A dispute over an $11 million park project in Williamson County has reached the Texas Court of Appeals for the Third District, with the focus now on whether Great American Insurance Co. of New York can be held liable under its performance and payment bonds, according to a report from USA Herald.
The case centered on how insurance coverage through surety bonds applies in public construction contracts and when claims under those bonds must be filed.
Williamson County sued Great American in 2022, alleging the insurer failed to meet its obligations as surety after the county terminated its contract with Ritter Botkin Prime Construction Co. Inc. over alleged delays and substandard work. The county contended Great American did not fulfill its responsibilities under the bonds issued for the project.
At issue is whether the performance bond should be treated as a separate insurance contract, distinct from the construction agreement. During oral arguments, justices examined whether the statute of limitations for filing a bond claim began with the contractor’s termination or whether different timelines apply under insurance law, the report said.
Representing Great American, attorney Mike Pipkin of Weinstein Radcliff Pipkin LLP argued that the bond agreement is a separate contract and that the county’s claim fell outside the one-year limitation period triggered by its June 2021 termination notice. He maintained that as a surety, Great American holds only conditional liability, and that the county had sufficient time to file its claim.
Justice Karin Crump questioned whether such an interpretation could allow insurers to delay their responses, effectively running out the clock on bond claims. Pipkin responded that the legal framework still gave the county a full year to take action.
Jeffrey Chapman of The Chapman Firm PLLC, representing the county, argued that the bond is part of the overall construction contract and that the statute of limitations should not apply unless the entire agreement was terminated. He said the insurer’s obligations remained active beyond the point asserted by Great American.
The appellate court's decision could have broader implications for how performance bonds are interpreted in Texas and how insurers’ obligations under such instruments are enforced in public-sector projects.
Great American Insurance Co. is represented by Mike F. Pipkin, Taylor Feldt, and Analicia Garcia of Weinstein Radcliff Pipkin LLP. Williamson County is represented by Jeffrey S. Chapman and Kerrie M. Taylor of The Chapman Firm PLLC.
