Preview
Filed: 8/6/2020 8:54 AM
JOHN D. KINARD - District Clerk
Galveston County, Texas
Envelope No. 45145108
By: Shailja Dixit
8/6/2020 9:02 AM
CAUSE NO. 19-CV-0340
ROBERT WELCH and § IN THE DISTRICT COURT OF
JENNIFER WELCH §
§
Plaintiffs, §
§
VS. § GALVESTON COUNTY, TEXAS
§
GREENECO BUILDERS, L.L.C. §
§
Defendant. § 122ND JUDICIAL DISTRICT
DEFENDANT’S FIRST AMENDED COUNTERCLAIM
Defendant, GREENECO Builders, L.L.C. (“Greeneco”), files this first amended
counterclaim and respectfully states:
1. Plaintiffs Robert and Jennifer Welch (as Buyers) and Defendant Greeneco (as
Seller) are parties to that certain New Home Sales Contract (the “Contract”) dated December 8,
2013, a true copy of which is attached hereto as Exhibit A.
2. Pursuant to the Contract, Greeneco sold to Mr. and Mrs. Welch a new residence
located at 303 Sea Breeze Drive, Bacliff, Texas 77518 (the “Residence”). Mr. and Mrs. Welch
have filed this lawsuit against Greeneco to recover damages including costs of repair with respect
to alleged construction defects in the Residence.
3. Mr. and Mrs. Welch assert that the cost of repairing alleged construction defects is
in excess of $246,000 – well over the full purchase price of the Residence, $150,906.00.
4. Pursuant to Texas Property Code §27.0042(a), a builder such as Greeneco may elect
to repurchase a residence as an alternative to damages claimed by the homeowners, in this case
Mr. and Mrs. Sanchez, if the parties so agree in the sales contract. The election is available if the
cost of repairs exceeds an agreed percentage of the current value of the residence, determined
without reference to the alleged defects. In Paragraph 39 of the Contract (“Re-Purchase Option”),
the parties agreed to this option and set that percentage at 20%. As the alleged costs exceed the
full purchase price of the Residence, this threshold is clearly met.
5. Greeneco has elected to repurchase the Residence. The election was made by letter
dated June 15, 2020, a copy of which is attached hereto as Exhibit B.
6. Mr. and Mrs. Welch have thus far failed and refused to honor the Re-Purchase
Option despite their statutory and contractual obligations. They are accordingly in breach of the
Contract.
7. Greeneco is entitled to and requests an order for specific performance of the Re-
Purchase Option, requiring Mr. and Mrs. Welch to comply with the option in all respects, including
execution of a deed in accordance therewith.
8. Greeneco made timely written demand on Mr. and Mrs. Welch to comply with the
Re-Purchase Option. Pursuant to Tex.Civ.Prac.&Rem.Code §38.001 et seq. and Paragraph 18 of
the Contract, Greeneco is entitled to recover judgment against Mr. and Mrs. Welch for the costs
of this proceeding including its reasonable attorney’s fees.
9. All conditions precedent to the relief requested herein have been performed or have
occurred.
WHEREFORE, PREMISES CONSIDERED, Counter-Plaintiff GREENECO Builders,
L.L.C. respectfully prays that upon final hearing or trial, Greeneco have judgment of and against
Counter-Defendants Mr. and Mrs. Welch for (i) specific performance of the Re-Purchase Option,
(ii) the costs including reasonable attorney’s fees incurred in this proceeding to enforce the option,
and (iii) such other and further relief to which Greeneco may be entitled.
2
Respectfully submitted,
CRAIN, CATON & JAMES
A Professional Corporation
By: /s/ H. Miles Cohn
H. Miles Cohn
State Bar No. 04509600
mcohn@craincaton.com
Melina M. Riseden
State Bar No. 24041443
mriseden@craincaton.com
Joe R. Savoie
State Bar No. 24083797
jsavoie@craincaton.com
1401 McKinney Street 17th Floor
Houston, Texas 77010
713.658.2323
713.658.1921 (Facsimile)
ATTORNEYS FOR DEFENDANT/
COUNTER-PLAINTIFF
GREENECO BUILDERS, L.L.C.
CERTIFICATE OF SERVICE
This is to certify that a true and correct copy of the foregoing First Amended Counterclaim
was forwarded by e-service this the 6th day of August 2020, to Plaintiffs’ counsel:
Dax O. Faubus
The Faubus Firm
1001 Texas Ave, 11th Floor
Houston, Texas 77002
dax-notice@faubusfirm.com
/s/ H. Miles Cohn
H. Miles Cohn
3
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BUILDERS, L.L.C. NEW HOME SALES CONTRACT
In this Contract ("the Agreement") for a House built by Greeneco Builders, L.L.C.,, the words "BUYER". "YOU" and "OUR"
mean or refer to all the buyers, listed below who have signed this Agreement, jointly and severally. The words "SELLER", "US",
"WE" and "OUR" mean and refer to Greeneco Builders, L.L.C., whose address is 21408 Provincial Drive, Katy, Texas 77450
(Fax 281-646-944 I) and its successors and assigns. THIS DOCUMENT CREA TES IMPORTANT LEGAL OBLIGATIONS
THAT YOU SHOULD UNDERSTAND PRIOR TO SIGNING. YOU SHOULD READ IT THOROUGHLY AND IF
YOU ARE UNCERTAIN OR HAVE QUESTIONS ABOUT YOUR RIGHTS, OBLIGATIONS OR
RESPONSIBILITIES UNDER THIS CONTRACT, YOU MAY WISH TO CONSULT AN ATTORNEY.
Date: December 8, 2013
Homesite: Lot~ Block_ 5 _Section I Subdivision EDGEWATER PARK
Street Address: 303 SEA BREEZE DRIVE __County ("County"): GALVESTON in the state ofTexas("State").
Buyer(s): DOUG AND SHALAINE WELCH
Current Address: 1302 MARINA BAY DRIVE 205A
City: CLEAR LAKE SHORES State: TEXAS
Zip Code: 77656 E-mail Address: DIVERDOUG784@GMAIL.COM
Home Phone: ( _ _ _ ) _ _ _ _ _ _ _ _ _ _ _ _ CELL Phone: 409-539-8247
Cell Phone:WIFE 832 ) 726-5774 Fax N u m b e r : ~ - ~ - - - - - - - - - - - - - -
Greeneco Builders, L.L.C. Sales Representative: SHAWNNA DEMERS 281-455-0020 SD@GREENECOBUILDS.COM
Outside Broker: (if not filled in, there is none): ---~N~/~A~_Outside Broker Commission: _ __
Is the Property subject to a mandatory Homcowner's Association (see Article 6)? _ ____,Y_,,E~S'------
1. THIS IS WHAT YOU ARE BUYING FROM US.
You agree to buy and We agree to sell You (on the terms and conditions stated in this Agreement) a dwelling (uHOME")
which is already substantially completed (a "Completed Home") or which is to be built and will be substantially similar to
floor plan2190C'Floor Plan") as depicted on Our marketing brochure with Elevation_£ and Swing R together with options,
upgrades and modifications requested by You and accepted by Us in writing. You represent to Us that You will use the
Home as your primary residence unless You check the following box (see Article 20): Not primary residence. 0
2. PURCHASE PRICE.
The purchase price that You will pay for the Property is the sum of all of the following ("Total Purchase Price"):
a) Base House Price: S 146000
b) Options Price: $ 6906
c) Elevation Premium: $ 0
d) Lot Premium: i. 0
e) INCENTIVE ~
Total Purchase Price $150906
f) You must also pay such additional sums as required for options, upgrades and changes which You request and We
approve in writing ("Extras").
g) You will pay the "Closing Costs" described in Article 12. when this transaction is consummated at a closing
("Closing") that will be scheduled pursuant to Article 8.
h) All other sums required by this Agreement to be paid by You.
3. EARNEST MONEY DEPOSIT.
You are obligated to make the following earnest money payment to Us at the time of execution of this contract: $1000 CK
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EXHIBIT A
4. THIS IS HOW YOU MUST PAY THE TOTAL PURCHASE PRICE.
The balance due at Closing (which is the Total Purchase Price less the Deposit Funds) must be paid in U.S. funds by
Cashier's check or wire transfer only. Choose one of the following two options (ifno choice is indicated, it will be assumed
that You have chosen option "a"):
0 a) THE HOME WILL NOT BE YOUR RESIDENCE OR YOU ALREADY QUALIFY FOR A MORTGAGE
FROM AN APPROVED LENDER OR YOU ARE A CASH BUYER AND DO NOT NEED A MORTGAGE.
Your obligation to purchase the Property is not contingent, in any way upon obtaining financing, nor upon any
conditions of any financing that You may seek. The Closing may not be delayed if You decide to borrow money
for Your purchase of the Home but your lender does not have sufficient time to process the loan or if You fail to
qualify for a loan. We may in Our sole and absolute discretion require You to complete within twenty (20) days a
Mortgage Loan Application with the mortgage company of your choice. You must authorize said mortgage
company to release to US all information obtained in connection with Your credit application including Your
credit report and credit score. You also authorize Us to obtain Your credit report and credit score directly from
the credit reporting agencies. The Earnest Money deposit funds are non-refundable with this option.
[]xx b) TllE HOME WILL BE YOUR RESIDENCE AND YOU NEED A MORTGAGE. Your obligation to purchase
the Property is contingent ("Loan Contingency") upon obtaining a written confirmation ("Loan Qualification'')
from a lending institution ("Lender") in writing stating that You are pre-qualified or qualified to obtain financing
("Mortgage Loan") for Your purchase of the Property. You agree to apply for a Mortgage Loan within five (5)
days after You sign this Agreement, if You have not secured a Mortgage Loan prior to this Agreement. You
hereby authorize Your Mortgage company to release to Us all infonnation obtained in connection with Your credit
report and credit score. You also authorize Us to obtain Your credit report and credit score directly from the credit
reporting agencies. You must use Your best and diligent efforts to secure a Loan Qualification from a reputable
Lender and deliver a copy of it to Us no later than 5:00 P.M. on the twentieth (20th) day after You sign this
Agreement ("Loan Contingency Deadline"). This Loan Contingency will expire and Your right to terminate this
Agreement will end immediately on the sooner of: (i) When You have received a Loan Qualification (even ifit is
preliminary or conditional) or, (ii) When the Loan Contingency Deadline has passed and We have not received
Your written notice that You are tenninating this Agreement because You did not receive a Loan Qualification.
At that time, the Deposit Funds shall become non-refundable and You will not be able to terminate this
Agreement, even if, (i) You are unable to obtain a Mortgage Loan due to an adverse change in Your personal or
financial condition; (ii) You are unable to satisfy the Lender's conditions for making the Mortgage Loan; (iii)
There is a change in the amount, interest rate or terms of the Mortgage Loan, or (iv) You decide that the
conditions imposed for the Mortgage Loan are not acceptable.
Your Lender must demonstrate their ability to process loans efficiently, comply with this Loan Contingency and facilitate
the Closing on time. It is Your responsibility to insist that Your Lender comply with the terms of this Agreement and Loan
Contingency. Once You have made Your application to a Lender, You may not change Lenders or loan programs without
Our written consent. If You change Lenders Your new Lender will need sufficient time to process Your application. If You
stay with Your original Lender but change loan programs, Your Lender may need to resubmit Your application for approval
under the new loan program, which also requires additional time. We will grant Our consent to change Lenders or loan
programs only it: in Our sole and absolute discretion, changing Lenders or loan programs wilt not delay the Closing or
increase Our expense. If We refuse Your requested change, you will not change Lenders or loan programs and will proceed
with the Closing using Your original Lender and loan program. Since a change in Lenders or loan programs may delay the
Closing or increase Our expense, Your agree to use the Lender, loan program, interest rate, terms and conditions stated in
the Loan Qualification. If We allow You to change Your Lender or loan program, We have the right to increase the Total
Purchase Price to include any price increases that have been instituted for similar new homes since the date We signed this
agreement.
5. SELECTING OPTIONAL FEATURES FOR YOUR HOME.
Unless You are buying a Completed Home or a Home that is pre-planned, You may select from Our list of design selections,
colors and materials for the options that are available for the Home. You must COMPLETE AND SUBMIT Your selections
to Us in writing at a scheduled appointment with our representatives not any later than DEC 1,2013 (but in no event
later than fourteen (14) days after You sign this Agreement if this blank is not filled in). An Approved option may be
unavailable due to shortages of labor or material and We may cancel these options or substitute colors, models and
manufacturers; if any approved option is not deliverable by Us, You will not be charged for it's cost and shall not constitute
grounds for deferring the Closing, terminating this Agreement or for imposing any conditions on Closing. If You do not
make Your selections on time, then We may choose to do any of the following in Our sole and absolute discretion: (i) We
will build the Home using design selections, colors and materials chosen by Us; or (ii) We may give notice to You that You
are in default under this Agreement and We may then terminate this Agreement by written notice to You and retain all
Deposit Funds, at which time this Agreement will terminate and You will have no further rights under this Agreement or to
any part of('\roperty.
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6. HOMEOWNERS' ASSOCIATIONS.
If the Property is required to be subject to a Homeowners' Association, then one or more not-for-profit corporations or
entities or both ("Associations"), will enforce and administer conditions, covenants and restrictions encumbering all or part
of the subdivision in which the Homesite is located ("Subdivision"). These Associations are identified in recorded
declarations that govern the use of the Property. Once You take title to the Property, You will automatically become a
member of one or more Associations. As a member of the Associations, You will enjoy all the rights and privileges of
membership and You will be responsible for all costs, obligations and liabilities of membership. NOTICE: The Property
may be subject to mandatory membership in an owners' association. Jfthe Property is subject to mandatory membership in
an owners' association, We notify You under Section 5.012, Texas Property Code, that as a purchaser of property in the
residential community in which the Property is located, You arc obligated to be a member of the owners' association.
Restrictive covenants governing the use and occupancy of the Property and a dedicatory instrument governing the
establishment, maintenance and operation of this residential community have been or will be recorded in the Real Property
Records of the county in which the Property is located. Copies of the re~irictive covenants and dedicatory instrument may
be obtained from the county clerk. You arc obligated to pay assessment to the owners' association. The amount of the
assessment is subject to change. Your failure to pay the assessments could result in a lien on and foreclosure of the
Property.
7. RECEIPT FOR OTHER LEGALLY BINDING DOCUMENTS.
We have previously delivered to You a copy of all the documents listed below, either in print, by e-mail or on a CD-ROM.
You acknowledge that before signing this Agreement You received a copy of ALL the following legally binding documents
in a fonnat acceptable to You:
a) All of the following Documents (if there is an Association for this Property):
All declarations of covenants and restrictions (as may be amended) administered
by Associations and encumbering the Property.
ii The Limited Statutory Warranty and Building Perfonnance Standards promulgated
by the Texas Residential Construction Commission.
iii If You arc financing the purchase of the Home through the Veteran's Administration
("VA") and if, and only if, Your Mortgage Loan is from the VA, You will be provided
the 2-10 HBW insured warranty program's warranty booklet provided by Home Buyers
Warranty Corporation (ifapplicable).
iv The "Care of Your Home Checklist".
You will promptly return to Us all of the documents described above if this Agreement is tenninated for any rea"IDn. Jf
you fail to return all of these documents to Us, We may keep $50.00 of any Deposit Funds that may be refundable to You.
8. CLOSING.
Your purchase of the Property will occur at a Closing after the Home is substantially completed and may be conducted in a
manner (i.e. by mail or electronic means or in person) and at a location selected by Us. The Home will be considered
substantially completed when a certificate of occupancy has been issued by the relevant local government agency and all
customary utilities have been connected. If You are buying a Completed home, the Closing will occur on or before
april2014_ _ (or within 20 days of the date of this Agreement if this blank is not filled in). Otherwise, We will give You
at least fourteen (14) days written notice ("Closing Notice") of the estimated date and a place of the Closing ("Closing
Date"), and at least one (1) day verbal notice of any change in the Closing Date. The Closing Date may occur on a date
chosen by Us occurring anytime after a Certificate of Occupancy is issued. We do not warrant or guarantee completion
of the Home on any specific date. A change of time and place of Closing only (i.e. one not involving a change of date) will
not require any additional notice period. If We agree to delay the Closing Date at Your request (which We arc not obligated
to do), or if the Closing is delayed as a result of Your action or inactions, including any delay resulting from Your changing
Your Lender or loan program after You have made a loan application, You will pay at the Closing (or in advance if so
required by Us) (i) an extension fee in the amount of $200.00 for each day the Closing is delayed if the Closing occurs on or
before the last day of the calendar month in which the Closing is scheduled; or (ii) a late Closing charge equal to two percent
(2%) of the Total Purchase Price if the Closing occurs after the last day of the calendar month in which the Closing is
scheduled. You will have no right of possession or use of the Home until after Closing and after We have received all funds
due to Us; prior to the Closing You will not be pennitted to store any furniture or personal belongings in the Home or to
have any work performed by anyone other than Us. We do not estimate when the Home will be substantially complete and
completion of the Home may be delayed due to many foreseeable or unforeseeable reasons such as unavailability of
materials, eqctll>ment or supplies, strikes or other labor shortages, acts of God or nature (including inclement weather),
government/or court orders, change orders requested by You and other events out of Our direct control. We will not be
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unable or unwilling to fund Your purchase on the Closing Date, or
ii indicate to Us prior to the Closing that You will not be able to close this transaction or are not
financiaJly capable of paying the Total Purchase Price, or You fail to give Us adequate assurance of
future performance in writing within ten (10) business days after notice is given by Us to You of
the uncertainty of Your performance. or
iii Voluntarily or involuntarily seek protection under any bankruptcy laws or similar laws protecting
debtors, or
iv prevent Us from completing construction of the Home or
v provide false infonnation to a Lender, or
vi your contractors perform, any work or store any goods or materials on the Homesite prior to the
Closing, or
vii default under this Agreement prior to the Closing (other than the defaults described in i, ii, iii, iv, v,
vi of this paragraph 15.a. above) and You do not cure the default within ten ( I 0) business days after
We give You written notice of the default.
lben We may elect, in Our sole and absolute discretion, either (i) terminate this Agreement and retain all Deposit
Funds or (ii) to specifically enforce all the tenns and conditions of this Agreement. You will be notified in writing
about our election. If We elect to terminate this Agreement, You will have no further rights under this Agreement or to
any part of the Property. Upon such tennination, You and We will shall be release from all liabilities and obligations
arising from this Agreement except for those that expressly survive termination and We may retain all Deposit Fund(s)
(together with interest, if any) as liquidated damages. You acknowledge that the extent and amount of Our actual
damages would be uncertain and that aJI the Deposit Funds (together with interest, if any) are agreed and liquidated
damages and are not a penalty.
b) Since certain parts of this Agreement survive Closing or termination, if You default under this Agreement after the
Closing, We will be entitled to aJl rights and remedies described in this Agreement, and those available at law and in
equity, including the right to specifically enforce the terms of this Agreement.
c} If We default under this Agreement prior to Closing, You will give Us written notice and if We have not cured the
default within ten (10) business days after We receive the notice, You may pursue any remedy available to You at law
or in equity. If We default under this Agreement after the Closing, You will give Us written notice and if We have not
cured the default within thirty (30) business days after the notice, You may pursue direct and actuaJ damages but You
may not seek specific performance or consequential, incidental, indirect, special, exemplary or punitive damage.
d) The terms of this Article will survive Closing.
16. CONT~CIES THAT WILL DELAY OR TERMINATE OUR OBLIGATIONS.
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In addition to all other rights and remedies available to Us, You understand and agree that We may, in Our sole and absolute
discretion delay applying for a building permit, suspend construction activity or terminate this Agreement at any time
without written notice of opportunity to cure, if any of the following circumstances occur:
a) Our cost to build the Home is more than three and one-half percent (3.5%) greater than the cost estimated by Us at the
time We sign this Agreement. Examples of costs that may increase include without limitation: building materiaJs and
supplies, labor, taxes. assessments, penalties, fines and fees charged by governments and insurance. We may use any
reasonable method to determine the amount of cost increases. For example, labor and supply cost increases may be
calculated by comparing unit costs charged by Our subcontractors and suppliers at the time You sign this Agreement to
the unit costs actually charged on the date installation of al I the Home's drywall has been completed.
b) There is a building moratorium in effect at any time or We do not receive a building permit within one hundred eighty
(180) days after application.
c) We do not obtain indefeasible title to the Homesite within thirty (30) days after You sign this Agreement.
d) Our ability to build the Home is materially and adversely affected, as determined by Us in Our sole and absolute
discretion, because of any legal, zoning or regulatory restriction
e) Construction of the Home is not feasible, as determined by Us in Our sole and absolute discretion., due to easements,
setbacks, house size or shape, soil conditions, structural options, or locations of septic drain fields or wells.
f) A government takes or threatens to take any part of the Homesite through condemnation or eminent domain, or a
casualty occurs and part of all of the home is destroyed prior to Closing.
g) Delays caused by inspection, or changes ordered by the inspectors of authorized governmental bodies.
h) Construction of the Home is delayed by more than thirty (30) days due to adverse weather, shortages of material, or
labor disputes or shortages.
i) You represent to Us that the Home will be Your residence and We detennine that the Home will not be Your residence.
j) You require a Loan Qualification and You do not apply for a Mortgage Loan as required by paragraph 4 above.
k) You require a Loan Qualification and We have not received a copy of it prior to the Loan Contingency Deadline.
If We terminate this Agreement., for any one or more of the reasons described in this Article, then We will return to You aJl
Deposited Funds (without interest), at which time this Agreement will tenninate. You will have no further rights or interests
under this Agreement or to any part of the Property, and You and We shall be released from all liabilities and obligations
arising from this Agreement except for those that expressly survive termination. We retain the right to tenninate this
Agreement even if We have previously chosen to delay application for a building permit or to suspend construction activity.
17. TRANSFER OR ASSIGNMENT.
You may not assign, sell or transfer any rights or interests in this Agreement without Our prior written consent. Our consent
may be conditioned upon receipt of an assignment fee. After any assignment of Your rights and interests in this Agreement,
you will continue to be responsible for all of the Buyer's obligations arising from this Agreement if Your assignee breaches
any part of this Agreement, including the failure to close. We may, in Our sole and absolute discretion, assign, pledge and
lien Our rights and interests in this Agreement.
18. DISPUTE RESOLUTION.
State of Texas Administrative Resolution: Any dispute involving, relating to or arising out ofa construction defect, as that
tennis defined in Chapter 401 of the Texas Property Code, may be submitted by either party, in its sole discretion, to the
Texas Residential Construction Commission or any successor thereto (the Commission) in accordance with the
Commission's applicable policies and procedures (Commission Process). If such dispute is not resolved within fifteen (15)
days following the conclusion of the Commission Process and applicable procedures under Chapter 27 of the Texas Property
Code, then the dispute shall be submitted to mediation and, if not settled during mediation, to binding arbitration as provided
by the Federal Arbitration Act (9 U.S.C. §§ 1 et seq.) according to the tenns and conditions set forth below.
Mediation-Binding Arbitration/Waiver of Jury Trial: The parties agree that any other dispute (whether arising in
contract, warranty, tort, statutory or otherwise), including, but not limited to, (i) any and all controversies, disputes or claims
arising under, or relating to, this Agreement, and any amendment,;; thereto, the Property, Improvements, or any dealings
between You and Us; (ii) any controversy, dispute or claim arising by virtue of any representations, omissions, promises or
warranties alleged to have been made by Us or any of Our representatives; and (iii) any personal injury or property damage
alleged to have been sustained by You on the Property or in the subdivision in which the Property is located, shall first be
submitted to mediation and, if not settled during mediation, shall thereafter be submitted to binding arbitration as provided
by the Fcd/!rbitration Act (9 U.S.C. §§ 1 et seq.) or, 1f applicable, by similar state statute, and not by or m a court of
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law. All decisions respecting the ability to arbitrate any dispute shall be decided by the arbitrator. In no event shall You be
initially required to pay arbitration costs and fees in excess of those that would have been incurred in filing suit in a court of
law and effecting service of process. The arbitrator may award to the prevailing party, if any, as determined by the arbitrator,
all or any portion of its costs and fees. "Costs and fees" may include reasonable expenses of mediation and/or arbitration,
including arbitrator's fees, administrative fees, travel expenses and out-of-pocket expenses such as copying and telephone,
court costs, witness foes, and reasonable attorney's fees. The mediation and, if necessary, the arbitration shall be conducted
pursuant to any procedures set forth in the applicable warranty documents. If there is any conflict between this Agreement
and such procedures, the provisions of this Agreement shall control. Furthermore, if the mediator and/or arbitrator
designated in any applicable warranty documents cannot conduct the mediation or arbitration for any reason, or if no
mediator and/or arbitrator is designated, the parties agree to work together in good faith to select a mediator and, if all
disputes are not resolved by mediation, an arbitrator in the county where the Property is located {to the extent practicable). If
the parties are unable to agree on the appointment of a mediator and/or arbitrator, either party may petition a court of general
jurisdiction in the subject county to appoint a mediator and/or arbitrator. It is stipulated and agreed that the filing of a
petition requesting appointment of a mediator and/or arbitrator shall not constitute a waiver of the right to enforce binding
arbitration. In any arbitration proceeding between the parties:
a) All applicable Federal and State law (including Chapter 27 of the Texas Property Code) shall apply;
b) All applicable claims, causes of action, remedies and defenses that would be available in court shall apply~
c) The proceeding shall be conducted by a single arbitrator selected by a process designed to ensure the neutrality of the
arbitrator;
d) The parties shall be entitled to conduct reasonable and necessary discovery;
e) The arbitrator shall render a written award and, if requested by any party, a reasoned award;
t) You shall not be required to pay any unreasonable costs, expenses or arbitrator's fees and the arbitrator shall have the
right to apportion the cost of any such items in an equitable manner in the arbitration award;
g) Any award rendered in the proceeding shall be final and binding and judgment upon any such award may be entered in
any court having jurisdiction~ and
h) If the proceeding pertains to a construction defect, as that term is defined in Chapter 401 of the Texas Property Code,
then the arbitration shall be conducted in the same county as the Property.
You and We agree that notwithstanding anything to the contrary, the rights and obligations set forth in this mediation-
arbitration agreement shall survive
the termination of this Agreement by either party;
ii the default of this Agreement by either party; or
iii any closing and delivery of deed.
The waiver or invalidity of any portion of this mediation•arbitration agreement shall not affect the validity or enforceability
of the remaining portions of this mediation-arbitration agreement and/or the Agreement. You and We further agree
that any dispute involving Our directors, officers, partners, employees and agents shall be resolved
as set forth herein and not in a court of law; and
ii we shall have the option to include its subcontractors and suppliers as parties in the alternative
dispute resolution procedures set forth in this Agreement.
Jfany party to this Agreement files a proceeding in any court to resolve any such controversy, dispute or claim, such action
shall not constitute a waiver of the right of such party or a bar to the right of any other party to seek arbitration of that or any
other claim, dispute or controversy, and the court shall, upon motion of any party to the proceeding, direct that such
controversy, dispute or claim be arbitrated in accordance herewith. Inasmuch as this Agreement provides for mandatory
arbitration of disputes, if any party commences litigation in violation of this Agreement, such party shall reimburse the other
parties to the litigation for their costs and expenses including attorneys 1 fees incurred in seeking abatement of such litigation
and enforcement of arbitration. The requirement that the parties submit any disputes between them to mediation and, if that
does not resolve the dispute, binding arbitration is absolute and enforceable despite there being no signature by either party
on this page of the Agreement. The parties, by their signatures at the end of this Agreement, agree to arbitration as if their
signatures appeared on the page where arbitration is made part of the Agreement.
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The parties further desire pragmatic and logical limitations on claims and remedies to ensure effective and realistic dispute
resolution. Accordingly:
Limitation of Claims: Under no circumstances shall either You or We be liable for any special,
indirect, or consequential damages, including claims of mental anguish, except as otherwise
specifically set forth in this Agreement. Any action or claim, regardless of fonn, which arises from
or relates to this Agreement, the construction and/or the improvements is barred unless it is
brought by either party not later than two (2) years and one (I) day from the date the cause of
action accrues.
ii WAIVER OF SUBROGATION; INDEMNITY: THE PARTIES AGREE THAT AFTER
OCCUPANCY OR CLOSING, WHICHEVER COMES FIRST, YOU SHALL SECURE AND
MAINTAIN INSURANCE COVERING RISK OF LOSS AND DAMAGE TO THE
IMPROVEMENTS. THE PARTIES FURTHER MUTUALLY AGREE THAT WITH RESPECT
TO ANY LOSS OR DAMAGE THAT MAY OCCUR TO THE PROPERTY OR
IMPROVEMENTS BY REASON OF FIRE, THE ELEMENTS, OR ANY OTHER CAUSE
WHICH COULD BE INSURED AGAINST UNDER THE TERMS OF STANDARD FIRE AND
EXTENDED COVERAGE INSURANCE POLICIES, REGARDLESS OF THE CAUSE OR
ORIGIN, INCLUDING NEGLIGENCE OF THE PARTIES HERETO, THEIR AGENTS,
OFFICERS, AND EMPLOYEES, THE PARTY HERETO CARRYING SUCH INSURANCE
AND SUFFERING SAID LOSS, HEREBY RELEASES THE OTHER FROM ANY AND ALL
CLAIMS WITH RESPECT TO SUCH LOSS. THE PARTIES FURTHER MUTUALLY AGREE
THAT THEIR RESPECTIVE INSURANCE COMPANIES SHALL HAVE NO RIGHT OF
SUBROGATION AGAINST THE OTHER PARTY HERETO ON ACCOUNT OF ANY SUCH
LOSS AND EACH PARTY AGREES THAT IT WILL REQUEST ITS INSURANCE CARRIER
TO INCLUDE IN ITS POLICIES SUCH A CLAUSE OR ENDORSEMENT. IF YOU RECEIVE
ANY CONSIDERATION FROM A THIRD PARTY, INCLUDING, BUT NOT LIMITED TO,
AN ASSIGNEE OR SUBROGEE, IN SETTLEMENT OR PAYMENT FOR ANY DISPUTE,
YOU SHALL INDEMNIFY US FOR ANY CLAIMS ASSERTED AGAINST US BY SUCH
HJIRD PARTY, REGARDLESS OF ANY ALLEGATION OF OUR NEGLIGENCE, STRICT
LIABILITY, BREACH OF CONTRACT, BREACH OF WARRANTY OR VIOLATIONS OF
THE TEXAS DECEPTIVE TRADE PRACTICES-CONSUMER PROTECTION ACT. NOTHING
CONTAINED IN THIS PARAGRAPH SIIALL BE DEEMED TO MODIFY OR OTHERWJSE
AFFECT RELEASES OF EITHER PARTY FROM LIABILITY FOR CLAIMS ELSEWHERE
HEREIN CONTAINED.
You and We acknowledge and agree that a request for warranty perfonnance shall not be construed as a notice of
construction defect under the Texas Residential Construction Liability Act (RCLA), and that any notice under RCLA shall
be separately sent to Us in the manner required by RCLA.
The prevailing party in any arbitration or legal proceedings brought under or with relation to this Agreement may be entitled
to recover from the non-prevailing party all costs of such proceeding and reasonable attorney's fees
19. PRIVACY.
We may share non-public information about You with companies that help us build, deliver or service the Home. We may
provide Your name, phone number and address to third parties who provide goods or services to homeowners, such as
insurance agencies and sellers of appliances.
20. RESIDENCE.
If the Home is intended to be rented to others by You, it will not be considered to be Your residence for the purposes of this
Agreement. ln order for the Home to be considered Your residence, You must be its owner and occupant and have no
intention of selling it for at least one (1) year after the Closing. If You MJSREPRESENT to us that You will use the Home
as Your residence, and if the Home does not qualify as Your residence, you hereby grant to Us the right to repurchase the
Property for the Total Purchase Price if You sell, offer to sell or solicit offers to purchase, the Property at any time within
365 days after the Closing Date. We do not have this right to repurchase if You have told Us that the Home will not be Your
residence prior to the time You sign this Agreement. To qualify Your Home as Your residence You will apply with the local
tax collector for a homestead exemption. Our right to repurchase the Home will terminate when you deliver to Us
venficatio~ l~cal tax collector recognizes the Home as Your homestead. This Article shall survive the Closing.
Seller 1mh.P . 11 Buyer ~ Buyer~
21. SIGNS.
You are not pennitted to display on the Property or in the home during the first year after the Closing, any sign offoring to
rent the Property if such sign can be seen from outside the Home. This Article shall survive the Closing.
22. GOVERNINGLAW.
This Agreement is governed by laws of the State, except as otherwise expressly stated herein.
23. TIME IS OF THE ESSENCE.
The performance of all Your obligations on the precise times stated in this Agreement is of absolute importance and failure
to perfonn any of them timely is a material breach of and default under this Agreement, time being of the essence.
24. RECORDING.
Neither this Agreement, nor any notice or summary hereof, may be recorded among any public records.
25. ENVIRONMENTAL RISK/MOLD.
We make no warranties, express or implied, about the existing or future health hazards or environmental conditions on the
Property. in the improvements, or from adjacent sources, including, but not limited to, exposure to radon gas, electric and
magnetic fields, shifting or instability of the soil and contamination of the improvements or the surrounding air, water or soil
from any sources or in any manner. You are advised that the continued presence of moisture on components of the
improvements can cause the propagation of mold, which may cause allergenic reactions and other health problems in some
individuals. Upon a,;suming possession of the improvements, You are responsible for implementing an inspection and
maintenance program for the identification and elimination of moisture in the improvements that could give rise to the
growth of mold or other conditions detrimental to functioning of the improvements or the health of its occupants.
26. AGENCY.
If there is more than one person who is a Buyer, then each such person hereby irrevocably appoints the other person to be
his or her agent and attorney-in-fact to bind him or her to any agreement, amendment or obligation that concerns or is
related to this Agreement, the Property, or Our warranty obligations. We are entitled, but not obligated, to rely on Your
authorization of each other as agents and attorneys-in-fact, and You will release and hold Us harmless if We rely on this
authori1ation.
27. TITLE INSURANCE.
You acknowledge that We have not directly or indirectly required You, as a condition of this sale, to purchase either an
owner's or mortgagee's title insurance policy from any particular insurer or agency.
28. PURPOSE FOR PURCHASE. You represent to Us that You are purchasing the Property for Your own use and not for or
on behalf of others. You acknowledge that You have not received from Us and you have not relied upon any statement,
infonnation or opinion about the present or future value of the Property or about any possible financial or tax advantages
that could be derived from real property, and We disclaim any such statements, It is impossible to predict the future value or
income potential of residential real property, which is inherently speculative, liquid and unique. You are encouraged to seek
the advice of competent attorneys and financial and tax advisors prior to signing this Agreement.
29. INSULATION.
We have advised You, as required by the rules of the Federal Trade Commission, that We currently intend to install in the
Home the minimum insulation disclosed below. The RM Value and other information shown below are based solely on the
infonnation given by the appropriate manufacturers (based on the thicknesses listed) and you agree that We are not
responsible for the manufacturers' errors or omissions.
MinimumR-
Location Minimum Type Approximate Thickness
Value
Walls Batt 3.5'' 13
Flat Ceilino'- Blown 14" 38
Sloped Ceiling Batt 6.25 11 19
Dead Slooes Batt 6,25 11 19
30. VA LOAN.
If You are obtaining Veterans Administration financing, then: it is expressly agreed that, notwithstanding any other
provisions of this Agreement, You shall not incur any penalty by forfeiture of earnest money or otherwise or be obligated to
ilie '"V
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Filed: 8/6/2020 8:54 AM JOHN D. KINARD - District Clerk Galveston County, Texas Envelope No. 45145108 By: Shailja Dixit 8/6/2020 9:02 AM CAUSE NO. 19-CV-0340 ROBERT WELCH and § IN THE DISTRICT COURT OF JENNIFER WELCH § § Plaintiffs, § § VS. § GALVESTON COUNTY, TEXAS § GREENECO BUILDERS, L.L.C. § § Defendant. § 122ND JUDICIAL DISTRICT DEFENDANT’S FIRST AMENDED COUNTERCLAIM Defendant, GREENECO Builders, L.L.C. (“Greeneco”), files this first amended counterclaim and respectfully states: 1. Plaintiffs Robert and Jennifer Welch (as Buyers) and Defendant Greeneco (as Seller) are parties to that certain New Home Sales Contract (the “Contract”) dated December 8, 2013, a true copy of which is attached hereto as Exhibit A. 2. Pursuant to the Contract, Greeneco sold to Mr. and Mrs. Welch a new residence located at 303 Sea Breeze Drive, Bacliff, Texas 77518 (the “Residence”). Mr. and Mrs. Welch have filed this lawsuit against Greeneco to recover damages including costs of repair with respect to alleged construction defects in the Residence. 3. Mr. and Mrs. Welch assert that the cost of repairing alleged construction defects is in excess of $246,000 – well over the full purchase price of the Residence, $150,906.00. 4. Pursuant to Texas Property Code §27.0042(a), a builder such as Greeneco may elect to repurchase a residence as an alternative to damages claimed by the homeowners, in this case Mr. and Mrs. Sanchez, if the parties so agree in the sales contract. The election is available if the cost of repairs exceeds an agreed percentage of the current value of the residence, determined without reference to the alleged defects. In Paragraph 39 of the Contract (“Re-Purchase Option”), the parties agreed to this option and set that percentage at 20%. As the alleged costs exceed the full purchase price of the Residence, this threshold is clearly met. 5. Greeneco has elected to repurchase the Residence. The election was made by letter dated June 15, 2020, a copy of which is attached hereto as Exhibit B. 6. Mr. and Mrs. Welch have thus far failed and refused to honor the Re-Purchase Option despite their statutory and contractual obligations. They are accordingly in breach of the Contract. 7. Greeneco is entitled to and requests an order for specific performance of the Re- Purchase Option, requiring Mr. and Mrs. Welch to comply with the option in all respects, including execution of a deed in accordance therewith. 8. Greeneco made timely written demand on Mr. and Mrs. Welch to comply with the Re-Purchase Option. Pursuant to Tex.Civ.Prac.&Rem.Code §38.001 et seq. and Paragraph 18 of the Contract, Greeneco is entitled to recover judgment against Mr. and Mrs. Welch for the costs of this proceeding including its reasonable attorney’s fees. 9. All conditions precedent to the relief requested herein have been performed or have occurred. WHEREFORE, PREMISES CONSIDERED, Counter-Plaintiff GREENECO Builders, L.L.C. respectfully prays that upon final hearing or trial, Greeneco have judgment of and against Counter-Defendants Mr. and Mrs. Welch for (i) specific performance of the Re-Purchase Option, (ii) the costs including reasonable attorney’s fees incurred in this proceeding to enforce the option, and (iii) such other and further relief to which Greeneco may be entitled. 2 Respectfully submitted, CRAIN, CATON & JAMES A Professional Corporation By: /s/ H. Miles Cohn H. Miles Cohn State Bar No. 04509600 mcohn@craincaton.com Melina M. Riseden State Bar No. 24041443 mriseden@craincaton.com Joe R. Savoie State Bar No. 24083797 jsavoie@craincaton.com 1401 McKinney Street 17th Floor Houston, Texas 77010 713.658.2323 713.658.1921 (Facsimile) ATTORNEYS FOR DEFENDANT/ COUNTER-PLAINTIFF GREENECO BUILDERS, L.L.C. CERTIFICATE OF SERVICE This is to certify that a true and correct copy of the foregoing First Amended Counterclaim was forwarded by e-service this the 6th day of August 2020, to Plaintiffs’ counsel: Dax O. Faubus The Faubus Firm 1001 Texas Ave, 11th Floor Houston, Texas 77002 dax-notice@faubusfirm.com /s/ H. Miles Cohn H. Miles Cohn 3 1lllftl! BUILDERS, L.L.C. NEW HOME SALES CONTRACT In this Contract ("the Agreement") for a House built by Greeneco Builders, L.L.C.,, the words "BUYER". "YOU" and "OUR" mean or refer to all the buyers, listed below who have signed this Agreement, jointly and severally. The words "SELLER", "US", "WE" and "OUR" mean and refer to Greeneco Builders, L.L.C., whose address is 21408 Provincial Drive, Katy, Texas 77450 (Fax 281-646-944 I) and its successors and assigns. THIS DOCUMENT CREA TES IMPORTANT LEGAL OBLIGATIONS THAT YOU SHOULD UNDERSTAND PRIOR TO SIGNING. YOU SHOULD READ IT THOROUGHLY AND IF YOU ARE UNCERTAIN OR HAVE QUESTIONS ABOUT YOUR RIGHTS, OBLIGATIONS OR RESPONSIBILITIES UNDER THIS CONTRACT, YOU MAY WISH TO CONSULT AN ATTORNEY. Date: December 8, 2013 Homesite: Lot~ Block_ 5 _Section I Subdivision EDGEWATER PARK Street Address: 303 SEA BREEZE DRIVE __County ("County"): GALVESTON in the state ofTexas("State"). Buyer(s): DOUG AND SHALAINE WELCH Current Address: 1302 MARINA BAY DRIVE 205A City: CLEAR LAKE SHORES State: TEXAS Zip Code: 77656 E-mail Address: DIVERDOUG784@GMAIL.COM Home Phone: ( _ _ _ ) _ _ _ _ _ _ _ _ _ _ _ _ CELL Phone: 409-539-8247 Cell Phone:WIFE 832 ) 726-5774 Fax N u m b e r : ~ - ~ - - - - - - - - - - - - - - Greeneco Builders, L.L.C. Sales Representative: SHAWNNA DEMERS 281-455-0020 SD@GREENECOBUILDS.COM Outside Broker: (if not filled in, there is none): ---~N~/~A~_Outside Broker Commission: _ __ Is the Property subject to a mandatory Homcowner's Association (see Article 6)? _ ____,Y_,,E~S'------ 1. THIS IS WHAT YOU ARE BUYING FROM US. You agree to buy and We agree to sell You (on the terms and conditions stated in this Agreement) a dwelling (uHOME") which is already substantially completed (a "Completed Home") or which is to be built and will be substantially similar to floor plan2190C'Floor Plan") as depicted on Our marketing brochure with Elevation_£ and Swing R together with options, upgrades and modifications requested by You and accepted by Us in writing. You represent to Us that You will use the Home as your primary residence unless You check the following box (see Article 20): Not primary residence. 0 2. PURCHASE PRICE. The purchase price that You will pay for the Property is the sum of all of the following ("Total Purchase Price"): a) Base House Price: S 146000 b) Options Price: $ 6906 c) Elevation Premium: $ 0 d) Lot Premium: i. 0 e) INCENTIVE ~ Total Purchase Price $150906 f) You must also pay such additional sums as required for options, upgrades and changes which You request and We approve in writing ("Extras"). g) You will pay the "Closing Costs" described in Article 12. when this transaction is consummated at a closing ("Closing") that will be scheduled pursuant to Article 8. h) All other sums required by this Agreement to be paid by You. 3. EARNEST MONEY DEPOSIT. You are obligated to make the following earnest money payment to Us at the time of execution of this contract: $1000 CK #157 ,, I l I Seller: --,n~lli-.al-- Buyer: Buyer: _tj~=•~\~V~- lnitial EXHIBIT A 4. THIS IS HOW YOU MUST PAY THE TOTAL PURCHASE PRICE. The balance due at Closing (which is the Total Purchase Price less the Deposit Funds) must be paid in U.S. funds by Cashier's check or wire transfer only. Choose one of the following two options (ifno choice is indicated, it will be assumed that You have chosen option "a"): 0 a) THE HOME WILL NOT BE YOUR RESIDENCE OR YOU ALREADY QUALIFY FOR A MORTGAGE FROM AN APPROVED LENDER OR YOU ARE A CASH BUYER AND DO NOT NEED A MORTGAGE. Your obligation to purchase the Property is not contingent, in any way upon obtaining financing, nor upon any conditions of any financing that You may seek. The Closing may not be delayed if You decide to borrow money for Your purchase of the Home but your lender does not have sufficient time to process the loan or if You fail to qualify for a loan. We may in Our sole and absolute discretion require You to complete within twenty (20) days a Mortgage Loan Application with the mortgage company of your choice. You must authorize said mortgage company to release to US all information obtained in connection with Your credit application including Your credit report and credit score. You also authorize Us to obtain Your credit report and credit score directly from the credit reporting agencies. The Earnest Money deposit funds are non-refundable with this option. []xx b) TllE HOME WILL BE YOUR RESIDENCE AND YOU NEED A MORTGAGE. Your obligation to purchase the Property is contingent ("Loan Contingency") upon obtaining a written confirmation ("Loan Qualification'') from a lending institution ("Lender") in writing stating that You are pre-qualified or qualified to obtain financing ("Mortgage Loan") for Your purchase of the Property. You agree to apply for a Mortgage Loan within five (5) days after You sign this Agreement, if You have not secured a Mortgage Loan prior to this Agreement. You hereby authorize Your Mortgage company to release to Us all infonnation obtained in connection with Your credit report and credit score. You also authorize Us to obtain Your credit report and credit score directly from the credit reporting agencies. You must use Your best and diligent efforts to secure a Loan Qualification from a reputable Lender and deliver a copy of it to Us no later than 5:00 P.M. on the twentieth (20th) day after You sign this Agreement ("Loan Contingency Deadline"). This Loan Contingency will expire and Your right to terminate this Agreement will end immediately on the sooner of: (i) When You have received a Loan Qualification (even ifit is preliminary or conditional) or, (ii) When the Loan Contingency Deadline has passed and We have not received Your written notice that You are tenninating this Agreement because You did not receive a Loan Qualification. At that time, the Deposit Funds shall become non-refundable and You will not be able to terminate this Agreement, even if, (i) You are unable to obtain a Mortgage Loan due to an adverse change in Your personal or financial condition; (ii) You are unable to satisfy the Lender's conditions for making the Mortgage Loan; (iii) There is a change in the amount, interest rate or terms of the Mortgage Loan, or (iv) You decide that the conditions imposed for the Mortgage Loan are not acceptable. Your Lender must demonstrate their ability to process loans efficiently, comply with this Loan Contingency and facilitate the Closing on time. It is Your responsibility to insist that Your Lender comply with the terms of this Agreement and Loan Contingency. Once You have made Your application to a Lender, You may not change Lenders or loan programs without Our written consent. If You change Lenders Your new Lender will need sufficient time to process Your application. If You stay with Your original Lender but change loan programs, Your Lender may need to resubmit Your application for approval under the new loan program, which also requires additional time. We will grant Our consent to change Lenders or loan programs only it: in Our sole and absolute discretion, changing Lenders or loan programs wilt not delay the Closing or increase Our expense. If We refuse Your requested change, you will not change Lenders or loan programs and will proceed with the Closing using Your original Lender and loan program. Since a change in Lenders or loan programs may delay the Closing or increase Our expense, Your agree to use the Lender, loan program, interest rate, terms and conditions stated in the Loan Qualification. If We allow You to change Your Lender or loan program, We have the right to increase the Total Purchase Price to include any price increases that have been instituted for similar new homes since the date We signed this agreement. 5. SELECTING OPTIONAL FEATURES FOR YOUR HOME. Unless You are buying a Completed Home or a Home that is pre-planned, You may select from Our list of design selections, colors and materials for the options that are available for the Home. You must COMPLETE AND SUBMIT Your selections to Us in writing at a scheduled appointment with our representatives not any later than DEC 1,2013 (but in no event later than fourteen (14) days after You sign this Agreement if this blank is not filled in). An Approved option may be unavailable due to shortages of labor or material and We may cancel these options or substitute colors, models and manufacturers; if any approved option is not deliverable by Us, You will not be charged for it's cost and shall not constitute grounds for deferring the Closing, terminating this Agreement or for imposing any conditions on Closing. If You do not make Your selections on time, then We may choose to do any of the following in Our sole and absolute discretion: (i) We will build the Home using design selections, colors and materials chosen by Us; or (ii) We may give notice to You that You are in default under this Agreement and We may then terminate this Agreement by written notice to You and retain all Deposit Funds, at which time this Agreement will terminate and You will have no further rights under this Agreement or to any part of('\roperty. I I '>-.,,I. . . I ; ,; Seller:~-✓-·. . initlii _ 2 V Buyer:~.,.· Buyer:W J-lnitial Initial 6. HOMEOWNERS' ASSOCIATIONS. If the Property is required to be subject to a Homeowners' Association, then one or more not-for-profit corporations or entities or both ("Associations"), will enforce and administer conditions, covenants and restrictions encumbering all or part of the subdivision in which the Homesite is located ("Subdivision"). These Associations are identified in recorded declarations that govern the use of the Property. Once You take title to the Property, You will automatically become a member of one or more Associations. As a member of the Associations, You will enjoy all the rights and privileges of membership and You will be responsible for all costs, obligations and liabilities of membership. NOTICE: The Property may be subject to mandatory membership in an owners' association. Jfthe Property is subject to mandatory membership in an owners' association, We notify You under Section 5.012, Texas Property Code, that as a purchaser of property in the residential community in which the Property is located, You arc obligated to be a member of the owners' association. Restrictive covenants governing the use and occupancy of the Property and a dedicatory instrument governing the establishment, maintenance and operation of this residential community have been or will be recorded in the Real Property Records of the county in which the Property is located. Copies of the re~irictive covenants and dedicatory instrument may be obtained from the county clerk. You arc obligated to pay assessment to the owners' association. The amount of the assessment is subject to change. Your failure to pay the assessments could result in a lien on and foreclosure of the Property. 7. RECEIPT FOR OTHER LEGALLY BINDING DOCUMENTS. We have previously delivered to You a copy of all the documents listed below, either in print, by e-mail or on a CD-ROM. You acknowledge that before signing this Agreement You received a copy of ALL the following legally binding documents in a fonnat acceptable to You: a) All of the following Documents (if there is an Association for this Property): All declarations of covenants and restrictions (as may be amended) administered by Associations and encumbering the Property. ii The Limited Statutory Warranty and Building Perfonnance Standards promulgated by the Texas Residential Construction Commission. iii If You arc financing the purchase of the Home through the Veteran's Administration ("VA") and if, and only if, Your Mortgage Loan is from the VA, You will be provided the 2-10 HBW insured warranty program's warranty booklet provided by Home Buyers Warranty Corporation (ifapplicable). iv The "Care of Your Home Checklist". You will promptly return to Us all of the documents described above if this Agreement is tenninated for any rea"IDn. Jf you fail to return all of these documents to Us, We may keep $50.00 of any Deposit Funds that may be refundable to You. 8. CLOSING. Your purchase of the Property will occur at a Closing after the Home is substantially completed and may be conducted in a manner (i.e. by mail or electronic means or in person) and at a location selected by Us. The Home will be considered substantially completed when a certificate of occupancy has been issued by the relevant local government agency and all customary utilities have been connected. If You are buying a Completed home, the Closing will occur on or before april2014_ _ (or within 20 days of the date of this Agreement if this blank is not filled in). Otherwise, We will give You at least fourteen (14) days written notice ("Closing Notice") of the estimated date and a place of the Closing ("Closing Date"), and at least one (1) day verbal notice of any change in the Closing Date. The Closing Date may occur on a date chosen by Us occurring anytime after a Certificate of Occupancy is issued. We do not warrant or guarantee completion of the Home on any specific date. A change of time and place of Closing only (i.e. one not involving a change of date) will not require any additional notice period. If We agree to delay the Closing Date at Your request (which We arc not obligated to do), or if the Closing is delayed as a result of Your action or inactions, including any delay resulting from Your changing Your Lender or loan program after You have made a loan application, You will pay at the Closing (or in advance if so required by Us) (i) an extension fee in the amount of $200.00 for each day the Closing is delayed if the Closing occurs on or before the last day of the calendar month in which the Closing is scheduled; or (ii) a late Closing charge equal to two percent (2%) of the Total Purchase Price if the Closing occurs after the last day of the calendar month in which the Closing is scheduled. You will have no right of possession or use of the Home until after Closing and after We have received all funds due to Us; prior to the Closing You will not be pennitted to store any furniture or personal belongings in the Home or to have any work performed by anyone other than Us. We do not estimate when the Home will be substantially complete and completion of the Home may be delayed due to many foreseeable or unforeseeable reasons such as unavailability of materials, eqctll>ment or supplies, strikes or other labor shortages, acts of God or nature (including inclement weather), government/or court orders, change orders requested by You and other events out of Our direct control. We will not be ·......____,_~- Buyer /Jon, even if it is because Your Lender is unable or unwilling to fund Your purchase on the Closing Date, or ii indicate to Us prior to the Closing that You will not be able to close this transaction or are not financiaJly capable of paying the Total Purchase Price, or You fail to give Us adequate assurance of future performance in writing within ten (10) business days after notice is given by Us to You of the uncertainty of Your performance. or iii Voluntarily or involuntarily seek protection under any bankruptcy laws or similar laws protecting debtors, or iv prevent Us from completing construction of the Home or v provide false infonnation to a Lender, or vi your contractors perform, any work or store any goods or materials on the Homesite prior to the Closing, or vii default under this Agreement prior to the Closing (other than the defaults described in i, ii, iii, iv, v, vi of this paragraph 15.a. above) and You do not cure the default within ten ( I 0) business days after We give You written notice of the default. lben We may elect, in Our sole and absolute discretion, either (i) terminate this Agreement and retain all Deposit Funds or (ii) to specifically enforce all the tenns and conditions of this Agreement. You will be notified in writing about our election. If We elect to terminate this Agreement, You will have no further rights under this Agreement or to any part of the Property. Upon such tennination, You and We will shall be release from all liabilities and obligations arising from this Agreement except for those that expressly survive termination and We may retain all Deposit Fund(s) (together with interest, if any) as liquidated damages. You acknowledge that the extent and amount of Our actual damages would be uncertain and that aJI the Deposit Funds (together with interest, if any) are agreed and liquidated damages and are not a penalty. b) Since certain parts of this Agreement survive Closing or termination, if You default under this Agreement after the Closing, We will be entitled to aJl rights and remedies described in this Agreement, and those available at law and in equity, including the right to specifically enforce the terms of this Agreement. c} If We default under this Agreement prior to Closing, You will give Us written notice and if We have not cured the default within ten (10) business days after We receive the notice, You may pursue any remedy available to You at law or in equity. If We default under this Agreement after the Closing, You will give Us written notice and if We have not cured the default within thirty (30) business days after the notice, You may pursue direct and actuaJ damages but You may not seek specific performance or consequential, incidental, indirect, special, exemplary or punitive damage. d) The terms of this Article will survive Closing. 16. CONT~CIES THAT WILL DELAY OR TERMINATE OUR OBLIGATIONS. Seller ( ~ '0J. · 8 Buyer f;tl,) Initial Buy,/27.e-i.,, / -~ In addition to all other rights and remedies available to Us, You understand and agree that We may, in Our sole and absolute discretion delay applying for a building permit, suspend construction activity or terminate this Agreement at any time without written notice of opportunity to cure, if any of the following circumstances occur: a) Our cost to build the Home is more than three and one-half percent (3.5%) greater than the cost estimated by Us at the time We sign this Agreement. Examples of costs that may increase include without limitation: building materiaJs and supplies, labor, taxes. assessments, penalties, fines and fees charged by governments and insurance. We may use any reasonable method to determine the amount of cost increases. For example, labor and supply cost increases may be calculated by comparing unit costs charged by Our subcontractors and suppliers at the time You sign this Agreement to the unit costs actually charged on the date installation of al I the Home's drywall has been completed. b) There is a building moratorium in effect at any time or We do not receive a building permit within one hundred eighty (180) days after application. c) We do not obtain indefeasible title to the Homesite within thirty (30) days after You sign this Agreement. d) Our ability to build the Home is materially and adversely affected, as determined by Us in Our sole and absolute discretion, because of any legal, zoning or regulatory restriction e) Construction of the Home is not feasible, as determined by Us in Our sole and absolute discretion., due to easements, setbacks, house size or shape, soil conditions, structural options, or locations of septic drain fields or wells. f) A government takes or threatens to take any part of the Homesite through condemnation or eminent domain, or a casualty occurs and part of all of the home is destroyed prior to Closing. g) Delays caused by inspection, or changes ordered by the inspectors of authorized governmental bodies. h) Construction of the Home is delayed by more than thirty (30) days due to adverse weather, shortages of material, or labor disputes or shortages. i) You represent to Us that the Home will be Your residence and We detennine that the Home will not be Your residence. j) You require a Loan Qualification and You do not apply for a Mortgage Loan as required by paragraph 4 above. k) You require a Loan Qualification and We have not received a copy of it prior to the Loan Contingency Deadline. If We terminate this Agreement., for any one or more of the reasons described in this Article, then We will return to You aJl Deposited Funds (without interest), at which time this Agreement will tenninate. You will have no further rights or interests under this Agreement or to any part of the Property, and You and We shall be released from all liabilities and obligations arising from this Agreement except for those that expressly survive termination. We retain the right to tenninate this Agreement even if We have previously chosen to delay application for a building permit or to suspend construction activity. 17. TRANSFER OR ASSIGNMENT. You may not assign, sell or transfer any rights or interests in this Agreement without Our prior written consent. Our consent may be conditioned upon receipt of an assignment fee. After any assignment of Your rights and interests in this Agreement, you will continue to be responsible for all of the Buyer's obligations arising from this Agreement if Your assignee breaches any part of this Agreement, including the failure to close. We may, in Our sole and absolute discretion, assign, pledge and lien Our rights and interests in this Agreement. 18. DISPUTE RESOLUTION. State of Texas Administrative Resolution: Any dispute involving, relating to or arising out ofa construction defect, as that tennis defined in Chapter 401 of the Texas Property Code, may be submitted by either party, in its sole discretion, to the Texas Residential Construction Commission or any successor thereto (the Commission) in accordance with the Commission's applicable policies and procedures (Commission Process). If such dispute is not resolved within fifteen (15) days following the conclusion of the Commission Process and applicable procedures under Chapter 27 of the Texas Property Code, then the dispute shall be submitted to mediation and, if not settled during mediation, to binding arbitration as provided by the Federal Arbitration Act (9 U.S.C. §§ 1 et seq.) according to the tenns and conditions set forth below. Mediation-Binding Arbitration/Waiver of Jury Trial: The parties agree that any other dispute (whether arising in contract, warranty, tort, statutory or otherwise), including, but not limited to, (i) any and all controversies, disputes or claims arising under, or relating to, this Agreement, and any amendment,;; thereto, the Property, Improvements, or any dealings between You and Us; (ii) any controversy, dispute or claim arising by virtue of any representations, omissions, promises or warranties alleged to have been made by Us or any of Our representatives; and (iii) any personal injury or property damage alleged to have been sustained by You on the Property or in the subdivision in which the Property is located, shall first be submitted to mediation and, if not settled during mediation, shall thereafter be submitted to binding arbitration as provided by the Fcd/!rbitration Act (9 U.S.C. §§ 1 et seq.) or, 1f applicable, by similar state statute, and not by or m a court of Seller ti- .inrui1 9 Buyer ;J~j Buyer ~ /liJ Initial law. All decisions respecting the ability to arbitrate any dispute shall be decided by the arbitrator. In no event shall You be initially required to pay arbitration costs and fees in excess of those that would have been incurred in filing suit in a court of law and effecting service of process. The arbitrator may award to the prevailing party, if any, as determined by the arbitrator, all or any portion of its costs and fees. "Costs and fees" may include reasonable expenses of mediation and/or arbitration, including arbitrator's fees, administrative fees, travel expenses and out-of-pocket expenses such as copying and telephone, court costs, witness foes, and reasonable attorney's fees. The mediation and, if necessary, the arbitration shall be conducted pursuant to any procedures set forth in the applicable warranty documents. If there is any conflict between this Agreement and such procedures, the provisions of this Agreement shall control. Furthermore, if the mediator and/or arbitrator designated in any applicable warranty documents cannot conduct the mediation or arbitration for any reason, or if no mediator and/or arbitrator is designated, the parties agree to work together in good faith to select a mediator and, if all disputes are not resolved by mediation, an arbitrator in the county where the Property is located {to the extent practicable). If the parties are unable to agree on the appointment of a mediator and/or arbitrator, either party may petition a court of general jurisdiction in the subject county to appoint a mediator and/or arbitrator. It is stipulated and agreed that the filing of a petition requesting appointment of a mediator and/or arbitrator shall not constitute a waiver of the right to enforce binding arbitration. In any arbitration proceeding between the parties: a) All applicable Federal and State law (including Chapter 27 of the Texas Property Code) shall apply; b) All applicable claims, causes of action, remedies and defenses that would be available in court shall apply~ c) The proceeding shall be conducted by a single arbitrator selected by a process designed to ensure the neutrality of the arbitrator; d) The parties shall be entitled to conduct reasonable and necessary discovery; e) The arbitrator shall render a written award and, if requested by any party, a reasoned award; t) You shall not be required to pay any unreasonable costs, expenses or arbitrator's fees and the arbitrator shall have the right to apportion the cost of any such items in an equitable manner in the arbitration award; g) Any award rendered in the proceeding shall be final and binding and judgment upon any such award may be entered in any court having jurisdiction~ and h) If the proceeding pertains to a construction defect, as that term is defined in Chapter 401 of the Texas Property Code, then the arbitration shall be conducted in the same county as the Property. You and We agree that notwithstanding anything to the contrary, the rights and obligations set forth in this mediation- arbitration agreement shall survive the termination of this Agreement by either party; ii the default of this Agreement by either party; or iii any closing and delivery of deed. The waiver or invalidity of any portion of this mediation•arbitration agreement shall not affect the validity or enforceability of the remaining portions of this mediation-arbitration agreement and/or the Agreement. You and We further agree that any dispute involving Our directors, officers, partners, employees and agents shall be resolved as set forth herein and not in a court of law; and ii we shall have the option to include its subcontractors and suppliers as parties in the alternative dispute resolution procedures set forth in this Agreement. Jfany party to this Agreement files a proceeding in any court to resolve any such controversy, dispute or claim, such action shall not constitute a waiver of the right of such party or a bar to the right of any other party to seek arbitration of that or any other claim, dispute or controversy, and the court shall, upon motion of any party to the proceeding, direct that such controversy, dispute or claim be arbitrated in accordance herewith. Inasmuch as this Agreement provides for mandatory arbitration of disputes, if any party commences litigation in violation of this Agreement, such party shall reimburse the other parties to the litigation for their costs and expenses including attorneys 1 fees incurred in seeking abatement of such litigation and enforcement of arbitration. The requirement that the parties submit any disputes between them to mediation and, if that does not resolve the dispute, binding arbitration is absolute and enforceable despite there being no signature by either party on this page of the Agreement. The parties, by their signatures at the end of this Agreement, agree to arbitration as if their signatures appeared on the page where arbitration is made part of the Agreement. Seller: (;' j 1 Buyer: .11.k'Z ✓ Buyer: f::tJtJ _ 10 ~ ~ 'fnitia] The parties further desire pragmatic and logical limitations on claims and remedies to ensure effective and realistic dispute resolution. Accordingly: Limitation of Claims: Under no circumstances shall either You or We be liable for any special, indirect, or consequential damages, including claims of mental anguish, except as otherwise specifically set forth in this Agreement. Any action or claim, regardless of fonn, which arises from or relates to this Agreement, the construction and/or the improvements is barred unless it is brought by either party not later than two (2) years and one (I) day from the date the cause of action accrues. ii WAIVER OF SUBROGATION; INDEMNITY: THE PARTIES AGREE THAT AFTER OCCUPANCY OR CLOSING, WHICHEVER COMES FIRST, YOU SHALL SECURE AND MAINTAIN INSURANCE COVERING RISK OF LOSS AND DAMAGE TO THE IMPROVEMENTS. THE PARTIES FURTHER MUTUALLY AGREE THAT WITH RESPECT TO ANY LOSS OR DAMAGE THAT MAY OCCUR TO THE PROPERTY OR IMPROVEMENTS BY REASON OF FIRE, THE ELEMENTS, OR ANY OTHER CAUSE WHICH COULD BE INSURED AGAINST UNDER THE TERMS OF STANDARD FIRE AND EXTENDED COVERAGE INSURANCE POLICIES, REGARDLESS OF THE CAUSE OR ORIGIN, INCLUDING NEGLIGENCE OF THE PARTIES HERETO, THEIR AGENTS, OFFICERS, AND EMPLOYEES, THE PARTY HERETO CARRYING SUCH INSURANCE AND SUFFERING SAID LOSS, HEREBY RELEASES THE OTHER FROM ANY AND ALL CLAIMS WITH RESPECT TO SUCH LOSS. THE PARTIES FURTHER MUTUALLY AGREE THAT THEIR RESPECTIVE INSURANCE COMPANIES SHALL HAVE NO RIGHT OF SUBROGATION AGAINST THE OTHER PARTY HERETO ON ACCOUNT OF ANY SUCH LOSS AND EACH PARTY AGREES THAT IT WILL REQUEST ITS INSURANCE CARRIER TO INCLUDE IN ITS POLICIES SUCH A CLAUSE OR ENDORSEMENT. IF YOU RECEIVE ANY CONSIDERATION FROM A THIRD PARTY, INCLUDING, BUT NOT LIMITED TO, AN ASSIGNEE OR SUBROGEE, IN SETTLEMENT OR PAYMENT FOR ANY DISPUTE, YOU SHALL INDEMNIFY US FOR ANY CLAIMS ASSERTED AGAINST US BY SUCH HJIRD PARTY, REGARDLESS OF ANY ALLEGATION OF OUR NEGLIGENCE, STRICT LIABILITY, BREACH OF CONTRACT, BREACH OF WARRANTY OR VIOLATIONS OF THE TEXAS DECEPTIVE TRADE PRACTICES-CONSUMER PROTECTION ACT. NOTHING CONTAINED IN THIS PARAGRAPH SIIALL BE DEEMED TO MODIFY OR OTHERWJSE AFFECT RELEASES OF EITHER PARTY FROM LIABILITY FOR CLAIMS ELSEWHERE HEREIN CONTAINED. You and We acknowledge and agree that a request for warranty perfonnance shall not be construed as a notice of construction defect under the Texas Residential Construction Liability Act (RCLA), and that any notice under RCLA shall be separately sent to Us in the manner required by RCLA. The prevailing party in any arbitration or legal proceedings brought under or with relation to this Agreement may be entitled to recover from the non-prevailing party all costs of such proceeding and reasonable attorney's fees 19. PRIVACY. We may share non-public information about You with companies that help us build, deliver or service the Home. We may provide Your name, phone number and address to third parties who provide goods or services to homeowners, such as insurance agencies and sellers of appliances. 20. RESIDENCE. If the Home is intended to be rented to others by You, it will not be considered to be Your residence for the purposes of this Agreement. ln order for the Home to be considered Your residence, You must be its owner and occupant and have no intention of selling it for at least one (1) year after the Closing. If You MJSREPRESENT to us that You will use the Home as Your residence, and if the Home does not qualify as Your residence, you hereby grant to Us the right to repurchase the Property for the Total Purchase Price if You sell, offer to sell or solicit offers to purchase, the Property at any time within 365 days after the Closing Date. We do not have this right to repurchase if You have told Us that the Home will not be Your residence prior to the time You sign this Agreement. To qualify Your Home as Your residence You will apply with the local tax collector for a homestead exemption. Our right to repurchase the Home will terminate when you deliver to Us venficatio~ l~cal tax collector recognizes the Home as Your homestead. This Article shall survive the Closing. Seller 1mh.P . 11 Buyer ~ Buyer~ 21. SIGNS. You are not pennitted to display on the Property or in the home during the first year after the Closing, any sign offoring to rent the Property if such sign can be seen from outside the Home. This Article shall survive the Closing. 22. GOVERNINGLAW. This Agreement is governed by laws of the State, except as otherwise expressly stated herein. 23. TIME IS OF THE ESSENCE. The performance of all Your obligations on the precise times stated in this Agreement is of absolute importance and failure to perfonn any of them timely is a material breach of and default under this Agreement, time being of the essence. 24. RECORDING. Neither this Agreement, nor any notice or summary hereof, may be recorded among any public records. 25. ENVIRONMENTAL RISK/MOLD. We make no warranties, express or implied, about the existing or future health hazards or environmental conditions on the Property. in the improvements, or from adjacent sources, including, but not limited to, exposure to radon gas, electric and magnetic fields, shifting or instability of the soil and contamination of the improvements or the surrounding air, water or soil from any sources or in any manner. You are advised that the continued presence of moisture on components of the improvements can cause the propagation of mold, which may cause allergenic reactions and other health problems in some individuals. Upon a,;suming possession of the improvements, You are responsible for implementing an inspection and maintenance program for the identification and elimination of moisture in the improvements that could give rise to the growth of mold or other conditions detrimental to functioning of the improvements or the health of its occupants. 26. AGENCY. If there is more than one person who is a Buyer, then each such person hereby irrevocably appoints the other person to be his or her agent and attorney-in-fact to bind him or her to any agreement, amendment or obligation that concerns or is related to this Agreement, the Property, or Our warranty obligations. We are entitled, but not obligated, to rely on Your authorization of each other as agents and attorneys-in-fact, and You will release and hold Us harmless if We rely on this authori1ation. 27. TITLE INSURANCE. You acknowledge that We have not directly or indirectly required You, as a condition of this sale, to purchase either an owner's or mortgagee's title insurance policy from any particular insurer or agency. 28. PURPOSE FOR PURCHASE. You represent to Us that You are purchasing the Property for Your own use and not for or on behalf of others. You acknowledge that You have not received from Us and you have not relied upon any statement, infonnation or opinion about the present or future value of the Property or about any possible financial or tax advantages that could be derived from real property, and We disclaim any such statements, It is impossible to predict the future value or income potential of residential real property, which is inherently speculative, liquid and unique. You are encouraged to seek the advice of competent attorneys and financial and tax advisors prior to signing this Agreement. 29. INSULATION. We have advised You, as required by the rules of the Federal Trade Commission, that We currently intend to install in the Home the minimum insulation disclosed below. The RM Value and other information shown below are based solely on the infonnation given by the appropriate manufacturers (based on the thicknesses listed) and you agree that We are not responsible for the manufacturers' errors or omissions. MinimumR- Location Minimum Type Approximate Thickness Value Walls Batt 3.5'' 13 Flat Ceilino'- Blown 14" 38 Sloped Ceiling Batt 6.25 11 19 Dead Slooes Batt 6,25 11 19 30. VA LOAN. If You are obtaining Veterans Administration financing, then: it is expressly agreed that, notwithstanding any other provisions of this Agreement, You shall not incur any penalty by forfeiture of earnest money or otherwise or be obligated to ilie '"V