H.B. 19

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REAL PROPERTY IMPROVEMENTS AGREEMENTS
2 1997 GENERAL SESSION
3 STATE OF UTAH
4 Sponsor: David Ure
5 AN ACT RELATING TO COMMERCE AND TRADE; MODIFYING PROHIBITION
6 AGAINST CERTAIN CONSTRUCTION CONTRACT PROVISIONS RELATING TO
7 LIABILITY; AND MAKING TECHNICAL CORRECTIONS.
8 This act affects sections of Utah Code Annotated 1953 as follows:
9 AMENDS:
10 13-8-1, as enacted by Chapter 35, Laws of Utah 1969
11 Be it enacted by the Legislature of the state of Utah:
12 Section 1. Section 13-8-1 is amended to read:
13 13-8-1. Construction industry -- Agreements to indemnify.
14 [A covenant, promise, agreement or understanding in, or in connection with or collateral
15 to, a contract or agreement relative to the construction, alteration, repair or maintenance of a
16 building, structure, highway, appurtenance and appliance, including moving, demolition and
17 excavating connected therewith, purporting to indemnify the promisee against liability for
18 damages arising out of bodily injury to persons or damage to property caused by or resulting from
19 the sole negligence of the promisee, his agents or employees, or indemnitee, is against public
20 policy and is void and unenforceable.]
21 (1) For purposes of this section:
22 (a) "Construction contract" means a contract or agreement relative to the design,
23 construction, alteration, repair, or maintenance of a building, structure, highway, appurtenance,
24 appliance, or other improvement to real property, including moving, demolition, or excavating,
25 connected to the construction contract between:
26 (i) a construction manager;
27 (ii) a general contractor;

1 (iii) a subcontractor;
2 (iv) a sub-subcontractor;
3 (v) a supplier; or
4 (vi) any combination of persons listed in Subsections (1)(a)(i) through (v).
5 (b) "Indemnification provision" means a covenant, promise, agreement or understanding
6 in, in connection with, or collateral to a construction contract requiring the promisor to insure, hold
7 harmless, indemnify, or defend the promisee or others against liability if:
8 (i) the damages arise out of:
9 (A) bodily injury to a person;
10 (B) damage to property; or
11 (C) economic loss; and
12 (ii) the damages are caused by or resulting from the fault of the promisee, indemnitee,
13 others, or their agents or employees.
14 (2) S [ An ] EXCEPT AS PROVIDED IN SUBSECTION (3), AN s indemnification provision in a
14a construction contract is against public policy and
15 is void and unenforceable.
15a S (3) WHEN AN INDEMNIFICATION PROVISION IS INCLUDED IN A CONTRACT RELATED TO
15b A CONSTRUCTION PROJECT BETWEEN AN OWNER AND PARTY LISTED IN SUBSECTION (1)(a), IN
15c ANY ACTION FOR DAMAGES DESCRIBED IN SUBSECTION (1)(b)(i), THE FAULT OF THE OWNER SHALL
15d BE APPORTIONED AMONG THE PARTIES LISTED IN SUBSECTION (1)(a) PRO RATA BASED ON THE
15e PROPORTIONAL SHARE OF FAULT OF EACH OF THE PARTIES LISTED IN SUBSECTION (1)(a), IF:
15f (a) THE DAMAGES ARE CAUSED IN PART BY THE OWNER; AND
15g (b) THE CAUSE OF THE DAMAGES DEFINED IN SUBSECTION (1)(b)(i) DID NOT ARISE AT THE
15h TIME AND DURING THE PHASE OF THE PROJECT WHEN THE OWNER WAS OPERATING AS A PARTY
15i DEFINED IN SUBSECTION (1)(a). s
16 S [(3)] (4) s This [act will] section may not be construed to affect or impair the obligations of
17 contracts or agreements, [which] that are in existence at the time [the act] this section or any
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Amend on 2_goldenrod March 3, 1997
Amend on 3_goldenrod March 4, 1997 18 amendment to this section becomes effective.


Legislative Review Note
as of 10-16-96 2:07 PM
A limited legal review of this bill raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel

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