senate Bill S6606

Amended

Provides that provisions in construction contracts with respect to requirements for certain additional insurance coverage are void and unenforceable

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Sponsor

Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 12 / Feb / 2014
    • REFERRED TO JUDICIARY
  • 11 / Jun / 2014
    • COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • 11 / Jun / 2014
    • ORDERED TO THIRD READING CAL.1343
  • 12 / Jun / 2014
    • PASSED SENATE
  • 12 / Jun / 2014
    • DELIVERED TO ASSEMBLY
  • 12 / Jun / 2014
    • REFERRED TO JUDICIARY
  • 17 / Jun / 2014
    • RECALLED FROM ASSEMBLY
  • 17 / Jun / 2014
    • RETURNED TO SENATE
  • 17 / Jun / 2014
    • VOTE RECONSIDERED - RESTORED TO THIRD READING
  • 17 / Jun / 2014
    • AMENDED ON THIRD READING 6606A
  • 20 / Jun / 2014
    • REPASSED SENATE
  • 20 / Jun / 2014
    • RETURNED TO ASSEMBLY
  • 20 / Jun / 2014
    • REFERRED TO JUDICIARY

Summary

Provides that provisions in construction contracts with respect to requirements for certain additional insurance coverage are void and unenforceable.

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Bill Details

Versions:
S6606
S6606A
Legislative Cycle:
2013-2014
Current Committee:
Assembly Judiciary
Law Section:
General Obligations Law
Laws Affected:
Amd ยง5-322.1, Gen Ob L

Sponsor Memo

BILL NUMBER:S6606

TITLE OF BILL: An act to amend the general obligations law, in
relation to the invalidity of additional insurance provisions

PURPOSE: This bill would hold invalid any provision in a construction
contract that requires the purchase of additional insured coverage the
scope of which is prohibited under general obligations law section
5-322.1.

SUMMARY OF PROVISIONS:

Section 1 - Section 5-322.1 of the general obligations law declares
void and unenforceable indemnification clauses in construction
contracts where the indemnitee required the indemnitor to indemnify
him for damages due in whole or in part to the indemnitee's
negligence. Indemnitees have circumvented this prohibition by
requiring the indemnitee to provide the indemnitor with additional
insured coverage. This bill would correct this unfair practice.

Section 2: Establishes the effective date.

JUSTIFICATION: The New York State Legislature enacted 5-322.1 of the
general obligations law to declare 'broad form' hold harmless
provisions in construction contracts void and unenforceable.
Additional insured provisions in construction contracts flies in the
face of this prohibition and allows indemnitees to circumvent the law.
This bill would correct this inequity. Similar legislation has
recently been enacted in the State of Texas.

LEGISLATIVE HISTORY: New bill

FISCAL IMPLICATIONS: None

EFFECTIVE DATE: This act shall take effect on the thirtieth day after
it shall have become a law and shall apply only to any covenants,
promises, agreements or understandings in or in connection with or
collateral to a contract or agreement entered into on or after such
date.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

    S. 6606                                                  A. 8747

                      S E N A T E - A S S E M B L Y

                            February 12, 2014
                               ___________

IN  SENATE  --  Introduced by Sen. DeFRANCISCO -- read twice and ordered
  printed, and when printed to be committed to the Committee on  Judici-
  ary

IN  ASSEMBLY  -- Introduced by M. of A. CUSICK -- read once and referred
  to the Committee on Judiciary

AN ACT to amend the general obligations law, in relation to the invalid-
  ity of additional insurance provisions

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Subdivision 1 of section 5-322.1 of the general obligations
law, as amended by chapter 67 of the laws of 1993, is amended to read as
follows:
  1.   A  covenant,  promise,  agreement  or  understanding  in,  or  in
connection with or collateral to a contract or agreement relative to the
construction, alteration, repair or maintenance of  a  building,  struc-
ture,  appurtenances  and  appliances  including  moving, demolition and
excavating connected therewith, purporting to indemnify or hold harmless
the promisee against liability for damage arising out of  bodily  injury
to  persons or damage to property contributed to, caused by or resulting
from the negligence of the promisee, his agents or employees, or  indem-
nitee, whether such negligence be in whole or in part, is against public
policy  and  is void and unenforceable; provided that this section shall
not affect the validity of any insurance contract, workers' compensation
agreement or other agreement issued by  an  admitted  insurer;  PROVIDED
FURTHER,  THAT  A PROVISION IN A CONSTRUCTION CONTRACT THAT REQUIRES THE
PURCHASE OF ADDITIONAL INSURED COVERAGE, OR ANY COVERAGE ENDORSEMENT, OR
PROVISION WITHIN AN INSURANCE POLICY PROVIDING ADDITIONAL INSURED COVER-
AGE, IS VOID AND  UNENFORCEABLE  TO  THE  EXTENT  THAT  IT  REQUIRES  OR
PROVIDES  COVERAGE, THE SCOPE OF WHICH IS PROHIBITED UNDER THIS SUBDIVI-
SION. This subdivision shall not preclude a promisee requiring  indemni-
fication  for  damages arising out of bodily injury to persons or damage
to property caused by or resulting from the negligence of a party  other
than the promisee, whether or not the promisor is partially negligent.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD13069-01-3

S. 6606                             2                            A. 8747

  S  2.  This  act shall take effect on the thirtieth day after it shall
have become a law and shall  apply  only  to  any  covenants,  promises,
agreements  or understandings in, or in connection with or collateral to
a contract or agreement entered into on or after such date.

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