By Wolens H.B. No. 99
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to certain criteria for enforceability of indemnification
1-3 agreements and release agreements.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subchapter D, Chapter 35, Business & Commerce
1-6 Code, is amended by adding Section 35.43 to read as follows:
1-7 Sec. 35.43. ENFORCEABILITY OF INDEMNIFICATION AGREEMENTS AND
1-8 RELEASE AGREEMENTS. (a) In this section:
1-9 (1) "Indemnification agreement" means an agreement in
1-10 writing to defend or indemnify a person against loss, liability,
1-11 cost, or expense (including attorneys' fees).
1-12 (2) a"Release agreement" means an agreement in writing
1-13 to release a person from liability.
1-14 (3) "Disclosure criterion" means a standard imposed
1-15 for the purpose of drawing attention to a particular term of an
1-16 agreement or a requirement that a particular obligation of a party
1-17 to the agreement be specifically expressed or expressed by the use
1-18 of particular language, including but not limited to any standard
1-19 or requirement that:
1-20 (A) the obligation be expressed in specific,
1-21 clear, or unequivocal language, rather than by implication;
1-22 (B) the term be set forth in print, type, or
1-23 some other form of writing that is conspicuous within the meaning
2-1 of Section 1.201 of the Uniform Commercial Code or that is
2-2 otherwise designed to attract attention to the term;
2-3 (C) the obligation be expressed by the use of
2-4 the word "negligence" or other particular words;
2-5 (D) the agreement contain a statement of the
2-6 consequences of the particular term or that the parties intend
2-7 certain consequences; or
2-8 (E) the term or obligation meet some other
2-9 criterion for notice or expression, whether or not heretofore
2-10 imposed by the courts of this state.
2-11 (b) The legality, validity, or enforceability of an
2-12 indemnification agreement or release agreement shall not be
2-13 affected by the fact that the indemnification agreement or release
2-14 agreement, or any part thereof, does not meet any disclosure
2-15 criterion.
2-16 (c) Subsection (b) of this section does not apply to an
2-17 indemnification agreement or release agreement if the indemnitor or
2-18 the releasing party is an individual who entered into the agreement
2-19 primarily for personal, family, or household purposes.
2-20 (d) Whether an agreement constitutes an indemnification or
2-21 release agreement to which subsection (b) of this section applies
2-22 is not affected by:
2-23 (1) whether the loss, liability, cost, or expense
2-24 against which a person is to be defended or indemnified, or the
2-25 liability from which a person is released, is wholly or partially a
3-1 result of the indemnitee's or released party's own past, present,
3-2 or future action or inaction;
3-3 (2) whether the action or inaction constitutes
3-4 negligence or gross negligence; or
3-5 (3) whether the loss, liability, cost, or expense
3-6 against which a person is to be defended or indemnified is a
3-7 liability to, or a loss, cost, or expense of, the indemnitor
3-8 itself.
3-9 SECTION 2. This Act applies to an agreement entered into
3-10 before, on, or after the effective date of this Act; provided,
3-11 however, that this Act shall not apply to any agreement that is the
3-12 subject of any action that was filed in a court of competent
3-13 jurisdiction before the effective date of this Act, and the law in
3-14 effect immediately prior to the effective date of this Act is
3-15 continued in full force and effect solely for the purpose of
3-16 determining the rights and liabilities of a party to such an
3-17 action.
3-18 SECTION 3. This Act takes effect September 1, 1995.
3-19 SECTION 4. The importance of this legislation and the
3-20 crowded condition of the calendars in both houses create an
3-21 emergency and an imperative necessity tht the constitutional rule
3-22 requiring bills to be read on three several days in each house be
3-23 suspended, and this rule is hereby suspended.