California Senate Bill 885 ("SB 885") (Wolk), which would have expanded upon existing legislative safeguards for design professionals that discourage risk-shifting towards subcontractors in construction project indemnity agreements, was pulled from the Assembly Judiciary Committee on July 12 at the request of the author. Had it passed out of the Assembly and been signed by Governor Brown, SB 885 would have rendered unenforceable all contracts or contract terms entered into on or after January 1, 2017 requiring design professionals to indemnify claims against another party on a construction project concerning that party's negligence, reckless or willful misconduct.
Since SB 885 had serious repercussions relative to indemnity claims arising from public works construction contracts, it is no surprise that public agencies were strongly opposed to the bill. For instance, the California Special Districts Association targeted SB 885 as a "top priority oppose bill" and the California Association of Joint Powers Authorities similarly broadcasted an "action alert" to oppose this bill. These opposition groups, along with other opposed groups (e.g., construction unions and project owners), convinced the author to withdraw the bill from Assembly Judiciary Committee consideration at a planned June 28 hearing.
Although the bill was pulled in 2016, given the importance of the issue raised by SB 885, it is likely that a similar bill will return during the next legislative session. We will report on further legislative action on this issue in future editions.
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