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Regular Session, 2012
SENATE BILL NO. 540
BY SENATOR MORRELL
CONTRACTS. Provides relative to motor carrier transportation contracts and construction
contracts. (gov sig)
AN ACT1
To amend and reenact R.S. 9:2780.1(A)(2)(a), (A)(5), (B), (C), and (D), to enact R.S.2
9:2780.1(G), and to repeal Section 2 of Act No. 492 of the 2010 Regular Session of3
the Legislature, relative to motor carrier transportation contracts and construction4
contracts; to provide relative to definitions; to exclude certain contracts; to provide5
relative to the enforcement of certain clauses in motor transportation contracts and6
construction contracts; to repeal a provision excluding certain contracts; and to7
provide for related matters.8
Be it enacted by the Legislature of Louisiana:9
Section 1. R.S. 9:2780.1(A)(2)(a), (A)(5), (B), (C), and (D) are hereby amended and10
reenacted and R.S. 9:2780.1(G) is hereby enacted to read as follows:11
ยง2780.1. Certain contract provisions invalid; motor carrier transportation contracts;12
construction contracts13
A. For purposes of this Section, the following terms have the meanings14
ascribed to them by this Subsection, except where the context clearly indicates15
otherwise:16
* * *17 SB NO. 540
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(2)(a) ''Construction contract'' shall mean any agreement for the design,1
construction, major alteration, or major renovation, repair, or maintenance of a2
building, structure, highway, road, bridge, water line, sewer line, oil line, gas line,3
appurtenance, or other major improvement to real property, including any moving,4
demolition, or excavation, except that no deed, lease, easement, license, or other5
instrument granting an interest in or the right to possess property will be deemed to6
be a construction contract even if the instrument includes the right to design,7
construct, alter, renovate, repair, or maintain improvements on such real property.8
* * *9
(5) "Third party" means any party not subject to the contractual obligations10
between the indemnities and indemnitor; excluding, however, any party who has11
otherwise contracted with the indemnitor or is at the indemnities's facility at the12
invitation or direction of the indemnitor.13
B. Notwithstanding any provision of law to the contrary and except as14
otherwise provided in this Section, any provision, clause, covenant, or agreement15
contained in, collateral to, or affecting a motor carrier transportation contract or16
construction contract which purports to indemnify, defend, or hold harmless, or has17
the effect of indemnifying, defending, or holding harmless, the indemnities from or18
against any liability for loss or damage resulting from the negligence or intentional19
acts or omissions of the indemnities, an agent or employee of the indemnities, or a20
third party over which the indemnitor has no control is contrary to the public policy21
of this state and is null, void, and unenforceable.22
C. Notwithstanding any provision of law to the contrary and except as23
otherwise provided in this Section, any provision, clause, covenant, or agreement24
contained in, collateral to, or affecting a motor carrier transportation contract or25
construction contract which purports to require an indemnitor to procure liability26
insurance covering the negligent or intentional acts or omissions or both of the27
indemnities, its employees or agents, or the acts or omissions of a third party over28
whom the indemnitor has no control is null, void, and unenforceable. However,29 SB NO. 540
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nothing in this Section shall be construed to prevent the indemnities from requiring1
the indemnitor to provide proof of insurance for obligations covered by the contract.2
D. (1) Notwithstanding any contractual provision to the contrary, the laws3
of the state of Louisiana this Section shall apply to and govern any construction4
contract to be performed in this state and any motor carrier transportation contract5
relative to loading or unloading activities, or any services incidental thereto, which6
occur in this state. Any provision, covenant, or clause in such contracts which7
conflicts with the provisions of this Section shall be null, void, and unenforceable.8
(2) This Section shall not apply to any contract to which the state of9
Louisiana or any of its political subdivisions is a party.10
* * *11
G. Nothing in this Section shall invalidate or prohibit the enforcement12
of any of the following:13
(1) Any clause in a motor carrier transportation contract or14
construction contract in which the parties reciprocally agree to indemnify,15
defend, or hold harmless each other and each other's contractors, employees,16
and invitees against loss, liability, or damages in connection with bodily injury,17
death, or property damage arising out of, related to, or resulting from the18
performance of the contract.19
(2) Any clause in a motor carrier transportation contract or20
construction contract containing the indemnitor's promise to indemnify, defend,21
or hold harmless the indemnities or an agent or employee of the indemnities if22
the contract also requires the indemnitor to obtain insurance to insure the23
obligation to indemnify, defend, or hold harmless and there is evidence that the24
indemnitor recovered the cost of the required insurance in the contract price.25
(3) Any clause in a motor carrier transportation contract containing the26
indemnitor's promise to indemnify, defend, or hold harmless the indemnities or27
an agent or employee of the indemnities from or against any liability for loss or28
damage resulting from the negligence or intentional acts or omissions of a third29 SB NO. 540
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party occurring outside the boundaries of the indemnities's facility.1
(4) Any clause in a motor carrier transportation contract or2
construction contract that requires the indemnitor to procure insurance or3
name the indemnities as an additional insured on the indemnitor's policy of4
insurance, but only to the extent that such additional insurance coverage5
provides coverage for liability due to any of the following:6
(a) An obligation to indemnify, defend, or hold harmless authorized7
pursuant to Paragraph (1) of this Subsection.8
(b) An obligation to indemnify, defend, or hold harmless authorized9
pursuant to Paragraph (2) of this Subsection.10
(c) An obligation to indemnify, defend, or hold harmless authorized11
pursuant to Paragraph (3) of this Subsection.12
Section 2. Section 2 of Act No. 492 of the 2010 Regular Session of the Legislature13
is hereby repealed.14
Section 3. This Act shall become effective upon signature by the governor or, if not15
signed by the governor, upon expiration of the time for bills to become law without signature16
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If17
vetoed by the governor and subsequently approved by the legislature, this Act shall become18
effective on the day following such approval.19
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Curry Johnson.
DIGEST
Present law defines a ''construction contract'' to mean any agreement for the design,
construction, alteration, renovation, repair, or maintenance of a building, structure, highway,
road, bridge, water line, sewer line, oil line, gas line, appurtenance, or other improvement
to real property, including any moving, demolition, or excavation, except that no deed, lease,
easement, license, or other instrument granting an interest in or the right to possess property
will be deemed to be a construction contract even if the instrument includes the right to
design, construct, alter, renovate, repair, or maintain improvements on such real property.
Proposed law redefines a "construction contract" to mean any agreement for the
construction, major alteration, or major renovation of a building, structure, highway, road,
bridge, water line, sewer line, oil line, gas line, appurtenance, or other major improvement
to real property, including any moving, demolition, or excavation, except that no deed, lease,
easement, license, or other instrument granting an interest in or the right to possess property
will be deemed to be a construction contract even if the instrument includes the right to SB NO. 540
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design, construct, alter, renovate, repair, or maintain improvements on such real property.
Present law defines a "third party" as any party not subject to the contractual obligations
between the indemnities and indemnitor.
Proposed law retains present law but excludes any party who has otherwise contracted with
the indemnitor or is at the indemnities's facility at the invitation or direction of the
indemnitor.
Present law provides that any provision, clause, covenant, or agreement contained in,
collateral to, or affecting a motor carrier transportation contract or construction contract
which purports to indemnify, defend, or hold harmless, or has the effect of indemnifying,
defending, or holding harmless, the indemnities from or against any liability for loss or
damage resulting from the negligence or intentional acts or omissions of the indemnities, an
agent or employee of the indemnities, or a third party over which the indemnitor has no
control is contrary to the public policy of this state and is null, void, and unenforceable.
Proposed law retains present law.
Present law provides that any provision, clause, covenant, or agreement contained in,
collateral to, or affecting a motor carrier transportation contract or construction contract
which purports to require an indemnitor to procure liability insurance covering the acts or
omissions or both of the indemnities, its employees or agents, or the acts or omissions of a
third party over whom the indemnitor has no control is null, void, and unenforceable.
Proposed law retains present law and specifies that acts or omissions may be negligent or
intentional.
Proposed law excludes any contract to which the state of Louisiana or any of its political
subdivisions is a party from the provisions of present law.
Proposed law provides that provisions of present law shall not invalidate or prohibit the
enforcement of any of the following:
1. Any clause in a motor carrier transportation contract or construction contract in
which the parties reciprocally agree to indemnify, defend, or hold harmless each
other and each other's contractors, employees, and invitees against loss, liability, or
damages in connection with bodily injury, death, or property damage arising out of,
related to, or resulting from the performance of the contract.
2. Any clause in a motor carrier transportation contract or construction contract
containing the indemnitor's promise to indemnify, defend, or hold harmless the
indemnities or an agent or employee of the indemnities if the contract also requires
the indemnitor to obtain insurance to insure the obligation to indemnify, defend, or
hold harmless and there is evidence that the indemnitor recovered the cost of the
required insurance in the contract price.
3. Any clause in a motor carrier transportation contract containing the indemnitor's
promise to indemnify, defend, or hold harmless the indemnities or an agent or
employee of the indemnities from or against any liability for loss or damage resulting
from the negligence or intentional acts or omissions of a third party occurring outside
the boundaries of the indemnities's facility.
4. Any clause in a motor carrier transportation contract or construction contract that
requires the indemnitor to procure insurance or name the indemnities as an additional
insured on the indemnitor's policy of insurance, but only to the extent that such
additional insurance coverage provides coverage for liability due to an obligation to
indemnify, defend, or hold harmless authorized by proposed law. SB NO. 540
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words in boldface type and underscored are additions.
Present law excludes from present law contracts providing indemnity to the indemnities
executed before August 15, 2010, if the contract governs a specific terminable performance
of a specific job or activity.
Proposed law repeals that provision.
Effective upon signature of the governor or lapse of time for gubernatorial action.
(Amends R.S. 9:2780.1(A)(2)(a), (A)(5), (B), (C), and (D); adds R.S. 9:2780.1(G))