laborer, contractor, subcontractor, or materialman who labors or furnishes labor or material for the construction or repair of an improvement on specific real property.  In some cases, general contractors were not allowed to pursue subcontractors who had accepted payment but failed to pay their own subcontractors or suppliers, as only unpaid parties had a legal remedy. SB 841 sought to make this remedy available to any assignee of the party who did not receive payment by classifying an assignee as a beneficiary of the trust funds paid or received. Under the bill, an assignment of interest in unpaid trust funds is only enforceable if made in writing, not earlier than the date the assignee has paid the beneficiary in good and sufficient funds for the assignment, and is not made part of the beneficiary’s construction contract. Further, the assignee must be a beneficiary, trustee, or property owner on the contract, and written notice of the assignment must be provided to the property owner and contractor no later than the seventh day after the assignment is made. The bill seeks to restore the ability of contractors and suppliers to recover unpaid funds by providing for a qualified assignee of a trust fund claim. The bill passed and became effective September 1, 2025.

House Bill, “HB” 2960, voids venue selection clauses calling for out of state venue in disputes arising from construction projects in Texas. 

Introduced in response to In re MVP Terminalling, LLC, a 2024 case out of the 14th Court of Appeals which held that because out of state venue provisions were “voidable” under existing law, prohibitions on such clauses could be waived by the parties, HB 2960 amended the Texas Business and Commerce Code to make such provisions void (as opposed to voidable). This adds the necessary clarity to the Texas law prohibiting out-of-state venue selection clauses for Texas contractors. Accordingly, once an out-of-state venue selection clause is determined void under the statute, an action must be brought in the county in Texas where the property subject to the litigation is located, absent an agreement between the parties after the dispute arises. HB 2960 went into effect on September 1, 2025.

SB 783 was introduced in an effort to update regulations for the construction and alteration of residential and commercial buildings.

Specifically, the bill amends Chapter 3000 of the Texas Government Code, which limits governmental actions affecting residential and commercial construction by adding additional exceptions to prohibitions on local ordinances imposing building standards. The additional exemptions include an energy code adopted by the State Energy Conservation Office (SECO) or the Health and Safety Code, an energy and water conservation design standard established by the SECO, and a high-performance building standard approved by the Board of Regents under the Education Code. The bill further clarifies that a new version of the IRC may not be amended or adopted more than once every six years, and requires SECO to first conduct an analysis calculating the impact on housing attainability and the incremental construction cost, including the payback period for any requirements that are more stringent than are in effect immediately before the change takes effect. The bill was introduced with the intention of allowing the SECO to adopt the 2021 IECC and the energy chapter of the 2021 IRC. The bill passed and became effective as of September 1, 2025.

SB 840 amended Chapter 211 of the Local Government Code to loosen zoning restrictions for the development of multi-family and mixed-use housing in commercial / office zones in certain cities.

The bill also restricts fees on new multi-family developments, allows the conversion of commercial spaces into residential use, and preempts certain municipal zoning regulations related to density, parking, height, and setbacks. This legislation benefits developers desiring to convert existing commercial buildings and those constructing new multifamily projects without zoning district limitations. This bill impacts approximately 20 cities across Texas, applying only to those with populations over 150,000 in counties with populations of 300,000. The bill was passed and went into effect on September 1, 2025.

SB 785 seeks to address a growing demand for affordable housing by removing regulatory barriers to the installation of HUD-code manufactured homes.

The bill limits a municipality’s ability to impose additional regulations on manufactured homes that are HUD-compliant. While passed, SB 785 does not take effect until September 1, 2026.

Like several bills this session, HB 1922 was introduced to clarify ambiguity in existing law relating to the accrual of claims under Texas’ “Right to Repair Statute” for government contractors.

The bill specifies that a cause of action accrues on the date the pre-claim report identifying the alleged defects is postmarked by the U.S. Postal Service. The date of the accrual of a cause of action for all other purposes is unaffected by the bill, including the date of an occurrence under applicable insurance policies, and whether the action is barred by limitations or repose. The bill is designed to protect contractors from disputes over technical filing dates. The bill passed and became effective September 1, 2025.

SB 687 extends existing protections for architects and engineers to registered professional land surveyors, as defined by the Occupations Code.

Construction contracts with land surveyors, like contracts with architects and engineers, can no longer contain certain duty-to-defend provisions. Further, the contractual duty of care is defined as services performed with the professional skill and care ordinarily provided by competent land surveyors practicing under the same or similar circumstances and professional licenses. Thus, this bill extends existing protections to an additional class of professionals. SB 687 became effective September 1, 2025.

HB 3005 clarifies that a bona fide dispute for a public work construction contract does not include an audit that continues for more than 60 days after the date of substantial completion.

This bill seeks to prevent delays in agreed-upon payments and the release of retainage already earned by contractors in projects subject to audits (to bring public projects in line with the goals of the Texas Prompt Payment Act). This benefits contractors and will likely facilitate the prompt payment of monies owed. This bill passed and applies to contracts entered into after September 1, 2025.

HB 3228 strengthens protections for landowners by requiring wind and solar facility agreements to require the provider to recycle and dispose of all components should the project be decommissioned.

This bill passed and became effective September 1, 2025.

HB 14 creates the Texas Advanced Nuclear Energy Office to oversee nuclear energy initiatives, funding programs, and provide regulatory assistance.

This bill was introduced in response to ERCOT’s projection that energy demand could reach 150 gigawatts by 2030. In addition to requiring additional studies, it establishes a reimbursement grant of up to $12.5 million, or half of the total project amount, for qualifying projects. The bill’s emphasis on promoting nuclear energy in Texas could pave the way for new construction projects and create opportunities for securing government funding. HB 14 passed and went into effect on September 1, 2025.

SB 1555 establishes a program to make more funds available for construction in Texas.

This program is designed to administer and fund the construction of railroad and rail-pedestrian grade separation projects at the intersection and crossings of railroads that are not part of the state highway system. All grants awarded under this program must be approved by the Texas Transportation Commission and require at least 10 percent of the total project cost to be provided by a source other than the state. This bill passed and took immediate effect on May 24, 2025.

As you can see, 2025 was an active session for construction-related bills, and 2026 promises to be no different! Keep a close eye on legislative activity and updates from the Cokinos | Young team to ensure you are informed of the latest developments.

About the Authors

James Richards is one of a small group of attorneys in the State of Texas to be Board Certified in Construction Law by the Texas Board of Legal Specialization. James serves as a trusted advocate and advisor for his clients and maintains a practice focused on construction, business, real estate, and related legal matters. If you have questions about the new legislative changes, or a related legal inquiry, James can be contacted via email at JRichards@CokinosLaw.com.

Allison Miller a trial attorney with extensive experience in construction, business, personal injury, and related disputes across Texas. Allison takes a practical, results-oriented approach to litigation, exploring creative settlements, mediation, arbitration, and trial strategies to achieve the best outcomes for her clients. If you have any questions about the new legislative updates, or a related legal inquiry, Allison can be contacted via email at AMiller@CokinosLaw.com.

James S. Richards
Allison R. Miller

About Cokinos | Young

Cokinos | Young has led Texas construction and real estate law for over three decades. And today, our 100+ dedicated professionals operate coast to coast and proudly handle all aspects of construction law for owner/developers, project managers, general contractors, design professionals, subcontractors, sureties, and lenders. We provide both dispute resolution and transactional services to clients through all phases of commercial, industrial, pipeline, offshore, civil, and residential construction. Our reputation was built on relentless commitment to client service and the industries we serve, and that remains our primary driver. Dedicated. Resilient. Expertise. That’s Cokinos | Young. Learn more at cokinoslaw.com.

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