As part of our monitoring of laws
affecting the construction industry, our firm
has been studying in greater detail the changes
the 2000 Legislature made to Florida Statue 725.06,
which was first mentioned in our Fall newsletter.
This statute controls indemnity provisions in
construction contracts. The revised statutory
language is on the reverse side.
Under the old law, any form of indemnity,
including an indemnity for another party's negligence,
could be inserted into the contract provided there
was either separate payment for the indemnity
or a limitation on the amount of the indemnity.
This was often handled by stating that a certain
part of the contract amount was payment for the
indemnity.
You should be aware that the Legislature
has changed that statute to specifically prescribe
the TYPE of indemnity which can be used in a construction
contract. Among other things, an indemnity for
another party's own negligence is now prohibited.
Because this statue is so new, there
is no case law interpreting its provisions. When
a court is presented with an indemnity that is
not the same as one allowed under the statute,
it will have to make choice:
1. Leave the indemnity in place, but
REDUCE its coverage to that which is provided
for under the revised statue.
2. Declare that the indemnity violates
the statute and is therefore VOID IN ITS ENTIRETY.
It's the second alternative that
is most troublesome because it eliminates altogether
any right of indemnification.
As a precaution, your contracts
should be reviewed carefully. This should include
your contracts with owners and subcontractors
to be certain that the indemnity provisions meet
the new requirements.
We are always ready to assist you
in any review and alteration of your contracts
that may be required.
 To Top
725.06. Construction Contracts: limitation on indemnification
(1) A construction contract may
require a party to that contract to indemnify
and hold harmless the other party to the contract,
their officers and employees, from liabilities,
damages, losses and costs, including, but not
limited to, reasonable attorney's fees, to the
extent caused by the negligence, recklessness,
or intentional wrongful misconduct of the indemnifying
party and persons employed or utilized by the
indemnifying party in the performance of the construction
contract.
(2) Except as specifically provided
in subsection (1), a construction contract may
not require one party to indemnify the other party,
its employees, officers, directors, or agents
from any liability, damage, loss, claim, action,
or proceeding, and any such contract provision
is void as against public policy of this state.
If you need additional information on any of these bills, please contact
our office and we will be happy to assist you.
To Top
|
