ENFORCEMENT OF CLAUSE PROHIBITED IF EXISTENCE OF SHAM RELATIONSHIP.

Tex. BUS. & COM Code § 56.053.
in effect
Sign in to generate a plain English summaryAsk Belisarius Agent
A contingent payor or its surety may not enforce a contingent payment clause if the contingent payor is in a sham relationship with the obligor, as described by the sham relationships in Section 53.026 , Property Code. Added by Acts 2009, 81st Leg., R.S., Ch. 87 (S.B. 1969 ), Sec. 4.001(a), eff. September 1, 2009.
Source: TX Statutes (Official Site)URL: https://statutes.capitol.texas.gov/Fetched: 6/28/2026

Starting a business in Texas? Texas LLC guide: costs and requirements