{"id":1782,"date":"2013-06-26T09:55:08","date_gmt":"2013-06-26T15:55:08","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=1782"},"modified":"2013-06-26T09:55:08","modified_gmt":"2013-06-26T15:55:08","slug":"broad-form-indemnities-in-construction-contracts","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/broad-form-indemnities-in-construction-contracts\/","title":{"rendered":"Broad Form Indemnities In Construction Contracts"},"content":{"rendered":"

Joe Virene – June 20, 2013<\/p>\n

Indemnifying someone for their own negligence is a tough pill to swallow.\u00a0 Yet, such clauses, often\u00a0referred to as \u201cbroad form indemnities\u201d,\u00a0have been common for many years in Texas construction contracts.<\/p>\n

In 2011, Texas passed a new law dramatically limiting such clauses in construction contracts.<\/p>\n

The New Rule<\/strong><\/p>\n

In a nutshell, the new law makes an indemnity provision in a construction contract void if it requires the indemnitor to indemnify, defend, or hold harmless the indemnitee for a claim caused in whole or in part by that indemnitee\u2019s\u00a0own\u00a0negligence. \u00a0The new law also bars any construction contract provision that requires the purchase of additional insurance that would cover the indemnitee\u2019s own negligence. \u00a0In other words, the change prevents an owner or a general contractor from requiring a contractor or subcontractor to provide insurance for the owner\u2019s or general contractor\u2019s own negligence.<\/p>\n

What is a \u201cconstruction contract\u201d?<\/strong><\/p>\n

The term \u201cconstruction contract\u201d is broadly defined in the statute. \u00a0It means:<\/p>\n

\u201ca contract, subcontract, or agreement, or a performance bond assuring the performance of any of the foregoing, entered into or made by an owner, architect, engineer, contractor, construction manager, subcontractor, supplier, or material or equipment lessor for the design, construction, alteration, renovation, remodeling, repair, or maintenance of, or for the furnishing of material or equipment for, 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.\u00a0\u00a0The term includes an agreement to which an architect, engineer, or contractor and an owner\u2019s lender are parties regarding an assignment of the construction contract or other modifications thereto.\u201d\u00a0<\/em><\/p>\n

This will cover many contracts including some (e.g., maintenance contracts)\u00a0that may not traditionally be thought of as construction contracts.<\/p>\n

Oil and Gas Contracts<\/strong><\/p>\n

The new law, however, specifically exempts out contracts covered by the Texas Oilfield Anti-Indemnity Act which will exclude most contracts related to oil and gas. \u00a0However, contracts related to pipelines may be covered by the new construction statute because such contracts are not covered by the Texas Oilfield Anti-Indemnity Act and arguably do fit the definition of \u201cconstruction contracts.\u201d<\/p>\n

Some Other Important Exceptions<\/strong><\/p>\n

The statute enumerates several other exceptions.\u00a0 For instance, this new law does not apply to claims \u201cfor the bodily injury or death of an employee of the indemnitor, its agent, or subcontractor of any tier.\u201d \u00a0Residential construction contracts are also excluded.<\/p>\n

Note that the express negligence rule should still apply to these exceptions. \u00a0That is, indemnity clauses that cover the indemnitee\u2019s own negligence should be clear and conspicuous.<\/p>\n

The Bottom Line<\/strong><\/p>\n

This new law is largely a good thing for subcontractors and suppliers in the construction industry because their contracts frequently contain broad form indemnities to the general contractor.\u00a0 This also benefits general contractors who also are sometimes\u00a0required to provide broad form indemnities to the owner.<\/p>\n

via Broad Form Indemnities In Construction Contracts | Looper Reed & McGraw, P.C. – JDSupra<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Joe Virene – June 20, 2013 Indemnifying someone for their own negligence is a tough pill to swallow.\u00a0 Yet, such clauses, often\u00a0referred to as \u201cbroad form indemnities\u201d,\u00a0have been common for many years in Texas construction contracts. In 2011, Texas passed a new law dramatically limiting such clauses in construction contracts. The New Rule In a… Continue reading Broad Form Indemnities In Construction Contracts<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[14,9],"tags":[369,72],"class_list":["post-1782","post","type-post","status-publish","format-standard","hentry","category-construction-2","category-construction-contracts","tag-broad-form-indemnities","tag-construction-contracts-2","entry"],"jetpack_publicize_connections":[],"yoast_head":"\nBroad Form Indemnities In Construction Contracts - Advise & Consult, Inc.<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/broad-form-indemnities-in-construction-contracts\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Broad Form Indemnities In Construction Contracts - Advise & Consult, Inc.\" \/>\n<meta property=\"og:description\" content=\"Joe Virene – June 20, 2013 Indemnifying someone for their own negligence is a tough pill to swallow.\u00a0 Yet, such clauses, often\u00a0referred to as \u201cbroad form indemnities\u201d,\u00a0have been common for many years in Texas construction contracts. 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