HB 1455

1	A bill to be entitled
2	An act relating to construction contracts; amending s.
3	725.06, F.S.; deleting exceptions and limitations on such
4	exceptions to construction contracts promising to
5	indemnify or hold harmless certain parties from certain
6	liabilities as being void and unenforceable; specifying as
7	void and unenforceable portions of construction contracts
8	under which parties undertake to insure or purchase
9	insurance liability for damages for certain other parties;
10	providing exceptions; providing construction to preserve
11	limits on certain indemnity agreements or agreements to
12	insure; deleting a prohibition against certain
13	construction contracts for public agencies requiring
14	certain activities of the parties relating to specified
15	liabilities; providing an effective date.
16
17	Be It Enacted by the Legislature of the State of Florida:
18
19	Section 1.  Section 725.06, Florida Statutes, is amended to
20	read:
21	725.06  Construction contracts; limitation on
22	indemnification.--
23	(1)  Except as provided in subsections (2) and (4), any
24	portion of any agreement or contract for or in connection with,
25	or any guarantee of or in connection with, any construction,
26	alteration, repair, or demolition of a building, structure,
27	appurtenance, or appliance, including moving and excavating
28	associated therewith, between an owner of real property and an
29	architect, engineer, general contractor, subcontractor, sub-
30	subcontractor, or materialman or any combination thereof wherein
31	any party referred to herein promises to indemnify or hold
32	harmless the other party to the agreement, contract, or
33	guarantee for liability for damages to persons or property
34	caused in whole or in part by any act, omission, or default of
35	the indemnitee arising from the contract or its performance,
36	shall be void and unenforceable unless the contract contains a
37	monetary limitation on the extent of the indemnification that
38	bears a reasonable commercial relationship to the contract and
39	is part of the project specifications or bid documents, if any.
40	Notwithstanding the foregoing, the monetary limitation on the
41	extent of the indemnification provided to the owner of real
42	property by any party in privity of contract with such owner
43	shall not be less than $1 million per occurrence, unless
44	otherwise agreed by the parties. Indemnification provisions in
45	any such agreements, contracts, or guarantees may not require
46	that the indemnitor indemnify the indemnitee for damages to
47	persons or property caused in whole or in part by any act,
48	omission, or default of a party other than:
49	(a)  The indemnitor;
50	(b)  Any of the indemnitor's contractors, subcontractors,
51	sub-subcontractors, materialmen, or agents of any tier or their
52	respective employees; or
53	(c)  The indemnitee or its officers, directors, agents, or
54	employees. However, such indemnification shall not include
55	claims of, or damages resulting from, gross negligence, or
56	willful, wanton or intentional misconduct of the indemnitee or
57	its officers, directors, agents or employees, or for statutory
58	violation or punitive damages except and to the extent the
59	statutory violation or punitive damages are caused by or result
60	from the acts or omissions of the indemnitor or any of the
61	indemnitor's contractors, subcontractors, sub-subcontractors,
62	materialmen, or agents of any tier or their respective
63	employees.
64	(2)  A construction contract for a public agency or in
65	connection with a public agency's project may require a party to
66	that contract to indemnify and hold harmless the other party to
67	the contract, their officers and employees, from liabilities,
68	damages, losses and costs, including, but not limited to,
69	reasonable attorney's fees, to the extent caused by the
70	negligence, recklessness, or intentional wrongful misconduct of
71	the indemnifying party and persons employed or utilized by the
72	indemnifying party in the performance of the construction
73	contract.
74	(3)  Except as provided in subsection (4), any portion of
75	any agreement or contract for or in connection with, or any
76	guarantee of or in connection with, any construction,
77	alteration, repair, or demolition of a building, structure,
78	appurtenance, or appliance, including moving and excavating
79	associated therewith, between an owner of real property and an
80	architect, engineer, general contractor, subcontractor, sub-
81	subcontractor, or materialman or any combination of such parties
82	under which any such party undertakes to insure or purchase
83	insurance for the other party to the agreement, contract, or
84	guarantee for liability for damages to persons or property
85	caused in whole or in part by any act, omission, or default of
86	the party to be insured is void and unenforceable, except such
87	insurance may be purchased to cover the vicarious liability that
88	the party to be insured may have for the actions of the other
89	party to the agreement, contract, or guarantee.
90	(4)(3)  This section shall not be construed to place limits
91	on indemnity agreements or agreements to insure that are solely
92	between an entity regulated by the Florida Public Service
93	Commission and an architect, engineer, general contractor,
94	subcontractor, sub-subcontractor, or materialman as long as the
95	contract contains a monetary limitation on the extent of the
96	indemnification that bears a reasonable commercial relationship
97	to the contract and is part of the project specifications or bid
98	documents, if any. Except as specifically provided in subsection
99	(2), a construction contract for a public agency or in
100	connection with a public agency's project may not require one
101	party to indemnify, defend, or hold harmless the other party,
102	its employees, officers, directors, or agents from any
103	liability, damage, loss, claim, action, or proceeding, and any
104	such contract provision is void as against public policy of this
105	state.
106	(5)(4)  This section does not affect any contracts,
107	agreements, or guarantees entered into before the effective date
108	of this section or any renewals thereof.
109	Section 2.  This act shall take effect July 1, 2006.

CODING: Words stricken are deletions; words underlined are additions.