BILL ANALYSIS


                                                         S.B. 341
                                                   By: Armbrister
                                             Economic Development
                                                         04-05-95
                                       Committee Report (Amended)
BACKGROUND

Current law restricts an engineer's ability to seek contractual
indemnification from others.  Engineers are prohibited from
requiring a contractor to indemnify the engineer against the
engineer's negligence.  The engineer is prohibited by law from
passing the liability for his or her negligence onto a contractor,
but can be required to accept the negligence of an owner.

PURPOSE

As proposed, S.B. 341 amends the process of indemnification in
construction contracts by prohibiting owners from requiring
registered engineers or architects to indemnify the owner, owner's
agent, or employee against liability caused by the owner's, owner's
agent's, or employee's negligence.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not grant any
additional rulemaking authority to a state officer, institution, or
agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Sections 130.001, 130.002, and 130.004, Civil
Practice and Remedies Code, as follows:

     Sec.  130.001.  DEFINITION.  Redefines "construction
     contract."
     
     Sec.  130.002.  COVENANT OR PROMISE VOID AND UNENFORCEABLE. 
     (a) Created from existing text.  Makes a nonsubstantive
     change.
     
     (b) Provides that except as provided by Subsection (c), a
       covenant or promise in connection with, or collateral to a
       construction contract for other than a single or multifamily
       residence is void and unenforceable if the covenant or
       promise provides that a registered architect or engineer
       whose work is the subject of the contract must indemnify the
       owner or the owner's agent or employee against liability for
       damages caused by or resulting from the negligence of the
       owner or the owner's agent or employee and arising from
       personal injury or death; property injury, or any other
       expense that arises from personal injury, death, or property
       injury.
       
       (c) Provides that a covenant under which a registered
       architect or engineer agrees to indemnify or hold harmless
       the owner or the owner's agent or employee against liability
       arising from personal injury or death of the architect or
       engineer or employees of the architect or engineer is
       enforceable.
       
       Sec.  130.004.  OWNER OF INTEREST IN REAL PROPERTY.  Makes
     conforming changes.
       SECTION 2.   Amends the heading of Chapter 130, Civil Practice and
Remedies Code, as follows:

CHAPTER 130.  New title:  INDEMNIFICATION IN CERTAIN CONSTRUCTION
                           CONTRACTS

SECTION 3. Makes application of this Act prospective.

SECTION 4. Emergency clause.
           Effective date: upon passage.