BILL ANALYSIS Ó AB 552 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 552 (O'Donnell) As Amended September 4, 2015 Majority vote -------------------------------------------------------------------- |ASSEMBLY: |79-0 |(May 11, 2015) |SENATE: | 40-0 |(September 9, | | | | | | |2015) | | | | | | | | | | | | | | | -------------------------------------------------------------------- Original Committee Reference: A. & A.R. SUMMARY: Limits the scope of consequential damages arising from a breach of a public works contract to cover only "delay damages," defined as damages incurred by a public agency for each day after the date on which the work was to be completed by the contractor pursuant to the public works contract. The Senate amendments limit the scope of consequential damages arising from a breach of a public works contract by: 1)Covering only "delay damages," defined as damages incurred by a public agency for each day after the date on which the work was to be completed by the contractor pursuant to the public works contract; 2)Applying the provision of this bill to only those public works AB 552 Page 2 contracts that contain a clause expressly requiring a contractor to be responsible for delay damages; and, 3)Specifying that this bill shall not be construed to preclude a public agency from including more than one clause for delay damages for specified portions of work when the delay damages have been liquidated to a set amount for each individual clause and identified in the public works contract. 4)Exempting the following departments, as identified in Public Contract Code Section 10106, from the provisions of this bill: a) The Department of Water Resources; b) The Department of Transportation; c) The Department of Boating and Waterways; d) The Department of Corrections and Rehabilitation; e) The Military Department; and, f) The Department of General Services. EXISTING LAW specifies that, for the breach of an obligation arising from a contract, the measure of damages, with certain exceptions, is the amount which will compensate the aggrieved party for all damages likely to result from the breach. (Civil Code Section 3300.) FISCAL EFFECT: According to the Senate Appropriations Committee, pursuant to Senate Rule 28.8, negligible state costs. Analysis Prepared by: William Herms / A. & A.R. / (916) 319-3600 FN: 0002242 AB 552 Page 3