|
A BILL TO BE ENTITLED
|
|
AN ACT
|
|
|
relating to indemnification provisions in construction contracts. |
|
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|
SECTION 1. The Civil Practice and Remedies Code is amended |
|
by adding Title 10 to read as follows: |
|
TITLE 10. ADDITIONAL MISCELLANEOUS PROVISIONS |
|
CHAPTER 502. INDEMNITY PROVISIONS IN CONSTRUCTION CONTRACTS |
|
Sec. 502.001. DEFINITIONS. In this chapter: |
|
(1) "Additional insured" means a person covered under |
|
another person's insurance policy for an occurrence caused by |
|
something other than the sole negligence of the first named insured |
|
under the policy. |
|
(2) "Construction contract" means a contract or |
|
agreement entered into or made by an owner, contractor, |
|
subcontractor, or supplier concerning the construction, |
|
alteration, remodeling, repair, or maintenance of a building, |
|
structure, appurtenance, or other improvement to or on public or |
|
private real property, including moving, demolition, and |
|
excavation connected with the real property. The term includes a |
|
contract or agreement described by this subdivision under which the |
|
construction, alteration, remodeling, repair, or maintenance is |
|
performed under a consolidated insurance program. |
|
Sec. 502.002. AGREEMENT VOID AND UNENFORCEABLE. (a) A |
|
covenant, promise, or understanding contained in a construction |
|
contract, or in an agreement collateral to or affecting a |
|
construction contract, is void and unenforceable if it purports to |
|
indemnify, hold harmless, or defend a person against loss or |
|
liability for damage that is caused by or results from: |
|
(1) the breach of contract or warranty by the |
|
indemnitee; |
|
(2) the sole or concurrent negligence of the |
|
indemnitee; or |
|
(3) a fine, penalty, administrative action, or other |
|
action assessed by a governmental entity directly against the |
|
indemnitee except to the extent that the indemnitor contributed to |
|
the violation upon which the fine, penalty, or administrative |
|
action is based. |
|
(b) For the purposes of this section, an indemnitee includes |
|
the indemnitee's agent or employee or an independent contractor, |
|
other than the indemnitor, directly responsible to the indemnitee. |
|
Sec. 502.003. UNENFORCEABLE INSURANCE PROVISIONS. (a) A |
|
covenant, promise, agreement, or understanding contained in a |
|
construction contract, or in an agreement collateral to or |
|
affecting a construction contract, that requires a person to |
|
provide insurance coverage or does provide insurance coverage, is |
|
void and unenforceable to the extent that it requires: |
|
(1) contractual liability coverage that exceeds the |
|
limitations of the indemnity obligations of this chapter; |
|
(2) that a person be an additional insured for that |
|
additional insured person's own negligence; or |
|
(3) a workers' compensation insurance policy to be |
|
endorsed to provide a waiver of subrogation. |
|
(b) An insurance contract may not provide an additional |
|
insured endorsement or a waiver of subrogation that is in |
|
contravention of this chapter. Any purported endorsement or waiver |
|
described by this subsection is void and unenforceable. |
|
Sec. 502.004. INSURANCE CONTRACTS; WORKERS' COMPENSATION; |
|
CERTAIN WAIVERS. This chapter does not otherwise affect the |
|
validity and enforceability of: |
|
(1) an insurance contract; |
|
(2) the benefits or protections under the workers' |
|
compensation laws of this state; or |
|
(3) a waiver of subrogation between contractors or |
|
between a principal and a contractor for coverage provided by a |
|
consolidated insurance program. |
|
Sec. 502.005. WAIVER PROHIBITED. The provisions of this |
|
chapter may not be waived by contract or otherwise. Any purported |
|
waiver of a provision of this chapter is void and unenforceable. |
|
Sec. 502.006. APPLICABILITY OF OTHER LAW. This chapter |
|
prevails over any other law that conflicts with or is inconsistent |
|
with this chapter. |
|
SECTION 2. Section 2252.902, Government Code, is repealed. |
|
SECTION 3. This Act applies only to liability for an act of |
|
negligence under a construction contract entered into on or after |
|
the effective date of this Act. Liability for an act of negligence |
|
under a construction contract entered into before the effective |
|
date of this Act is governed by the law in effect immediately before |
|
the effective date of this Act, and that law is continued in effect |
|
for that purpose. |
|
SECTION 4. This Act takes effect September 1, 2007. |
|
|
|
* * * * * |