BILL NUMBER: AB 758	CHAPTERED  09/29/05

	CHAPTER  394
	FILED WITH SECRETARY OF STATE  SEPTEMBER 29, 2005
	APPROVED BY GOVERNOR  SEPTEMBER 29, 2005
	PASSED THE ASSEMBLY  AUGUST 25, 2005
	PASSED THE SENATE  AUGUST 18, 2005
	AMENDED IN SENATE  JULY 6, 2005
	AMENDED IN ASSEMBLY  MAY 31, 2005

INTRODUCED BY   Assembly Member Calderon
   (Principal coauthor: Assembly Member Haynes)

                        FEBRUARY 18, 2005

   An act to amend Section 2782 of the Civil Code, relating to
construction contracts.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 758, Calderon  Construction contracts: indemnity.
   Existing law provides that, except as specified, agreements
affecting any construction contract that purport to indemnify the
promisee against liability for damages for death or bodily injury to
persons, injury to property, or any other loss, damage, or expense
arising from the sole negligence or willful misconduct of the
promisee or the promisee's agents, servants, or independent
contractors who are directly responsible to the promisee, or for
defects in design furnished by those persons, are against public
policy and are void and unenforceable.
   This bill would provide that, except as specified, all agreements
affecting any residential construction contract and amendments
thereto entered into after January 1, 2006, that purport to indemnify
the builder by a subcontractor against liability for claims of
construction defects or other injury to property arising from,
pertaining to, or relating to the negligence of the builder or the
builder's other agents, servants, or independent contractors who are
directly responsible to the builder, or for defects in design
furnished by those persons, or for claims that are unrelated to the
scope of work in the agreement, are unenforceable, as specified.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 2782 of the Civil Code is amended to read:
   2782.  (a) Except as provided in Sections 2782.1, 2782.2, 2782.5,
and 2782.6, provisions, clauses, covenants, or agreements contained
in, collateral to, or affecting any construction contract and that
purport to indemnify the promisee against liability for damages for
death or bodily injury to persons, injury to property, or any other
loss, damage or expense arising from the sole negligence or willful
misconduct of the promisee or the promisee's agents, servants, or
independent contractors who are directly responsible to the promisee,
or for defects in design furnished by those persons, are against
public policy and are void and unenforceable; provided, however, that
this section shall not affect the validity of any insurance
contract, workers' compensation, or agreement issued by an admitted
insurer as defined by the Insurance Code.
   (b) Except as provided in Sections 2782.1, 2782.2, and 2782.5,
provisions, clauses, covenants, or agreements contained in,
collateral to, or affecting any construction contract with a public
agency that purport to impose on the contractor, or relieve the
public agency from, liability for the active negligence of the public
agency are void and unenforceable.
   (c) For all construction contracts, and amendments thereto,
entered into after January 1, 2006, for residential construction, as
used in Title 7 (commencing with Section 895) of Part 2 of Division
2, all provisions, clauses, covenants, and agreements contained in,
collateral to, or affecting any such construction contract, and
amendments thereto, that purport to indemnify, including the cost to
defend, the builder, as defined in Section 911, by a subcontractor
against liability for claims of construction defects are
unenforceable to the extent the claims arise out of, pertain to, or
relate to the negligence of the builder or the builder's other
agents, other servants, or other independent contractors who are
directly responsible to the builder, or for defects in design
furnished by those persons, or to the extent the claims do not arise
out of, pertain to, or relate to the scope of work in the written
agreement between the parties. This section shall not be waived or
modified by contractual agreement, act, or omission of the parties.
Contractual provisions, clauses, covenants, or agreements not
expressly prohibited herein are reserved to the agreement of the
parties.
   (d)  Subdivision (c) does not prohibit a subcontractor and builder
from mutually agreeing to the timing or immediacy of the defense and
provisions for reimbursement of defense fees and costs, so long as
that agreement, upon final resolution of the claims, does not waive
or modify the provisions of subdivision (c). Subdivision (c) shall
not affect the obligations of an insurance carrier under the holding
of Presley Homes, Inc. v. American States Insurance Company (2001) 90
Cal.App.4th 571. Subdivision (c) shall not affect the builder's or
subcontractor's obligations pursuant to Chapter 4 (commencing with
Section 910) of Title 7 of Part 2 of Division 2.