By Hardcastle                                         H.B. No. 3105
         77R7172 DAK-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to indemnification in construction contracts.
 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1. Title 6, Civil Practice and Remedies Code, is
 1-5     amended by adding Chapter 145 to read as follows:
 1-6        CHAPTER 145.  INDEMNITY PROVISIONS IN CONSTRUCTION CONTRACTS
 1-7           Sec. 145.001.  DEFINITION.  In this chapter, "construction
 1-8     contract" means a contract or agreement made and entered into by an
 1-9     owner, contractor, subcontractor, or supplier concerning the
1-10     construction, alteration, repair, or maintenance of a building,
1-11     structure, appurtenance, or other improvement to or on real
1-12     property, including moving, demolition, and excavation connected
1-13     with the real property.
1-14           Sec. 145.002.  AGREEMENT VOID AND UNENFORCEABLE.  A covenant,
1-15     promise, agreement, or understanding contained in a construction
1-16     contract, or in an agreement collateral to or affecting a
1-17     construction contract, is void and unenforceable if it indemnifies,
1-18     holds harmless, or defends a person against loss or liability for
1-19     damage that:
1-20                 (1)  is caused by or results from the sole or
1-21     concurrent negligence of the indemnitee, its agent or employee, or
1-22     an independent contractor, other than the indemnitor, directly
1-23     responsible to the indemnitee; and
1-24                 (2)  arises from:
 2-1                       (A)  personal injury or death;
 2-2                       (B)  property damage;
 2-3                       (C)  a fine, penalty, administrative action, or
 2-4     other action assessed by a governmental entity directly against the
 2-5     indemnitee, its agent or employee, or an individual contractor
 2-6     directly responsible to the indemnitee; or
 2-7                       (D)  any other loss, damage, or expense that
 2-8     arises from an occurrence described by Subparagraph (A), (B), or
 2-9     (C).
2-10           Sec. 145.003.  INSURANCE LIMITATION.  (a)  An insurance
2-11     policy provision or endorsement relating to a construction contract
2-12     may apply only to damages arising from the negligence of the person
2-13     who is the named insured.
2-14           (b)  A policy provision or endorsement that applies to
2-15     damages arising from the negligence of a person other than the
2-16     named insured is void and unenforceable.
2-17           Sec. 145.004.  EFFECT ON INSURANCE CONTRACT.  Except as
2-18     provided by Section 145.003, this chapter does not affect the
2-19     applicability, validity, or enforceability of an insurance
2-20     contract.
2-21           Sec. 145.005.  CONTRIBUTION.  This chapter does not affect a
2-22     right of contribution established under Chapter 33 or another
2-23     statute.
2-24           Sec. 145.006.  WAIVER PROHIBITED.  The provisions of this
2-25     chapter may not be waived by contract or otherwise.
2-26           SECTION 2.  This Act takes effect September 1, 2001.
2-27           SECTION 3.  Chapter 145, Civil Practice and Remedies Code, as
 3-1     added by this Act, applies only to an agreement described by
 3-2     Section 145.002, Civil Practice and Remedies Code, as added by this
 3-3     Act, entered into on or after the effective date of this Act.  An
 3-4     agreement entered into before the effective date of this Act is
 3-5     governed by the law applicable to the agreement immediately before
 3-6     the effective date of this Act, and that law is continued in effect
 3-7     for that purpose.
 3-8           SECTION 4.  Section 145.003, Civil Practice and Remedies
 3-9     Code, as added by this Act, applies only to an insurance policy
3-10     that is delivered, issued for delivery, or renewed on or after the
3-11     effective date of this Act.  A policy that is delivered, issued for
3-12     delivery, or renewed after the effective date of this Act is
3-13     governed by the law as it existed immediately before that date, and
3-14     that law is continued in effect for that purpose.