§ 113.009.No Third-Party Beneficiaries

The last section decides who may use the waiver, and the answer is a short list.

A party to the contract may sue. The waiver exists for the benefit of the people who made the agreement.

An assignee may sue if the contract permits assignment. The permission has to come from the contract itself, not from the assignment.

No third-party beneficiaries. A downstream customer, a lender or a co-owner of the plant cannot claim the waiver as its own.

The cause of action cannot be sold. Except for a permitted assignment of the contract interest, a party authorized to sue may not transfer or assign the claim to any person.

That closes the obvious workaround. A waiver limited to contracting parties would mean little if the claim could be handed to anyone afterward.

It also keeps the district’s exposure predictable. A district knows, when it signs, exactly who can bring it to court on the contract.

Financing arrangements have to be built with this in mind. A lender taking security in a generating facility does not acquire the claim, and an assignment has to run through the contract’s own assignment terms.

The limit is unusual among contract statutes. Commercial claims are ordinarily assignable, and the legislature narrowed that here because the defendant is a public body created to serve a defined constituency.