October 12, 2010Construction & Design Professionals Alerts
Indemnity Obligations of Design Professionals
Two recent California court cases have interpreted the contractual indemnity provisions in contracts between a design professional and its client, to expand the scope of the design professional's indemnity obligation and the duty to defend to claims not caused by any fault on the part of the design professional. These cases held that there is a duty to defend allegations of negligence at least until such time as there is an actual court finding of no negligence. By that time, most of the litigation expense has already been incurred.
On September 29, the governor signed into law SB 972 which provides that in contracts between a design professional and a public agency all provisions in the contract which purport to require the design professional to indemnify and defend the public agency, are unenforceable, except for claims that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the design professional. All contracts entered into on or after January 1, 2011, between a design professional and a public agency will be deemed to incorporate these provisions by reference.
"Design professional" is defined to include licensed architects, landscape architects, land surveyors, and registered professional engineers. "Public agency" is defined to include any county, city, city and county, district, school district, public authority, municipal corporation, or other political subdivision, joint powers authority, or public corporations in the state, but does not include the State of California.
In contracts for private projects, it is still critical that a design professional include language making it clear that the design professional has no duty to indemnify or defend its client with respect to allegations of negligence, unless the claim is caused by the negligence, recklessness, or willful misconduct of the design professional.