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H.B. 19 Enrolled

    

REAL PROPERTY IMPROVEMENTS AGREEMENTS

    
1997 GENERAL SESSION

    
STATE OF UTAH

    
Sponsor: David Ure

    AN ACT RELATING TO COMMERCE AND TRADE; MODIFYING PROHIBITION
    AGAINST CERTAIN CONSTRUCTION CONTRACT PROVISIONS RELATING TO
    LIABILITY; AND MAKING TECHNICAL CORRECTIONS.
    This act affects sections of Utah Code Annotated 1953 as follows:
    AMENDS:
         13-8-1, as enacted by Chapter 35, Laws of Utah 1969
    Be it enacted by the Legislature of the state of Utah:
        Section 1. Section 13-8-1 is amended to read:
         13-8-1. Construction industry -- Agreements to indemnify.
        [A covenant, promise, agreement or understanding in, or in connection with or collateral
    to, a contract or agreement relative to the construction, alteration, repair or maintenance of a
    building, structure, highway, appurtenance and appliance, including moving, demolition and
    excavating connected therewith, purporting to indemnify the promisee against liability for
    damages arising out of bodily injury to persons or damage to property caused by or resulting from
    the sole negligence of the promisee, his agents or employees, or indemnitee, is against public
    policy and is void and unenforceable.]
        (1) For purposes of this section:
        (a) "Construction contract" means a contract or agreement relative to the design,
    construction, alteration, repair, or maintenance of a building, structure, highway, appurtenance,
    appliance, or other improvement to real property, including moving, demolition, or excavating,
    connected to the construction contract between:
        (i) a construction manager;
        (ii) a general contractor;
        (iii) a subcontractor;
        (iv) a sub-subcontractor;

        (v) a supplier; or
        (vi) any combination of persons listed in Subsections (1)(a)(i) through (v).
        (b) "Indemnification provision" means a covenant, promise, agreement or understanding in,
    in connection with, or collateral to a construction contract requiring the promisor to insure, hold
    harmless, indemnify, or defend the promisee or others against liability if:
        (i) the damages arise out of:
        (A) bodily injury to a person;
        (B) damage to property; or
        (C) economic loss; and
        (ii) the damages are caused by or resulting from the fault of the promisee, indemnitee, others,
    or their agents or employees.
        (2) Except as provided in Subsection (3), an indemnification provision in a construction
    contract is against public policy and is void and unenforceable.
        (3) When an indemnification provision is included in a contract related to a construction
    project between an owner and party listed in Subsection (1)(a), in any action for damages described
    in Subsection (1)(b)(i), the fault of the owner shall be apportioned among the parties listed in
    Subsection (1)(a) pro rata based on the proportional share of fault of each of the parties listed in
    Subsection (1)(a), if:
        (a) the damages are caused in part by the owner; and
        (b) the cause of the damages defined in Subsection (1)(b)(i) did not arise at the time and
    during the phase of the project when the owner was operating as a party defined in Subsection (1)(a).
        (4) This [act will] section may not be construed to affect or impair the obligations of
    contracts or agreements, [which] that are in existence at the time [the act] this section or any
    amendment to this section becomes effective.

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