Legislature(2007 - 2008)CAPITOL 120
04/30/2007 01:00 PM House JUDICIARY
| Audio | Topic |
|---|---|
| Start | |
| HB163 | |
| HB3 | |
| HB151 | |
| HB225 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 3 | TELECONFERENCED | |
| += | HB 151 | TELECONFERENCED | |
| += | HB 225 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 163 | TELECONFERENCED | |
HB 151 - INDEMNITY CLAUSE IN PUBLIC CONTRACTS 1:45:57 PM CHAIR RAMRAS announced that the next order of business would be HOUSE BILL NO. 151,"An Act requiring an indemnification and hold harmless provision in professional services contracts of state agencies, quasi-public agencies, municipalities, and political subdivisions." [Before the committee was a proposed committee substitute (CS) for HB 151, Version 25-LS0479\L, Bannister, 3/28/07, which had been previously adopted by the House Judiciary Standing Committee on 4/2/07]. 1:46:57 PM LEANNE BOLDENOW, Vice-President, Marsh USA Inc., explained that March USA Inc. is an insurance brokerage that works with about 30 design firms statewide. She related that she previously wrote a letter of support for HB 151 because she often has reviewed poorly written, uninsurable contracts released by public agencies that contain onerous indemnification clauses. Those contracts often require the design consultant to take on liabilities that are not typically his/her responsibility. She said that insurance generally covers liability in tort law and that a firm would be held responsible even if a written contract is not in place. She said she also supports HB 151 because it is in alignment with professional liability insurance for the design professionals. 1:48:26 PM JAMES CANTOR, Chief Assistant Attorney General - Statewide Section Supervisor, Transportation Section, Civil Division (Anchorage), Department of Law (DOL), stated that he agreed with the last speaker. He opined that HB 151 pertains to insurability and the negligent acts that cause liability and third party claims not contract claims between the contractor and the agency or claims between the subcontractor and the contractor. He said that HB 151 applies to a person who is injured and who sues the person that built, designed, or owns the project, which amounts basically to tort claims. Insurance is already available to cover the risk between consultants and the public agency, but that co-insurance is not available. This legislation addresses how risk should be handled when insurance is not available. He said that the Department of Law supports CSHB 151, Version L, as written. REPRESENTATIVE HOLMES asked whether the standardized language contained within HB 151 was in the state's best interest or at the least would not adversely impact the state. MR. CANTOR responded that HB 151 is similar to language the Department of Transportation & Public Facilities (DOT&PF) already uses. The bill is aimed at the few agencies that do not currently use the DOT&PF provisions. [Chair Ramras passed the gavel to Vice Chair Dahlstrom.] 1:50:38 PM BOYD MORGENTHALER, P.E., Client Contract Task Force, Alaska Professional Design Council (APDC), explained that the APDC is a consortium of professional societies that represents about 5,000 architects, engineers, and land surveyors registered in Alaska. He related that APDC and himself, as a mechanical engineer, strongly support HB 151. He said that the bill levels out the playing field for insurance and liability questions in tort and would help the design professionals more smoothly negotiate contracts. There is a wide range of how terms are written and that this proposed standardization would help the design professionals. VICE-CHAIR DAHLSTROM, upon determining no one else wished to testify, closed public testimony on HB 151. 1:52:49 PM TREVOR FULTON, Staff to Representative Craig Johnson, Alaska State Legislature, said that he wanted to be certain that the members' prior concerns have been addressed. He stressed that HB 151 pertains only to construction related contracts, which are addressed in the CSHB 151(STA), and are also included in the Version L. He noted that the bill does not address issues that arise between builders and public contracting agencies. The Associated General Contractors (AGC) and the Associated Builders and Contractors, Inc., Alaska Chapter (ABC) support the bill, he related. The DOT&PF language does not extend to builders and he opined that doing so would expand the scope of the bill considerably. He explained that subcontractors are covered under the terms of a separate contract between them and the agency, or the company with whom they are contracting. 1:55:44 PM REPRESENTATIVE GRUENBERG moved to report the proposed committee substitute (CS) for HB 151, Version 25-LS0479\L, Bannister, 3/28/07, out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, CSHB 151(JUD) was reported from the House Judiciary Standing Committee.
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