Texas Commercial Tenant Rights: CAM Audit Statute of Limitations

Texas does not have a commercial tenant CAM audit statute comparable to California's SB 1103. CAM rights in Texas are almost entirely lease-driven. What Texas provides is a clear four-year statute of limitations for contract claims under Texas Civil Practice & Remedies Code § 16.004, a specific assessment-of-charges statute that limits landlords' ability to bill for costs outside the lease, and a body of appellate case law that shows how Texas courts resolve CAM disputes.

The practical result: Texas commercial tenants who negotiate strong audit rights before signing have meaningful leverage. Tenants who don't negotiate audit rights — and who miss the four-year limitation window — have very little recourse.

The four-year statute of limitations

Tex. Civ. Prac. & Rem. Code § 16.004: Four-year limitations period for enumerated actions, widely cited as the applicable period for contract payment disputes including commercial lease CAM claims.

For Texas CAM overcharge claims, the clock starts when the claim accrues — generally when the landlord issues the reconciliation statement containing the challenged charge and the tenant has information sufficient to identify the dispute.

Practical implication: A tenant who receives a reconciliation statement in March 2022 alleging $40,000 in improper capital expenditures has until approximately March 2026 to file a breach of contract claim. By the time many tenants discover CAM overcharges through an audit, some historical years may already be time-barred.

The four-year window means tenants should audit their CAM charges promptly after each annual reconciliation, not years later when they first suspect a problem.

In Clear Lake Center, L.P. v. Garden Ridge, L.P. (Tex. App. — Houston [14th Dist.] 2013), the appellate court addressed limitations in a CAM management fee dispute, remanding with a holding that claims accruing before a specified date were barred by limitations. The case confirms that Texas courts apply the four-year SOL to CAM disputes and that multiple years of billings can produce multiple accrual dates, some of which may be time-barred while others are not.

Texas Property Code § 93.012: the assessment of charges backstop

One Texas statute directly relevant to CAM disputes: Texas Property Code § 93.012 (Assessment of Charges). This provision is commonly understood to require that any charge (or the method of computing a charge) be stated in the lease or a referenced/attached exhibit to be enforceable against a tenant.

Tex. Prop. Code § 93.012: Restricts the enforceability of certain pass-through charges unless the charge or computation method is stated in the lease or a referenced exhibit.

Practical significance: If a landlord attempts to assess CAM charges using a method not described in the lease — for example, adding a management fee that the lease doesn't mention, or using a denominator formula not specified in the lease — § 93.012 can be framed as a statutory backstop against that billing. The statute doesn't create a reconciliation audit procedure, but it limits the landlord's ability to improvise new charges outside the lease framework.

Practitioners sometimes reference § 93.012 in disputes where landlords have expanded CAM definitions or changed allocation methods during the lease term without lease amendment. The statute is indirect protection at best, but it can reinforce a breach-of-lease argument where the changed methodology has no textual support in the lease.

How Texas courts resolve CAM disputes

The dominant pattern in Texas CAM litigation: courts analyze the lease text, the landlord's documentation, and the billing methodology. Statutory rights play a supporting role; the lease drives the outcome.

Clear Lake Center, L.P. v. Garden Ridge, L.P. (Tex. App. — Houston [14th Dist.] 2013): Arose from a dispute over whether the landlord's management fees were properly included in CAM. The lease provided that the tenant had the right to "inspect, audit and copy" the landlord's books and records on reasonable notice — a contractual audit right that the court cited as the mechanism for challenging charges. The court applied limitations to bar claims for older years, remanding for further proceedings on timely claims.

The case illustrates that a contractually negotiated audit right ("inspect, audit and copy") gave this tenant real leverage that a tenant without an audit clause would not have had.

WC 4th and Colorado, LP v. JAC Entertainment (Tex. App. — Austin 2019): Commercial lease dispute where the landlord increased CAM charges and the tenant alleged the charges improperly included general administrative expenses for the entire premises rather than just the defined common areas. The court analyzed the lease definitions and the landlord's ledgers, reflecting how documentation quality affects outcomes.

What Texas tenants can negotiate

Because Texas provides no statutory audit rights for most commercial tenants, lease negotiation is the only opportunity to create them. Key provisions to address:

Audit rights clause: Texas courts (as in Clear Lake Center) have enforced contractual audit rights. Negotiate a clause giving you the right to inspect, audit, and copy the landlord's CAM records within 12 months of each reconciliation statement.

Section 93.012 compliance: Include lease language explicitly stating the CAM definition and allocation method so that any deviation constitutes a breach. This reinforces the § 93.012 argument if the landlord later unilaterally changes methodology.

Limitations period: The lease can shorten (but typically cannot extend) the Texas statutory SOL. Watch for lease provisions that require you to object to reconciliation statements within 30 or 60 days — these effectively shorten the four-year period by converting silence into acceptance.

Management fee definition: Specify the rate, the base (gross revenues or actual costs), and whether affiliated entities can be paid management fees.

Capital expenditure exclusion: Texas courts do not provide a per se rule excluding capital expenditures from CAM. Without an express exclusion, a landlord can argue that amortized capital costs are recoverable if the lease definition is broad enough.

Texas-specific practical considerations

Commercial lease disputes in Texas are predominantly contract disputes. Unlike residential tenants, commercial tenants in Texas have limited statutory protections. Courts enforce the lease as written. An undiscriminating or broadly drafted lease is a landlord's best protection; a precisely drafted lease with clear exclusions and audit rights is a tenant's best protection.

Texas courts may apply the business judgment rule to landlord management decisions. When a landlord makes a decision about building operations that a tenant disagrees with — like choosing a higher-cost vendor or allocating certain overhead to the property — Texas courts typically don't second-guess that decision unless the lease explicitly prohibits the expense category. The exclusion list in the lease is what gives tenants the ability to challenge specific line items.

The accrual question is important in multi-year disputes. If a landlord has been applying an improper methodology (for example, a GLOA denominator when the lease specifies GLA) for several years, each annual billing likely constitutes a separate accrual, meaning some years may fall outside the four-year window while others don't. Running an audit that covers the full four-year lookback period is advisable.

Comparing Texas to California and New York

Texas and New York share the contract-driven approach: rights are what the lease says they are. California is the outlier with its 2025 QCT statute. Illinois provides the longest limitations period for written contracts, giving tenants the most time to bring historical claims.

Frequently Asked Questions

Does Texas have any CAM audit law for commercial tenants?

No general statutory CAM audit right exists for Texas commercial tenants. Texas Property Code § 93.012 is the closest analog — it limits landlords' ability to bill for charges not described in the lease — but it doesn't create a reconciliation review or inspection procedure. Audit rights must be negotiated and included in the lease.

Can a Texas tenant withhold CAM payments to dispute charges?

Generally no, without significant legal risk. Texas courts treat commercial leases as contracts, and most leases require continued payment of additional rent including CAM while disputes are pending. Withholding payment can expose a tenant to lease termination claims. The appropriate remedy is to pay under protest and pursue recovery through legal process or arbitration per the lease terms.

What is the strongest CAM protection a Texas commercial tenant can negotiate?

A comprehensive exclusion list (especially capital expenditures), a 12-month audit rights clause with explicit records access, a management fee cap at market rates, and a fixed GLA denominator. The § 93.012 argument is a backstop if the landlord bills outside the lease framework, but it's not a substitute for precise lease drafting.

Does a reconciliation statement start the four-year clock in Texas?

Generally yes. Texas courts have recognized that a claim accrues when the facts necessary to pursue a cause of action exist — for a CAM overcharge, that's typically when the reconciliation statement is issued and the tenant receives the billing. The tenant doesn't need to have performed an audit or discovered the error; the question is when the claim arose.

How far back can a Texas tenant audit CAM charges?

The four-year SOL under § 16.004 is the backstop. For an audit initiated in 2026, claims for CAM overcharges going back to 2022 are generally within the window. Earlier years may be time-barred depending on accrual dates and any contractual objection deadlines in the lease.

Related reading:

• The Commercial Tenant's Guide to CAM Lease Language — complete provision-by-provision guide
• California SB 1103: What Commercial Tenants Need to Know
• New York Commercial Lease CAM Dispute Protections
• Audit Rights Clauses: How to Protect Yourself Before Signing
• Understanding CAM Dispute Rights — multi-state dispute guide